BUDGET WORKING GROUP’S 2023/24 PRE-BUDGET STATEMENT:

SECURING SUSTAINABLE DEVELOPMENT THROUGH BUDGET

RELIABILITY AND FISCAL SUSTAINABILITY

1. Preamble 2. A Synopsis of the National Budget

It is our pleasure to present to you the analysis While the National budget for the Financial Year
of the FY 2023/24 national budget. Policy Forum (FY) 2022/23 increased by 12%, the 2023/24
commends the government’s economic reforms budget reflects an increase of 7% from TZS.
aimed at promoting private sector-led growth 41,480.6 billion in 2022/23 to TZS. 44,388.1
and enhancing the business environment and billion. Of this total budget, development
emphasizes the importance of budget credibility expenditure receives an allocation of TZS.
in achieving sustainable development goals1. 15,156.0 billion, representing 34.2% of the
budget, while TZS. 29,232.1 billion, accounting
In this position paper, we continue our efforts to for 65.8%, is designated for recurrent
contribute to the budget process, discourse, and expenditure. The Minister of Finance and
performance. Our analysis reviews budgetary Planning released this proposal on 13th March
allocations and expenditures, examining budget 2023, which also outlines the National Plan and
credibility. We highlight key sectors and Budget ceilings for the financial year 2023/24.
programs that will be targeted by the
government in pursuit of development, while As for the development funds, TZS. 11,873.9
also striking a balance between funding critical billion (equivalent to 78.3%) is to be sourced
sectors and maintaining fiscal sustainability. internally while TZS. 3,282.1 billion (equivalent
to 21.7%) is expected to be sourced externally.
Our analysis includes a look at the government's On the other hand, out of the recurrent budget,
revenue estimates, spending and resource TZS 12,771.5 billion (43.8% of the total
distribution to sectors including education, recurrent budget) is intended to service the
agriculture, water, and trade. We recognize the national debt. Therefore, with the national debt
various challenges facing Tanzania, such as the aside, the recurrent budget is TZS. 16,460.6
effects of COVID-19 and the post-pandemic billion constituting TZS 10,882.1 billion for
quest for recovery, high inflation, and a personnel emolument and TZS 6,396.9 billion
significant debt burden. Therefore, effective for other charges.
implementation and monitoring of the budget
will be critical to ensuring that the intended According to the recent 2021/22 CAG report, the
outcomes of each sector are achieved. tax-to-GDP ratio was 13.4% which is lower than
the international standard of 15%. The
This position paper carries with it valuable government needs to address the challenges
insights that ought to be considered throughout faced in revenue collection from the previous
the execution of the fiscal year, building a fiscal year and take necessary measures to
potential impact on the country's sustained enhance tax compliance and tackle issues of tax
economic growth. evasion and corruption including addressing the
recommendations raised by the Controller and
Auditor General.

1SDG Indicator 16.6.1: Primary government expenditures as a proportion of the original approved budget, by sector (or by budget

codes or similar)
Figure 1 Breakdown of the 2023/24 Moreover, it is important to take into
consideration concessional loans over
Recurrent Budget in Billions
commercial loans because the former have lower
interest rates, typically have longer repayment
periods making it more affordable for the
country, may offer more flexible repayment
options and are often used to support
development and infrastructure projects such as
schools, hospitals, and roads. For the 2023/24
budget, there are revenue projections reflecting
grants and concessional loans of TZS 5,466
billion and non-concessional loans of TZS 7,540
billion. Solid justifications need to be rendered in
the quest for such high non-concessional loans.

Source: Statement by the Minister of Finance While the 7% budget increase demonstrates the
and Planning presented to the National Assembly government's commitment to meeting social
on 13th March 2023. needs, historical trends indicate that actual
performance may fall short of the approved
It is worth noting that the allocation for servicing budget. In its expenditure reports, the
the national debt represents a significant portion government has acknowledged this problem,
of the recurrent budget (about a third as noted citing unfulfilled pledges from development
within the Consolidated Fund Services as noted partners as key contributor (as illustrated in
in Figure 2). This highlights the importance of Figure 3).
debt management and sustainability as the
Government needs to ensure that it has
Figure 3: Trend of the Development
adequate resources to meet other critical Budget
expenditure needs, such as operational
expenses which are equally important.

