Tuesday, January 19, 2021
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The Controller and Auditor General’s review of construction projects relating to roads and airports at Tanzania National Roads Agency (Tanroads)has revealed significant overdue claims which lead to delays and escalation of project costs due to interest charges to claimants, TPJ has learnt.

The findings are contained in the Annual General Report of Controller and Auditor General on the audit of development projects for the financial year 2018/19 that was submitted to President John Magufuli in Dodoma recently.

According to the report, contractors and consultantshad claims amounting to TZS 1.03 trillion as at November 2019 due to late payment of interim payment certificates.

The report reveals that the total outstanding claim was made of principal amount TZS 794,091,175,546.39, interest charges of TZS 224,025,668,186.62 (current year TZS 166,930,716,964 plus privious year TZS 57,094,951,223), and compensations amounting to TZS 13,019,579,894.23 to people affected by projects.

“It was revealed that the outstanding claims were caused by under release of funds by the Ministry of Finance and Planning; that eventually inhibited Tanroads to pay the contractors on time and consequently resulted to slow progress of works as well as escalation of project cost due to interest charges,” reads the report in part.

“In addition, I am concerned that the untimely payment of outstanding claims of the contractors and consultants may increase the amount of debt due to interest charges which may make the pertinent projects stall or remain uncompleted therefore, denying citizens the intended benefits of the projects,” observed the CAG.

The report further revealed that review of holdings accounts at Treasury showed unspent balance amounting to USD 25,161,526.18 from 12 projects, most of which were closed some years back and the balances had been outstanding for a period up to seven years without being utilized.

“It is my view that thenon-utilization of monies for long period exposes the funds to the risk of being used for unintended activities,” stated the CAG.

The CAG expressed expectation that the report would assist stakeholders to make evaluation on the appropriated funds to determine whether their utilization has achieved the intended purposes and whether it met the value for money objective.

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