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TANZANIA GOVERNANCE REVIEW 2013: Who Will Benefit from the Gas Economy, If It Happens? TANZANIA GOVERNANCE REVIEW 2013: Who will benefit from the gas economy, if it happens? TANZANIA GOVERNANCE REVIEW 2013: Who will benefit from the gas economy, if it happens? TANZANIA GOVERNANCE REVIEW 2013 Who will benefit from the gas economy, if it happens? Supported by: 2 TANZANIA GOVERNANCE REVIEW 2013: Who will benefit from the gas economy, if it happens? ACKNOWLEDGEMENTS Policy Forum would like to thank the Foundation for Civil Society for the generous grant that financed Tanzania Governance Review 2013. The review was drafted by Tanzania Development Research Group and edited by Policy Forum. The cartoons were drawn by Adam Lutta (Adamu). Tanzania Governance Reviews for 2006-7, 2008-9, 2010-11, 2012 and 2013 can be downloaded from the Policy Forum website. The views expressed and conclusions drawn on the basis of data and analysis presented in this review do not necessarily reflect those of Policy Forum. TGRs review published and unpublished materials from official sources, civil society and academia, and from the media. Policy Forum has made every effort to verify the accuracy of the information contained in TGR2013, particularly with media sources. However, Policy Forum cannot guarantee the accuracy of all reported claims, statements, and statistics. Whereas any part of this review can be reproduced provided it is duly sourced, Policy Forum cannot accept responsibility for the consequences of its use for other purposes or in other contexts. ISBN:978-9987-708-19-2 For more information and to order copies of the report please contact: Policy Forum P.O. Box 38486 Dar es Salaam Tel +255 22 2780200 Website: www.policyforum.or.tz Email: [email protected] Suggested citation: Policy Forum 2015. ‗Tanzania Governance Review 2013: Who will benefit from the gas economy, if it happens?‘ Dar es Salaam, June. © Policy Forum 3 TANZANIA GOVERNANCE REVIEW 2013: Who will benefit from the gas economy, if it happens? TABLE OF CONTENTS Policy Forum‘s Objectives……………………………………………………………………………...8 Chapter 1: INTRODUCTION AND OVERVIEW……………………………………………….……9 1.1 Overview 2013……………………………………………………………………………………………………………..14 1.2 Governance trends……………………………………………………………………………………………………….14 1.2.1 Voice and accountability…………………………………………………………………………………..14 1.2.2 Peace, security, rule of law………………………………………………………………………………15 1.2.3 Service delivery and public goods……………………………………………………………………23 1.2.4 Policy and regulation…………………………………………………………………………………………23 1.2.5 Corruption control…………………………………………………………………………………………….23 1.3 Conclusion…………………………………………………………………………………………………….………………24 CHAPTER 2: PUBLIC MONEY AND NATIONAL GOVERNANCE…………………………………….…26 2.1 Introduction …………………………………………………………………………………………………………………26 2.2 Taxation ……………………………………………………………………………………………………………………….28 2.2.1 Tax exemptions, avoidance and evasion…………………………………………………………28 2.2.2 Illicit financial flows …………………………………………………………………………………………31 2.2.3 Natural resource rents……………………………………………………………………………………..35 2.2.4 Aid……………………………………………………………………………………………………………………..36 2.3 Public expenditure ……………………………………………………………………………………………………...36 2.3.1 Wages and allowances……………………………………………………………………………………..37 2.3.2 Procurement and contracting…………………………………………………………………………..37 2.3.3 Public debt…………………………………………………………………………………………………………39 2.3.4 Pension funds……………………………………………………………………………………………………39 2.4 Transparency and accountability ………………………………………………………………………………..40 2.4.1 Parliamentary oversight ………………………………………………………………………………….40 2.4.2 Judiciary…………………………………………………………………………………………………………..41 2.4.3 Prevention and Combating of Corruption Bureau: fewer ‗allegations‘ ………….42 2.4.4 The Controller and Auditor General: ‗Significant regression.‘………………………..44 2.4.5 Public Procurement Regulatory Authority (PPRA)…………………………………………..47 2.4.6 Tanzania Extractive Industries Transparency Initiative (TEITI) and Tanzania Minerals Audit Agency (TMAA)…………………………………………………………………………47 2.4.7 Open Government Partnership…………………………………………………………………………49 2.5 Conclusion…………………………………………………………………………………………………………………….50 CHAPTER 3: PUBLIC MONEY AND LOCAL GOVERNANCE……………………………………51 3.1 Introduction: poor marks for the LGRP………………………………………………………………………51 3.2 Trends in service delivery performance …………………………………………………………………….55 3.2.1 Education …………………………………………………………………………………………………………55 3.2.2 Healthcare ……………………………………………………………………………………………………….57 3.2.3 Water and sanitation: Is WSDP a costly failure? ……………………………………………62 3.3 Controller and Auditor General: ‗positive audit trends‘ …………………………………………….67 3.4 Parliamentary oversight……………………………………………………………………………………………….71 3.5 Conclusion…………………………………………………………………………………………………………………….71 4 TANZANIA GOVERNANCE REVIEW 2013: Who will benefit from the gas economy, if it happens? CHAPTER 4: