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Tanzania to merge 19 state-owned entities into 7
President Samia Suluhu Hassan speaks at the opening ceremony of the meeting of chief executives and chairpersons of boards of public institutions held in Arusha City on August 19, 2023. PHOTO | STATE HOUSE
What you need to know:
- The decision comes two months since President Samia Suluhu Hassan gave her approval for reforming those parastatals and institutes so that they can be run more efficiently and contribute to the growth of the country’s economy.
Dar es Salaam. The managing directors and executive officers of 19 state-owned firms have been assured of retaining their jobs following the government’s decision of merging them (parastatals) and remain with seven.
The decision comes two months since President Samia Suluhu Hassan gave her approval for reforming those parastatals and institutes so that they can be run more efficiently and contribute to the growth of the country’s economy.
The Head of State agreed to the reforms on August 19, this year, in Arusha city during an action meeting of the chairpersons of the boards and executives officers of public institutions.
However, the President directed that before reaching a decision of either dissolving or merging those parastatals and institutes, the Office of the Treasury Registrar and the President’s Office (Planning and Investment) should meet with them (parastatals).
“Go and listen to them before making decisions, if they convince you that they can improve their work performance then they should be watched,” said President Hassan that day.
In the implementation of her directives, the Registrar of the Treasury, Mr Nehemiah Mchechu, told The Citizen yesterday that his office has already met with many state-owned firms out of those it was supposed to meet with for negotiations and evaluations.
Due to this and the evaluation that was made, Mr Mchechu said that a decision has already been made to merge 19 parastatals out of which seven will remain.
“There are some that we have already decided to merge, it is 19 parastatals that will be merged to remain with seven,” said Mr Mchechu without naming the parastatals for what he said due to operational reasons.
The decision is based on what he explained, for the most part the parastatals, to a large extent, had either the same or similar activities.
According to Mr Mchechu, measures are currently being taken within the government to finalise the merger and the merged parastatals will be made public before the end of this financial year.
However, he said the meetings of various public institutions and news editors are ongoing, as part of explaining the work they have done.
In her speech delivered on August 19, this year, President Hassan said the merger of the parastatals would not affect staff jobs, clarifying that 17 percent of the country’s jobs were from public-owned firms and institutes and hence no one would lose his/her job.
“All those employed by the parastatals will either be transferred to other state-owned firms or other public institutions will be reformed to be more meaningful than when they were started and no job will be lost,” assured the President.
Human Resources and Administration Lecturer from Tumaini University Dar es Salaam College (Tudarco), Dr Lazzaro Swai, said the government’s decision will reduce bureaucracy and increase productivity.
“If they were performing similar activities, then merging them would help reduce bureaucracy and increase productivity. This is because a certain activity will be known to be performed by a certain public institution, so one will have to go there,” said Dr Swai.
Dr Swai also added that the decision will reduce the burden on the Government to manage and look after its institutions that sometimes were not productive for the nation.
“Having a few organizations that you will be able to manage and that are vibrant is better than having many that you can’t even monitor them,” said Dr Swai.
In the implementation of that decision, the lecturer advised the Government not to be ashamed of firing those executives who were the source of the underperformance of some of the parastatals and institutes.
“If you decide to make them join others, it means you transmit the disease from one place to another, those who were not good supervisors should not be given that chance in this merger so that the expected efficiency can be achieved,” he advised.
The root cause of the argument for the dissolution or merger of the public institutions was due to the statement of President Hassan in March, this year, when she received the report of the Comptroller and Auditor General (CAG) and that of the Institute for the Prevention and Combating of Corruption Bureau (PCCB).
After receiving the report, the head of state said 14 parastatals are being run at a loss including the Tanzania Railway Corporation (TRC), Air Tanzania Company Ltd (ATCL) and the National Development Corporation (NDC).
“There is a need to make an assessment whether some public institutions should continue to operate, those that are productive should continue and those that are unproductive should be disbanded. Many public state-owned firms earn money from the government but they themselves do not bring money to the government,” she said.
