Tazara continues to drains state treasury, gets USD2.4million bailout from government

Tazara train in the Zambian space.

Tanzania Zambia Railways Authority- Tazara has continued to be a drain on state resources despite the railway company having a strategic and cheaper route to transport bulk copper export cargo from the Copperbelt of Zambia to the port city of Dar-es-salaam in Tanzania.

The railway company is also supposed to be the cheapest route for bulk cargo imports such as industrial machinery, oils & fuels and chemicals mostly used for copper processing into Zambia’s mining and industrial hub.

In a press statement by newly appointed Finance Minister, Margaret Mwanakatwe emailed to Zambia’s premier business news provider – ZBT, of the total sum of K5.77 billion (about US$577 million) released in April 2018 by the treasury, K24 million  (about US$2.4 million) was released to settle salary arrears for TAZARA employees.

The Finance ministry said that K2.14 billion went towards capital and other key developmental programs, K160 billion was released for department services, the K816.6 million for support to grant- aided institutions and K2.19 billion for personal emulations.

Mwanakatwe said K91.76 million was received by the public service pension benefits, while the social cash transfer program got K45.8 million. She said the K245.4 million was allocated to the farmer input support program (FISP) to settle payments to various creditors for supplies of fertilizer for the year 2017/18 farming season while the food reserve agency was given K120 million.

The Ministry of Health received K140million for the procument of drugs and medical supplies. The treasury also distributed K60.8 million to meet operational costs for health facilities which was from the total of K816.6 million release for grants to different sectors in various institutions in across the country.

The finance minister further stated that in the month  under review, K62 million was released as constituency development found (CDF) to support development projects in various constituencies across the country while K89.9 million was disbursed towards the local government equalization founds to facilitate the operations of local authorities.

‘’The Lusaka supply and sanitation project under the Millennium Challenge Account Zambia received K103.80 million. And of the total founding for the month of April 2018, the road sector received K353.68 million being founds from the Road Tolls fuel levy and road user charges. The disbursement went towards on-going road projects across the country,’’  Mwanakatwe stated.

Co-operating partners also came to the party with some support towards the implementation of different programs across ministries provinces and other spending agencies. And in this regard , K113.63 million was received and disbursed to various donor funded projects during the same month.

A total of K210.83 million was released to Ministries Provinces and Spending Agencies (MPSA’s) for general operations and implementation of 2018 planned programs and activities. Mwanakatwe further emphasized that although the economy has a fantastic opportunity to record higher growth rates as a result of the transformational reforms being implemented, the banking and financial services sectors needed to pull together with those in the production and real sector in order for the 6% – 8% growth rates to be attained.

The release of monthly spending breakdown by the new minister is welcome and will lead to better analysis of the spending patterns of government. It will also aid to synchronize monetary and fiscal policy which has been one of Zambia’s biggest economic challenge.

The funding of parastatals however will need to be done with accountability and a view to get a return on investment. Tazara continues to struggle in a transport industry where truckers are thriving, how is this acceptable when Tazara should ideally provide a more cost effective and safer mode of bulk cargo transport service?

When these salary areas are cleared, will the company spin back to life? Will the tax payers funds be repaid back so that it can be invested in other more pressing public goods? These and many other such questions that Mwanakatwe and her team should answer as they disburse these funds on behalf of the Zambian people.

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