Figure 2: Breakdown of the

Consolidated Fund Services

Source: Budget Execution Reports

Efficient revenue mobilization is essential for the
successful implementation of development plans
and efforts should be made to progressively
Source: Statement by the Minister of Finance realise this including the target set out in the
and Planning presented to the National Assembly FYDP III on tax revenue as a percentage of GDP
on 13th March 2023. of 14.4% in the year 2025/26.

Additionally, improving fiscal discipline and

strengthening financial management systems
are crucial to ensure effective disbursement of
funds.
 This involves streamlining processes, enhancing The Education Sector Development budget
transparency, and establishing mechanisms to allocated TZS 353.4 billion for COVID-19 relief
monitor and evaluate the utilization of allocated and the construction of 12,000 classrooms,
funds. 3,000 satellite schools, and 50 dormitories for
students with special needs. TZS 160 billion was
3. Highlights of the Budget provided for the construction of 8,000
Shortfalls from Key Sectors classrooms for more than 400,000 Form I
students in 2023. The government is also
3.1 Education Sector building 26 girls' schools for science studies,
costing about TZS 30 billion or nearly TZS 1
The total budget of the sector has increased by billion per school. While this is only a portion of
around 20% from TZS 4,720 billion in 2020/21 the overall budget, the government aims to
to TZS 5,952 billion in the fiscal year 2023/2024. prioritize improving infrastructure in basic
This has been an average increase of 5% per education to create a better learning
year. environment for Tanzanian students.
Figure 4: Education Sector Vs The government has also expanded the scope of
Share of Budget Fee-Free education by increasing the budget of
TZS 10.3 billion for fifth and sixth-form students,
while the budget for free education for primary
and secondary education students (Fourth Form)
increased from TZS 364.2 billion in 2021/22 to
TZS 390 billion in the Fiscal Year 2022/23. The
loan budget for higher education students also
increased by 14.7% from TZS 570 billion in
2021/2022 to TZS 654 billion in 2022/2023. The
subsistence allowance for higher education
students has also increased from TZS 8,500 to
TZS 10,000 per day.

The Education sector allocation of TZS 5,952 The government has prioritized several
billion as a share of the total government Budget initiatives to improve access and quality of
of TZS 44,388 billion is 13.4%, a slight decrease education for Tanzanian students, as well as
in share from 2022/23, where the allocation was improvement of the learning environment, as
TZS 5,684 billion, and a 13.7% share of the total shown by its focus on infrastructure
budget of TZS 41,481. improvements and the strong push towards
fee-free education. However, the challenges in
Most of the 2023/24 education sector budget our education system are still prominent. To
allocation goes to basic education (75%) and continue to find solutions to these challenges,
Higher education (20%). this statement recommends the Government
consider the following priorities when the
The education sector allocation for 2023/24 is at Parliament sits to review and approve the plans
a 4.7% increase compared to the previous year’s and budget for the financial year 2023/2024.
budget, meaning that the increase has just
managed to keep up with the inflation rate of A. Consideration of priorities and budget
4.7% as stated by BOT as of March 2023. The specified in the Education Sector Development
increase in the education sector budget is also Plan (ESDP III)
small in comparison to the overall increase in the
total government budget allocation, which is The Third Education Development Plan (ESDP
projected to increase by 7% from 2022/23. III) lists the priorities and estimated budget
needed to implement the provision of education
in the country for the five years of
2021/22-2025/26.
In the past two years, the Government has failed According to the Basic Education Statistics for
to comply with the costing recommendations as Tanzania (BEST) issued by the Ministry of
outlined in this Plan. While the ESDP III Education and PO-RALG for the Year 2021; the
estimated costs of TZS 7,116 billion for the fiscal pupil-classroom ratio for primary schools is 1:74
year 2021/2022, the government allocated and instead of the recommended 1:45. In 2021, the
approved TZS 5,645 billion which is equal to only number of primary school classrooms was
79.3% of the estimate. 151,315 while the number of primary school
students was 11,196,788. For this number of
For the Year 2022/2023 ESDP III estimated cost students, several 248,818 classrooms are
was TZS 7,587 billion, while the government needed to achieve a ratio of 1:45. Since there
approved and passed TZS 5,684, which is are already 151,315 rooms, the government
equivalent to only 75.5%. Finally, for 2023/24, needs to build 102,485 additional rooms to cover
the ESDP estimated cost was TZS 8,128 billion, this shortage in primary schools.
while the government has estimated an
allocation of TZS 5,952 billion for the education
sector, which is just 69.9% of the total estimated
cost for the ESDP implementation for that year.

