Local authorities given two months to service loans

Dodoma. The government has ordered all councils that were yet to service their loans with the Local Government Loans Board to do so by December 30, this year.

The Minister of State in the President’s Office (Regional Administration and Local Government), Mr Selemani Jafo, yesterday revealed that the Board had issued loans totalling Sh9.7 billion to 54 councils from across the country.

He added that, among the borrowers, 11 district councils have shown reluctance towards servicing their loans, which are worth over Sh2 bilion. However, he detailed that at least Sh6.6 billion has so far been paid back to the Board out of Sh9.7 billion loaned out. Mr Jafo named the councils in debt as Mwanza, Mbeya, Moshi, Singida, Morogoro, Kigoma, Karatu, Pangani, Igunga, Kongwa and Mbinga.

Furthermore, the minister directed Board’s chief executive director Richard Mfugale to tress and ensure all councils in the category serviced their loans before the set deadline, failure of which will attract punitive measues by the parent ministry.

“The dillydallying by these councils in servicing the loans is denying other councils access to loans so that they would also implement various development initiatives in their areas of jurisdiction. The fifth phase government will not tolerate such habit,” the minister said during a press conference yesterday here.

Mr Jafo said he was not in position to see the Board failing to accomplish its key duties due to delays or failures by some councils at servicing loans.

He added, “This Board was formed by the government in order to boost the pace of development in all councils in the country and thus, all borrowers must service their loans within the agreed time.”

However, the minister challenged the council directors to assure effective expenditure of the money accessed through loans, particularly in ensuring that the money is used to speed up development and reduce poverty at all levels.

For his part, Board’s chief executive director Mfugale said Mbinga and Mbeya held the biggest share of the unpaid debts, thus urging them to be accountable and service them within the ultimatum.