THE UNITED REPUBLIC OF TANZANIA
Ministry of Finance
Medium Term Strategic Plan
2004 - 2009
May 2004
Table of Contents
LIST OF ABBREVIATIONS ................................................................................................ II
ACKNOWLEDGEMENTS ................................................................................................. IV
EXECUTIVE SUMMARY .................................................................................................... V
1.0
INTRODUCTION........................................................................................................ 1
1.1
2.0
SITUATION ANALYSIS ............................................................................................ 4
2.1
2.2
2.3
2.4
2.5
2.6
3.0
RECENT HISTORY........................................................................................................ 4
MANDATE OF THE MINISTRY .................................................................................... 15
RECENT INITIATIVES AND ACHIEVEMENTS ............................................................... 15
STAKEHOLDER ANALYSIS ......................................................................................... 23
ENVIRONMENTAL SCAN ............................................................................................ 25
CRITICAL ISSUES ....................................................................................................... 39
VISION, MISSION AND VALUES ......................................................................... 39
3.1
3.2
3.3
4.0
METHODOLOGY .......................................................................................................... 1
VISION ...................................................................................................................... 39
MISSION .................................................................................................................... 39
VALUES .................................................................................................................... 40
THE PLAN ................................................................................................................. 41
APPENDICES ........................................................................................................................ 62
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Ministry of Finance: Medium Term Strategic Plan: 2004 - 2009
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LIST OF ABBREVIATIONS
ACGEN
AIDS
ATC
CAG
CB
CMT
COMESA
CPS
CSRP
CTB
CUTS
DAP
DAWASA
DCS
DLS
DSA
DSV
EAC
EFQM
EIU
ES-CTB
EWURA
FDI
GDP
GFS
HBS
HIPC
HIV
HRD
IECU
IFM
IFMS
ILFS
JFC
LAN
LART
LGAs
MIS
MOF
MTEF
MTSP
NDS
NGOs
NHIF
NIC
NMB
PER
-
Accountant General
Acquired Immunity Diseases Syndromes
Air Tanzania Cooperation
Controller and Auditor General
Commissioner of Budget
Change Management Team
Common Market for Eastern and Southern Africa
Central Payment System
Civil Service Reform Programme
Central Tender Board
Consumer Unity and Trust Society
Director of Administration and Personnel
Dar es Salaam Water and Sanitation Authority
Director of Computer Services
Director of Legal Services
Dar es Salaam School of Accountancy
Director of Stock Verification
East African Community
European Foundation for Quality Management
Economist Intelligence Unit
Executive Secretary – Central Tender Board
Energy and Water Utilities Regulatory Authority
Foreign Direct Investment
Gross Domestic Product
Government Financial Statistics
Household Budget Survey
Highly Indebted Poor Countries
Human Immuno-deficiency Virus
Human Resource Development
Information, Education and Communication Unit
Institute of Finance Management
Integrated Financial Management System
Integrated Labour Force Survey
Joint Finance Commission
Local Area Network
Loans and Advances Realisation Trust
Local Government Authorities
Management Information System
Ministry of Finance
Medium Term Expenditure Framework
Medium Term Strategic Plan
National Debt Strategy
Non-Governmental Organisations
National Health Insurance Fund
National Insurance Company
National Microfinance Bank
Public Expenditure Review
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Ministry of Finance: Medium Term Strategic Plan: 2004 - 2009
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PFA
PPA
PSP
PSPF
PSRC
RAS
SACU
SADC
SDS
SME
SUMATRA
TANESCO
TAS
TCRA
THA
TIA
TNA
TR
TRA
TRC
UNCTAD
URT
VAT
-
Public Finance Act
Public Procurement Act
Private Sector Participation
Public Service Pension Fund
Presidential Parastatal Sector Reform Commission
Regional Administrative Secretary
South African Customs Union
Southern Africa Development Community
Service Delivery Survey
Small and Medium Scale Enterprises
Surface and Marine Transport Regulatory Authority
Tanzania Electric Supply Company Limited
Tanzania Assistance Strategy
Tanzania Communications Regulatory Authority
Tanzania Harbours Authority
Tanzania Institute of Accountancy
Training Needs Assessment
Treasury Registrar
Tanzania Revenue Authority
Tanzania Railways Cooperation
United Nations Conference on Trade and Development
United Republic of Tanzania
Value Added Tax
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Ministry of Finance: Medium Term Strategic Plan: 2004 - 2009
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ACKNOWLEDGEMENTS
The preparation of this Plan has been made possible by the excellent co-operation,
commitment and seriousness of the Heads of Departments and their Assistants and the Heads
of Units in the Ministry of Finance. Credit also goes to the Consultants, Mr. John Ulanga and
Mr. Peter Mukurasi from Economic and Social Research Foundation and Cowater
International, respectively, for guiding and overseeing the process through and for the
invaluable comments which greatly improved and made the report what it is.
Gratitude also goes to the Ministerial Strategic Planning Support Team whom in addition to
participating the whole process of developing the Strategic Plan also helped in the writing of
this document.
Lastly, I extend my thanks and appreciation to all members of the Ministry, who in one way
or another contributed to the success of this work.
G.S. Mgonja
PERMANENT SECRETARY
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Ministry of Finance: Medium Term Strategic Plan: 2004 - 2009
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EXECUTIVE SUMMARY
The Ministry of Finance is entrusted with the following main functions:
-
Formulation of policy issues related to macroeconomic analysis, fiscal, monetary and
debt policy and strategy.
-
Overseeing financial aspects of the Government interest as shareholder in public, as
well as private enterprises; and advises the Government on various issues pertaining
to its investments.
-
Preparation of expenditure targets, review of expenditure performance, and
preparation of budget guidelines.
-
Preparation and implementing external aid policies, mobilization and coordination of
external aid and regional cooperation.
-
Managing the Government payroll.
-
Overseeing all revenue and expenditure operations of the Government.
This Medium Term Strategic Plan (MTSP) provides a framework for improved service
delivery in the Ministry of Finance by introducing performance based management systems
in the Ministry. This is an integral part of the Public Service Reform Programme. As part of
the Reform Programme, the Ministry launched its first Client Service Charter in November
2002. In addition, the Ministry undertook a Service Delivery Survey and Self Assessment
Exercise in February and October 2003, respectively. These two exercises provided useful
inputs in the preparation of this Strategic Plan.
The Medium Term Expenditure Framework (MTEF) for the Ministry of Finance provides yet
another opportunity to translate Government policies, aspirations and perspectives into
meaningful actions. These actions contribute to the betterment of the people’s lives and
towards achieving national goals and objectives particularly that of poverty reduction. The
Ministry will, therefore, make deliberate efforts to link the MTSP and MTEF to be able to
obtain best results.
The major pillar of this strategic plan is as the articulation of the Ministry’s Vision, Mission
and Values.
The Vision of the Ministry of Finance is stipulated in the following statement:
“High economic growth and macro-economic stability, sound financial management
and accountability achieved and sustained.”
The Mission of the Ministry is stated as:
“The mission of the Ministry of Finance is to achieve and maintain high economic
growth, macro-economic stability, sound financial management through development
of robust fiscal and monetary policies and enhancing professionalism and promote
the use of Information Technology (IT)
The following were agreed to be the Core Values of the Ministry:
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Ministry of Finance: Medium Term Strategic Plan: 2004 - 2009
v
-
Innovativeness
Professionalism
Customer focused
Commitment to work
Efficiency
Participatory management
Teamwork
Timely service delivery
Integrity
The rationale for the strategic plan is to enable the Ministry to perform its functions
effectively and efficiently. For this, the plan defines Seven Key Results Areas that address the
following issues: - Stable macro-economic growth and development
- Financial management and accountability
- Resource mobilisation, allocation and utilization
- Efficiency and effectiveness of information systems
- To improve social security benefits and pension administration
- Maintain and develop sustainable human resource capacity to ensure quality service
delivery to the public
- Effective consultations and communication with MoF stakeholders
To realise the outcomes of these areas, the strategic plan includes strategic objectives and
strategies for their achievement. To ensure accountability, service delivery targets have been
developed. All the components that constitute the strategic plan are summarized in the matrix
at Appendix 1.
From the strategic plan, the Ministry will progress to the stage of operational planning. This
involves line managers and support units in the development of costed Annual Operating
Plans with output objectives directly derived from the strategic objectives of the strategic
plan.
It is hoped that the Strategic Plan will enable Ministry of Finance to organize itself to
improve quality, efficiency, effectiveness and performance of services on a continuous basis
and sustain these gains on a longer term.
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Ministry of Finance: Medium Term Strategic Plan: 2004 - 2009
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1.0
INTRODUCTION
The Ministry of Finance is a Central Ministry responsible for mobilizing and allocating
financial resources, formulating and implementing fiscal and monetary policies, controlling
and accounting of public finances. Additionally, it is also the custodian of government assets
and responsible for service public debt.
Currently, the MoF is using the Medium Term Expenditure Framework (MTEF) as the major
planning base to carry out its roles and functions. However, MTEF is limited, as it does not
provide room for comprehensive analysis of all the various pertinent issues related to MOF
mandate. As part of Public Service Reforms, the Ministry therefore has adopted the use of a
strategic plan as a comprehensive tool to be used to assist the Ministry to effectively and
efficiently carry out its mandate and therefore improve its performance. This document sets
out the Strategic Plan for the Ministry of Finance for the period 2004/5-2009/10.
1.1
Methodology
Preparation of this Medium Term Strategic Plan was done in a participatory approach
involving the Senior Management of the Ministry. The main approach for the preparation of
this Medium Term Strategic Plan was the review and updating of the previous strategic plan
of the Ministry by critically re-evaluating the situation and based on the re-evaluation,
agreeing on changes to be made and as a result this revised MTSP was prepared. Throughout
this process, facilitation and technical backstopping was provided by a Team of Consultants
from a Consortium consisting of Cowater International (Canada), Economic and Social
Research Foundation (Tanzania) and International Development Management Advisory
Group (Canada). The session to review and update the Strategic Plan was preceded by two
main activities that provided useful inputs into the process. These were the undertaking of
the Service Delivery Survey and conducting Self Assessment Exercise for the Ministry.
1.1.1
Service Delivery Survey
A service delivery survey was undertaken during the months of February and March 2003 in
38 districts of 12 regions of the country. The main objectives of the survey were to provide
information that will be used to update the Strategic Plan and the Client Service Charter, and
to provide baseline data that will be used for future performance improvements. A
questionnaire was designed with questions relevant to the three issues identified, surveyors
were trained, the questionnaire was pre-tested and the actual field work was undertaken in a
span of 21 days. Data gathered was entered and analyzed using SPSS (a statistical package)
and a report was prepared and the key findings were used as one of the basis for the
preparation of this strategic plan.
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Ministry of Finance: Medium Term Strategic Plan: 2004 - 2009
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1.1.2
Self Assessment
A two-day self-assessment working session was held whereby all the Top Management of the
Ministry were involved. To support the self-assessment process, training sessions, workshops
and working sessions were held with Ministry personnel between March and October 2003.
For the self-assessment process to be undertaken successfully and for it to have a real and
long-term impact on the Ministry, training was critical. MCM nominated self-assessment
trainees, largely drawn from the Change Management Team (CMT), received a two-day
intensive in-class training program, at ESRF, Dar-es-Salaam (21-22 March 2003), addressing
all aspects of the European Foundation for Quality Management’s (EFQM) Business
Excellence Model self-assessment process. This was followed by a further two-day on-thejob training during which the trainees worked with the consulting team to facilitate the
Ministry self-assessment session.
The aim of the training was to provide the Ministry with
 An understanding of the self-assessment process.
 A core competency to assist other leaders within the Ministry to undertake selfassessments in the future.
 Knowledge to use the Excellence Model as a diagnostic tool that provides invaluable
information about the Ministry’s development and performance.
With the experience of having carried out the self-assessment, and having reviewed the
results, the nominated Ministry trainees who will, in the future, have the capacity to lead
similar self-assessment exercises at the Ministry level or at any level within the organization.
Two-day self-assessment workshop was targeted at Ministry senior management (i.e., PS,
Heads of Departments and their Assistants). The self-assessment workshop was held at the
Golden Tulip Hotel, Dar-es-Salaam (October 2003).
The participants were initially provided with the background information and basic
knowledge of EFQM Business Excellence Model self-assessment process. The topics
covered during the introductory session included:
 Background, concept and history of the Excellence Model;
 The role of self-assessment and benchmarking as a part of the performance
management system currently being implemented in their Ministry;
 The concept of excellence, and the practical experience from business and
government that lay behind the Excellence Model’s enabler and results criteria;
 The experience of using the self-assessment process in Tanzania and other countries;
 How to undertake the self-assessment;
 The analysis and use of self-assessment session outputs.
Consortium consultants and MoF nominated self-assessment trainees together facilitated the
self-assessment session. Participants were divided into five small working groups of four to
six staff members. Each group was assigned Excellence Model criteria drawn from all nine
criteria, in order to improve the quality of the sample.
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Ministry of Finance: Medium Term Strategic Plan: 2004 - 2009
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The formal Excellence Model scoring and score calculation processes were applied
rigorously to achieve the statistically high quality results. Following the two-day assessment
process, Consortium consultants coded and entered the data into the EFQM data analysis
software. The scores for each criterion and sub-criterion of the Excellence Model were
consolidated to derive the Ministry performance baseline score. This is the score the Ministry
will use as the benchmark when undertaking subsequent self-assessments to gauge
performance improvements.
The self-assessment exercise provided:
 A benchmark that will be used as a reference for future self-assessments,
 The list of vital few areas of improvement critically important to the Ministry, and
 Systematically extracted information that will contribute to the Ministry’s
planning process.
The self-assessment exercise also proved to be an excellent way for managers to exchange
ideas concerning MOF management, and to build capacity around best practice approaches to
the organization.
A subsequent working session was thereafter during which the CMT, self-assessment trainees
and the consulting team reviewed the outcomes and validated the scores produced during the
two-day assessment workshop. The self-assessment process identified a detailed list of
organizational areas for improvement for each criteria and sub-criteria, requiring varying
degrees of attention by the Ministry. Working session participants applied a formal
prioritisation process using an impact matrix to identify the vital few areas for improvement
that require the immediate attention of Ministry management.
Participants, in reviewing the vital few areas, then developed a list of actions that were felt
necessary to address the vital few areas, and that should be included in the Ministry’s
planning processes. A separate Self Assessment Report has been prepared and the key
findings have been used as one of the basis for the preparation of this Strategic Plan.
1.1.3
Strategic Planning Session
Following those two activities, an intensive three day strategic planning session was held at
ESRF Conference Hall in November/December 2003 and a two-day session was held in
March 2004 whereby all the senior officers of the Ministry participated in the sessions. The
sessions were organised in a participatory manner whereby small groups were used to
provide basis for discussions in the plenary session. The session was initiated by a
presentation of the process that was to be followed during the review of the Strategic Plan.
Thereafter, participants were divided into groups to develop the Vision, Mission, Values
which were then discussed and agreed in plenary. The groups thereafter undertook situation
analysis of the Ministry, identified the critical issues, which were again discussed and agreed
in the plenary. The same approach was used to revise the Key Results Areas, Strategic
Objectives, and Strategies etc and then undertake the Force Field Analysis.
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Ministry of Finance: Medium Term Strategic Plan: 2004 - 2009
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2.0
SITUATION ANALYSIS
2.1
Recent History
2.1.1
Recent Economic Trends and Performance
The Tanzanian economy performed relatively well during 2002 as it recorded a substantially
higher real Gross Domestic Product (GDP) growth rate of 6.2 percent, which was above the
growth rates of 4.9 percent and 5.7 percent attained during 2000 and 2001 respectively. This
growth exceeded the target rate of 5.9 percent that was set for the year 2002. The average
economic growth rate of 5.6 percent per annum attained in the last three years when
compared with previous growth rates and an average of 3.4 percent achieved by African
countries, is encouraging. However, this growth is still too low to the needs of the population
growing at 2.9 percent per annum, and to have a significant impact on our problems of
poverty and unemployment. However, real GDP growth was 5.2 percent in 2003 slightly
lower than the level attained during 2002, mainly due to unsatisfactory performance of the
agricultural sector, arising from inadequate rains in most parts of the country that adversely
affected agricultural production. The rate of inflation remained more or less the same at 4.6
percent in October 2003, which is only 0.1 percent higher than October 2002. The decline
in the inflation rate from 30 percent in 1995 to 4.3 percent has been of great benefit. The
economy has stabilized, which, among other things, is a prerequisite for its growth and
sustainability, attract investments and bring improvements in the monetary sector. This
decline in inflation is attributed to improvement in food availability and distribution, coupled
with deliberate policies to control expenditure as well as money supply in the country. The
value of Tanzanian shilling to the dollar depreciated by 7.6 percent from TSh. 888.9 to the
dollar at the end of June 2001 up to TSh. 956.8 to the dollar at the end of June 2002. The
shilling continued to fall, reaching TSh. 1061.7 to a dollar at the end of December 2003 and
TSh 1,120 to the dollar early February 2004. The depreciation of the shilling was triggered
by low export sales, which was caused by the fall in the prices of traditional exports on the
world market. Increased exports earnings are the main way of strengthening the value of the
shilling.
Table 1:
Trends in Selected Macroeconomic Indicators
Indicator
1995
Real GDP Growth- (%)
Inflation-Annual
Average- %
Exchange Rate
(TSh/USD)-Annual
Average
Merchandise Exports
(Mill. US. $)
Merchandise Imports
(Mill. US$)
Export/Import Ratio (%)
1996
1997
1998
1999
2000
2001
2002
2003
3.6
4.2
3.3
4.0
4.7
4.9
5.7
6.2
5.2
27.1
21.0
16.1
12.9
7.8
6.0
5.2
4.5
4.6
574.8 580.0
612.1
664.7
744.8
808.4
876.4
978.9 1045.7
682.9 763.8
752.6
588.5
543.3
663.3
776.4
902.5 1073.8
1340.5 1212.6 1148.0 1382.2 1497.9 1366.3 1560.5 1511.3 1873.9
50.9
63.0
65.6
42.6
39.7
49.6
59.7
57.3
Investment/GDP Ratio
19.7
16.5
14.7
16.0
15.4
17.5
17.2
18.2
(%)
Foreign Reserves (Month
1.6
2.4
3.8
3.1
4.2
5.7
6.2
6.4
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Ministry of Finance: Medium Term Strategic Plan: 2004 - 2009
52.0
Indicator
of Imports)
1995
1996
1997
1998
1999
2000
2001
2002
2003
1995/96 1996/97 1997/98 1998/99 1999/00 2000/01 2001/02 2002/03 2003/04
Fiscal Balance (before
Grants)-(% of GDPmp)
0.1
-1.7
-2.3
-2.3
-5.8
-4.6
-6.6
-2.6
Average Deposit Rate-%
12.0
11.0
10.0
7.9
7.1
4.2
3.5
3.1
-9.9
Average Lending Rate-%
28.0
26.5
24.0
24.5
22.1
19.6
16.4 15. 7
Source: President’s Office, Planning and Privatisation, 2003 and Bank of Tanzania, monthly
economic review, December2003/January 2004.
2.1.2
Macroeconomic Stability
MoF has made progress over the last decade in creating economic stability. It has
brought the budget deficit and inflation under control and instituted structural reforms to
boost economic growth and reduce poverty.
Reforms to liberalise the economy have included:
 Freeing prices from Government control.
 A major privatisation programme.
 Encouraging foreign investment.
As a result there has been a marked increase in inward investment as private investors and
international lending agencies and donors have responded positively to the reforms. In 2003,
Tanzania Investment Centre registered 372 projects US$1,589.87m, out of which 155 are
owned by local investors, 109 by foreign investors, and 108 are Joint Venture projects.
Furthermore, in 2002 a number of investors who were facilitated by the Centre on various
permits, licenses and registrations were 260 on TRA issues, 243 on company registration, 214
on business licenses, 926 on work permits, 976 on resident permits and 61 on land issues.
The level of investment has been increased from 14.8 percent of GDP in 1997 to 17.4 percent
in 2003. However, this level of investment is still below the required level to accelerate rapid
economic growth. The ideal investment as a percentage of GDP to spur growth for Tanzania
should not be less than 10 percent. The Ministry, in collaboration with other Ministries,
continues with its efforts of creating enabling environment and putting in place attractive
incentive package and procedures that would attract investors and facilitate their access to
credit.
2.1.3
Foreign Direct Investment
Net FDI inflows into Tanzania have shown a steady increase from 1991. There was a
significant response from foreign investors from the second half of 1990s. The highest level
of FDI inflow occurred between 1994 and 1995, where the annual level of net FDI inflows
more than doubled from US$50m to US$119m in 1995. It has since been increasing steadily
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Ministry of Finance: Medium Term Strategic Plan: 2004 - 2009
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and stood at US$ 463.4m in 2000 (see Fig. 1.1). During 1995-2000, Tanzania received a total
of US$1bn, compared to less than US$2m during 1986-1981 (UNCTAD 2001). While FDI
inflows hovered close to 0 percent of GDP in 1980s, it increased to 2.1 percent in 1998 and
averaged 1.3 percent from 1990-1998. By 1999, inward stock of FDI had reached 11.2
percent of GDP, up from 7.0 percent in 1995, and lower still at 2.2 percent in 1990
(UNCTAD 2001, CUTS, 2003). On the other hand during 2002, the level of foreign direct
investment declined to US $ 240.4 million from US $ 327.4 million recorded in 2001. The
high levels of foreign direct investment attained during the period 1999-2001 were on
account of substantial investments in the mining sector. Table 2 shows the growth of FDI
flows in the country from 1997 to 2002 (Economic Survey, 2002).
Table 2:
Growth of Foreign Direct Investment Flows (FDI) in the Country, 19972002
VALUE OF INVESTMENTS (US
$ MILLION)
157.8
172.2
516.7
463.4
327.4
240.4
YEAR
1997
1998
1999
2000
2001
2002
Source: The Economic Survey, 2002
Note: The value of investments for the period 1999-2002 has been revised following the results of a
joint study conducted by the Bank of Tanzania, National Bureau of Statistics and the
Tanzania Investment Centre.
Table 3:
Major Economic Indicators
1997
1998
1999
2000
2001
2002
8,711 8,927
2003
6,995
7,711
8,025
8,377
3.5
4.0
4.7
4.9b
5.7
6.2
5.2
Consumer Price Inflation (ave
%)
16.0
12.8
7.9
5.9
5.1
4.6
4.6
Population (m)
31.3
32.1
32.9
33.8
34.7
33.6
34.5
Export of goods fob US$m
752.6
588.5
543.3
663.3
Import of goods fob US$m
1,148
1,382
1,415
1,368 1,560.3 1,511
-403.4
-905.4
-829.5
-498.6
623.1
599.2
775.5
974.2
7,578.5
7,384.7
GDP US$ Mill
Real GDP growth (%)
Current account balance
US$m
Forex reserves excluding gold
(US$m
Total external debt Mill USD
9,300
776.4 902.5 1,073.8
-480.0
-251
1,874
-476
1,157 1,529 1,922.4
7,669.
7,624.8 7,464.0 7,268
7
16.2
16.2
12.8
7.7
7648.2
13.2
21.0
7.7
Debt-service ratio (1) %
Exchange rate (average)
612.1
664.7
744.8
800.4
876.4 966.6
1,046
TSh/US$
Source: Bank of Tanzania (Monthly Economic Review, December 2003/January 2004) and EIU
estimates
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Ministry of Finance: Medium Term Strategic Plan: 2004 - 2009
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2.1.4
Prospects
The rate of growth in GDP has risen steadily from 3.5% in 1997 to an estimated 5.2% in
2003. We project the real GDP to grow at 6.3 percent in 2004 and up to 7.0 percent by 2006.
Forecast also indicates that the consumer price inflation will be maintained at 4 percent
during 2004/05 to 2006/07. Successful reform programme has laid the basis for a sustained
increase in growth and investment. This should enable Tanzania to outperform neighbouring
countries and become an increasingly attractive location for international business in the
region.
2.1.5
Structure of the Economy
Agriculture represents about half of total GDP and manufacturing industry about 8.4%.
Growth in most sectors has been in line with that of GDP as a whole, with the notable
exception of the buoyant mining sector. Manufacturing has recovered in recent years, helped
by the improved performance of the privatised industries. In 2003 Tanzania had a total GDP
of about TSh 9,725.01 billion, equivalent to US$ 9.3billion. This is equivalent to an income
per person of US$ 265 on a direct-conversion basis and about US$ 1,000 on a PPP basis.
The main components of GDP are shown in the following table:
Table 4:
Tanzania: GDP Origins and Components 2002
Origins of GDP 2002
Agriculture
Mining
Manufacturing
Construction
Services
% Of total
47.5
2.7
8.4
5.0
36.4
GDP at factor cost
including others
Source: Economic Survey, 2002
Components of GDP 2002
Private consumption
Government consumption
Gross fixed capital formation
Increase in stocks
Exports of goods and non-factor services
Imports of goods and non-factor services
% Of total
70.9
16.9
19.0
0.2
22.8
-29.8
100 GDP at market prices.
100
Agriculture
Agriculture has four main sub-sectors: crops, livestock, forestry and fisheries. Crops are the
most important, representing about 75% of total agricultural output. Smallholders produce
the bulk of subsistence crops (principally maize, wheat, cassava and rice) using traditional
methods, but yields are low and vulnerable to drought. Smallholders are also the principal
growers of the major cash crops (coffee, cotton, cashew nuts and tobacco) while sisal, the
main pre-independence export crop, and tea are predominantly grown on large estates.
Production of all crops fluctuates depending on climatic conditions, but cashew nut
production has increased substantially in recent years. Sisal production, which fell
dramatically in the three decades to 1997, has fluctuated since then. It is now increasing,
spurred no doubt by a substantial increase in price. Livestock production is predominantly
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Ministry of Finance: Medium Term Strategic Plan: 2004 - 2009
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shorthorn cattle, with around 400,000 head in commercially managed beef and dairy herds.
There is an important fishing industry on Lake Victoria, which exports chilled or frozen Nile
perch.
Manufacturing
The industrial sector in Tanzania includes industries manufacturing import substitutes, such
as cement and clothing, together with those processing agricultural products for local
consumption and exports such as sugar, beer and cigarettes. Output in some sub-sectors has
increased as parastatals have been privatised and new management and new investment
brought in. But, in general, growth has been slow as a result of insufficient capital and
increasing competition as trade is liberalised .The sugar and cigarette industries have
maintained steady production in recent years, and the flour and beer industries (the latter
clearly showing the impact of privatisation in 1995 have sustained considerable growth.
Mining now represents over 20% of exports and has been the fastest growing sector of the
economy in recent years. Tanzania has been removing barriers to foreign ownership, and this
has led to substantial foreign direct investment in mining.
Services
Tanzania has great potential for increasing its income and foreign exchange earnings from
tourism. Unique attractions include Africa’s highest mountain (Mt. Kilimanjaro) and largest
game reserve (the Selous) and the world’s greatest concentration of wildlife (the Serengeti
plains) as well as the increasingly popular destination of Zanzibar. Tourism in Tanzania plays
a vital role in the country’s economic development. It is one of the major sources of foreign
exchange. The industry is also credited for being one that offers employment opportunities
either directly or indirectly through its multiplier effect. The sector directly accounts for
about 16% of the GDP and nearly 25% of total export earnings. It directly supports the
estimated 156,500 jobs (2001). Foreign exchange receipts from tourism grew from US$
258.14 million in 1995 to $730.00 in 2002. These receipts were generated by tourists’
arrivals in the stated years, which have shown a steady growth from 293,834 in 1995 to
575,000 in 2002. With an average growth rate of 20%, Tanzania expects to reach the target of
one million tourists by the year 2010. The sector also plays a major role in enhancement of
national and international peace and understanding.
Table 5:
Number of Tourists and Foreign Exchange Earnings: 1990 - 2002
Year
Number of Tourists
% Change
1990
153000
-
Foreign exchange
earnings (US $ mil.)
65.00
1991
186800
22.1
94.73
45.7
1992
201744
8.0
120.04
26.7
1993
230166
14.1
146.84
22.3
1994
261595
13.7
192.10
30.8
1995
293834
12.3
258.14
34.4
1996
1997
1998
1999
2000
2001
326192
360000
482331
628188
501668
525122
11.0
10.4
34.0
30.2
-20.1
4.7
322.00
392.41
570.00
733.30
739.10
725.00
24.7
21.9
45.3
28.6
0.8
-1.9
% Change
-
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Ministry of Finance: Medium Term Strategic Plan: 2004 - 2009
8
2002
575000
Source: Economic Survey, 2002
2.1.6
9.5
730.00
0.7
External Trade
Export of goods for the year 2002 increased by 16.25 percent to USD 902.55 million
compared to USD 776.40 million recorded in year 2001.The good performance of exports
was mainly explained by large exports of nontraditional goods, especially minerals, fish and
fish products as well as manufactured goods, which contributed 77.16 percent to total exports
of goods as compared to 70.1 percent in 2001. In general, the value of traditional goods
export (coffee, cotton, sisal, cashew nuts and clove) continued to deteriorate in 2002, causing
the contribution of traditional exports to decline to 22.8 percent compared to 29.9 percent of
total exports in 2001. As regards imports, the value of imported goods declined from USD
1,560.5 million in 2001 to USD 1,511.3 million in 2002. The decrease was attributed to low
imports of capital goods, especially for the mining sector, and low food imports.
Table 6:
Value of Traditional and Non- Traditional Exports: 1999-2002
Exports
1999
2000
2001
2002
Change (%)
2001/2002
Traditional Exports
Coffee
76.63
83.7
57.05
35.14
-38.4
Cotton
28.46
38
33.7
28.15
-16.5
Sisal
7.26
5.6
6.68
6.65
-0.4
Tea
24.65
32.7
29.03
29.35
1.1
Tobacco
43.44
38.4
35.69
50.5
41.5
100.89
84.4
56.58
46.26
-18.2
19.86
10
12.32
5.4
-56.2
301.19
292.8
231.05
201.45
-12.8
Minerals
73.26
178.2
302.23
372.78
23.3
Manufactured Goods
30.05
43.4
56.17
67.1
19.5
Fish and Fish Products
56.75
76.3
96.77
116.76
20.7
Horticultural Products
8.88
9.7
11.01
10.86
-1.4
72.74
62.9
79.34
108.09
36.2
241.68
370.5
545.52
675.59
23.8
Grand Total
542.87
663.3
Source: President’s Office, Planning and Privatisation, 2003
776.57
877.04
12.9
Cashew nuts
Cloves
Sub Total(Total Trad. Exports)
Other Exports
Sub Total (Non-Trad. Exports)
The principal destinations of Tanzania’s exports in 2002 were India (15.3%), Japan (12.4%)
and Netherlands (9.2%). The largest shares of imports came from South Africa (12.7%),
China (7.9%) and Kenya (6.6) Import share from the European Union including Norway and
Switzerland was 23.6%
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Ministry of Finance: Medium Term Strategic Plan: 2004 - 2009
9
Exports
Agricultural products form the major part of Tanzania’s exports, but mineral exports are
rapidly increasing. In 2002, cotton and coffee typically represented around 32% of exports,
with tea and tobacco together contributing a further 40%. In recent years, exports of cashew
nuts have increased substantially; they now represented about 23% of total exports in 2002.
Mineral exports have grown strongly, underpinned by the increase in gold production.
Manufacturing exports grew by 17.3% from US$ 56.2m in 2001 to some US$ 65.9m in 2002.
Regional Economic Links
Major regional groupings of relevance to Tanzania are the East African Community (EAC),
the Common Market for Eastern and Southern Africa (COMESA), the Southern African
Development Community (SADC), and the Southern African Custom Union (SACU). Of
these groupings, the EAC and SADC are most important for Tanzania.
The EAC covers Tanzania, Kenya and Uganda and aims to return the three countries to the
levels of economic cooperation they previously enjoyed. One aspect of this is to create a
customs union to serve the three economies, which have a total population of over 80m and a
combined GDP of some US$20 billion.
SADC has 14 member states in Central and Southern Africa with a total population of some
199m and a combined GDP of US$ 176 billion. SADC also covers many areas of
cooperation. Prominent among these is a plan to introduce free trade throughout the region
by 2007, with some exceptions for specially disadvantaged states until 2012.
2.1.7
Public Finance
As part of its reform programme, Tanzania has adopted a rigorous system of cash budgeting.
Thanks to the substantial inflows of technical assistance Tanzania has had in recent years,
fiscal deficits have been relatively small - despite a low ratio of tax revenue to GDP. The
Government believes there is an opportunity to broaden the tax base and improve the way
taxation is administered.
The budget outturn in the years 1999/2000 to 2003/2004 was as in Table 7. This indicates the
scale of revenue and expenditure and the importance of foreign financing.
Table 7:
Summary of Budget Frame Estimates (1999 – 2004) in Million TSh.
Item
Total Revenue
Total Expenditure
Budget deficit/surplus
Development expenditure
and Net lending
Grants
Financing
Foreign Financing (net)
Domestic Financing (net)
1999/00
810,298.0
841,326.0
31,028.0
2000/01
929,624.0
1,305,035.3
375,411.3
2001/02
1,042,955.1
1,466,136.9
423,181.8
2002/03
1,217,517.0
1,896,854.1
679,337.1
2003/04
1,393,026.2
2,383,250.2
990,224.0
217,233.0
286,253.2
344,610.9
473,188.6
757,722.3
235,603.0
29,690.0
64,340.0
36,650.0
286,306.0
114,552.7
90,354.2
2,494.4
379,849.4
40,128.6
121,842.5
22,606.6
622,302.1
135,502.6
172,016.5
36,513.9
665,961.0
324,263.0
278,968.6
45,294.4
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Ministry of Finance: Medium Term Strategic Plan: 2004 - 2009
10
Source: BOT Monthly Economic Review, December 2003/January 2004
2.1.8
Money and Prices
The following table shows the main financial indicators for 2000 to 2003.
Table 8:
Tanzania: Financial Indicators for 2000/01 and 2003/04
2000/01
2001/02
2002/03
2003/04
Central Government Finance (Mill TSh)
Revenue and Grants
1,215,930.0
1,422,804.5
1,839,819.1 2,058,987.2
Expenditure
1,305,035.3
1,466,136.9
1,896,854.1 2,383,250.2
-25,447.4
-89,105.3
2000
5.9
800.4
803.3
3,203.8
-43,332.4
2001
5.1
876.4
916.3
8.1
13.10
20.05
8.5
695,006.5
18.1
1,093,610.9
12.5
974.4
4.7
9.78
20.09
4.68
766,019.9
15.0
1,233,667.0
12.8
1,156.6
748
920
Adjustment
Balance
Prices/Financial indicators
CPI (1994=100; % change)
Exchange Rate TSh: US$ (ave)
Exchange Rate TSh: US$ (end-period)
Interest Rates (%)
Deposit (aver)
Discount (end-period)
Lending (aver)
Treasury bill (aver)
M1 (end-period; TSh Mill)
M1 (% change, year on year)
M2 (end-period; TSh Mill)
M2 (% change, year on year)
Gross official reserves (US $m)
Reserves excluding gold (end-period)
-79,389.1
-57,035.0
2002
4.6
966.6
976.3
0.0
-324.263
2003
4.6
n.a
1,045.7
3.3
n.a
9.18
n.a
15.76
n.a
4.60
n.a
958,786.6 1,083,761.2
18.0
n.a
1,507,386.5 1,669,610.4
22.2
13.3
1,529.0
n.a
1010
Source: Bank of Tanzania, Monthly economic review, November 2003 and International Financial
Statistics (IFS) 2002
In the period covered by the table, average deposit rates have fallen from 8.1 in 2000/01% to
3.3% in 2002/03. Lending rates have also fallen from 20.05% in 2000/01 to 15.76% in
2002/03. (These are weighed average rates calculated by the BoT. Lending rates are prime
rates offered by banks. Deposit rates are for savings and time deposits.)
The increases in M1 and M2 have fluctuated, as the table shows. Because of the
Government’s fiscal discipline, the BoT has not had to adopt an excessively tight monetary
policy.
Although the government has eliminated financial repression by raising interest rates to
positive real levels, and allowed free determination of interest rates in the financial market,
the cost of borrowing remains excessively high. This is mainly because competition in the
sector still remains weak, high risks in lending due to difficulties on the part of the
commercial banks to assess the credit worthy of private borrowers, and problems associated
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Ministry of Finance: Medium Term Strategic Plan: 2004 - 2009
11
with the handling of commercial disputes. Such constraints make lenders put the element of
risk in calculating the cost of loans. This makes loans expensive leading to excess of
liquidity in the banking system while starving the private sector. The government should
institute loan repayment enforcement mechanisms by establishing a well-functioning
commercial court system and set up a credit rating bureau to reduce the cost of screening
prospective borrowers in the banking sector.
The BoT will also aim as far as possible to keep the Tanzania shilling competitive and to
improve the market for Government securities. Ndissi (2003 – BOT) highlights the following
plans for securities market:
o Development of secondary market, situational analysis and enforcement of dealer
obligations;
o Development of new tradable market instruments to enable diversification;
o Speeding up the formation of the credit information bureau that will enable
participants to make informed decisions; and
o Conducting sensitisation seminars.
The Government and the BoT plan to reduce inflation to between 4 and 4.5% in 2000-3. But
even if the rate falls only to 5%, as forecast by the EIU, this will represent modest price
increases by past standards and will not harm economic stability.
The exchange rate should be relatively stable –- in the Government’s view it is not
overvalued. But it will remain vulnerable to external shocks. The EIU’s forecast rate for
TSh to the US$ was 984 for 2002 and 1,063 for 2003 (both averages). The exchange rate
recorded for the year 2003 was 1,045.7(BoT, 2003)
2.1.9
Balance of Payments
Tanzania’s current-account deficit is falling slowly. It fell from 10.34% of GDP in 1999 to
5.95% of GDP in 2000 and to 5.12% of GDP in 2003. Positive influences that will help to
bring down the deficit are likely to be:

Higher production, and probably higher prices, of gold.

Some increase in tourism earnings.

Better trends in some commodity prices.
Table 9:
Tanzania: Balance of Payments (US $m)
1997
1998
1999
2000
2001
2002
2003
Exports
752.6
588.5
543.3
663.3
776.4
902.5
1,073.8
Imports
-1,148.0
-1,382.1
-1,415.4
-1,1367.6
-1,560.3
-1,511.3
-1,873.9
(395.4)
(793.7)
(872.1)
(704.3)
(783.9)
(608.8)
n.a
(403.4)
(905.4)
(829.5)
(498.6)
(480.0)
(251.1)
n.a
Balance of Visible
Trade
Balance on
______________________________________________________________________
Ministry of Finance: Medium Term Strategic Plan: 2004 - 2009
12
Current Account
(199.8)
(505.8)
(109.0)
(35.1)
Overall Balance
Source: BOT, Monthly Economic Survey, December/January 2004
2.1.10
17.5
328.8
n.a
Privatisation
In 1993 the Government established the Presidential Parastatal Sector Reform Commission
(PSRC) to carry out its programme of privatising large numbers of state-owned organisations.
Up to June 2003, a total of 281 parastatals were privatized including 50 that were placed
under LART. Among the privatised parastatals, 140 were 100 percent acquired by
Tanzanians and 20 paratastals were 100 percent acquired by foreigners, while 121 were
privatised through joint venture between local and foreign investors. Among the privatised
companies sold to Tanzanians, 15 were sold to the employees of the respective companies
through management and employee buyout. In addition, 271 non-core companies were sold.
In 2002, emphasis was on preparing strategies to privatise or rehabilitate the infrastructure of
service companies including DAWASA, ATC, TANESCO, THA, TRC, NIC and NMB. Up
to December 2003, the government managed to privatise Air Tanzania Corporation on joint
venture basis and DAWASA on lease Agreement.
In order to control the major utility companies, the government has established four
regulatory authorities, which are Energy and Water Utilities Regulatory Authority
(EWURA), Surface and Marine Transport Regulatory Authority (SUMATRA), Tanzania
Communication Regulatory Authority (TCRA), and Tanzania Government Aviation
Regulatory Authority (TGARA). Consequently, for the year 2003/04, the government will
continue to privatise the major utility companies and their infrastructure, major agricultural
and livestock farms. Also, the government will continue to monitor the companies, which
have been privatised to ensure that the companies operate efficiently according to the sale
contracts.
The privatisation programme has been a vital component of the past decade’s economic
reforms. It has contributed greatly to economic growth and to investment.
Table 10:
Divested/Privatised Public Enterprises Providing Dividends to the
Government in million Shillings
Divestiture Year
1.
Tanzania Breweries co. ltd
2.
Tanzania Cigarette Company Ltd.
3.
Tanga Cement Co.
4.
2001/2002
2002/2003
1993
3,486
1,984
1995/6
1,688
1,605
1995
341
384
Tanzania Portland Cement Co.
1997
299
300
5.
TPC Arusha
1999
-
USD 50,000
6.
DAHACO
2000
698
336
1960
2000
7.
THA
Source: President’s Office, Planning and Privatisation, 2003
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Ministry of Finance: Medium Term Strategic Plan: 2004 - 2009
13
2.1.11
Action to Reduce Poverty
The analysis of the information and data from the Household Budget Survey (HBS 2000/01)
which was carried out as part of the Poverty Monitoring system, and the Integrated Labour
force Survey (ILFS) of 2000/01 has revealed that there were no significant improvements in
reducing income and non- income (health, education, employment and housing) levels of
poverty of the population over the past ten years. The results show that 19 percent of the
population lie below the food poverty line in 2000/01 compared to 22 percent in 1991/92. 36
percent of the population also lies below the basic needs poverty line in 2000/01 compared to
39 percent in 1991/92. Poverty is still more severe in the rural areas. However, income
inequality has increased significantly in Dar es Salaam. The implementation of the Poverty
Reduction Strategy has started registering notable achievements especially in the education
sector and in some poverty indicators within the health sector, urban water supply and rural
roads.
The challenge facing government in poverty reduction is: 

To attain a sustainable economic growth that will reach at least, 8 percent;
To improve service delivery to the community (the Government in collaboration with
the private sector);
To strengthen existing infrastructure, especially key roads, and agricultural irrigation
projects;
To enable each district prepare and implement medium term Poverty reduction plans;
and
To stress the need for all able bodied citizens to work.