We recommend that the Government, through We recommend that the Government should
the relevant Ministry of Education, Science and come up with a plan to build 25,000 classrooms
Technology, the Office of the President per year so that within the next five years we can
TAMISEMI, the Standing Committees of the resolve this challenge. If each construction of
Parliament for Education and Services as well as one primary class will cost TZS 15 million, then
the Members of Parliament; ensure that the in the Financial Year 2023/24; the government
budget planning of the education sector is should allocate TZS 375 billion for the
governed by and allocate funds that are construction of classroom infrastructure in
consistent with the estimates under ESDP III. primary schools only. This construction of new
Specifically, we ask the government to allocate classrooms should go hand in hand with the
approximately 16 - 20% of the National Budget construction of pit latrine facilities. According to
for the Education Sector. BEST 2021, the pit latrine ratio is 1:50 vs the
standard of 1:25 for male students and 1:48 vs
An increase in allocation would be beneficial not the standard of 1:20 for female students. Boys’
only in ensuring that adequate funding is latrines needed are 114,366, and girls’ latrines
available to implement the education sector needed are 164,946.
strategic plan, but would also contribute to
fast-tracking of initiatives to improve the C. Resolving the Teacher Shortage Challenge
learning environment of students in key areas
such as infrastructure, quality of teaching, as According to the Speech of the President’s
well as general monitoring and evaluation. Office-Regional and Local Government
(PO-RALG) for the Financial Year 2022/2023,
B. Allocate Budget for the Construction and Primary schools in the country are facing a
Repair of Basic Education Infrastructure shortage of 100,958 teachers, equivalent to a
37% shortage. The number of teachers available
The great efforts made to strengthen the for Primary schools is 173,591 while the total
secondary education infrastructure in the past amount of teachers required at the Primary
two years have been crucial in addressing the school level is 274,549 teachers.
shortage of classes in secondary schools and
ensuring that a large number of primary school
graduates have the opportunity to join Form I.
However, this focus on Secondary schools should
not diminish efforts to expand infrastructure for
Primary Schools where enrollment is increasing.
The government through PO-RALG planned to It is our opinion that the Government to set
recruit 10,000 teachers in the financial year plans and allocate funds to monitoring and
2021/2022 and another 10,000 teachers in the quality assessment for all schools, at least every
financial year 2022/23. In September 2022, the two years.
Deputy Minister of Education, Science and
Technology Omary Juma Kipanga speaking in In the fiscal year 2022/23, the government has
parliament in Dodoma, told the MPs that the planned to conduct a general assessment of
government has requested permission to hire 'comprehensive school inspections' in 19,800
more than 42,697 teachers and the priority will institutions including 17,164 primary schools,
be for Science and Mathematics teachers. which is approximately 96% of primary schools,
However, there is no official information from the and 2,578 secondary schools, equals 49% of
government on the implementation of this secondary schools. This ambition is good, and
commitment. we recommend that it is also the goal for the
financial year 2023/24. It is our request for the
In the fiscal year 2021/22, our statement government to make a deliberate effort to plan
advised the government to set a long-term plan and allocate an adequate budget for monitoring
(5 years) to end the problem of the shortage of and regular inspection activities in schools,
teachers in the country. In our especially public schools.
recommendations, we urged the government
should set a budget plan to recruit 40,000 Recommendations
teachers per year (25,000 Primary and 15,000
Secondary). This program will lead to a 1. Increased allocation to the education sector
resolution to the problem of the shortage of that will be able to fully fund implementation of
primary and secondary teachers within the next the ESDP III.
five years. It is also our recommendation that for
the Fiscal Year 2023/2024, the government 2. To prioritize the improvement of infrastructure
plans and allocates a budget for the recruitment and resolving the teacher shortage, which would
of 40,000 primary and secondary teachers. If provide benefit to the vast majority of Tanzanian
this level is reached every year, we will end this students and increase their chances of future
challenge within the next five years. success in learning and the workforce.

