CAG Report: A Glimmer of Accountability in Tanzania’s Ongoing Struggle with Corruption

By Adonis Byemelwa

The recent report from the Controller and Auditor General (CAG) paints a grim picture of the state of public finance and governance in Tanzania, raising serious concerns about accountability and corruption in government institutions.

Nevertheless, upon closer inspection, this report offers more of a cosmetic gloss than a genuine attempt at addressing the systemic issues that plague the country.

Critics, especially economists with extensive experience in development and governance, argue that the CAG’s findings merely serve to fulfill the requirements of international bodies that advocate for transparency, but they do little to combat the deep-rooted corruption that undermines the nation’s progress.

The CAG report outlines significant financial losses, which seem to be a recurring theme in Tanzanian state-run institutions. From the staggering Sh99.8 billion that Air Tanzania received in subsidies to avoid even worse losses, to the Sh27.7 billion loss reported by the Tanzania Telecommunications Corporation (TTCL), the situation paints a picture of inefficiency and financial mismanagement.

However, when we dig deeper, it's evident that these reports are designed to maintain the illusion of accountability rather than to bring about real change. While the CAG highlights these losses, the language of the report remains carefully crafted to avoid calling out the true culprits: the political elites who are entrenched in the very systems that perpetuate such corruption.

Take, for example, the Tanzania Postal Corporation (TPC), which reported a loss of Sh23.6 billion, a result of plummeting revenues. The CAG proposes improvements to reduce inefficiencies, but what is never addressed is the glaring issue of why these institutions continue to hemorrhage money without any real accountability.
Senior economists argue that institutions like the CAG, along with the Prevention and Combating of Corruption Bureau (PCCB), function as mere window-dressing. They exist to satisfy the demands of international donors and the expectations of foreign governments, who are pushing developing countries toward some form of transparency.

Yet, these institutions rarely produce meaningful results in tackling corruption. They seem more concerned with appearing compliant than actually taking bold steps to root out the rot at the core of Tanzania’s governance.

As the national debt continues to balloon, reaching alarming figures, it’s incredibly telling that corruption remains rampant. What’s even more alarming is how cases of corruption, even when exposed, are swept under the rug.

The so-called “untouchables” are the well-placed figures—those who are part of the ruling machinery, the individuals who wield influence and power behind the scenes. These are the ones who make the decisions, and it’s no surprise that they remain immune to the scrutiny and consequences that the average citizen would face. To say this is a broken system is an understatement. Corruption has become a way of life for those in power, and very little is done to bring these individuals to justice.

It's interesting to note that many of these institutions are not operating in a vacuum. They are deeply intertwined with international aid, loans, and investment, and much of their reporting, like the CAGs, is done to appease external stakeholders.

While the international community calls for reforms and transparency, they seem all too willing to overlook the deeper issues at play, particularly when these issues involve people with political connections.

This is precisely why the real stories behind the numbers in the CAG report are likely much worse than what is presented to the public. It’s well known among critics that these reports are edited, sanitized for public consumption, and crafted to provide a façade of progress.

The doomsayers, including seasoned economists who have worked in similar environments, argue that the real picture is one of systemic failure, where corruption continues to thrive unchecked and with impunity.

Looking at the debts owed by state-owned enterprises like the Tanzania Electric Supply Company (Tanesco) and the Public Service Pensions Fund (PSPF), it becomes painfully clear how corruption has been allowed to thrive.

These institutions are deeply indebted, yet their management is rarely held to account. Tanesco, for example, owes Sh238.7 billion to Independent Power Tanzania Limited (IPTL), a debt that includes both principal and accumulated interest.

Despite this, there’s little to no follow-up on the legitimacy of the claims made by IPTL. The CAG report makes only passing mention of these debts, never questioning the contracts, the deals, or the people involved.

If the goal was genuine transparency, one would expect far more scrutiny, particularly when the money involved is taxpayers' money. But this is where the systemic failure becomes clear. There’s an almost intentional lack of follow-up, leaving many questions unanswered.

Even within local authorities, where it is expected that financial accountability would be most effective, we see blatant mismanagement. The CAG report notes that 14 local authorities failed to meet their revenue collection targets by a staggering Sh26.1 billion.

This is not a trivial amount. In Dar es Salaam, for instance, the City Council collected a mere Sh3.4 billion out of the Sh15 billion it had projected. The question must be asked: Where does this money go? Why is there such a persistent gap between targets and outcomes, and why are these cases not being investigated more rigorously?

The most disturbing aspect of this report is not just the financial losses but the utter lack of accountability that pervades every level of governance. This absence of action is evident not only in the public sector but also in private enterprises linked to the government.

For example, the government-owned cement factory continues to bleed resources without showing any improvement. A company set up to manufacture cement and other construction materials has failed to meet even basic targets.

And yet, nothing substantial is done to rectify the situation. It’s clear that these failures are not just administrative but are symptomatic of a much deeper issue: a governance structure that rewards those in power, rather than those who have the public’s best interests at heart.

This lack of accountability extends beyond financial mismanagement. The Prevention and Combating of Corruption Bureau (PCCB) is another example of an institution that looks good on paper but fails to act effectively in practice.

The bureau is supposed to tackle corruption head-on, yet it has become yet another vehicle for meeting the demands of international donors and aid agencies. Its role has been diluted over time, with its real effectiveness being called into question.

Even though the country’s debt continues to rise and corruption scandals continue to emerge, very little is done to investigate and prosecute those responsible for the theft and mismanagement of public funds.

Economists, particularly those who have worked in developing nations, argue that this lack of true accountability is a fundamental barrier to progress. The role of the CAG and the PCCB should not be merely to report and check boxes to satisfy international requirements.

They should be tasked with uncovering the truth and holding the powerful accountable, something that, sadly, seems to be consistently avoided. The truth is that the individuals who are perpetuating these corrupt practices are often the ones closest to the power structures in the government, and they are the ones who will never face consequences.

This is the real tragedy of Tanzania’s public finance system: it’s not a lack of reporting, but a lack of will to take action, to dig deeper, and to make real changes.

While the CAG report might seem like an effort at transparency, it ultimately serves as a tool to maintain the status quo. The international community may be satisfied with these reports, but they do little to address the true problems at the heart of Tanzania’s governance.

The corruption that continues to fester is not just a series of isolated incidents; it is a systemic issue that will not be solved by cosmetic reports or token investigations. Until those in power are held to account, and until institutions like the PCCB and the CAG are given the real mandate and resources to address corruption, these reports will remain nothing more than a reflection of the political theater, not a real attempt at progress.