2.1.13
Taxation and Investment Regime
Taxation
Table 11:
Tanzania: Taxes
Type of Tax
Brief Details
Corporate Tax
30% of taxable income of corporate entities
Payroll Levy
4% of gross emoluments paid during the month
Withholding Tax
Capital Gains Tax
Varies depending on the tax source. For more
information, see Tanzania investment guide
On gain from the sale of any interest held on premises or
any financial asset. 10% of the difference between the
value of the consideration and the adjusted historical cost
of the premise or financial asset
Import Duties
Up to 25% depending on the tariff band
Property Tax
On commercial and residential properties. The local
authority fixes the tax rate. In most cases, it is a flat rate
depending on the location of the property.
Value Added Tax
20% on sales of certain goods and services. Applies to
companies with over TSh 20m annual sales.
The principal taxes in Tanzania are as follows:
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Ministry of Finance: Medium Term Strategic Plan: 2004 - 2009
14
Source: Tanzania Investment Guide, 2002 and beyond
2.2
Mandate of the Ministry
Formulation of fiscal, monetary and financial policies, timely and adequate allocation of
funds to MDAs, and make close follow-ups on the budget execution in Tanzania.
2.2.1
Functions
Broad Functions of the Ministry include:
-
Formulation of policy issues related to macroeconomic analysis, fiscal, monetary and
debt policy and strategy.
-
Overseeing financial aspects of the Government interest as shareholder in public, as
well as private enterprises; and advises the Government on various issues pertaining
to its investments.
-
Preparation of expenditure targets, review of expenditure performance, and
preparation of budget guidelines.
-
Preparation and implementing external aid policies, mobilization and coordination of
external aid and regional cooperation.
-
Managing the Government payroll.
-
Overseeing all revenue and expenditure operations of the Government.
2.3
Recent Initiatives and Achievements
Recently, the Ministry of Finance has undertaken some initiatives towards achieving the
overall goal of attaining and sustaining macro economic stability and sound financial
management procedures. These initiatives are discussed here under.
2.3.1
Public Sector Reform
During the Civil Service Reform Programme (CSRP), the Ministry of finance (MoF) carried
out an organization and efficiency (O & E) review. The objective of O & E review was to redefine the roles and functions of the Ministry to conform to the changed role of the
Government from being a direct implementor to that of policy development, advisory,
supervisory, regulatory, monitoring and evaluation functions. In short, the role of the
Government is that of a facilitator of an open market economy. In the on going Public
Service Reform Programme, MoF hopes to consolidate and sustain the comprehensive
structure and institutional reforms. At the same time, MoF will launch a strategy process
aimed at transforming its role, capacity and performance in the delivery of public services on
a sustainable basis.
2.3.2
Expenditure Management
The Ministry of Finance is undertaking organizational and systems changes to strengthen the
Government’s budget execution process, accountability and transparency through:
______________________________________________________________________
Ministry of Finance: Medium Term Strategic Plan: 2004 - 2009
15

Centralization of the payment and banking processes in Dar es Salaam through the
Central Payment System (CPS).

The implementation of an improved Budget Classification/Chart of Accounts systems.

Improved approaches to cash management and expenditure control.
(i)
Cash Budgeting and Centralization of Payments
Cash Budgeting is a means to ensure that spending entities live within their allocated funds
and to encourage efficiency through hard budget constraints.
The objectives of cash budgeting are to:
Limit expenditure allocations at any time to resource availability.

Bring under control the growing government over expenditure.

Introduce and entrench a culture of fiscal discipline i.e. to stop the expectation of
supplementary estimates.
To meet these challenges, the Government is now implementing the Government Financing
Statistics (GFS) classification and the Integrated Financial Management System (IFMs) using
an Epicor package. These measures will meet the financial management and accounting
needs of government including those of its Agencies and Projects, and enhance financial
sustainability, accountability and transparency in the Government.
(ii)
Performance Budgeting
Performance budgeting is a technique of budgeting which is result (output) oriented. It seeks
to re-orient the old budget system used to be incremental-based to a system that focuses on
outputs from government expenditure. This technique was applied on a pilot basis in the
Ministries of Education, sciences, Technology and Higher Education, Health, Water, Energy
and minerals, Agriculture and Cooperatives, and Works for 1998/1999.
The remaining MDAs were introduced to the system during 1999/2000. This technique of
budgeting was initiated as a logical extension of the work done by O & E reviews under the
Civil Service Reform Programme. O & E reviews started to address the issue of improved
efficiency and accountability in service delivery. This would be achieved through the process
of Annual Performance Reporting and Service Improvement Planning (APRSIP).
Performance budgeting was thus recommended as a tool that could operationalise the whole
process.
Since the introduction of the technique there has been a lot of improvement in the following
areas.

Presentation of budgets that are properly linked to the vision, mission, objectives,
targets and activities.

Elaborate presentation and identification of key players in budget implementation.

Attempts to integrate the budget process.

Easy monitoring and follow-up because the targets and the activities are stated.
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Ministry of Finance: Medium Term Strategic Plan: 2004 - 2009
16
The government will extend this approach to Regional Administrative Secretaries (RAS)
budgets for 2000/2001. MoF has trained budget staff in all MDAs and Regions on this new
technique of budgeting within the Strategic Planning Framework. More effort is needed to
improve the techniques especially on performance indicators.
(iii)
Budget Reclassification
Budget classification is about how the budget is classified and coded to show levels of
authority, control, accountability and facilitation of economic analysis.
The Government took initiatives to improve the budget classification up to 1998. Despite
these efforts, the current classification still suffers from unclear item structure which is
inconsistent and does not therefore facilitate a meaningful economic analysis.
To address the above limitations, the Government has adopted an international classification
Government Financial Statistics (GFS). This classification attempts to put in place an
economic classification that will facilitate not only control and accountability but also impact
analysis of the budget in the economy and different social groups. GFS looks at the budget as
a package and thus lays proper ground for budget integration. Budget Officers in all MDAs
have been trained on this new budget classification system.
(iv)
Wage Bill Control
Government expenditure on salary and wages is substantial. Control of expenditure on the
wage bill poses a major challenge in the management of the government budget due to high
degree of volatility. Expenditure overruns on salaries and wages reduce resources that would
otherwise be available for other services thus undermining government’s efforts to improve
service delivery.
In view of the above, MoF initiated a system of overseeing all issues related to the civil
service wage bill control by ensuring that expenditures are maintained within the approved
budgets. Specifically, MoF undertakes to:
Scrutinise and assess all amendments to be entered in the payroll every month.

Compile monthly payroll and monthly, quarterly and annual wage bill reports.

Liaise with the Civil Service Department to update and maintain a register of the
number of employees in the Central and Local Governments, changes in staffing
levels and amendments in the payroll.

Assess payroll/wage bill trends on a monthly basis.

Monitor and keep a record of recurrent and non recurrent payments to be made on the
payroll.

Work-out wage bill implications from the amendments and examine the effect on the
ceiling.

Maintain an up-to-date payroll database.
The result has been a drastic reduction in the number of ghost workers, control excess vote,
accurate and timely availability of reports.
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Ministry of Finance: Medium Term Strategic Plan: 2004 - 2009
17
2.3.3
Public Expenditure Review (PER) and Medium Term Expenditure Framework
(MTEF)
The Public Expenditure Review (PER) has been an ongoing process for several years now.
The traditional PER function has focused on the budget process in terms of review of the
activities involved e.g. resource forecast and allocation, expenditure management, control and
accountability. The underlying objective has been to evaluate performance against approved
targets and established procedures and identify shortcomings and corrective measures.
However, the current concerns on budget management involve fiscal stability, improved
predictability of resource flows, increased efficiency in resource use, budget integration and
donor participation in determining resource envelope.
To address the above problems, recently PER process has also taken initiatives to facilitate
the implementation of medium term expenditure management in Tanzania. This entails three
main elements. The first element has to do with improving predictability of the Government
budget in terms of resource flows. This will be achieved by implementing a Medium Term
Expenditure Framework (MTEF) and increased donor involvement in the budget frame
preparation. The second element is in respect of sustainability and consistency of sector
targets with priorities and resource envelope. Thirdly, it is also intended that under MTEF
the donor support will increase resource allocation across investment and recurrent costs on a
medium to longer term basis.
2.3.4
Revenue Collection Management
(i)
Domestic Revenue Collection
The government revenue comprise of tax revenues and non tax revenues. The tax revenue
contribute about 90% of the total revenue. The responsibility of collecting tax revenues is
vested upon the Tanzania Revenue Authority (TRA) since 1996.
The non tax revenues contribute about 10% of the total domestic revenue. The responsibility
of collecting non tax revenue is vested in MDAs. This source is likely to increase as the
MDAs responsible for the generation of this revenue are allowed to retain a certain
percentage of tax collected as an incentive.
The tax administration era in Tanzania can be divided into two i.e. prior to 1996 and post
1996. Prior to 1996, the tax administration was performed by the Revenue Department,
namely, the Income Tax Department, Customs and Excise Department and the Sales Tax and
Internal Revenue Department which were under the Civil Service and under the Ministry of
Finance. The Post 1996 era witnessed the formation of TRA which was established by Act of
Parliament, No. II of 1995. TRA is a semi autonomous body operating out of the civil
service and was formed in line with government fiscal policy, which among other objectives,
was to enhance revenue collection by strengthening tax administration.
TRA oversaw one of the major tax reforms, that is, the enactment of the Value Added Tax
Act, 1997 which led to the introduction of VAT on 1st July, 1998 in place of Sales Tax and
part of receipts based stamp duty. VAT was introduced with the objective of broadening the
tax base and increasing revenue yield, promotion of exports by zero rating as well as
removing economic distortions. In tandem with this, efforts have been made with the view of
increasing efficiency in document processing and improving client compliance.
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Ministry of Finance: Medium Term Strategic Plan: 2004 - 2009
18
Despite all these ongoing initiatives, revenue collections of around 13% of GDP falls far
short of the average for the East African region, which is around 20% of GDP. This calls for
more concerted efforts aimed at increasing compliance an widening the tax base.
(ii)
Tanzania Assistance Strategy (TAS)
Since attaining independence more than 40 years ago, Tanzania has enjoyed favorable
relations with multilateral financial institutions and bilateral donors. As a result, foreign and
has played a very important role in Tanzania’s economic and social development. To date,
about 30% of the total budget and more than 80% development budget is financed by donors.
Efforts to solicit donor assistance have been fragmented, ad-hoc and unpredictable and have
resulted in parallelism and duplication of activities.
In order to eliminate these deficiencies and build on previous and ongoing efforts to improve
sustainability and bring predictability of donor assistance, Tanzania has formulated the
Tanzania Assistance Strategy (TAS).
TAS is expected to improve Government–donor partnership and the utilization of donor
resources with the view to ensuring that local ownership is sustainably promoted and an
overall national development strategy that would underpin the formulation of individual
external strategies is in place. TAS is expected to provide a national framework which will
encompass:(a)
The national agenda:
- Vision and goal
- Situation analysis/core development problem
- Macro-economic policy framework
- Priority programmes/areas
- Implementation strategies
(b)
Monitoring and evaluation.
(c)
“Best Practice” development Cooperation:
- Smart partnership
- Local ownership
- Governance
- Predictability of resources (MTEF)
2.3.5
National Debt Strategy (External)
Tanzania is one of the countries with a high external debt amounting to an average of US $
7.5 billion for the past three years. The domestic debt by December 2002 amounted to about
TSh. 1,413.7 billion. Given the economic problems which characterized the economy over
the past two decades, the government’s capacity to service the matured debts declined.
However, the Government has been using about 54% of its total revenue to service its debts.
This has crowded out resources from other sectors of the economy in particulars the Social
Sectors and thus hampered its efforts to eradicate poverty.
In addressing the debt problem; he Government established the National Debt Strategy Part I
(External Debt) The Main objective of NDS is to reduce the current debts through
negotiations with donor countries and institutions. Several debt relief programmes are in
place. They include Paris Club, Debt Conversion Debt Buy-back, Multilateral Debt Relief
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Ministry of Finance: Medium Term Strategic Plan: 2004 - 2009
19
Fund and High Indebted Poor Countries (HIPC). The later will be concluded soon. As
regard to the incurring of future debts, the Debt Management and Debt Co-ordination
Committees formed will advise the Ministry of Finance on contracting foreign loans. The
Government in future shall borrow only on highly concessionary terms such as IDA
comparable terms with grant element of 78% or above. This condition aims at contracting
expensive loans that will further worsen the debt position.
2.3.6
Mainstreaming Gender in the Budget
The Ministry of Finance as the central agency entrusted with the management of public
finance i.e. resource allocation of the country, must ensure that the budget, which is an
instrument for implementing macroeconomic policies should integrate gender issues in their
analysis, planning and programming, hence the concept main streaming gender equality.
The main purpose of the programme is to ensure that gender equality objective influence
other policy areas e.g. poverty alleviation democratic development and resource allocation as
well as equal participation of both women and men.
The objectives of the programme are as follows:
To engender the microeconomic policies and the Budgetary Instrument.

To build technical expertise within the Ministry for gender mainstreaming.

To establish Institutional framework for monitoring and Coordination mechanism on
gender issues.

To improve women participation in finance management as well as in decision
making within the Ministry of Finance.
In terms of progress, the 1999/2000 budget guidelines incorporated a section on gender
issues. Six Ministries were identified to pilot the Mainstreaming of gender into their sector
MTEF these are; Ministry of Community Development, Gender Affairs and Children,
Agriculture, Health, Education, Water and Regional Administration and Local Government.
Budget officers from central Ministries and pilot sectors were trained in gender analysis
skills. The development of tools for engendering the budget is in progress.
2.3.7
(i)
Management of Government Property
Public Procurement and Supply Management
During the late 1980’s the Government policy moved away from an emphasis on government
organizations being responsible for all aspects of supply and distribution, and towards a
resuscitation of the private sector. Until recently, the Government’s supply policy has been
based on a highly centralized procurement and distribution system governed by outdated
Financial Orders.
In line will the ongoing social economic changes and the changing role of the government.
MoF initiated a Public Procurement and Supply Management Study which included the
whole name of procurement for the public sector.
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Ministry of Finance: Medium Term Strategic Plan: 2004 - 2009
20
The study made recommendations as follows:





Review of the whole legal framework,
Strengthening Financial Control and Accountability,
Establishment of a procurement unit in MoF, separate from CTB,
Reconstitution of membership of CTB to include professionals,
Human Resources Development, and
Dissolution of Government Stores.
MoF is in the process of implementing the study recommendations.
(ii)
Management of Government Assets
The Ministry of Finance is the custodian of government assets and property Until recently,
the control and management of assets was governed by outdated, fragmented and
uncoordinated Financial Orders in form of Stores Regulations. Financial Regulations and
Guidelines. These regulations coupled with the lack of capacity in data and record keeping,
led to poor management.
In its effort to address the above problems, the Government during 1997/98 initiated
measures for the proper control, management and disposal of government assets and
property.
The specific initiatives were: To review legal and regulatory framework,
 To implement and promulgate appropriate Financial and Stores Regulations so as to
increase efficiency, accountability and responsibility, and
 To maintain the appropriate records including standardization and reporting
statements on government assets (Assets Register) in annual accounts.
2.3.8
(i)
Management of Public Investment
Financial Sector Reforms
Given the importance of an effective financial system for overall economic development, the
Government is committed to allowing financial intermediaries to operate free of government
intervention within the norms of prudential regulations. The government intends to foster
competition and improve efficiency in the banking sector by continuing to encourage the
entry of private and foreign financial institutions. The encouragement to new entrants,
however will continue to be based on a rigorous and transparent licensing process, which
compliments the government vision for a safe and sound financial sector. The Government is
in the process of establishing a Credit Information Bureau (jointly with the private sector),
and a Commercial Court has already been established.
(ii)
Parastatal Sector Reforms
Over and above the financial sector reforms, in order to fulfill the Government’s commitment
to reform the economy it has been necessary to implement the parastatal sector reform
programme. This is aimed at improving operational efficiency of enterprises, reduce the
burden of loss making on the government budget and expand role of the private sector in the
economy.
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21
Ministry of Finance: Medium Term Strategic Plan: 2004 - 2009
2.3.9
Reform in the Government Pension Scheme
The delivery of retirement benefits to government employees under the Pension Ordinance
Cap 371 has been characterized by a number of complaints and elements of dissatisfaction
from the retirees ranging from:



Inadequate gratuities and pensions;
Inefficiency in processing gratuities and pension that cause delays in making
payments; and
High costs incurred to collect gratuities and monthly pension.
For the past decade, MoF has undertaken a number of initiatives/programmes aimed at
addressing the above weaknesses and improving delivery of gratuity and pension benefits.
Such initiatives included changing the Gratuity and Pension factors from 1/510 and 12.5 to
15.5 respectively and the introduction of monthly lump sum payment to pensioners with
small monthly pensions. These initiatives succeeded in raising the amounts of gratuity and
pension amounts collected at the same time. The administration costs also have been reduced
as a result of the decreased monthly pensioners who have been paid their monthly pensions in
lump sum. These initiatives could not, however, solve all the problems that face delivery of
pension and gratuity benefits.
In order to address these problems comprehensively, the Government established the Public
Service Retirement Benefit Act No. 2 of 1999. The major changes made in this Act include
the establishment of a Contributory Public Service Pension Fund (PSPF) in which all civil
servants will be required to compulsory contribute 5% of their monthly salaries. The
Government as employer will contribute 15%.
2.3.10
Information Technology Initiatives
In the past, the effectiveness in decision making throughout the Civil Service has been
impaired by lack of accurate, reliable and timely information. An effective information
system supported by appropriate information technologies (IT) is necessary to support
management decisions in order to plan, manage and control the operations of the Public
Service. In this regard, IT initiatives aim to:

Avail relevant, complete, accurate and timely information to Public Service managers
and decision makers, and,

Modernize information and communications systems in government offices.
The Ministry of Finance is responsible for Government payroll, Accounting Units and SubTreasuries. The Ministry has substantial Information Technology (IT) infrastructure that is
relied on continuously for major tasks and duties (mission critical systems) within the
Treasury or related functions in MDA, and Regions. These functions create a need for an
effective, reliable and more productive implementation of an IT security programme and
appropriate maintenance procedures.
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Ministry of Finance: Medium Term Strategic Plan: 2004 - 2009
22
As a strategy for achieving this objective, there is a need for MoF to play a more proactive
role in the management of the common IT strategy and maintenance of the common IT
standards.
2.4
Stakeholder Analysis
As part of the strategic planning session, senior managers from the Ministry of Finance
carried out a stakeholders’ analysis. The aim of the analysis was to identify who are the
stakeholders of the Ministry and what are their expectations from the Ministry. The
expectations were identified in terms of the services they expect but more importantly the
attribute that goes with the service expected. A summary of the main stakeholders and their
expectations is presented below.
Business Community/Investors
 Macro-economic stability
 Predictable and equitable tax regime
 Efficient and effective tax administration
 Supportive financial infrastructure
 Timely availability of monetary and fiscal information
 Good governance
 Political stability
Parastatals
 Timely and adequate allocation of funds
 Effective policy guidance
 Effective tax administration
 Good governance
 Macro-economic stability
 Adequate allocation of funds to MDAs for utilities
Academic / Research Institutions
 Timely and accurate data on revenues and expenditures
 Timely and adequate funding
 Increased number of government – sponsored students
 Employment opportunities fro graduates
Parliament
 Robust monetary and fiscal policies
 Adequate allocation of resources to constituencies
 Timely and accurate disbursement of allowances and terminal benefits
 Timely and accurate financial reports
 Clean audited report
 Timely and adequate allocation of funds
 Proper financial management
 Accurate valuation of government assets
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Ministry of Finance: Medium Term Strategic Plan: 2004 - 2009
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Development partners
 Clarity and consistency of policies
 Good governance and accountability
 Effective coordination
 Government ownership
 Government ownership of programmes and improved partnership
 Abide by the terms of agreement
MoF Employees
 Attractive terminal benefits
 Accurate, adequate and timely payment of salaries
 Transparent and fair career development plan
 Appropriate codes of conduct
 Conducive working environment and adequate working tools and equipment
 Fair performance appraisal, rewards and sanction system
Politicians
 Good governance and accountability
 Transparency and fairness
 Sound financial discipline
Controller and Auditor General
 Statutory audit of CAG accounts
 Total compliance with financial regulations
 Value for money
Public