D. Increasing the Budget for Monitoring & 3.2 Agriculture Sector

Quality Control
Budget allocation to the agriculture sector has
The government has made commendable efforts increased significantly in 2022/23 compared to
to improve monitoring and quality control in the the previous year; to the Ministry of Agriculture
education sector, including providing training for (MoA) it increased from TZS 294 billion in
quality control staff, building offices, and 2021/22 to TZS 954 billion in 2022/23, to the
purchasing equipment such as cars. However, Ministry of Livestock and Fisheries (MLF); from
the government's ability to reach schools and TZS 169 billion in 2021/22 to TZS 268 billion in
colleges that should be inspected annually is 2022/23 (92 billion TZS for Livestock and 176
very low. billion TZS for Fisheries) (MoF, 2022).
In the fiscal year 2019/20, the Government
assessed the environment for providing Nevertheless, looking at actual spending levels
education in 3,251 primary schools out of 17,804 against the benchmark of the Maputo
which equals to only 18.3% and 837 secondary Declaration of 2003 and reaffirmed under the
schools out of 5,289 which equals approximately Malabo Declaration of 2014 in which the Heads
16% only. In 2020/21, the Government of State of the African Union committed to
evaluated 4,700 Primary schools which equals allocate 10% of total public expenditure to
26.4% and 1,200 Secondary schools which agricultural development, the country is far in
equals only 23%. This is an indication that many allocating sufficient resources as committed. The
schools are not always inspected or not low public investment in the sector translates
inspected at all. into food and nutrition insecurity, and abject
poverty due to low income and economic growth.
Figure 5: Trends in Share of Figure 6: The Development Budget
Agriculture Sector Budget Against Allocation by Category for
Total National Budget, FY 2001/02 2016/17-2021/22
to 2022/23

Source: MoFP Data

Source: MoA Data
3.2.1 Trends in National Budget Implementation
2021/22 -2022/23 The disbursement for development expenditure
at the Ministry of Agriculture (MoA) level has
The development budget allocation in nominal declined from 47% in 2018/19 to 23.6% in
terms for crop production has been increasing 2021/22 as indicated in Figure 3. The high
over time, except for the year 2018/19. The performance between 2013/14 and 2014/15 was
budget approved for development activities has probably attributed to Big Results Now (BRN)
increased from TZS 137 billion in 2020/21 to efforts by the government in developing the
TZS 287.38 billion (internal source) in 2022/23 agriculture sector. The low disbursement rate of
through vote 43. The disbursement for crop 3.3% in 2016/17 was a period when the regime
production (Vote 43) as of March 2023 was TZS changed, and the priority shifted to other
195.27 billion out of the internal fund approved. sectors. Moreover, the 2021/22 CAG Audit
Likewise, in the irrigation area, the government Report indicated that out of the TZS 36,169.67
put emphasis to support irrigation infrastructure million approved for 7 development projects in
development where the budget decreased from the Agriculture sector, TZS 27.688 billion
TZS 39.9 billion in 2016/17 to TZS 17.7 billion in (76.6%) was spent while unspent was TZS 8.480
2020/21 and then increased to TZS 37 billion in billion (equivalent to 23.4%).
2020/21 and then increased rapidly in the year
2022/23 to TZS 361 billion, where internal Figure 7: The Disbursement Rate for
resources were TZS 350 billion. For cooperative Development Expenditure against
development, the budget allocation increased Approved Budget
from TZS 57 billion in the year 2016/17 to TZS
93 billion in 2020/21 and gradually decreased to
TZS 51.5 billion in 2021/22 and further to TZS
1.1billion in 2022/23. The plan for the
development budget in the cooperative for
2023/24 is around TZS 1.5 billion, whereas the
plan for crop production in 2023/24 is TZS
460.67 billion, of which TZS 401.7 is from
internal sources.

