It is now official. Development partners (DPs) have not released even a single dollar out of the $558 million (Sh937 billion), that had been pledged to boost Tanzania’s 2014/15 Budget.

They will only give it out upon seeing—and being satisfied with—the outcome of the investigations into the controversial payments of Independent Power Tanzania Limited (IPTL) escrow monies to Pan Africa Power Solutions Tanzania Limited (PAP).

The DPs chairperson and Finnish Ambassador to Tanzania, Ms Sinikka Antila, Tuesday confirmed to The Citizen that the money, which was meant to support the country’s 2014/15 general budget, had been suspended, pending the release of the IPTL probe reports.

Ms Antila said the donor community was concerned over how the escrow monies were paid to the company that claims to have bought 70 per cent shares of IPTL, which were held by a Malaysian firm, Mechmar Berhad Corporation.

The donors, said the Finland ambassador, would for the time being wait for the final CAG report before making any categorical commitment to support the national budget.

“Budget support development partners in Tanzania take the emerging IPTL case with the utmost seriousness and are carefully monitoring its development as the case involves large amounts of public funds,” she said.

“We meet with the government regularly to discuss budget support issues,” said Ms Antila.

Key findings

According to Ms Antila, in March 2014, firm commitments for budget support in the financial year 2014/15, worth $558 million, were communicated to the government with the caveat that releases would be informed by developments in relation to the IPTL case.

She said the DPs’ contribution to the budget finances stood at approximately five per cent of the national public expenditure programme.

“Development partners are now awaiting the CAG report and information about its key findings, as well as a response from government, which will determine our decisions on further disbursements,” said the envoy.

On Sunday, Kigoma South MP David Kafulila (NCCR-Mageuzi), told reporters that donors, especially those in EU countries, were withholding funds meant to support the 2014/15 budget pending the release of the two probe reports on the $250 million in escrow monies, part of which was paid directly to Pan Africa Power Solutions Tanzania Ltd (PAP) after the company claimed it has bought 70 per cent shares in IPTL.

“If the government fails to take serious measures against the culprits, it is obvious donors will not release funds,” he said,

Earlier this year, Mr Kafulila took the matter to Parliament following an exposure of the multibillion scandal by The Citizen newspaper.

The MP further threatened that if the government failed to release the two reports, he would move a motion of no-confidence against either Prime Minister Mizengo Pinda— who also defended the deal before the House—or the President.