People-focused national budget
Sustainable and stable economic growth
Transparency in funds allocation and expenditure
Quality customer service
Taxpayers
 Friendly tax policy
 Efficient tax collection administration
 Proper utilization of taxes collected
Civil Servants
 Attractive, accurate, adequate and timely payment of salaries
 Timely release of salary and other funds
 Transparent and fair carrier development plans
 Attractive and timely payment of retiring benefits
 Relevant codes of conduct
Regional bodies
 Micro-economic stability
 Good governance
 Predictable tax regime
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Ministry of Finance: Medium Term Strategic Plan: 2004 - 2009
24



Clarity and consistency of policies
Improved partnerships
Abide by terms of agreements
Pensioners
 Courtesy in handling pensioners
 Fair and timely payment of retiring benefits
MDAs / LGAs
 Timely issuance of budget guidelines
 Timely and predictable release of public funds
 Timely availability of technical financial guidance
 Approval of tenders within their validity period
 Timely availability of financial information
 Improved fiscal and monetary management practices
 Sound and strategic resource allocation mechanisms
 Timely guidance on IT standards in line with international best practices
 Timely stock verification and disposal of government assets
 Relevant codes of conduct
CSOs




Good governance
Civic-friendly tax policies and practices
Timely availability of information on monetary and fiscal issues
Accountability in financial management
Cabinet /Presidency
 Sound and implementable financial policies
 Timely and realistic government budget
 Good financial management
 Economic stability
2.5
Environmental Scan
As part of the strategic planning process, the Ministry undertook an internal and external
environmental assessment in order to identify the strengths, areas for improvement and
expectations of the clients.
2.5.1
Internal Assessment of the Ministry (Self Assessment)
As explained in the introduction, the Ministry undertook self-assessment exercise using the
European Foundation for Quality Management (EFQM) Business Excellence Model, which
helped to identify some strengths and areas for improvements. The following are the key
findings of the self-assessment process.
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Ministry of Finance: Medium Term Strategic Plan: 2004 - 2009
25
Criterion
Part
Strengths
Areas for Improvement
Leadership 1a: Leaders develop the mission, vision, values and ethics and are role models of a culture of
excellence.
1a
Improved Performance accountability and
Transparency
Establishment of internal and external review
mechanism
1a
Adherence to staff meetings
Encourage usage of suggestion box
1a
Existence of Medium Term Strategic Plan
Ensure holding of Departmental and workers council
meetings
1a
Existence of Client Service Charter
Carrying out/ initiate the review process to access
achievement
1a
Openness and Transparency
Leadership 1b: Leaders are personally involved in ensuring the organisation’s management system is
developed, implemented and continuously improved.
1b
Weekly management meetings
Enhance capacity for Implementation and monitoring
of the MOF Strategic Plan
1b
Appointment of Substantive Heads of
Department
To enhance Managerial and Negotiation Skills of
Leaders
1b
Leadership Commitment to improve
Performance
Strengthen feedback mechanism on Performance at all
levels
Establish incentive Package for exemplary
Performance
1b
Leadership 1c: Leaders interact with customers, partners and representatives of society
1c
Budget guidelines issued timely
To have review mechanism of Donor conferences
1c
To have programmed Donor meeting
1c
Involve Stakeholders in major decisions
1c
Leaders meet Stakeholders regularly
1c
Participatory approach in Budget preparation
1c
Enhanced Transparent approach in
Conducting Public business
1c
Commitment by partners
1c
To improve Service delivery
Effective feedback from Customers
Leadership 1d: Leaders motivate, support and recognise the organisation’s people
1d
Involvement of staff in setting organization
objectives /targets
Criterion for selecting best workers (rewarding)
1d
Good forum for meeting members of staff
SASE needs to be extended to staff below TGS6
1d
Trade Union are members of the management
team
1d
Management team’s meeting held
1d
Best staff awarded every year
1d
Institutionalized periodic meetings
1d
Readiness of Leadership to Cooperate
Improvement of an ‘open door policy’
Policy and Strategy 2a: Policy & Strategy are based on the present and future needs and expectations of
stakeholders
2a
Improved service delivery accountability and Review mechanism needs to be in place
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Ministry of Finance: Medium Term Strategic Plan: 2004 - 2009
26
Criterion
Part
Strengths
Areas for Improvement
transparency
2a
Focused budget
Close follow - up and execution of programs
2a
Stakeholders views are incorporated into
government budget
Institutionalize Customers Service Delivery Surveys
2a
Various financial laws reviewed
Institutionalize Service Delivery Surveys
Policy and Strategy 2b: Policy & Strategy are based on information from performance measurement,
research, learning and creativity related activities.
2b
Improvement in Tax collection
Wider involvement of stakeholders in policy
development
2b
A policy department in place
Capacity building
2b
Regular reviews
2b
A Planning Unit has been established at DAP
2b
Enhanced capacity at the Policy Analysis
Department promising
To increase staff and capacity at Policy Department
and Planning Unit to conduct research
Policy and Strategy 2c: Policy & Strategy are developed, reviewed and updated
2c
Having more realistic budget
Enforcement of IFMS
2c
Improved management of financial resources
To have a clear review mechanism of the Policies and
Strategies
2c
Compliance to PFA in reporting requirements Comprehensive review of the Strategic plan
2c
Committed and involved leadership
2c
Participation of stakeholders in
institutionalized forum
Policy and Strategy 2d: Policy & Strategy are deployed through a framework of key processes
2d
Improvement of revenue collection
Capacity building
2d
Efficiency in payments
Regular review of the processes
2d
Ensured value for money and accountability
2d
Strategic Plan identifies the critical areas
A System of Evaluation and Monitoring to be
established
2d
Client Service Charter gives direction
Introduce Customer Needs Study
2d
Establishment of Planning Unit,
Communication and Information Unit and
LAN
Introduce Service delivery Surveys
2d
External Service Delivery Survey
Policy and Strategy 2e: Policy & Strategy are communicated and implemented
2e
Computerized financial management system
(IFMS)
2e
Budget sustainability
2e
Timely preparation of budget
2e
Presence of institutionalized arrangement for
Ensure conduct of departmental weekly meetings
management and departmental meetings
2e
Commitment of top management /leadership
2e
Close follow - up of the implementation process
Review of effectiveness and frequency of meetings
Ensure feedback to workers of the outcome of
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Ministry of Finance: Medium Term Strategic Plan: 2004 - 2009
27
Criterion
Part
Strengths
Areas for Improvement
meetings
People 3a: People resources are planned, managed and improved
3a
Existence of Training institutions i.e., IFM,
TIA
3a
Need for regular assessment of Employees morale
Ensure timely promotion
3a
A revised MOF structure in place
Trained front line staff in customer care
3a
Required number of personnel in place
Provision of conducive working environment for staff
3a
Qualified financial management cadre
Deliberate effort of retooling
3a
Presence / availability of Scheme of Service
and job description for workers
Formulation of clear and elaborate motivation and
incentive scheme
3a
Institution of effective feedback mechanism /system
from workers
3a
Preparation of implementable training programme
People 3b: People’s knowledge and competencies are identified, developed and sustained
3b
Quality services
Regular review of TNA
3b
Committed staff
Post training evaluation
3b
Bond as regards sponsored staff
3b
DSA is now TIA. IAA has improved
Need to adopt a Human Resource Development Plan
3b
Training budget substantially increased and
Government sponsorship of risen
Consider review of salary scales to attract retention
3b
The Strategic Action Plan identifies HRD as
critical
People 3c: People are involved and empowered
3c
Employees kept informed on the functions of Need for immediate review by Master Workers
the Ministry
council
3c
Motivated work force
Adherence of departmental /annual ministerial
workers council (calendar)
3c
Workers Council in place
Provision of research facilities
3c
Commitment of top leadership to involve and Adequate reward for outstanding performance and
empower people
assessment criteria
3c
Institute system for workers to contribute ideas
People 3d: People and the organisation have a dialogue
3d
Customer satisfaction
Capacity building to IECU
3d
Establishment of information education and
communication unit (IECU)
3d
Management is committed to open door policy Institute Procedure for monitoring and reporting on
and meeting the people
the MOF Strategic Plan
3d
Good relations with Trade Union
Open door policy be institutionalized
People 3e: People are rewarded, recognised and cared for
3e
Availability of funds to motivate the workers Promotion to be effected in time
3e
Improved working environment
Review NHIF policy
Partnerships and Resources 4a: External partnerships are managed
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Ministry of Finance: Medium Term Strategic Plan: 2004 - 2009
28
Criterion
Part
Strengths
Areas for Improvement
4a
Control of payments and procurements
Procurement procedures not adequate
4a
Resource mobilization and allocation
Payment systems not fully secured
4a
Partners confidence in Government increased Review of PER Process required
4a
More accountability and transparency in
financial management
Review of tax reform and consultation required
4a
Budget data Maintained at GFS Codes
Review of CFAD, Client Service Charter, TAS, IFMS
planned
Partnerships and Resources 4b: Finances are managed
4b
Competent manpower fully computerized
finance management system
More training on information technology
4b
Existence of public financial regulation and
procedures
Training for the accounting staff
4b
Timely preparation of financial statement in
line with PFA 2001
Review of accounting manual
4b
Upgrading and change of former DSA to
TIA
Roll out IFMS to regions and councils
4b
Formation of Technical Audit Unit
Audit using computer
4b
Introduction and use of Integrated Financial
Management System (IFM)
4b
The IFMS System and amended acts put a
strong base for sound financial management
Enhance capacity for implementing and monitoring
the Loans, Grants and Guarantee Act (Amended)
4b
Review of processes urgently required especially cash
budget
4b
Expenditure trading and assets management
Partnerships and Resources 4c: Buildings, equipment and materials are managed
4c
Improved procurement and tendering
processes
4c
Registers of all government assets maintained Capacity building
4c
Efficient regulatory and transparent frame
work in place
Management of assets and resources
Review of procedures and processes required
4c
Capacity building required
4c
Policy on Government Assets required
Partnerships and Resources 4d: Technology is managed
4d
Qualified IT personnel
Intensify IT user in MOF
4d
To IFMA and LAN give Potential for ICT
Capacity in IFMS need to be fully utilized
4d
ICT Strategy to be developed and Security
Partnerships and Resources 4e: Information and knowledge are managed
4e
Wider information sharing
Data security
4e
Control of government expenditure
Capacity building
4e
Improved transparency and accountability
4e
Budget speech on the Web and in all local
papers and radio
4e
Increased transparency in resource allocations Ensure timely annual meetings of the workers council
Required review of Budget Performance Report
presentation format
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Ministry of Finance: Medium Term Strategic Plan: 2004 - 2009
29
Criterion
Part
Strengths
Areas for Improvement
achieved
4e
Improved quality of reports and feedback
4e
Review of IFMS required
Processes 5a: Processes are systematically designed and managed
Systematic payments
Carry out process re-engineering (Identification of
key processes and carry out process re-engineering)
Establishment of NDCM
Process of budget guidelines preparations should
involve all sectors
5a
Increased efficiency on payment systems
Data capturing of funds from donors needs to be
addressed
5a
Staff recruitment and manning levels
improved
Enhanced capacity of debt management committees
5a
Access into SASE has been possible
5a
5a
Processes 5b: Processes are improved, as needed, using innovation in order to fully satisfy and generate
increasing value for customers and other stakeholders
5b
HIPC completion Point attained
Qualified IT personnel
5b
Computerized Financial Management System
Improved implementation of regulations
in place
5b
An instituted public expenditure process
jointly with donors and other stakeholders
Improvement of data management
5b
Political commitment
Capacity building with regard to procurement
5b
We have in place Regulatory Framework
Processes 5c: Products and services are designed and developed based on customer needs and expectation
5c
Relatively timely payments
Capacity building on process re-engineering
5c
Response to customer demands
5c
Timely payment of terminal benefits
5c
Improved pension benefits
5c
Particulars of staff now computerized
Review of the Client Service Charter and Strategic
Plan
5c
Vision and Mission of MOF clear in the
MTSP and Client Charter
Enhance capacity building for service delivery and
MIS
5c
Improved tax administration
5c
Planned review of TAS
Computerization of Pension Unit
Processes 5d: Products and services are produced, delivered and serviced
5d
Establishment of TRAB, TRAT and PSPF
Need to review TAA Revenue Appeal Act no.
15/2000
Recruitment of Pension manager should be expedited
5d
People’s awareness
5d
Computerized Financial Management System Improved Revenue base
5d
Access to Information
Capacity building at local Government level
Processes 5e: Customer relationships are managed and enhanced
5e
Improved customer relationship
Capacity building in human resources and re-tooling
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Ministry of Finance: Medium Term Strategic Plan: 2004 - 2009
30
Criterion
Part
Strengths
Areas for Improvement
5e
Improved dissemination of information
5e
MOF has adopted Private Sector Participation Secretaries need training and capacity building to
(PSP)
level of OMASEC
5e
Initiative for computerization and LAN will
improve Registry
Capacity Building for Registry Staff
5e
Client Service Charter targets lead to change
The Communication and Information Unit to be
strengthened
Customer Results 6a: Perception Measures
6a
Introduction of customer surveys system
6a
Commitment to our targets
Urgent need for carrying out SDS
6a
Existence of Suggestion Box
Monitoring mechanism for compliance
6a
Establishment of information office
Conduct of Customer Surveys
Customer Results 6b: Performance Indicators
Mechanisms of getting customers feedback to know
how are they satisfied with our services
6b
6b
Tax appeals budget and revenue appeals
tribunal
Enhance capacity for service delivery as per Client
Service Charter
6b
Communication and Information Unit
Introduce Private Sector Participation in non core
functions
Customer Results 6b: Performance Indicators
Mechanisms of getting customers feedback to know
how are they satisfied with our services
6b
6b
Tax appeals budget and revenue appeals
tribunal
Enhance capacity for service delivery as per Client
Service Charter
6b
Communication and Information Unit
Introduce Private Sector Participation in non core
functions
People Results 7a: Perception Measures
7a
NONE
Formal survey system to be in place
7a
Best worker award done yearly
Review criteria on selection of best worker
Establish system for obtaining peoples feedback on
the organization
7a
7a
Institutionalized weekly departmental meeting
where people can air their views
People Results 7b: Performance Indicators
7b
Install mechanism of tracking and reporting, formally
and constantly
7b
Conduct training needs assessment
7b
Conduct job analysis
7b
Put in place worked put manning levels
7b
Put in turnover and absenteeism tracking system
Society Results 8a: Perception Measures
8a
Communication and Information Unit
Install mechanism of tracking and reporting. data
analysis
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Ministry of Finance: Medium Term Strategic Plan: 2004 - 2009
31
Criterion
Part
Strengths
Areas for Improvement
Analytical and standard reports generation capacity
required to be enhanced in the Policy Analysis
Department and Planning Unit in Administration
8a
Client Service charter
8a
Gender and Aids Main Streaming in the
Budget
Society Results 8b: Performance Indicators
8b
Data collection and all necessary analysis be worked
out
8b
Periodical review of strategic plan
8b
Information Education and Communication
unit in place
8b
Urgent installation of MOF Website
Establish System of obtaining societal feedback
Key Performance Results 9a: Perception Measures
9a
Need to measure these indicators, report and carry out
analysis
Ministry Strategic Plan lists out indicators
Key Performance Results 9b: Performance Indicators
Strengthen monitoring system and dissemination of
information
9b
9b
All MDA’S are networked
Urgent roll over to regions and councils
9b
Indicators have been properly articulated
Establish periodic mechanism of review of indicators
and publishing for public consumption
From the above list, participants identified a number of key areas that need immediate
attention of the Ministry in the coming period. These areas are as listed below:
Criterion
1. Customer
Results
Sub-criterion
(a) Leaders are personally
involved in ensuring
the organization’s
management system is
developed,
implemented and
continuously
improved.
(b) Leaders motivate,
support and recognize
the organization’s
people









Vital Area for Improvement
Strengthen feedback mechanism on performance at all
levels
Establish incentive package for exemplary performance
Enhance capacity for implementation and monitoring the
Ministry of Finance’s Strategic Plan
Enhance leaders leadership, managerial and negotiating
skills
Provide more training in leadership skills among all leaders
throughout the organization
Leaders have to explicitly adopt an ‘open door’ policy by
encouraging vertical and horizontal interaction and flow of
ideas
Leaders have to develop open and measurable criteria for
selection and rewarding the best worker, team and
department
SASE needs to be rolled over to all staff of the Ministry as
they all contribute to the Ministry’s success, and to service
delivery
Leaders have to find other financial and non-financial
incentives beyond SASE be introduced e.g. accelerated
promotions, letters of recognition, honoraria, etc
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Ministry of Finance: Medium Term Strategic Plan: 2004 - 2009
32
Criterion
2 Policy and
Strategy
3. People
Sub-criterion
(a) Policy and Strategy are
based on information
from performance
measurement,
research, learning and
creativity related
activities
(a) People resources are
planned, managed and
improved
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(b) People’s knowledge
and competencies are
identified, developed
and sustained.
4 Partnership and
Resources
(a) Technology is managed
(b) Information and
knowledge are
managed
6 Customer
Results
(a) Perception Measures
Vital Area for Improvement
To increase staff and capacity at the Policy Department and
Planning Unit to conduct research
Leadership needs to change its mindset toward scientific
management approach
Need to include the wider involvement of stakeholders in
policy development and implementation
Need to conduct reviews of policy and strategy, regularly
Formulation of clear and well elaborated motivational and
incentive scheme
Institute effective feedback mechanism and feedback
systems from workers
Prepare a training programme that is practical, and that can
be successfully implemented – make the implementation of
the training plan a priority
Need for regular assessment of employees morale
Ensure timely promotions
Provide conducive working environment for staff
Train staff on customer care
Review scheme of service (those that are in place)
Urgent Actions – Quick Wins
 Provide Customer care training for frontline staff,
receptionists, accountants in pension department, drivers
and telephone operators
 Provide intrinsic and extrinsic motivators and incentive
schemes for workers / employees (conducive working
environment, transport, loans to staff, land for building
houses)
 Regular review of Training Needs Assessment for our
organization’s people (staff included)
 Evaluation of the impact of training received by our
employees
 Creation of a conducive environment to sustain ably
improve retention of our People
 Need to create and adopt a human resource Development
Plan
 Allocation of more funds for training
 Immediate implementation of the new Public Service Act
 Intensify the use of IT in the Ministry
 Fully utilize the capacity of the IFMS
 ICT and security strategy urgently need to be developed
 Apply the revised review of Budget Performance Report
presentation format
 Ensure timely annual meetings of the Workers Council
 Improve the quality of assessment reports and feedback
 Review of IFMS is required
 Put in place planned reviews and standards of measurement
of Data Security and password control
 Need to build user capacity in IT among many employees
 The Ministry needs to know its customers perceptions
regarding the Ministry and its services, by conducting a
customer survey, and by installing a monitoring mechanism
that record customer complaints and feedback
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Ministry of Finance: Medium Term Strategic Plan: 2004 - 2009
33
Criterion
7 People Results
Sub-criterion
(a) Perception Measures



9. Key
Performance
Results
(a) Performance Indicators


Vital Area for Improvement
Need to put in place formal employee survey system
Review and improve the criteria on selection of Best
Worker awards
Establish a system for obtaining employees feedback on the
organization
Urgent rollover of IFMS to Regions and Councils
Establish mechanism for periodic review of performance
indicators and publishing results for stakeholder
consumption
2.5.1.1 Quick Wins
As part of an internal assessment and an overall assessment of the people, systems and
procedures, the Ministry of Finance Senior Management Group identified a number of areas
that if some steps are taken to improve them a major impact is going to be felt by the clients.
The areas identified are stipulated hereunder:
(i)
Customer Care for Frontline Staff and Staff in the Pension Department
Ministry of Finance has a lot of visitors of various nationalities visiting the Ministry Offices
every day. One area that has been noted as not giving a good impression is the procedure and
the attitude of staff receiving visitors at the Ministry Headquarters. Also, the accountants at
the Pension Department do receive a large number of pensioners who visit the offices daily to
follow up on their dues. In order to address the weaknesses identified in these areas, the
Ministry will conduct a customer care training to the frontline staff, telephone operators and
accountants in the pension department to improve their customer care skills but also we will
review the system used for receiving visitors and improve on the telephone system to ensure
that our clients visiting and/or calling the Ministry do receive high quality services.
(ii)
Staff Motivation
Another area that the was identified as a potential area for quick win is the introduction of
intrinsic and extrinsic motivators and incentive schemes for workers/employees such as
conducive working environment, transport, loans to staff and land for building houses.
(iii)
Disposal of Government Assets
The current procedures for disposal of Government [mainly obsolete] assets are too long and
cumbersome such that it takes quite a long time to dispose off Government assets. In practice
therefore, by the time these items are disposed of, they have so deteriorated that there is
hardly any residual value left. The Ministry will therefore review the procedures and
streamline them to reduce the time taken to dispose off the assets without compromising
control aspects.
(iv)
Guidelines for the Preparation of the Medium Term Expenditure Framework
When the MTEF process started, the Ministry prepared a set of guidelines and forms that the
MDAs use for the preparation of their Medium Term Expenditure Framework. However,
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34
Ministry of Finance: Medium Term Strategic Plan: 2004 - 2009
over time the MDAs and other stakeholders provided comments that the forms are too
numerous, and some of them are not necessarily used by them once they have been filled.
The Ministry of Finance will look at the procedures and assess to what extent we can
streamline this procedures to ease the work of the MDAs but also ensure that we obtain all
the relevant information needed from them.
2.5.2
External Environmental Assessment
In assessing the external environment, the Ministry used two key methods; undertaking a
service delivery survey and conducting and external environment scan. The objectives of the
Service Delivery Survey were threefold; to inform this strategic planning process by
providing opinions on how best the Ministry may deliver its services and assessing
performance of the ministry in particular issues, to provide information that may be used to
review the client service charter and finally to provide data and information that may be used
to benchmark future performance improvements. External Environment Scan aimed at
identifying the various forces in the external environment and list the opportunities and
challenges posed by those forces. Below are the key findings of these two components of the
external environment scan.
2.5.3
Findings of Service Delivery Survey
The key findings arising out of the survey are structured along the way the lines of the
questionnaire. They cover policy perceptions, service delivery options and the assessment of
service delivery.
Policy Perceptions

Awareness of the existence of the strategic plan is fairly high as 70% of respondents
from the public service were aware of it and from the private/civil society 53% were
aware. Unlike the strategic plan, awareness of the service charter was lower. Forty
nine per cent of those in the public service knew about the service charter while 18%
from the private /civil society knew about it.