Source: MoA

The livestock subsector budget increased from

TZS 38.9 billion in 2020/21 to TZS 47.8 billion in
2021/22. The statistics show that the budget for
development activities in the subsector between
2018/19 and 2021/22 has been below 40%.
 • Building a Better Tomorrow (BBT): In
Also, the disbursement for the approved budget 2022, the government initiated the “Building a
was low, for example, in half of 2021/22 only Better Tomorrow - Youth Initiative for
10% of the TZS 1.6 billion was disbursed. In the Agribusiness (BBT-YIA)” programme to address
fisheries subsector, there was a huge increase in youth and women challenges in the agriculture
the budget from TZS 34.7 billion in 2020/21 to sector including access to land, capital,
TZS 121.4 billion in 2021/22. While the technology, and markets. The programme aims
development expenditure increased to TZS 99.1 to increase 3 million jobs and 10% growth in the
billion in 2021/22 from TZS 13.1 billion in agricultural sector by 2030 and is implemented
2020/21. In 2022/23, out of TZS through various agricultural value chain projects
168,248,787,000 allocated to Livestock and under the block farming model for youth and
Fisheries (Vote 64), the total development women. The BBT-YIA estimated budget is TZS
budget allocation for livestock and fisheries was 356.199 billion of which 24% of the budget will
TZS 72.73 billion. Moreover, out of TZS 62.55 come from the Government (MoA and PORALG)
billion for development budget from internal and the remaining 76% from Development
sources, only 6.3% was spent as of 30th April Partners, NGOs and the private sector with the
2022. Ministry of Agriculture serving as the facilitator
and coordinator.
However, the Deputy Minister for Livestock and
Fisheries reported that the government from the These initiatives and arrangements need to be
year 2021/22 to 2023/24 has allocated TZS 5.9 applauded because of the programme coverage
billion to build 257 cattle dip facilities in 80 LGAs,
and the number of beneficiaries targeted.
where 88 of them have been completed and the However, the government has to draw lessons
remaining 169 are in various stage of from ASDP II in implementing the BBT-YIA
construction. Also, the government has provided programme by avoiding ambitious plans, instead
subsidies for 52,560 litres of drugs with a value developing an implementable plan based on the
of TZS 2.3 billion. In addition, the government in resources (finance and human capital) available.
Simanjiro district council at Narakauo village the Relying on other stakeholders for 76% of the
dam was constructed for TZS 413 million in budget may pose a challenge since they are not
2021/22 and the Lelarumo dam to be committed to the program, therefore the
constructed in 2022/23 for TZS 364 million. government should increase its funding in the
implementation of the program and integrate
3.2.2 Key Strategic Initiatives and Financing Agricultural Sector Lead Ministries especially
Livestock and Fisheries into the program
• Improved Seed: Increased budget allocation implementation and budget allocation.
to Agricultural Seed Agency (ASA) from TZS
5.42 billion in 2020/21, TZS 10.8 billion in • Climate Change: In 2018/19 the Ministry of
2021/22 to TZS43.03 billion in 2022/23 (MoA, Agriculture plans had features of climate
2023) has catalyzed increased production of resilience financing, whereby its budget
sunflower seeds from 1,750 tonnes in 2019 to allocation increased by TZS 13.75 billion
3,750 tonnes in 2022 through expansion of (equivalent to 40%) from TZS 25.50 billion in
cultivated land for seeds production by ASA. 2017/18 to TZS 39.25 billion in 2018/19 and was
allocated to climate change adaptation and
• Fertilizers: The government came up with a mitigation related activities. However,
fertilizers subsidy which lowered the prices of addressing climate change and variability is still
fertilizers (DAP, UREA) from TZS 120,000 to TZS an issue.
70,000 all over the country. By December 31, CAADP and ASDP II programs call for the
2022, the farmers had purchased 175,829.33 government to enhance investment in climate
tonnes of subsidies fertilizers worth TZS 192.46 change resilience and the Environmental Act of
billion (MoA 2022). However, the sustainability of 2004 establishing the National Environmental
the programme is uncertain since there is no Trust Fund (NETF) to finance environmental
clear strategic plan to conduct a needs activities in Tanzania, but the fund is not yet fully
assessment, and there are tycoons who are not operationalized due to some limitations including
farmers benefitting from the subsidy. Therefore, financial challenges.
the government needs to develop a clear and
sustainable financing programme for SHFs.