REGULATING THE ECONOMY……………………………………………………..73 4.1 Introduction………………………………………………………………………………………………………………..73 4.2 Private sector policy and regulation…………………………………………………………………………..73 4.2.1 Mining ……………………………………………………………………………………………………………..75 4.2.2 Natural gas………………………………………………………………………………………………………77 4.2.3 Tourism…………………………………………………………………………………………………………...80 4.2.4 Manufacturing………………………………………………………………………………………………….81 4.2.5 Construction……………………………………………………………………………………………………..83 4.3 Land and Agriculture……………………………………………………………………………………………………84 4.4 Regulating state enterprises and corporations…………………………………………………………..88 4.4.1 Power ……………………………………………………………………………………………………………….88 4.4.2 Dar es Salaam port…………………………………………………………………………………………..90 4.4.3 Quality control: TBS and TFDA…………………………………………………………………………91 4.5 Financial services………………………………………………………………………………………………………….92 4.6 Conclusion…………………………………………………………………………………………………………………….93 CHAPTER 5: CSOs, MEDIA AND CITIZENS‘ VOICE……………………………………………94 5.1 Introduction………………………………………………………………………………………………………………….94 5.2 Civil society…………………………………………………………………………………………………………………..97 5.2.1 Evidence-based advocacy …………………………………………………………………………………………..97 5.2.2 Deepening downward accountability …………………………………………………………….100 5.3 Faith-based organisations (FBO)……………………………………………………………………………….103 5.4 Tracking the extractive industries…………………………………………………………………………….105 5.5 PETS, SAM and accountability…………………………………………………………………………………..105 5.6 The media…………………………………………………………………………………………………………………..108 5.7 Civil society governance…………………………………………………………………………………………….111 Corruption and human rights…………………………………………………………………………………….112 5.9 Conclusion ………………………………………………………………………………………………………………..112 CHAPTER 6: FOREIGN AID AND GOVERNANCE………………………………………………114 6.1 Changing aid modalities ………………………………………………………………………………………….114 6.2 GBS, aid effectiveness and corruption control…………………………………………………………116 6.3 Supply and demand for ‗good governance‘ ………………………………………………………………116 6.4 Conclusion …………………………………………………………………………………………………………………121 CHAPTER 7: EAST AFRICAN PERSPECTIVES…………………………………………………122 7.1 Introduction………………………………………………………………………………………………………………122 7.2 Tanzania-EAC relations…………………………………………………………………………………………….122 7.3 Comparative governance indicators………………………………………………………………………..124 7.4 Conclusion…………………………………………………………………………………………………………………128 CHAPTER 8: MONITORING POVERTY and WELL-BEING 8.1 Introduction ………………………………………………………………………………………………………………129 8.2 Human development indicators 2013……………………………………………………………………….130 8.3 Monitoring MKUKUTA and the Millennium Development Goals ………………………………131 8.4 Well-being………………………………………………………………………………………………………………….136 8.5 Conclusion………………………………………………………………………………………………………………….137 APPENDIX: SUMMARY OF TGR 2012…………………………………………………………………………………….139 USEFUL WEBSITES………………………………………………………………………………………………………………..147 ACRONYMS…………………………………………………………………………………………………………………………….148 5 TANZANIA GOVERNANCE REVIEW 2013: Who will benefit from the gas economy, if it happens? Tables 2.1: Tanzania Revenue Authority performance 2006/07-2011/12, TShs billion……………….……………….….28 2.2: Tanzania: Annual Average Trade Misinvoicing, 2002-2011 (US dollars million or %) ………………….…32 2.3: PCCB performance 2005-13…………………………………………………………………………………………………………..42 2.4: Main weaknesses in expenditure management………………………………………………………………………….….47 2.5: Gold production, royalties and taxes paid by the six largest gold mines, 2013……………………………...48 3.1: Under-release and under-spend of budgeted funds to LGAs, FY 2012-13……………………………………..69 3.2: Underspending in LGA, 2012-13 …………………………………………………………………………………………………...70 4.1: Ten leading countries registered investments with Tanzania Investment Centre, 1990-2012…….…73 4.2: Doing Business in Tanzania 2008-2013………………………………………………………………………………………..…74 4.3: Power generation capacity, March 2013 (MW)……………………………………………………………………………...89 5.1: World Press Freedom Index, East African rankings, 2008-13………………………………………………………..109 7.1: EAC member states: size and population, 2013…………………………………………………………………………….122 7.2: Doing business in East Africa 2013, rank and percentile……………………………………………………………….125 7.3: Global competitiveness of EAC countries, 2008-13, ranks, scores, percentiles…………………………….126 7.4: EAC Logistics Performance Index 2014…………………………………………………………………………………………127 7.5: CPI scores and ranks for EAC members, 2009-13…………………………………………………………………………127 8.1: Tanzania development indicators 2013………………………………………………………………………………………..131 8.2: World happiness rankings, EAC countries, 2013 ………………………………………………………………………….136 Boxes 1.1: Violence in Tanzania, January 2013…………………………………………………………………………………………….…19 1.2: Religion and witchcraft…………………………………………………………………………………………………………………..22 3.1: Inequities and inequalities in local government finance………………………………………………………………..53
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