Awareness was of both documents were high among those in the Ministry, LGA for
public service respondents and Financial services, Business and Development partners
for private and civil society.
Service Delivery Options
Findings in this section indicate the direction to be taken by the Ministry to improve its
services to its clientele.

The process of strengthening financial control to ensure effective use of funds could
be further enhanced if managers could be given the flexibility to determine the skill
mix of staff required to help them deliver on their performance obligations as per the
MTEF budget.

Institutionalization of stakeholder participation should either be in the budget process
could be achieved by involving them in the process of allocating funds within the
sector and verifying that the contents of the MTEF are based on the sector strategic
plans or by organizing budget hearings and formal consultations with identifiable
private / civil society organizations and passing on the insights gained to the sector
ministries through budget guidelines.
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Ministry of Finance: Medium Term Strategic Plan: 2004 - 2009

The strategic plan can be linked to the MTEF budget through the introduction of a
Development Action Plan Format consistent with the MTEF format. This format
should accompany the MTEF budget and the Ministry should ensure consistency
between the two by reviewing estimates.

Fiscal incentives that will enhance profitability and growth will be a reduction of
corporate taxes.

Suggestions made to improve the methodology for preparing the budget guidelines
are that regional planning officers /stakeholders should be involved in the process,
formats should be simplified, budget ceilings should be made realistic and guidelines
should be provided on time

To remove ghost workers from the payroll, regular census of staff should be carried
out, payments should be effected through the banks, payroll should be computerized
and there should be the regular updating of payrolls.
2.5.4
Assessment Of Service Delivery

In budget management the Ministry is not switching expenditure or using insights
from sector reviews and knowledge of the sector best practices to advise sector on
programme impacts, effectiveness of programme delivery e.g. It is also not providing
advice to sector Ministries to prioritize MTEF budget programmes in such a way that
reduction in planned allocations will lead to cancellations of specific programmes not
an across the board cut in every programme with the consequent result on non
completion of every programme.

The relationship between development partners and the Ministry could be
strengthened by increasing the involvement of partners in the planning, development,
budgeting and monitoring process of the Ministry.

Tax disputes could be minimized if the tax system could be reviewed, TRA could be
objective in their assessment and better monitory systems could be institutionalized.

Government could establish specific banks to finance activities of the agriculture
sector, corporate farmers unions could be established and guarantee schemes
introduced.

On a corruption point scale of 1 to 5 with 1 being least corrupt and 5 most corrupt
most respondents rated the Ministry between 1 and 3 indicating that some level of
corruption is perceived to exist in the Ministry. This perceived corruption is however
on the lower end of the scale.
2.5.5
Key Issues from the Survey
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Ministry of Finance: Medium Term Strategic Plan: 2004 - 2009
36
The issues to emerge here will be deduced from the impact of the survey on aspects of the
strategic plan of the Ministry. The discussions cover 5 of the 13 Kris in the Ministry’s
strategic plan. The Kris left out are not directly or materially impacted by the survey
outcomes.
Macro-economic stability
Aspects of the initiatives under this KRA is to enhance the growth of the private / productive
sector. Some outcomes of the surveys provide insights as to what stakeholders want in the
form of fiscal policy to enhance the growth of the private sector.
The survey results reveal the preferences of the respondents with respect to the use of fiscal/
financial incentives in support of the productive sector. The revealed preference in order of
relative importance: (I) reduction in corporate tax (ii) government guarantees for loans
(14%); customs exemptions (13%); input tax incentives (8%) and subsidies on interest
payments (7%)
Support to the agricultural sector is key to the growth of the productive sector. The survey
suggests some policy options which the ministry could pursue in an attempt to influence
financial institutions to increase their lending to the agricultural sector. These in order of
relative importance include (i) Setting up of a Government sponsored Bank to finance the
agricultural sector (ii) setting up of a cooperative farmers bank (iii) provision of agricultural
credit guarantee schemes (iv) strengthening of farmers associations for funds mobilization
(v) subsidizing interest on loans to farmers (vi) provision of export guarantee scheme etc.
What can be done within this KRA will be (i) to pursue stakeholder consultations to develop
a menu of financial policies to influence financial institutions in support of the agricultural
sector within the framework of the preference options revealed by the survey.
Public Accountability and Financial Management
An aspect of the survey results focus on removal of ghost names on the public sector payroll,
which falls under financial accountability. Suggestions for the removal of ghost names or
measures to ensure the elimination of the practice of retention of ghost workers include in
order of importance (i) making staff census a regular feature (19%); (ii) payment of staff
through a bank (13%); (iii) computerization of the payroll system (10%); holding ministry
heads accountable for existence of ghost names (5%); regular update of staff list (5%), etc.
What the survey results provide is a list of actions which could be pursued by the ministry in
an attempt to minimize or eliminate the ghost names practice. What could be required of this
KRA is to (i) develop a framework with these suggested actions as inputs which could
provide systematic efforts to fight the element of ghost names on a continuous basis.
Information Advocacy and Dialogue
The key objectives under this area include sharing information with stakeholders as means of
broadening participation in the budgetary process; ensuring that MDAs have realistic MTEF
budgets in place etc. Aspects of the survey outcomes provide insights for designing
strategies for their implementation.
The survey results reveal that the preference for stakeholder participation in the budgetary
process entail the following (i) organizing budget hearings (ii) inviting stakeholders of every
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Ministry of Finance: Medium Term Strategic Plan: 2004 - 2009
37
sector ministry to participate in the hearings and (iii) passing on the insights gained to the
sector ministries in the form of budget guidelines.
Other specific roles which the NGOs/ private sector stakeholders etc can play in the
budgetary process in order of importance as per the survey are (i) seeking ideas from
identifiable groups on budget processes and priorities (37%) (ii) Ensuring the participation
of stakeholders in the strategic plans of sector ministries upon which the MTEF budgets are
prepared (20%) and (iii) organizing public fora for ideas solicitation.
Management and Control of Government Budget
Some of the survey outcomes provide information which can lead to budget implementation
effectiveness an area which could be of concern to this area which currently concerns itself
on budget methodology.
About a quarter of the respondents, mostly Public Servants opine that the budgetary control
process should (i) set allocations for sector ministries and (ii) give authority to sectors to
make allocations within their sector. This suggestion is in line with Government’ s
decentralization policy. The ministry could (i) develop the framework for financial
decentralization to sector ministries based on the above suggestion.
Those who have had the chance to use the budget guidelines of the ministry indicate the
following which need to be addressed so that the effectiveness of the budgetary process could
be improved. These are in order of importance (i) involvement of Regional Planning Offices
in the budgetary process (ii) timely provision of guidelines (iii) alignment of budget ceilings
to outputs (iii) simplification of the MTEF format to make it user friendly (iv) budget
guidelines should be consolidated and issued from one source (v) zonal budget guidelines
should be introduced etc. To enhance the effectiveness of the budgetary process, this KRA
could include addressing of these concerns as part of its activity under (i) a framework for
enhancing the budgetary preparation process.
Impartial and fair determination of tax appeals
The goal of this area is to ensure speedy disposal of registered tax disputes. The survey
results provide some information which could help in the minimization of the occurrence of
tax disputes.
These suggestions in order of importance could be addressed under this area: (i) identification
of the current sources of conflict as a basis for reviewing tax laws (ii) enhancing the level of
objectivity in the assessment process (iii) expanding tax education (iv) improving the
accuracy in categorization of tax payers (v) reducing the number of types of taxes (vi)
improving the monitoring mechanisms in the collection of taxes.
What could be expected of the ministry is to (i) develop and implement a framework for
minimizing tax disputes in addition to the initiatives envisaged under this area.
The External Environment Scan
Opportunities and Threats

Opportunities
Anti Corruption Strategy in place

Threats
Low GDP growth rate
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Ministry of Finance: Medium Term Strategic Plan: 2004 - 2009
38