ANSAF (2020) proposed several fund sources 3.2.3 Loans to Agriculture Sector
including emissions from vehicles (TZS 3,000
per vehicle), electronic waste fees (1% of the The public institutions lending portfolio to the
product value), tourism and hospitality industry sector has been increasing since 2016. In the
(USD 0.5 per tourist), and drinks served on last five years, the government loans
plastic bottles (TZS 0.5/ bottle). disbursement to various agriculture value chains
actors through Tanzania Agriculture
• Post-Harvest Management: Despite the Development Bank (TADB) has increased from
commitments from all groups to finance National TZS0.34 billion in 2018 to TZS 61.74 billion in
Post-Harvest Management Strategy (NPHMS), 2021, then declined to TZS 48.47 billion in 2022.
2018/19-2028/29, there has been low budget
allocation to support the strategy. Based on this, Moreover, in 2021/2022 the government
both government and development partners reduced interest rates from between 17% and
have to enhance efforts in terms of finance and 20% to 9% for agricultural loans from
technical support in implementing the strategy. commercial banks to increase farmers’ access to
inputs on time, and revive and establish
• Research and Development (R&D): The small-scale value-addition industries. The Banks’
African Union (CAADP program) recommends lending to private sector activities shows that
that countries spend at least 1% of their lending to agriculture increased from TZS
agricultural GDPs on agricultural research. ASDP 952,883.8 million in 2018 to TZS 1,592,519
II recommends the government set aside 3.8% million in 2021 and increased to TZS
of its agricultural budget for research and 1,993,626.4 million in June 2022. However,
development. However, based on the available lending to fishing has been decreasing, whereas
evidence, the allocation for R&D is minuscule. according to the Bank of Tanzania (BoT) lending
For example, the Ministry of Agriculture budget to fishing has declined from TZS 74,022.3 million
allocation was pegged at TZS7.35 billion in in 2018 to TZS 33,725.3 million in June 2022.
2020/21, which increased to TZS40.73 billion in
2022/23. Thus, it is important to honour the Recommendations
guidelines and directives to ensure that
agriculture (crop, livestock, and fishery) 1. 2023/24 budget should focus on establishing
contribute to national growth and income. strong systems such as large-scale farming and
cooperatives for high productivity of cereal crops
• Extension Services: In recent years, the (maize, rice) to address the issue of food
government through MoA has been making insecurity.
remarkable efforts in extension advisory
services. Among the outstanding achievements 2. Budget allocations to key agriculture areas
is the development of the M-Kilimo platform should correlate with sufficient disbursements to
which intends to bridge the extension advisory the same for high results realization.
information access gap for smallholder farmers.
Budget allocation has been increasing from 3. Development of long-term policy for
TZS0.603 billion in 2020/21 to TZS14.5 billion in agro-processing enterprises is paramount to
2022/23, hence facilitating the provision of the enable them to make predictable investment
necessary equipment including motorcycles, soil decisions.
scanners, and smartphones to extension officers
to facilitate service delivery, especially in rural 4. At least 20% of revenue collected by LGAs
areas. However, the country requires 15,082 from the agriculture sector should be allocated
extension officers to effectively provide services to agriculture sector development projects and
to farmers in all wards and villages but currently, should be legalized (10% to agriculture, 5% to
there are 7,974 officers which is only 50% of the livestock and 5% to fishery).
requirement.
3.3 Water Sector However, in 2021/22 the disbursement was at
95% which showed that the Government made
The initial review of the Water Sector enormous efforts in making sure that the vision
Development Programme (WSDP) Phase II set of implementing the development projects is
the budget for Water Resources Management attained.
(WRM) at 26%, (Rural Water Supply and
Figure 9: Water Sector Budget
Sanitation) RWSS 26%, Urban Water Supply and
Sanitation (UWSS) at 46%, Sanitation and
Allocation Vs Disbursement
Hygiene(S&H) at 5% and Programme Delivery
Support (PDS) at 3%. However, the actual
allocation of the received amount completely
changed the structure of the revised WSDP II
budget. Allocation to the WRM component was
only 4%, RWSS at 44%, UWSS at 46%, the S&H
at 3% and PDS at 2%. The WSDP III, which
started in July 2022, is more ambitious,
depicting a budget of US$ 6.464 million, an
increase of US$ 3.19 billion above the budget of