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Vision 2025
TAS
PSRP
Non Public Service Act
O & E reviews
PRSP
Performance Management System
Public Management and Employment of Policy
Record Management Project
EMS
Current initiatives on the financial and
parastatal sector reform
On going job evaluation and regarding exercise
On going pay policy reform including LOC
packages
Introduction of Performance Improvement Fund
Customer satisfaction surveys.
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2.6
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Low revenue effort
Misuse of public finances and property
Macro-economic instability
Inadequate financial resources
A heavy debt burden
Strong donor dependency
High incidence of poverty
High rates of unemployment in public and
private sectors.
Staff poorly remunerated
Inefficient tax administration system
An unattractive investment climate
In adequate communication and coordination between and across sectors
General erosion of public service ethics
Policies and strategies characterized by
parallelism and contradiction limited
stakeholder participation in policy strategy
development
Critical Issues
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Macro economic stability
Coordination
High donor dependence
o Lack of information on Donor support to NGOs/ communities
o Capturing of Donor support for projects in government budget
Debt levels
Poverty incidence
Narrow tax base
Tax evasion
Low staff morale
HIV/AIDS pandemic
Corruption
Performance monitoring
Budget monitoring
3.0
VISION, MISSION AND VALUES
3.1
Vision
High economic growth and macro-economic stability, sound financial management and
accountability achieved and sustained.
3.2
Mission
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Ministry of Finance: Medium Term Strategic Plan: 2004 - 2009
39
The mission of the Ministry of Finance is to achieve and maintain high economic growth,
macro-economic stability, sound financial management through development of robust fiscal
and monetary policies and enhancing professionalism and promote the use of Information
Technology (IT)
3.3
Values
-
Innovativeness
Professionalism
Customer focused
Commitment to work
Efficiency
Participatory management
Teamwork
Timely service delivery
Integrity
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Ministry of Finance: Medium Term Strategic Plan: 2004 - 2009
40
4.0
THE PLAN
In carrying out its functions as discussed earlier and guided by its vision and mission, the
Ministry has identified seven main key results areas with objectives, strategies and key
performance indicators. The Strategic Plan Matrix summary the Plan and an outline is
provided hereunder:
KEY RESULTS AREA 1: STABLE MACRO-ECONOMIC AND GROWTH AND
DEVELOPMENT
KEY PERFORMANCE INDICATORS (OUTCOME INDICATORS)
- GDP Growth Rate.
- Rate of inflation.
- Rate of current Budget Deficit.
- Amount of Foreign Reserves.
- Size of Trade Balance.
- Percentage of the National Debt.
- Revenue Collection as a percentage of GDP.
Strategic Objective 1:
Reduce inflation from 5% in 2004 to 4% by 2009.
In order for the Ministry of Finance to maintain a steady GDP growth rate, there shall be a
need to continue implementing measure aimed at reducing inflation rate from the current rate
of about 5% to 4% in the year 2009.
Strategies:
- Control of money supply.
- Control Budget Deficit.
Expected outputs will be:
- Money supply growth maintained at 10 percent of total budget.
- Maintain budget deficit before grant not exceeding 14% of total budget.
Strategic Objective 2:
To raise GDP growth rate from 6.3% in 2004 to 8% by
2007
In order for the Ministry of Finance to maintain a steady GDP growth rate, there shall be a
need to continue implementing measure aimed at stimulating and sustaining economic
growth. MOF will strive to increase the current GDP growth rate from an average of 5%
currently attained to 10% by the year 2009.
Strategies:
- Implementation of Micro – Finance Policies.
- Develop and implementation of policies to promote private sector financing.
- Enhance resource allocation to priority sectors.
- Develop a total quality management (TQM) plan for implementation of micro-finance
policies.
Expected outputs will be:
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Ministry of Finance: Medium Term Strategic Plan: 2004 - 2009
41
-
Enhance small and medium enterprises (SME) guarantee schemes from 500 million to
2004 to 5 billion in 2009.
Policy for private sector financing in place by 2005.
Maintain resource allocation to priority sectors against the budget.
Strategic Objective 3:
To reduce debt stock from 90% of domestic revenue in 2004
to 70% by 2009
The heavy debt burden is one of the causes of macro economic instability and reduced
provision of social services in the country. The Ministry will therefore strive to reduce the
debt burden of the Country.
Strategy:
- Implement the National Debt Strategy.
Expected outputs will be:
- Debt relief negotiations with the remaining Paris Club creditor countries and nonParis Club creditor countries concluded by 2009.
- Quarterly debt management committees meetings held.
Strategic Objective 4:
To increase foreign reserve from 8.5 months of imports in
2004 to 13 months by 2009
To ensure macro economic stability and mitigate impacts of external shocks to the economy,
it is important that a country maintains adequate foreign exchange reserves. The country has
succeeded to increase the foreign reserve level from only three months of exports few years
ago to the 8.5 months of exports in 2004. The Ministry will strive to ensure that the level is
increased to at least 13 months of exports by the year 2009.
Strategies:
- Management of foreign Exchange.
- Implement Fiscal measures.
Expected outputs will be:
- Monthly monetary policy committee meetings held.
- Pre budget task force consultative meetings held annually.
Strategic Objective 5:
To raise revenue collection from 13% of GDP in 2004 to
17% GDP by 2009
Revenue collection in Tanzania has substantially increased from an average of TSh. 25 bn per
month in the year 1995/96 to TSh. 104 bn per month in 2004. However, as a percentage of
GDP, revenue collection in Tanzania is still low compared to our neighbours, Kenya and
Uganda. While Tanzania has reached an average rate of 13% in 2004, our neighbours are
within the range of 18.5% to 25%. The Ministry therefore targets to increase our revenue
collection as a percentage of GDP to 17% in the year 2009.
Strategies:
- Implement Tax Reforms to broaden the tax base.
- Improve the investment climate.
- Promote Tax Payment culture.
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Ministry of Finance: Medium Term Strategic Plan: 2004 - 2009
42
-
Review collection mechanisms and tax rates.
Review incentives for TRA Staff and other Revenue agents.
Expected outputs will be:
- The tax base broadened by 2009.
- Tax Payer education program regularly conducted by 2007.
- Task force on tax reform consultative meetings held yearly by 2006.
- Situational analysis study on TRA’s operations carried out by 2007.
- Legislations regarding investment climate reviewed by 2007.
- Collection mechanism in place and tax rates reviewed by 2008.
Strategic Objective 6:
To ensure sustainable intergovernmental and interstate
fiscal and monetary relations by 2009
The United Republic of Tanzania comprises of two Governments, The United Republic
Government and that of the Government of Zanzibar. The URT also has a role and
obligations as part of a member of the regional bodies to which it is a member. There is
therefore a need to ensure relations are harmonious in fiscal and monetary issues. The
Ministry therefore aims at ensuring sustainable intergovernmental and interstate fiscal and
monetary relations Local Government Authorities financing framework inclusive.
Strategies:
- Strengthen the Joint Finance Commission (JFC).
- Strengthen capacity in handling internal, regional and international co-operation
matters.
- Strengthen Anti-money laundering activities.
Expected outputs will be:
- A proper organization structure for JFC created by December 2004.
- Capacity building in CPAD, DLS, DSV and CEF on SADC, EAC and other regional
arrangement matters.
- Anti-money laundering laws, regulations and other related acts reviewed by 2009.
- Meetings to transact routine and special matters held by 2009.
- All committee members trained by 2009.
- Local Government Authorities financing framework improved by 2009.
KEY RESULTS AREA 2: FINANCIAL MANAGEMENT AND ACCOUNTABILITY
KEY PERFORMANCE INDICATORS
- Level of pilferage of Government funds.
- Number of ghost workers in Government payroll.
- Number of audit queries in financial reports.
- Level of compliance to Public Finance and Procurement Acts.
STRATEGIC OBJECTIVES/MTEF TARGETS
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Ministry of Finance: Medium Term Strategic Plan: 2004 - 2009
43
Strategic Objective 7:
To enhance efficiency transparency and accountability of
public funds annually by 2009
Increasing accountability and transparency of public funds is a very important aspect towards
improvement management of public finance.
The Ministry shall ensure that full
accountability of public finance becomes a priority in all MDAs. The Ministry will also
ensure that all financial statements/reports are prepared and availed to MDAs in time. On the
other hand, to enhance transparency and accountability in the utilization of public funds, it is
important that stakeholders participate in the various processes that are being used to review
and assess expenditure of public finances. One such process is the Public Expenditure
Review that does a thorough review of the expenditure of public funds in a financial year,
compare it with allocations and priorities, assessing the impacts or outcomes of the spending.
It is therefore important that stakeholders are able to fully participate in this process and for
that reason the Ministry will put emphasis on promoting that. Also public financial
management is a continuous process that undergoes evolution whereby new best practices
come around every day. The Ministry will therefore ensure that it promotes best practices in
public financial management both within the Ministry itself and in all the MDAS. As part of
public financial management process, accounting of non-tax revenue is important therefore
the Ministry shall ensure that the accounts are reconciled timely by the end of each month.
The key component of a financial management system is the controls that are put to ensure
appropriate utilization of the funds. The MoF will ensure that appropriate controls are put in
place to ensure effective use of public funds. To achieve this objective, the Ministry shall
undertake the following strategies which are expected to provide a set of outputs listed
thereafter.
Strategies:
- Manage the Government accounting system.
- Conduct annual public expenditure review Sessions.
- Review the legal and regulatory for control, accounting, auditing and reporting.
- Management of Non Tax Revenue collected.
Expected outputs will be:
- All national loan agreements computerized by 2009.
- MDAs receive cheques within 24 hours of voucher list submission by 2009.
- Government accounts are timely reconciled by the end of each month.
- To extend sustain and maintain a secure, timely and efficient computerized
Government accounting and financial management system to all MDAs and local
authorities by 2005.
- To ensure public accountability and timely release of financial statements reports by
2009.
- To extend, sustain and maintain a secure timely efficient computerized Government
Accounting and Financial Management System to all MDAs by 2009.
- To review Public Finance Act and its Regulations for control, management and
utilization of government resources.
- To develop human resource capacity and promote MIS for improved public service
delivery by 2009.
- To establish Government financial reconciliation systems by 2009.
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Ministry of Finance: Medium Term Strategic Plan: 2004 - 2009
44
-
To monitor, analyze, control and give directives to MDAs regarding vote accounts
appropriateness and accuracy and insure all audit queries are properly replied by 2009
To prepare financial reports and allied statements to be submitted CAG on 31st
October yearly up to 2007.
Replies to audit queries management Audit, letter at Final Audit Report are made.
Bank reconciliation statements and allied adjustment for non-tax revenue account are
prepared monthly up to 2007.
Flash reports for non tax revenue account are prepared monthly to 2007.
Strategic Objective 8:
To manage and achieve profitability in all public
enterprises annually and oversee economic usage of
resources in Government institutions (Executive Agencies)
by 2009
Although most of the former Government owned enterprises have been privatized, some of
the Government Institutions have been turned into Executive Agencies and in some
privatized firms, the Government still maintains a shareholding, sometimes even a majority
shareholding. It is therefore important, on behalf of the Government, to oversee that
Government investments are being effectively and economically utilized.
Strategies:
- Establish a modern system of maintaining appropriate records and statement on
government investments shares.
- Monitoring of Government interests in Public Enterprises/Executive Agencies.
- Restructuring of non-profitable enterprises.
Expected outputs will be:
- To update, Computerize and maintain the treasury registrar investment register by
2007.
- To analyse financial statements and other reports and prepare company status report
annually.
- Maintain records of Government revenue generated from investments/interests
annually.
- Maintain Government loans and guarantee register quarterly.
- Publicize identified Government investments for divestiture quarterly.
- To formulate circulars to various TR scheduled activities for executive agencies and
public enterprises annually.
- Review and audit of management contracts annually.
- Attend all Annual General Meetings.
- To advise on disposal of government shares/interests annually.
- To process necessary approvals for the envisaged divestitures power of Attorney by
2007.
Strategic Objective 9:
To facilitate compliance for Public Finance Regulation 2001
and Public Procurement Regulations for effective and
efficient procurement, management and disposal of
Government assets by all MDAs annually by 2009
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Ministry of Finance: Medium Term Strategic Plan: 2004 - 2009
45
In the year 2001, the Government, through the Ministry of Finance, introduced Public
Finance and Public Procurement Acts which aim at guiding financial management and
procurement in the country. However, compliance to the Acts and Regulations has been
rather slow mainly due to lack of understanding by the MDAs on the Acts. An area that
seems to suffer a lot from non-full-compliance situation is the that of procurement,
management and disposal of Government Assets. The Ministry therefore will put effort to
ensure compliance of the regulations especially in the area of procurement, management and
disposal of Government Assets.
- Conduct stock verification inspections.
- Facilitate appointment Boards of Survey.
- Identify Assets to be valued.
- Adhere to Court Orders.
- Check compliance to regulations.
- Attend to court.
Expected outputs will be:
- Stock verification/inspection in all MDAs carried out annually.
- Issuance of Guidelines Compliance to PFR 2001 and PPR 2001.
- Timely disposal of dormant/unserviceable and expired stocks annually.
- To have properly valued Governments assets in all Ministries by 2009.
- To provide legal advice on compensation claims and civil cases.
- To facilitate speedy Governments compliance to court orders and other
compensation claims annually.
- Compliance audits carried out annually.
To develop procurement capacity in all MDA’s and ensure
that all MDA’s carry out procurement in accordance with
public procurement act and its regulations by 2009
As noted earlier, since the introduction of PFA and PPA of 2001, compliance has not been as
high as expected mainly due to capacity of the MDAs to fully implement the requirements of
the Acts. The MoF will therefore put efforts in making sure that capacity is built within the
MDAs and that the whole new process is institutionalized within the MDAs as part of their
other processes.
Strategic Objective 10:
Strategies:
- Carry out procurement in accordance with Public Procurement Act and its
Regulations.
- Develop and institutionalize guidelines and procedures.
Expected outputs will be:
- To amend the PPA and relieve the CTB (PPRA) from the role of executing
procurement of all MDA’s.
- To review and propose amendments o PPA and its regulations.
- To guide and monitor all MDA’S in procurement procedures and practice by
2009.
- To establish and implement a system for checking and monitoring the
procurement processes (through consultant) of all MDA’s by 2009.
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Ministry of Finance: Medium Term Strategic Plan: 2004 - 2009
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To develop Procurement Capacity Building Strategy for the MDAs and ensure its
implementation.
To develop a Management Information System for Monitoring and Evaluation of
all MDAs.
To enhance Procurement Audit and reduce Corruption in procurement to all
MDAs.
Strategic Objective 11:
To ensure timely availability of accurate and updated assets
and liabilities report annually
One of the areas that the Government experiences weaknesses is on the ability to manage and
report on Assets and Liabilities of the Government. During the planning period, the MoF
will put emphasis on ensuring that accurate and update assets and liabilities report is prepared
timely.
Strategies:
- Review the control system.
- Conduct timely Internal Audit.
Expected outputs will be:
- To review Internal Control System in order to reduce the number of Audit Queries
raised by CAG reduced by 50% from 2003 level by 2009.
- To carry out salary tracking to 25 ministries, 15 regions, and 30 District council
by 2006/07.
- To carry out normal and specialized Auditing to all MoF Department by 2009.
- To undertake Audit to All MDAs Executive Agency and Higher learning
institution to ensure optional utilization of Government funds.
- To undertake 100% vouching of both payments and receipts.
Strategic Objective 12:
To promote best practice in implementation of projects of
technical in nature by 2009
At any particular time, MDAs implement and supervise a lot of projects of various types for
and on behalf of the Government. Most of these projects are of technical nature and in many
cases the MDAs would need guidance on the best practices of how to implement those
projects. The Ministry will, during the planning period, promote best practices in the
implementation of those projects with technical nature.
Strategy:
- Carry out expenditure tracking, project inspection and technical audits.
Expected outputs will be:
- To carry out expenditure tracking to MDA’s, test audit to 24 Projects and detailed
audit to 12 on going/completed project by 2009 and issue corrections actions and
measures.
- To sublet 5 specialized assignment to technical consultant by 2009.
- To update expenditure records by preparing of 30 functional reports by 2009.
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Ministry of Finance: Medium Term Strategic Plan: 2004 - 2009
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Issue Guidelines on the best practice in the implementation of project of technical
nature.
KEY RESULTS AREA 3: RESOURCE MOBILISATION, ALLOCATION AND
UTILISATION
KEY PERFORMANCE INDICATORS
- Revenue collections as a percentage of GDP.
- Tax compliance rate.
- Number of tax disputes determined against the total.
Strategic Objective 13:
To have enhanced efficiency and transparency in resource
allocation by 2009
One of the major functions of the Ministry of Finance is to ensure adequate allocations of
resources to various sectors. To achieve that, it is important to attain and maintain efficiency
in the allocation of resources and for accountability purposes, transparency is paramount.
The Ministry during the planning period will, therefore, strive to enhance efficiency and
transparency in resource allocation.
Strategy:
- Timely drafting and distributing budget guidelines by December every year.
Expected outputs will be:
- To release on time budget guidelines with realistic ceilings by December.
- To develop performance budgeting indicators by 2007.
- To produce Government budget documents and submit to Parliament by June each
year.
- To monitor the implementation of the Government budget through reports,
expenditure tracking and project inspection.
- To strengthen the implementation of MTEF by all MDA’s by 2007.
- To manage Government wage bill.
- To prepare and process budget Adjustment by June each year.
- To facilitate disbursement of funds to MDAs for budget implementation.
Strategic Objective 14:
To improve MTEF processes in all MDAs and regions by
2009
Medium term expenditure framework is a key tool to enhance efficiency and transparency in
resource allocation. However, this process is still only carried out at the National level and
even there, the adequacy of the process varies from one Ministry to another. MoF will
therefore put efforts to improve MTEF processes in all MDAs and all the regions by 2009.
Strategy:
- To put in place budget management and analytical tools.
Expected outputs will be:
- To carry out GFS economic and functional classification by 2007.
- To develop MTEF Manual for use by MDAs in preparing MTEF Budgets by
2006.
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Ministry of Finance: Medium Term Strategic Plan: 2004 - 2009
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To establish gender gaps and gender sensitive indicators in the Budget by 2009.
Strategic Objective 15:
To propose enactment of tax laws and regulations which
are friendly to tax payers by 2009
A major source of Government revenue is tax. For that reason, strategies must be put in
place to increase tax revenue. One of the identified impediments to increasing tax revenue is
the legal and regulatory framework for tax collection whereby some tax laws are unfriendly
such that they motivate tax payers to evade or avoid paying taxes. The Ministry, therefore,
will propose enactment of tax laws and regulations that are friendly to tax payers.
Strategy:
- Timely review and provision of appropriate legal advice on tax legislation
annually.
Expected outputs will be:
- Identification of Legislations to be amended by May every year.
- Preparation of Finance Bill by June every year.
- Preparation of Government Notices (GNs).
Strategic Objective 16:
Impartial and timely disposal of tax disputes by 2009
Resolution of tax disputes is an important component for a good tax regime. Disposal of the
disputes has to be done fairly and timely. The Ministry will therefore put up a mechanism to
dispose off the disputes impartially and timely.
Strategies:
- Create awareness of tax laws to taxpayers.
- Harmonization of Tax Laws.
- Revision of the Tax Revenue Appeals Act 2000; and Rules 2001.
Expected outputs will be:
- Regular seminars and workshops for tax payers conducted.
- Identification of legislations to be amended.
- Each filed tax appeal be Determined within a period of three months.
Strategic Objective 17:
To conduct consultations with external partners
As part of strategies to increase resource availability to the Government Budget, the Ministry
will enhance consultations with external partners.
Strategy:
- Preparation and firming up of donors commitments by March every year.
Expected output will be:
- To Review existing agreements with external donors.
Strategic Objective 18:
To conduct physical verification and value for money audit
of goods and services delivered/acquired annually by 2009
In order to ensure proper utilization of resources, the Ministry of will be conducting physical
verification and value for money audit of goods and services delivered or acquired.
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Ministry of Finance: Medium Term Strategic Plan: 2004 - 2009
Strategy:
- To conduct site visits to MDAs.
The expected output will be:
- To undertake 24 visits to MDAs annually.
KEY RESULTS AREA 4: EFFICIENCY AND EFFECTIVENESS OF
INFORMATION SYSTEMS
KEY PERFORMANCE INDICATORS
- Number of MoF staff trained on IT.
- Number of Ministries capturing Payroll deduction.
- Pension Drafts production time.
- Number of competent IT MoF Team.
- Number of Stakeholders sensitised.
- MoF Stakeholders participation in Policy making and progress.
- Service delivery satisfaction.
- Number of complaints.
Strategic Objective 19:
To have computer literate MoF staff capable of utilizing the
ICT to the maximum
The Ministry of Finance has a role to ensure utilization of information and communication
technology for various uses within the Ministry and also within the Government. In order to
undertake this function adequately, the Ministry itself needs to have people who are well
versed and knowledgeable with ICT facilities. Currently the MoF staff are not using the
Information Technology tools to the maximum.
Strategies:
- Carry out training needs assessment (TNA).
- Prepare Training Programme.
- Implement Training Programme.
Expected output will be:
- TNA carried out by December 2004.
- Training programme prepared by March 2005.
- All MoF staff trained in IT as per Training Needs identified by 2009/10.
Strategic Objective 20:
To roll out the payroll online system for deduction data
capture to all Ministries by 2009/10
The Ministry has installed an online payroll system which has a capability to capture
deduction data for employees. If this system is properly installed in the Ministries, the
deduction data can be entered at the Ministries themselves instead of sending them to the
MoF for data entry. Currently, data entry has to be done in batch mode at the MoF Offices
which generates a lot of back logs. There is a need to facilitate MDAs to enter deduction data
straight into the system. During the planning period, the Ministry will therefore roll out this
system to all the Ministries by 2009/10.
Strategies:
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Ministry of Finance: Medium Term Strategic Plan: 2004 - 2009
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Upgrade the existing IT equipment.
Configure the MDAs work places for network connectivity.
Train staff on Payroll data entry.
The expected output will be:
- All MDAs capturing Payroll deduction data by 2009/10.
Strategic Objective 21:
Production of timely pensioners drafts (cheques) on the due
date by 2009/10
A major complaint of the pensioners is delayed receipt of their drafts/cheques. Pension Draft
are produced late thus creating complaints from Pensioners. The Ministry will, during the
planning period, ensure that this situation is arrested and that pensioners receive their cheques
on time.
Strategies:
- Establish up to date Database on employees record.
- Trained staff in Pension issues.
Expected outputs will be:
- To develop computer programme which includes draft number into the Pension
system by 2006/07.
- To enter into pension system up to date pension details for draft production in
September and May by 2006/07.
Strategic Objective 22:
To have competent professional staff team managing and
maintaining the ICT resources
As indicated earlier, the Ministry of Finance has the responsibility of ensuring that ICT
resources are effectively utilized by the MDAs to enhance efficiency and effectiveness. In
order to be able to do that, MoF needs to have competent professional team of staff that can
manage and maintain ICT resources.
Strategies:
- Identify the people to compose the team.
- Contract out major specialized onetime activities.
- Train the team.
- Assign the members of the to specific specialized duties.
Expected outputs will be:
- To set-up Help desk team of 4 IT staff by 2007.
- To train 10 IT professionals on short and long course by 2006/07.
- To have up to date Antivirus diagnostic tools and software by 2006/07.
Strategic Objective 23:
Information and Communication Technology (ICT) and
Data integrity security policy for MoF established by
2009/10
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Ministry of Finance: Medium Term Strategic Plan: 2004 - 2009