its predecessor WSDP II, (US$ 3.2 billion). The
increased funding is aimed at meeting the
targets of providing access to safe drinking water
to 85% and 95% of the population in rural and Recommendations
urban areas, respectively, by 2025.
1. Divergences experienced during WSDP II's
This analysis examined the budget trends across implementation affected the programme's
the two first phases of the WSDP about the planning, budgeting, financing, monitoring, and
sources from which budget commitments were evaluation.
made, actual allocations; disbursement and
where possible, the expenditures. The planned 2. Both Basket Funding and Earmarked Funding
budget for the entire 20-year implementation data could be found in the government reporting
period was US$ 3,366.38 million; distributed to although with noted differences. The depth of
the four phases at US$ 951.08 million for Phase information on commitments, allocation,
I; US$ 878.79 million for Phase II; US$ 889.72 disbursement and expenditure varied between
million for Phase III; and Phase IV; 646.79. these two WSDP’s funding modalities. The
Basket Funding data is more consistent and
Figure 7: Figure 8: WSDP Original Plan readily available either through the Water Sector
Status Report (WSSR), the budget speeches and
Vote Book 049. However, different sources of
information provided the Earmarked Funding
information, but sometimes with gaps. Several
WSSRs indicated that the information on Sector
Financing is provided but with missing
information on Earmark Funding. This situation
hampers completeness in reporting and may
distort among other things a legitimate link
Source: Ministry of Water between efficiency and effectiveness and
equitable WSDP financing.
Similarly, there have been significant disparities
between budget allocation and disbursement in 3.4 Trade Sector
the water sector. While the government
recognizes the importance of water resources The role of trade is to promote sustainable
and infrastructure development, the actual economic growth through promoting market
disbursement of allocated funds has faced access to all produced products and services.
challenges.
This role can never be achieved if other social As of March 2022, only 30% of the funds
groups in the community including women and allocated for development projects in the
youth who play an important part in promoting 2021/2022 budget under the purview of the
trade are excluded. The government needs to Ministry of Investment and Trade were disbursed
allocate enough financial resources for various from domestic sources.
activities that will lead to the development of the
trade sector. Furthermore, no disbursements have been
received to date from external contributors.
For the Trade and Industry Sector, the Regrettably, this presents a significant hurdle to
government had planned a total budget of TZS the competitiveness of women and youth in the
112.7 billion for the fiscal year 2021/2022, but market.
only TZS 55.6 billion (48%) was disbursed. In
the following fiscal year, 2022/2023, the planned The Ministry, however, identified various
budget decreased by 12.1% to TZS 99.1 billion. obstacles that hinder the involvement of women
The recurrent budget, which includes expenses and youth in investment and trade. These are
such as salaries and routine operations, was poor policies, laws, and strategies. Poor business
planned at TZS 59.6 billion, of which 74.9% was environment and limited access to funding, and
disbursed in 2021/2022. For the fiscal year lack of women's business skills. Also, in recent
2022/2023, the recurrent budget increased by times, the sector faced a drop in employment
14.6% to TZS 68.3 billion. On the other hand, opportunities. For instance, in 2020 total
the development budget, which includes employment was 370,485 while in 2021, the
expenditures for improving infrastructure and number decreased to 345,615. This shows that
other long-term investments, was planned at the sector has challenges in influencing and
TZS 53.1 billion, but only 29.8% was disbursed creating new job opportunities, especially for
in 2021/2022. In the fiscal year 2022/2023, the youth who are looking for jobs desperately.
development budget decreased by 41.9% to TZS
30.7 billion (see Table 1): The government has taken steps to encourage
investment through the implementation of
Figure 10: General Resources Investment Law No. 10 of 2022 and the
Allocated in the Trade and Industry establishment of the Tanzania Electronic
Sector Integrated Investment Window (TeIW) to
expedite new investment initiatives in the
country. However, it is concerning that the
engagement of the Small and Medium
Enterprises (SMEs) subsector has not been
adequately addressed, given that SMEs are the
primary contributors to the national economy.

3.4.1 Gender Issues in the Trade Sector

The shortfalls pose a challenge in the planning

and implementation of projects related to
improving the capacity enhancement of women
and youth to access markets and increase the
value of their products. On market development,
the financial year 2023/2024 sub-votes 4002 on
commodity market development and 4949 on
support for trade mainstreaming have been
given TZS 200 million. While for the previous
financial years 2012/2022 and 2022/2023 there
were no funds in that vote.
Recommendations

1. Allocate resources towards streamlining the certification procedures to support SMEs, especially
those run by women and youth. The government can also introduce a special certification mark for
SMEs' products to facilitate their access to lucrative markets.

2. Recommend increasing budget for 2023/24 to support SIDO centres establishment in more rural
areas and renovations to have modern equipment that reflects the current environment and serves
young entrepreneurs both men and women.

3. Encourage Local Content Policy Implementation: Employment policies and guidelines that
influence job creation and provision mostly to investors in the country should be improved. The
government should encourage the implementation of local content policies to provide more job
opportunities to Tanzanians.

Conclusion

This comprehensive budget analysis for the fiscal year 2023/24 reveals that there are significant
disparities between the plans and allocated funds on one hand, and the actual disbursements on
the other. As seen in the education sector analysis above, a lack of budget credibility can have
significant consequences on people and may impede progress towards accomplishing Sustainable
Development Goals. Failure to meet cost targets in the education sector, for instance, raises
questions about the commitment to resolving the various issues that contribute to a poor learning
environment for students: overcrowding limiting students from getting the required amount of
attention from teachers; poor pit latrine ratio restricting a hygienic environment; and low
monitoring and evaluation to ensure accountability for progress.

To address these issues, it is crucial to enhance financial discipline, align planning and execution,
improve accountability mechanisms, and establish robust monitoring and evaluation systems. By
doing so, institutions can ensure optimal utilization of allocated funds, achieve desired outcomes,
and foster trust among citizens which will ultimately foster sustainable development.

Prepared by