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Although ICT provides a lot of flexibility and enhances efficiency in Government operations,
if data is not well kept, there are a lot of physical and soft dangers facing data in a
computerized environment. In addition, in the absence of Policy on ICT malicious operations
cannot be prosecuted. To curb the dangers it is important that a common policy is formulated
and agreed up to ensure that MDAs abide to certain policies guiding integrity and security of
data.
Strategies:
- Raise awareness to stakeholders.
- Technical working group assign to form terms of reference (ToR).
- To engage a consultant to assist and guide the formulation exercise.
Expected outputs will be:
- To conduct three seminar to all stakeholders by 2006/07.
- To appoint a technical team.
- First policy draft produced by 2006/07.
- Approval of ICT policy drat in place.
Strategic Objective 24:
To produce accurate, reliable and timely payroll pay-slip by
2005/06
Timely payment of salaries is very key to ensuring that public servants are motivated. The
role of the Ministry of Finance to ensure that is the production of accurate, reliable and timely
payroll slips, currently the information displayed on the pay-slip is inaccurate and many
fields are lacking. For that reason the Ministry would like, during the planning period, to do
that.
Strategies:
- Train IT professional.
- Accurately fill data sheets.
Expected outputs will be:
- To prepare payroll GEPF monthly reports according to stakeholders needs up to
2005/06.
- Preparation of Lawson system maintenance contract by 2005/06.
- To incorporate Budget Division into Lawson system for quick excursion.
KEY RESULTS AREA 5: TO IMPROVE SOCIAL SECURITY BENEFITS AND
PENSION ADMINISTRATION
KEY PERFORMANCE INDICATORS
- Number of pensioners paid in time against the total.
- Pensioners/customer satisfaction rate.
- Number of social security benefits offered and amount paid.
- Quality of key information database on military staff and public servants.
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Ministry of Finance: Medium Term Strategic Plan: 2004 - 2009
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Strategic Objective 25:
To increase social security benefits and peg the minimum
pension at 50% of the minimum pay by the year 2009
Adequate and reliable retirement benefits of gratuity and pension are essential to ensure that
retired civil servants continue to lead a normal life after retirement. MOF in collaboration
with the Public Service Pension Fund will strive to improve and widen the retirement benefits
package and peg the minimum [cash] pension at 50% of the minimum wage, by the year
2009.
Strategies:
- Review the existing Pension policy.
- In collaboration with MLYDS, review the social security policy.
Expected outputs will be:
- A new pension policy in place by 2006.
- Inputs to the social security policy prepared by 2006.
- To review the pension Act and propose amendments.
Strategic Objective 26:
To widen the base of social security benefits by the year
2009
Adequate and reliable retirement benefits of gratuity and pension are essential to ensure that
retired civil servants continue to lead a normal life after retirement. MOF in collaboration
with the Public Service Pension Fund will strive to widen the retirement benefits package so
that it embraces more than just a cheque.
Strategies:
- Review the existing Pension policy.
- Review data on pensioners.
- Study alternative benefits that could be made available e.g. provision of medical
cover or loans to retirees, etc.
Expected outputs will be:
- List of Pensioners and their benefits.
- List of alternative extra benefits for pensioners.
Strategic Objective 27:
To ensure all retiring military staff, political leaders and
contract employees receive their terminal benefits on the
day of retirement by 2009
Timely processing of retirement benefits is another aspect important to pensioners. MoF will
endeavour to reduce to a minimum, time taken to process gratuities and pensions to all
retiring military staff and other public servants.
Strategies
- Institute up-to-date personnel records management system.
- Establish up-to-date records of all staff about to retire in collaboration with POPSM.
- Ensure timely processing of pension benefits.
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Ministry of Finance: Medium Term Strategic Plan: 2004 - 2009
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Train pension staff on customer focus.
Educate military staff and retiree servants on the retiring benefits and procedures.
Expected outputs will be:
- All military staff and other retirees’ records computerized by 2007.
- All retirees pension benefits processed before their retirement date by 2007.
- Training programme in place and operational by 2007.
- Sensitization programme in place by 2006.
- All retirees’ pension benefits processed before their actual retirement date by
2009.
Strategic Objective 28:
To ensure that all existing retired civil servants receive
their benefits timely on their due dates by 2007
Availing pensioners of their benefits when they fall due is a critical service to pensioners.
MoF will therefore ensure that all existing retired servants receive their benefits timely as
they fall due.
Strategies:
- Timely processing of benefits to have them ready on due date.
- Train Pensions Department staff on customer [pensioners] focus.
- Educate pensioners on their benefits and procedures.
KEY RESULTS AREA 6: MAINTAIN AND DEVELOP SUSTAINABLE HUMAN
RESOURCES CAPACITY TO ENSURE QUALITY
SERVICE DELIVERY TO THE PUBLIC
KEY PERFORMANCE INDICATORS (OUTCOME INDICATORS)
- Customer satisfaction rate.
- Gender Equity in place.
- Rate of HIV/AIDS transmission.
- Number of professional staff trained on new skills.
- Number of quick wins achieved.
Strategic Objective 28:
To strengthen transparent, merit-based recruitment,
promotion and disciplinary procedures among staff by 2008
For the Ministry to be able to perform efficiently and effectively, it is crucial that the human
resources in the Ministry be of high caliber. In order to have such people, the Ministry has to
have a strong, transparent, merit-based recruitment, promotion and disciplinary procedures
among the staff.
Strategies:
- Review existing procedures and schemes of services for different cadres under
MOF.
- Undertake recruitment, promotions and disciplinary procedures in compliance
with Public Service Act 2002 and Public Service Act Regulations 2003.
- Train administrative and Human Resources Management Development officers on
new procedures.
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Ministry of Finance: Medium Term Strategic Plan: 2004 - 2009
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Disseminate code of ethics and the new Public Service Act and its Regulations to
all staff.
Expected outputs will be:
- Revised schemes of service for all cadres under MOF by 2008.
- Vacant posts advertised and filled on merit by 2009.
- Performance, seniority and vacancies reviewed by 2009.
- Disciplinary actions taken for non-compliance with the Act and Regulations.
- Administrative and Human Resources officers trained in Public Service
Management Reforms by 2008.
- All MoF staff to be sensitized on code of ethics by 2008.
- Code of ethics, Public Service Act and Regulations made available to all MoF
staff by 2008.
Strategic Objective 29:
Raise the number and increase competence of professional
and technical staff by 2008
Having adequate numbers of skilled personnel is also a prerequisite for good performance.
The Ministry will therefore ensure that it has adequate numbers of skilled professional and
technical staff.
Strategies:
- Develop new professional, technological, managerial, negotiation, and analytical
and auditing skills.
- Contract and recruit consultants to supplement new or scarce skills.
Expected outputs will be:
- Professional staff trained on new skills by 2006.
- To train 6 staff in managerial skills abroad by 2007.
- To train 10 staff on Pension Management and Social Security skills by 2007.
- To train 10 staff on records management in coordination with Civil Service
Department by 2007.
- Contract consultants recruited by December 2007.
Strategic Objective 30: To ensure gender mainstreaming into MoF by 2009
Taking into account gender issues helps in bridging the current gap existing due to
gender. During the planning period, the Ministry will ensure that all the plans and
strategies incorporate a gender perspective.
Strategies:
- Develop MoF gender affirmative action plan in career development.
- Conduct gender Sensitization training for all MoF staff.
Expected outputs will be:
- Gender employment situation and response analysis prepared by 2005.
- Gender affirmative action plan in place by 2006.
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Ministry of Finance: Medium Term Strategic Plan: 2004 - 2009
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All staff sensitized on gender awareness by 2005.
Strategic Objective 31:
MoF Training Policy and Strategy Developed by 2005
For the Ministry to be able to train its staff adequately and fairly, there needs to be a policy
that guides training activities of the Ministry. The Ministry will therefore develop a training
policy and strategy by 2005.
Strategies:
- Training Needs Assessment.
- Develop comprehensive training programme.
Expected outputs will be:
- Training Needs Analysis report in place by 2006.
- Human resource development programmes in place by 2006.
- Tailor-made training developed.
- Managerial personnel receive IT training by 2009.
Strategic Objective 32:
To strengthen the implementation of the anti–corruption
strategy by 2005
The fight against corruption is a national campaign, whereby all the MDAs are supposed to
have in place strategies to curb corruption within the MDAs. MoF already has in place an
anti-corruption strategy but during the planning period, we will ensure that its
implementation is being strengthened.
Strategy:
- Review of the anti-corruption strategy.
Expected outputs will be:
- All staff sensitized on the anti–corruption strategy by 2005.
- Action plans for implementation of the anti-corruption strategy ready by end of
year 2005.
Strategic Objective 33:
To improve service delivery and reduce the transmission of
HIV/AIDS, and Mitigate its impact in MOF staff by 2008
HIV/AIDS is a national disaster whereby an increasing number of people are infected with
the virus and therefore suffer from or die of HIV/AIDS and related diseases. The Ministry
will make efforts to reduce transmission and mitigate the impact of HIV/AIDS within the
Ministry.
Strategies:
- Carry out HIV/AIDS Situation and Response Analysis Study.
- Mainstreaming HIV/AIDS into MOF Finance sector.
- Mainstream HIV/AIDS MOF.
- Enhance MOF capacity for effective response to HIV/AIDS.
Expected outputs will be:
- All staff sensitized on prevention of HIV/AIDS and control by 2006.
- HIV/AIDS responses mainstreamed in policy development and budgeting by 2005
- Care and treatment for PLWHA.
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Ministry of Finance: Medium Term Strategic Plan: 2004 - 2009
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Economic and social support to HIV/AIDS affected MOF employees.
Strategic Objective 34:
To continue reviewing the MoF’s Organization Structure
MoF will continuously undertake Organisational and Efficiency Review to determine areas
that it can improve its service delivery by reorganization of some sections, or contracting out
some functions which are non-core.
Strategies:
- Implement the job evaluation and staff re-grading exercise.
- Hive off, privatize or abolish all non-core functions.
Expected outputs will be:
- All staff to have clear job descriptions and non-overlapping of duties by 2006.
- All non-core functions in MoF hived-off and Contracted to PSP by 2006.
Strategic Objective 35:
To install Performance Improvement Management in MOF
by 2005
As part of the overall Public Service Reforms, the Ministry of Finance has adopted some
measures that are necessary to install a performance management system in the Ministry.
Some of the measures include the preparation of Five year Strategic Plan, Three Year Annual
Operational Plans and Performance Budgets, and one year Annual Action Plans. The
Ministry is committed to making this process a success and will therefore continuously
review the implementation of this process against the targets and take necessary corrective
measures, whenever necessary.
Strategies:
- Review MoF medium term strategic plan 2000 - 2004.
- Operationalise the Revised Strategic Plan 2004 - 2009.
Expected outputs will be:
- Strategic Plan reviewed after every five years.
- Operational plan (MTEF) prepared by June every year.
Strategic Objective 36:
To Review Client Service Charter annually
A client service charter is a commitment to our clients on the level and type of service
standards that they should be expecting from the MoF. It is a living document that needs to
be reviewed regularly and also implementation of the Ministry activities needs to be
compared against the targets set out in the Client Service Charter.
Strategies:
- Review the implementation of performance based remuneration and the Client
Service Charter.
- Review Customer satisfaction.
Expected outputs will be:
- Performance targets prepared by June 2005.
- Performance Agreements signed by June 2005.
- Conduct customer service delivery satisfaction survey 2005.
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Ministry of Finance: Medium Term Strategic Plan: 2004 - 2009
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Revised Client Service Charter by June 2005.
Strategic Objective 37:
To have an increased capacity of 10 accountants and 1
supporting staff by 2007
Training for the PAT staff has been as an important component of the overall achievement of
MoF objectives of better service delivery. This objective therefore aims at increasing
capacity of the PAT by training staff of the Department.
Strategies:
- Training and development of staff.
Expected outputs will be:
- To enhance both local and foreign Training; Continuous Professional Education
(CPE) to 10 staff yearly to the year 2007.
- To enhance skill and knowledge in computing for 3 members of the staff by
2004/05.
Strategic Objective 38:
To have a modern library which can accommodate up to
30,000 books with 350 sitting spaces from the present
capacity of having only 15,000 books with 40 sitting spaces
Strategy:
- Construction of IAA Modern Library.
Expected output will be:
- 40% of the library complex initially constructed by 2004/05.
Strategic Objective 39:
To have conducive working studying and living
environment within 3 Main Buildings and their allied staff
houses by 2006/07
Strategy:
- Renovation of existing structures.
Expected output will be:
- Rehabilitation of 3 IFM Main Building and staff houses by 2004/05.
Strategic Objective 40:
To have improved efficiency and effectiveness of the
information, Education and Communication Unit (IECU) by
equipping and providing administrative and personnel
services to staff by 2007
Expected outputs will be:
- To recruit communication strategist, News Analyst, and Media Management
expert, by December 2004.
- To recruit a policy marketing and branding expert for image and brand
managements.
- To recruit information Research and knowledge Management expert by June
2005.
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Ministry of Finance: Medium Term Strategic Plan: 2004 - 2009
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To train 10 officers locally and abroad in economic and financial journalism,
report writing, information and document management, speech writing, web-site
management and marketing and communication by 2007.
To acquire various office equipment and communication tools/facilities by June
2005.
KEY RESULTS AREA 7: EFFECTIVE CONSULTATIONS AND
COMMUNICATION WITH MOF STAKEHOLDERS
KEY PERFORMANCE INDICATORS
- % of MOF clients accessing information and participating in policy making.
- % of MOF clients satisfied with services delivery.
- Number of complaints received.
- % of the public with knowledge of MOF policies and programmes.
Strategic Objective 41:
To communicate MoF policies, programmes and rationale
and results achieved effectively, so as to enhance
transparency and accountability by 2007
In order to enhance transparency, accountability and good governance, MoF will be
communicating with stakeholders more effectively to disseminate the policies, programmes
and the results thereof. To increase awareness among stakeholders, information sharing with
all the MoF stakeholders is important. The Ministry will therefore improve information
sharing, advocacy and communication with all stakeholders.
Strategies:
- Engage a consultant to design the Communication Strategy.
- Conduct workshops for discussing and internalization of the draft strategy – MOF
top Management and staff.
- Execute MoF Communications Strategy.
- Produce Radio/Television Programs/Spots for promoting MOF policies and
results.
- Participate in Public Fairs and events e.g. DSM International Trade Fair and Nane
Nane.
- Produce and disseminate MOF publications -Treasury News Bulletin/Letter,
Posters, and Fliers, Banners, Calendars, Brochures regularly; and publish Feature
Articles on MOF.
- Create an effective mechanism for effective and efficient up-date of information
on MOF on Web-Site.
Expected outputs will be:
- Key issues, policies positions outlined and articulated for enhanced
macroeconomic management by June 2005.
- MoF Communications Strategy and Action Plan developed by August, 2005.
- Workshops conducted by July 2005.
- MoF Communications strategy published by September 2005.
- Sectoral and Ministerial papers for workshops, Seminars and Conferences coordinated by the Unit by 2009.
- Press conferences or briefings held regularly by 2009.
- Promotional programs developed and delivered by 2009.
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Ministry of Finance: Medium Term Strategic Plan: 2004 - 2009
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MoF participate yearly in fairs by 2009.
Various publications on MoF and Sectoral reforms, including regular HAZINA
News Bulletin/Letters produced by 2009.
MoF information on WebSite up-dated regularly by 2009.
To carry out assessment of stakeholders’ needs and their
perception of MoF policies and actions by 2009
To enhance stakeholders’ involvement in MoF activities, the Ministry will carry out an
assessment of stakeholder needs in various aspects and also receive feedback from them on
the effectiveness and adequacy of MoF policies and actions.
Strategic Objective 42:
Strategies:
- Devise an effective feedback mechanism from MoF stakeholders and services.
- Carry out communications research and analysis, and provide quality advice to
MoF policy analysts and top Management.
Expected outputs will be:
- Media scanning, monitoring and analysis conducted regularly to identify emerging
issues and brief the MoF top Management accordingly and prepare rapid
responses by 2009.
- Monitoring annually using methodical survey method, the perception of
stakeholders on MoF policies and service delivery by 2009.
- Pre-assessment of various policy opinions through systematic focus group
monitoring exercises carried out by 2009.
- Priority issues for research identified by December 2005.
Strategic Objective 44:
To build the capacity of the IEC Unit
Recently, a unit responsible for Information, Education and Communication has been
established within the Ministry and staffs have already been allocated. However, it is
appreciated that specialized skills are required to better manage the unit and its functions.
During the planning period, the Ministry will therefore put efforts in building capacity of the
Unit.
Strategies:
- Training needs assessment of the Unit carried out.
- Training of the IEC Unit staff to equip them with the required skills.
- Acquisition of necessary equipment and facilities by 2005.
Expected outputs will be:
- TNA carried out by July 2005.
- All IECU officers trained in long term and short courses, locally and abroad in
economic and financial journalism, communications management, report, &
speech writing skills, presentation skills, etc. by 2007.
- Various office equipment and facilities acquired by 2005.
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Ministry of Finance: Medium Term Strategic Plan: 2004 - 2009
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Ministry of Finance: Medium Term Strategic Plan: 2004 - 2009
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APPENDICES
KEY RESULTS AREA 1: STABLE MACRO-ECONOMIC GROWTH AND DEVELOPMENT
KEY PERFORMANCE INDICATORS (OUTCOME INDICATORS)
No.
1.
-
GDP Growth rate
-
Rate of inflation
-
Rate of current Budget Deficit
-
Amount of Foreign Reserves
-
Size of Trade Balance
-
Percentage of the National Debt
-
Revenue Collection as a percentage of GDP
Strategic Objectives
Reduce inflation from 5% in
2004 to 4% by 2009
Strategies
Control of money supply
Control Budget Deficit
2.
To raise GDP Growth rate
from 5% in 2004 to 10% by
2009
Implementation of MicroFinance Policies
Development and
implementation of policies to
promote private sector
financing
Service Delivery Target
Annual money supply growth maintained at 10%
by 2009
Output Indicators
% growth of money supply
against the target
Reduce budget deficit before grant from 15% in
2004 to 8% of GDP in 2009
Enhance small medium enterprises (SME)
guarantee schemes from 500 million in 2004 to 5
billion in 2009
Policy for private sector financing in place by
2005
% of budget deficit before grant
against the target
Actual level of credit scheme
against the target
Policy Document in place
Responsible
CPAD
CPAD
CPAD
Schemes established
Private sector financing guarantee of TSh. 100
billion schemes established by 2005 and
enhanced to TSh 500 billion by 2009
______________________________________________________________________
Ministry of Finance: Medium Term Strategic Plan: 2004 - 2009
62
No.
3.
4.
5.
6.
Strategic Objectives
To reduce debt burden from
Debt Stock of 90% GDP to
Debt stock of 70% GDP by
2007
Strategies
Enhance resource allocation to
priority sectors
Implement the National Debt
Management Strategy
Service Delivery Target
Maintain resource allocation to priority sectors
against the budget
Debt relief negotiations with the remaining two
Paris Club creditor countries and the remaining
seven non-Paris Club creditor countries carried
out by 2009
Quarterly debt management committees meeting
held
To increase Foreign Exchange
reserve from 8.5 months of
imports in 2004 to 13 months
of imports by 2009
Management of foreign
exchange
Monthly monetary policy committee meetings
held
Implement Fiscal measures
To raise Revenue Collection
from 13% of GDP in 2004 to
20% GDP by 2009
Implement Tax Reforms to
broaden the tax base
Promote Tax Payment culture
Pre budget task force consultative meetings held
annually
The tax broadened by 2009
To ensure sustainable
intergovernmental fiscal and
monetary relations by 2009
Review collection mechanisms
and tax rates
Review incentives for TRA
staff and other revenue agents
Improve the investment
climate
Strength the Joint 6.2 Finance
Commission (JFC)
Establish a sustainable
framework for LGAs
Strengthen capacity in
handling internal, regional and
international co-operation
matters
Tax Payer education regularly conducted by 2007
Collection mechanisms and tax rates reviewed by
2008
Situational analysis study on TRAs operations
carried out by 2007
Legislation regarding investment climate
reviewed by 2007
A proper organization structure for JFC created
by December 2004
Framework operationalised by 2007
Capacity Buildings in CPAD, DLS, DSV and
CEF on SADC, EAC and other regional
arrangements matters by 2007
Output Indicators
% of resource allocated to
priority sectors against the target
Number of debt relief
agreements concluded against
target
Responsible
CB
Number of Debt Management
Committees meetings per annum
against statutory requirement
Number of monetary policy
committee per month
Number and date of pre-budget
task force consultative meetings
CPAD
Tax measures in budget speech
CPAD
Number of TV/Radio programs
conducted
Review Report
PIO
Study report
CPAD
Reviewed Legislation
CPAD
An organization structure for
JFC in place by December 2004
JFC
Operationalisation of sustainable
framework
Number of staff attending
workshops, short courses and
seminars
______________________________________________________________________
Ministry of Finance: Medium Term Strategic Plan: 2004 - 2009
CPAD
ACGEN
CPAD
CB
CEF/STEF
63
No.
Strategic Objectives
Strategies
Strengthen Anti-money
laundering activities
Service Delivery Target
Anti-money laundering Laws Regulations and
other related acts reviewed by 2009
Establish a sustainable
framework for financing LGA
Operationalise framework by 2007
Output Indicators
Number of Anti-money
laundering Laws Regulations
and other related acts reviewed
by 2009
Number of indicators implied
with
______________________________________________________________________
Ministry of Finance: Medium Term Strategic Plan: 2004 - 2009
Responsible
DLS
CB
64
KEY RESULTS AREA 2: FINANCIAL MANAGEMENT AND ACCOUNTABILITY VFM
KEY PERFORMANCE INDICATORS (OUTCOME INDICATORS)
- Level of Pilferage of Government Funds
- Number of Ghost Workers in Government Payroll
- Number of Audit Queries on financial reports
- Level of Compliance to Public Finance and Procurement Acts
No.
7.
Strategic Objectives
To enhance efficiency
Transparency and
accountability of public
funds annually by 2009.
Strategies
Efficient Management of
Government Accounting system.
Conduct annual public
expenditure review Sessions
Service Delivery Target
All national loan agreements computerized by 2009
MDAs receive cheques within 24 hours of voucher
list submission by 2009.
Government accounts are reconciled by the end of
each month by 2006
A secure, timely and efficient computerized
Government Accounting and financial Management
System extended to all MDAs and Districts,
sustained and maintained by 2009
Review and evaluation performance of government
budget carried out quarterly.
Indicators
Computerized reports
Responsible
ACGEN
Number of registered
complaints from MDAs
Reconciliation report
ACGEN
Computerized Accounting
systems
ACGEN
PER Report
Review the legal and Regulatory
for control, accounting, Auditing
and reporting.
To ensure public accountability and timely release of
financial statements by 2009
Financial Statements
Ensure efficient computerized
accounting and financial
management system
To extend, sustain and maintain a secure, and
efficient computerized Government Accounting and
Financial Mgt System in all MDAs by 2009
Computerized Accounting
System
Review the Public Finance Act
and its regulations
To review Public Finance Act and its Regulations for
control, management and utilization of government
resources by 2009
______________________________________________________________________
Ministry of Finance: Medium Term Strategic Plan: 2004 - 2009
ACGEN
CB
DAD
CEF
ACGEN
Reviewed Act and
Regulations
ACGEN
DLS
65
No.
Strategic Objectives
Strategies
Service Delivery Target
Indicators
Responsible
Develop human resources
To develop human resource capacity and promote
MIS for improved public service delivery by 2009.
Number of trained
Government officers in
MIS
DCS
Monitor performance of MDAs
on vote accounts
To monitor, analyze, control and give direction to
MDAs regarding vote accounts appropriateness and
accuracy; and ensure all audit queries are properly
replied by 2009.
Circulars and Directives
ACGEN
Timely prepare financial reports
To prepare financial reports and Allied statements to
be submitted CAG on 31st October yearly by 2007.
Timely preparation of
Final Accounts
PAT
Timely replying to audit queries
Replies to Audit Queries management Audit, letter at
Final Audit Report timely and adequately made by
2007
Timely Replies to PAC
Reports
PAT/ACGEN
Manage Non Tax Revenue
collected.
Bank Reconciliation statements and allied adjustment
for non-tax Revenue account prepared monthly by
2007.
Bank Reconciliation
statement.
Flash Reports
PAT
Flash Reports for non-tax revenue account prepared
monthly by 2007.
______________________________________________________________________
Ministry of Finance: Medium Term Strategic Plan: 2004 - 2009
PAT
66
No.
8.
Strategic Objectives
Strategies
To manage and achieve
profitability in all public
enterprises annually and
oversee economic usage of
resources in Government
Institutions (Executive
Agencies).
Establish a modern system of
maintaining appropriate records
and statement on government
investments shares.
Service Delivery Target
Indicators
To update, Computerize and maintain the Treasury
Registrar investment register by 2009
Number of enterprises
captured in the data base.
To analyse financial statements and other reports
(MIR) and prepare company status report annually
by 2009
Number of financial
statements analysed.
Maintain records of Government Revenue generated
from investments/interests annually by 2009
Responsible
TR/ACGEN
Investments Register
Loans and Guarantee
Registers
Maintain physical Government Loans and guarantee
register quarterly by 2009
Monitoring of Government
interests in Public
Enterprises/Executive Agencies
Wage circulars to various TR scheduled activities
for executive Agencies formulated annually by
2009.
Circulars to various TR scheduled activities for
public enterprises formulated annually by 2009
Number of Circulars
Number of contracts
reviewed
Number of meetings
attended
TR
To advise on disposal of government shares/interests
annually by 2009
All Annual General Meetings attended by 2009
Management contracts Reviewed and audited
annually, by 2009
Restructuring of non-profitable
enterprises.
9.
To facilitate compliance to
Public Finance Regulations
2001 and Public
Procurement Regulations
Conduct stock verification
inspections
Necessary approvals for the envisaged divestitures
processed by 2009.
Stock verification/inspection in all MDAs carried out
annually by 2009
Number of restructured
enterprises
TR
No. of SV Reports
Number of guidelines
issued
DSV
ES-CTB
Issuance of Guidelines
______________________________________________________________________
Ministry of Finance: Medium Term Strategic Plan: 2004 - 2009
67
No.
Strategic Objectives
Strategies
2001 for effective and
efficient procurement,
management and disposal of
Government assets by all
MDAs annually.
Facilitate appointment of Boards
of Survey.
Service Delivery Target
Provide legal advise in compiling
claims and civil cases
Responsible
Timely disposal of dormant/unserviceable and
expired stocks annually by 2009
Number of disposal
reports
Formulation of Board rules in all Ministries by 2009.
All government assets
value reflected in public
accounts (CAG Reports)
ACGEN
DLS
Number of claims settled
DTAU/DSV
DLS
Identify Assets to be valued.
Adhere to Court Orders
Check compliance to regulations.
Indicators
Legal advice on compensation claims and civil cases
attended by 2009
Guidelines with respect to PFR and PPR, 2001 issued
by 2009
To facilitate speedy Governments compliance to
court orders and other compensation claims annually
by 2009
Number of claims & civil
cases process
Number of compliance
audits attended
Compliance audits carried out annually by 2009
10
To develop procurement
capacity in all MDA’s and
ensure that all MDA’s carry
out procurement in
accordance with public
procurement Act and its
Regulations by 2009.
Amend the PPA and its
regulations to relieve the CTB
(PPRA) from the role of
executing procurement of all
MDA’s.
PPA amended by 2005
Amended PPA
ESCTB/DLS
To guide and monitor all MDA’S
in procurement procedures and
practice
All MDAs abide to procurement procedures and
practice by 2009
Number of MDAs fully
abiding to PPA
ESCTB/DLS
Establish and implement a system
for checking and monitoring the
procurement processes of all
MDA’s
System established and operational by 2009
System in place
ESCTB/DLS
______________________________________________________________________
Ministry of Finance: Medium Term Strategic Plan: 2004 - 2009
68
No.
11
Strategic Objectives
Strategies
To ensure timely
availability of accurate and
updated Assets and
liabilities report annually by
2009
Service Delivery Target
Indicators
Responsible
Develop Procurement Capacity
Building Strategy for the MDAs
and ensure its implementation
Capacity Building Strategy developed by 2007
Strategies in place
Capacity building fully implemented by 2009
No. of MDAs participating
Develop a
Management Information System
for Monitoring and Evaluation of
all MDAs.
MIS for Monitoring and Evaluation installed in all
MDAs by 2009
MIS developed and in use
ESCTB/DLS
Enhance Procurement Audit and
reduce Corruption in procurement
to all MDAs.
Procurement Audits carried once a year in all MDAs
by 2009
Number of audits carried
out
ESCTB/DLS
Strategy for preventing corruption in procurement
developed in place by 2009
Number of reported
corruption cases
Establishment of Assets register
Asset Registration in place in 2009
Asset register
Establishment of liabilities
register
Liability register in place by 2009
Liabilities register
To have an effective internal
control system
To carry out normal and
specialized Auditing to all MoF
Department by 2009
Establishment of effective control system by 2009
100% vouching of both payments and receipts
undertaken.
ESCTB/DLS
DSV
System in place
ACGEN
Number of Departments in
which normal and
specialized audit has been
performed
CIA
No. of Audited vouchers
and receipts
______________________________________________________________________
Ministry of Finance: Medium Term Strategic Plan: 2004 - 2009
69
No.
Strategic Objectives
Strategies
Undertake salary tracking
12
To promote best practice in
implementation of Projects
of a technical nature by
2009.
Carry out expenditure tracking,
project inspection and technical
audits
Service Delivery Target
Indicators
Salary tracking to 25 ministries and 15 regions and
30 District council carried out by 2009
Expenditure tracking of MDA’s,
Test Audit of 24 Projects
Detailed audit of 12 on going/completed projects
carried out by 2009 and issue corrective actions and
measures.
Expenditure records updated by preparing 30
functional reports by 2009.
Guidelines on the best practice in the implementation
of project of technical nature issued yearly by 2009.
Number of Ministries,
regions and districts in
which salary tracking has
been performed.
CB/DCS
Number of MDAs/ projects
with Expenditure tracking
reports
DTAU
Tests conducted
Number of functional
reports against target
Guidelines issued
______________________________________________________________________
Ministry of Finance: Medium Term Strategic Plan: 2004 - 2009
Responsible
70
KEY RESULT AREA 3:
RESOURCE MOBILISATION, ALLOCATION AND UTILISATION
KEY PERFORMANCE INDICATORS (OUTCOME INDICATORS)
- Revenue collections as a percentage of GDP
- Tax compliance rate
- Number of Tax disputes determined against total
No.
13.
14.
Strategic Objectives
Strategies
To have enhanced
efficiency and transparency
in resource allocation by
2009
To improve MTEF
processes in all MDAs and
regions by 2009
Timely drafting and
distributing guidelines by
December every year
Put in place budget
management and analytical
tools
15.
Timely review & provision
of legal advise on tax
legislation annually
Review and amendment of
tax laws and regulation
16.
Impartial and timely
disposal of Tax disputes by
Create awareness of tax
laws to tax payers
Service Delivery Target
Output Indicators
Economic and financial data collection and analyzed
by October every year
Budget guidelines with realistic ceilings released by
December every year
Performance budgeting indicators developed by
2007
Government Budget Documents produced and
submitted to Parliament by June each year
The implementation of MTEF strengthen to all
MDAs by 2007
To manage Government wage Bill
To prepare and process Budget Adjustment by June
each year
GFS economic and functional classification carried
out by 2007
MTEF manual for use by MDAs in preparing MTEF
Budgets developed by 2006
Gender gaps and gender sensitive indicators
established in the Budget by 2007
Legislations to be amended & identified by May
every year
Finance bill prepared by June every year
Government Notices (GNS) prepared
Regular seminars and workshops to tax payers
conducted
Number of MDAs with budget
guidelines
Draft budget guidelines circulated
CB
Performance indicators in place
CB
Government Budget Documents
issued
Performance based budgeting in
place
Monthly wage bill reports
Approved re-allocation warrants
CB
CB
CB
GFS Classification codes
CB
MTEF Manual
CB
Gender gaps and gender sensitive
indicators
Number of Tax laws to be
amended
Finance Bills prepared in time
Number of GNS issued
Number of seminars and
workshop conducted on tax laws
CB
______________________________________________________________________
Ministry of Finance: Medium Term Strategic Plan: 2004 - 2009
Responsible
CB
CB
CB
DLS
TRAT
71
No.
Strategic Objectives
Strategies
2009
17.
Resource mobilization
allocation and utilization
18.
Financial Management and
accountability VFM
Service Delivery Target
Output Indicators
Responsible
Harmonization of Tax
Laws
Review of the Revenues
Laws as regards dispute
resolution annually
Legislations to be amended & identified yearly
Number of laws harmonized
DLS
Each filed tax appeal be determined within a period
of three months
TRAT
To review existing
agreements with external
donors
To promote best practice in
implementation of projects
of technical nature by
2006/09
Preparation and firming up of donors commitments
by March every year
Number of tax disputes
determined
Time taken to determine an appeal
against the target
Financial commitments by donors
Number of goods and services in
place
Number of reports
DTAU
Carry out expenditure tracking to 36 districts, test
audits to 24 projects and detailed audits to 12 on
going/completed projects by June 2009
Sublet 3 specialized assignments to technical
consultants by June 2009
Issue guidelines on the best practice in the
implementation of the project of technical nature by
June 2009
Prepare 4 quarterly Mid-Year Review and Annual
reports on MTEF performance budgets by 2006/9
Prepare a new MTEF budget and submit the same by
2006/9
______________________________________________________________________
Ministry of Finance: Medium Term Strategic Plan: 2004 - 2009
CEF
72
KEY RESULTS AREA 4: EFFICIENCY AND EFFECTIVENESS OF INFORMATION SYSTEMS
KEY PERFORMANCE INDICATORS (OUTCOME INDICATORS)
- Number of MoF staff trained on IT
- Number of Ministries capturing Payroll deduction
- Pension Drafts production time
- Number of competent IT MoF Team
- Number of Stakeholders sensitized
- MoF Stakeholders participation in Policy making and progress
- Service delivery satisfaction
- Number of complaints
No.
19.
20.
Strategic Objectives
To have computer literate MoF staff
capable of utilizing the ICT to the
maximum by 2009
To roll out the payroll online system
for deduction data capture to all
Ministries by 2009.
Strategies
Carry out training needs assessment
(TNA)
Prepare Human resource development
programme
Implement HR Development
Programme
Upgrade the existing IT equipment.
Service Delivery Target
TNA carried out by Dec 2005
Human Resource development
Programme prepared by June 2006.
All MoF staff trained in IT as per
Training Needs identified by
2009/10.
All MDAs capturing Payroll
deduction data by 2009.
Indicators
Responsible
TNA document indicating
breakdown of needs
HR Development plan
DAP/DCS
No. of staff trained on IT
against target
DAP/DCS
DAP/DCS
Number of MDAs able to
work online.
Configure the MDAs’ work places for
network connectivity.
DCS
Train staff on Payroll data entry.
21.
22.
Production of timely pensioners
drafts (cheques) on the due date by
2009.
Establish up to date Database on
employees record.
Train staff in Pension issues.
To have competent Professional
staff team managing and
Identify the people to compose the
team.
Database established by 2007
All relevant staff trained on pension
issues by 2007
Help desk team of 4 IT staff set-up
by 2007.
Database established
DCS/DoP
Number of staff trained
DCS/DoP
Help desk set up
DCS
______________________________________________________________________
Ministry of Finance: Medium Term Strategic Plan: 2004 - 2009
73
No.
Strategic Objectives
maintaining the ICT resources.
Strategies
Train the team.
Contract out major specialized onetime
activities
23.
24.
Information Communication
Technology (ICT) and Data
integrity security policy for MoF
Established by 2009.
Accurate, reliable and timely payroll
pay-slips produced by 2005/06.
Raise awareness to stakeholders
Assign Technical working group to
form terms of reference (ToR)
Engage a consultant to assist and guide
the formulation exercise.
Train IT professional
Ensure accurate filling of data sheets.
Service Delivery Target
Indicators
Responsible
10 IT professionals trained on short Number of IT professionals
and long course including on-thetrained against the target
job by 2007.
All one time activities contracted
Number of one time activities
out by 2009
contracted out
DCS/DAP
To conduct three seminar to all
stakeholders by 2007.
A technical team appointed by 2005
Numbers of stakeholder
sensitive
ToR in place
DCS/DAP
First policy draft produced by 2008
Policy document in place
DCS/DAP
Approval of ICT policy draft by
2009
All IT professional well trained on
payroll systems by 2006
Number of IT professionals
trained
DCS
% of data sheets with errors
DCS
All data sheets accurately filled by
2005
______________________________________________________________________
Ministry of Finance: Medium Term Strategic Plan: 2004 - 2009
DCS
DCS/DAP
74
KEY RESULTS AREA 5: TO IMPROVE SOCIAL SECURITY BENEFITS AND PENSION ADMINISTRATION
KEY PERFORMANCE INDICATORS (OUTCOME INDICATORS)
-
Number of pensioners paid in time against the total
Pensioners/customer satisfaction rate
Number of social security benefits offered and amount paid
Quality of key information database on military staff and public servants.
No.
Strategic Objectives
25.
To increase social security
benefits and peg the
minimum pension at 50% of
the minimum wage by the
year 2009.
Review the existing Pension policy.
A new pension policy in place by 2006.
Policy document in place.
ACGEN
In collaboration with MLYDS,
review the social security policy
Inputs to the social security policy prepared
by 2005.
Pension Act reviewed by 2006.
Proposed inputs prepared.
ACGEN
Reviewed Act in place
ACGEN
To widen the base of social
security benefits by the year
2009
To ensure all retiring
military staff, political
leaders and contract staff
receive their terminal
benefits on the day of
retirement by 2007.
Review data on pensioners.
Number of Pensioners and their benefits
determined.
Updated records in place.
ACGEN
Establish up-to-date records of
retirees in collaboration with POPSM.
Ensure timely processing of pension
benefits.
All military staff and retirees servants
records computerized by 2007.
Number of records.
ACGEN
All retirees pension benefits processed
before their retirement date by 2007.
Number of retirees receiving timely
pension.
ACGEN
Train pension staff on customer
focus.
Educate military staff and retiree
servants on the retiring benefits and
procedures.
Training programme in place and operational
by 2006.
Sensitization programme in place by 2006.
Number of personnel trained.
ACGEN
26.
27.
28
Strategies
To ensure that those already
on retirement receive their
benefits on the due dates
Ensure timely processing of pension
benefits
Service Delivery Target
All retirees benefits processed by the due
date by 2006
Output Indicators
Radio, Television programmes in
the air
Number of Booklets/
Leaflets/Brochures
Percentage of retirees receiving
their pensions on time
______________________________________________________________________
Ministry of Finance: Medium Term Strategic Plan: 2004 - 2009
Responsible
ACGEN
75
No.
Strategic Objectives
Strategies
Train Pension Department staff on
customer focus
Educate those about to retire and
retirees on the procedures for
processing benefits
Service Delivery Target
Training programme in place and operational
by 2007
Sensitization programme in place by 2006
Output Indicators
Responsible
Number of staff trained
ACGEN
Radio, Television
programmes/Advertisements aired
ACGEN
Number of booklets/
Leaflets/Brochures distributed
______________________________________________________________________
Ministry of Finance: Medium Term Strategic Plan: 2004 - 2009
76
KEY RESULTS AREA 6: MAINTAIN AND DEVELOP SUSTAINABLE HUMAN RESOURCES CAPACITY TO ENSURE
QUALITY SERVICE DELIVERY TO THE PUBLIC
KEY PERFORMANCE INDICATORS (OUTCOME INDICATORS)
- Customer satisfaction rate
- Level of Gender Equity
- Rate of HIV/AIDS Transmission
- Number of professional staff trained on new skills
- Number of quick wins achieved
- Number of MoF staff aware of communication policy and strategy
No
29
30
Strategic Objectives
To strengthen transparent,
meritocratic recruitment,
promotion and disciplinary
procedures among staff by
2008.
Raise the number and
increase competence of
professional and technical
staff by 2008.
Strategies
Review existing procedures and
schemes of services or cadres
under MoF.
Train administrative and Human
Resources Management
Development officers on new
procedures.
Disseminate code of ethics and the
new Public Service Act to all staff.
Develop new professional,
technological, managerial,
negotiation, and analytical and
auditing skills.
Services outputs delivery target
Revised schemes of service for all cadres under MoF by
2008.
Output indicators
Amended schemes of service.
Administrative and Human Resources officers trained in
Public Service Management Reforms by 2008.
No of Ad. & HRDM officers
trained in relevant fields.
DAP
All staff to be sensitized on code of ethics by 2008.
Number of staff sensitized on the
code of ethics against the total
Increased professional and
technical capacities.
DAP
All Professional staff trained on new skills by 2006
Responsible
DAP
DAP
6 staff trained in managerial skills abroad by 2007.
10 staff trained on Pension Management and social
security skills by 2007.
10 staff trained on records management in coordination
with Civil Service Department by 2007.
31
All Professionals Technical
staff have access to IT.
Contract and recruit consultants to
bring new scarce skills.
Contract consultants recruited by December 2007.
Number of consultants recruited
DAP
Prepare a retooling plan
A retooling plan in place by 2005.
Retooling plan implemented
DAP
______________________________________________________________________
Ministry of Finance: Medium Term Strategic Plan: 2004 - 2009
77
No
32
33
Strategic Objectives
(Computer, telephone and
adequate furnished office
space) by 2009.
To Ensure Gender
mainstreaming into the MoF
by 2009.
MoF Training Policy and
strategy Developed by 2005.
Strategies
Develop a gender affirmative
action plan in career development.
Conduct gender Sensitization
training for all staff.
Training Needs Assessment.
Develop and implement
comprehensive training program.
Services outputs delivery target
Gender employment situation and response analysis
prepared by 2005.
Gender affirmative action plan in place by. 2006
All staff sensitized on gender awareness by 2005.
Training Needs Analysis in place by 2005.
Training programmes in place by 2005.
Output indicators
Gender disaggregated data in
place.
Implementation of Gender
Affirmative Action Plan.
Number of Staff sensitized on
gender concerns
Training Programmes
implemented as per strategic
plan.
Training policy and strategy
Document in place.
Responsible
DAP
DAP
DAP
DAP
DAP
Tailor-made training.
Training IT managerial skills short /long-term training
programme by 2009.
34
To strengthen the
implementation of the anti –
corruption strategy by 2005.
Review of the anti-corruption
strategy.
All staff sensitized on the anti – corruption strategy by
2005.
Action plans for implementation the anti-corruption
strategy ready by end of year 2005.
35
To reduce the transmission
of HIV/AIDS, and Mitigate
the Impact of HIV/AIDS by
2008.
Number of staff trained in
various relevant fields.
Training Evaluation Report
Number of staff sensitized.
Quarterly reports submitted to
the POG (Presidents Office
Good Governance)
Number of staff sensitized on
HIV/AIDS transmission,
prevention and control.
Carry out HIV/AIDS Situation and
Response Analysis Study.
All staff sensitized on prevention of HIV/AIDS control
preventions by 2006.
Mainstreaming HIV/AIDS: into
Finance sector.
HIV/AIDS responses mainstreamed in policy
development and budgeting by 2005.
HIV/AIDS situational analysis
study report by 2005.
Mainstream HIV/AIDS: Ministry
and Institutions (Workplace
Care and treatment for PLWHA
MoF HIV/AIDS work place
Policy.
______________________________________________________________________
Ministry of Finance: Medium Term Strategic Plan: 2004 - 2009
DAP
DAP
78
No
Strategic Objectives
Strategies
Interventions).
Services outputs delivery target
Economic and social support to HIV/AIDS affected
people. (employees/family members including orphans).
Control and prevent the
transmission of HIV and mitigate
36
37
38
To review the MoF’s
Organization Structure by
2009.
To review the
implementation of
Performance Improvement
Management by 2005.
To Review Client Service
Charter annually
Enhance Institutional capacities for
effective response to HIV/AIDS
response.
Implement the job evaluation and
regarding exercise.
Output indicators
Responsible
MoF HIV/AIDS Strategy
2004/08
MoF HIV/AIDS Action Plans
Budget 2004/05.
All staff to have clear job descriptions and nonoverlapping of duties by 2006.
Number of staff with Clear Job
Descriptions, number of
Contracts for non core functions
(Engagement of PSP)
DAP
Revised strategic Plan
DAP
DAP
Hive off, privatize or abolish all
non-core functions.
Review MoF medium term
strategic plan.
Operationalise the Strategic plan.
All non-core functions in MoF hived off and Contracted
to PSP by 2006.
Strategic Plan reviewed every after two years.
Operational plan prepared by January every year
Operational Plan Document
Review the implementation of
performance base remuneration
and the Client Service Charter.
Performance targets prepared by June 2005
Reviewed annual strategic
plan/action plans/targets
Performance Criteria signed by June 2005.
DAP
Review Customer service
satisfaction.
39.
40.
To have an increased
capacity of 10 accountants
and 1 supporting staff by
2007.
To have a modern library
which can accommodate up
Conduct customer service delivery satisfaction survey
2005.
Revised Client Service Charter by June 2006.
To enhance both local and foreign Training Continuous
Professional Education (CPE) to 10 staff fearly to the
year 2007.
Training staff
Construction of IAA
Modern Library.
To enhance skill and knowledge in computing services
for 3 members of the staff by 2004/05.
40% of the library complex initially constructed by
2004/05.
Customer Survey Reports.
Number of staff trained.
PAT
Library Constructed
PAT
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Ministry of Finance: Medium Term Strategic Plan: 2004 - 2009
79
No
41.
Strategic Objectives
to 30,000 books with 350
sitting spaces from the
present capacity of having
only 15,000 books with 40
sitting spaces.
To have conducive working
studying and living
environment within 3 Main
Building and their allied
staff houses by 2006/07.
Strategies
Renovation
Services outputs delivery target
Rehabilitation of 3 IFM Main Building and staff house
by 2004/05.
Output indicators
Improvement of Office
Buildings.
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Ministry of Finance: Medium Term Strategic Plan: 2004 - 2009
Responsible
PAT
80
KEY RESULTS AREA 7: EFFECTIVE CONSULTATIONS AND COMMUNICATION WITH MOF STAKEHOLDERS
KEY PERFORMANCE INDICATORS
- % of MOF clients accessing information and participating in policy making.
- % of MOF clients satisfied with services delivery.
- Number of complaints received
- % of the public with knowledge of MOF policies and programs.
No.
42.
Strategic Objectives
Increase awareness
among the stakeholders
(media/Public etc) on
MoF policies and on
going programs by 70%
by 2007.
Strategies
Conduct regular publicity campaigns
Service Delivery Target
Produce 52 Televisions/ Radio Programmes.
Engage a consultant to design the
Communication Strategy.
52 short Television/Radio spots produced per
year by 2007
Press Briefings/conferences held monthly by
2007.
Participate In Dar es Salaam International Trade
Fair annually by 2007.
Quarterly Treasury News Bulleting produced by
2007.
Quarterly workshops, seminars and conferences
held by 2007.
Annual calendars and monthly fliers, posters,
writing of feature articles; fliers, posters etc.
produced by 2007.
To develop MOF communications strategy and
action plan by June 2005
Output Indicators
Number of TV/Radio programmes
produced against the target
Number of TV/Radio spots
produced against the target
Number of press briefings held per
year against the target
Participation in Trade Fairs
Responsible
IECU
Number of Quarters bulletin
produced
Number of workshops per quarter
IECU
Calendars, fliers, posters produced
IECU
MOF Communications Strategy in
place by June 2005.
IECU
IECU
IECU
IECU
IECU
% of MOF internal and external
stakeholders well informed and
participating in policy making and
programs by 2007.
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Ministry of Finance: Medium Term Strategic Plan: 2004 - 2009
81
No.
43.
44.
Strategic Objectives
Disseminate information
on achievement made by
MoF and the Financial
Sector by 70% by 2007.
To carry out assessment
of stakeholder needs and
their perception of MOF
policies and actions by
2009.
Strategies
Conduct workshops for discussing
and internalization of the draft
strategy – MOF top Management and
staff.
Publish and deliver the strategy with
tabling of 2005/06 budget.
Produce Radio/Television
Programs/Spots for promoting MOF
policies and results.
Participate in Public Fairs and events
e.g. DSM International Trade Fair
and Nane Nane
Produce and disseminate regularly
MOF publications -Treasury News
Bulletin/Letter, Posters, and Fliers,
Banners, Calendars, Brochures and
writing of Feature Articles on MOF.
Create an effective mechanism for
effective and efficient up-date of
information on MOF in Web-Site.
Service Delivery Target
Workshops conducted by April 2005
Output Indicators
Number of workshops conducted
Responsible
IECU
Strategy Published by May 2005.
Strategy Document in place
IECU
Weekly programmes/spots produced by 2007
Number of MOF promotional
programs/publications designed
and disseminated.
Number of fairs attended per year
IECU
Various publications on MOF and Sectoral
reforms, including regular Treasury News
Bulletin/Letters produced by 2007
Number of publications produced
and disseminated
IECU
Up-date of MOF information on Web- Site by
2007.
Website in place with updated
information
IECU
Information dissemination
40,000 various publications; Treasury News
letter, brochures, books, reports etc produced
yearly up to 2007.
Yearly participation in fairs
IECU
IECU
Distribution of publications to stakeholders local
and foreign yearly by 2007.
Devise an effective feedback
mechanism from MOF stakeholders
on policies and services by June
2006.
Periodic conferences, seminars and workshops
held by 2007.
Regular media scanning, monitoring & analysis
to identify emerging issues Conducted and brief
the MOF top Management accordingly and
prepare rapid responses by 2007.
Quality advice provided to MOF
policy analyst and the top
Management.
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Ministry of Finance: Medium Term Strategic Plan: 2004 - 2009
IECU
82
No.
45.
Strategic Objectives
To build the capacity of
the IEC Unit.
Strategies
Carry out communications research
and analysis, and provide quality
advice to MOF policy analysts and
top Management.
- Training needs assessment of the
Unit carried out.
Training of the IEC Unit staff to
equip them with the required skills
Service Delivery Target
Monitor annually using methodical survey
methods, the perception of stakeholders on MOF
policies and service delivery.
Carry out pre-assessment of various policy
options through systematic focus group
monitoring exercises.
Identify priority issues for research by December
2004.
Output Indicators
Media effectively managed and
relationship maintained.
Responsible
Effective mechanism for MOF
stakeholders’ feedback in place
and delivering by 2007.
Research Carried Out
IECU
TNA carried out by December 2004
TNA Report
DAP/IECU
All IECU officers trained in long term and short
courses, locally and abroad in economic and
financial journalism, communications
management, report, & speech writing skills,
presentation skills, etc. by 2007
Number of staff trained against the
target
DAP/IECU
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Ministry of Finance: Medium Term Strategic Plan: 2004 - 2009
83