CORRUPTION – THE LATEST

Action by Parliament, the media and the judiciary continue on several allegations of corruption and Tanzania has again set a good example by revealing to the public more and more new cases of alleged corruption, or inefficiency in the public service.

The Richmond/Dowans saga
In what The East African describes as the ‘Scandal which just won’t go away’ (it was in 2006 that TANESCO contracted the Richmond Development Company to supply emergency electricity to Tanzania’s Tanesco) there has been a major new development. In 2008 Dowans (the company which took over from Richmond because the latter did not perform satisfactorily) appealed to the International Commercial Court (ICC) to arbitrate in its dispute with the government. The previous history of this case has been covered extensively in earlier issues of TA.

In December 2010 the ICC ruled in favour of Dowans and required Tanzania to pay $65.8 million (TShs 94 billion) compensation for breach of contract by Tanesco. Tanzanians were shocked at the size of the award and many were very angry and wanted the government to refuse to pay. The President, parliament and the media were immediately involved in a huge controversy. Should Tanzania pay or not? Energy and Minerals minister William Ngeleja announced that he had received instructions from Attorney General Frederick Werema to pay Dowans. East African Cooperation minister Samwel Sitta and Works Deputy minister Dr Harrison Mwakyembe queried the legality and the speed with which the problem was being handled.
In a speech broadcast live on radio and television President Kikwete said he was not for or against payment. He said the issue was legal and the government would do everything possible to ensure that the penalty was successfully challenged so as to spare taxpayers the enormous cost. He also declared that he neither had shares in Dowans nor did he know the firm, adding that he was not protecting ‘friends’ alleged to have a stake in the company…. I don’t have even a single cent in shares in Dowans…..I agree with those who say that we should not hasten to pay Dowans all those billions of shillings,” he added.

Prime Minister Mizengo Pinda said a CCM committee had resolved to engage legal experts in pursuing the case so as to spare Tanzanian taxpayers.

The Guardian wrote about how the ICC’s judgment had come with a ‘stunning revelation on how the ‘Mafia style’ described in Mario Puzo’s novel the Godfather, had played a crucial role in awarding Richmond and later Dowans a lucrative tender deal.’ The paper went on to say that the judgment had indicated why Dowans had been awarded a multi-billion shillings compensation package, thanks to failure by Tanesco lawyers to include corruption in their main issues as well as the government’s move to break the laws it was supposed to supervise and respect.’

On February 20 the previously mysterious owner/principal shareholder of Dowans arrived in Dar es Salaam. He is Brigadier General (retired) Sulaiman Mohammed Yahya Al Adawi from Oman. He said that he had come to negotiate with Tanesco and talked of the possibility of varying some of the damages due to him. He did not want his photograph to be taken. He said he formed Dowans Ltd with the aim of assisting Tanzania with its power problems. He wondered the why the media had portrayed his company so badly.

He revealed that he had given power of attorney to a Tanzanian businessman-cum-politician, Rostam Aziz, a prominent CCM MP, who is also a member of the ruling party’s National Executive Committee. “There are people who are misinformed and have been criticising Dowans as a fake company even though it owns substantial power generation capacity.”

The next day Mr Al Adawi visited the generating plant. According to the Citizen, while entering the premises, security guards were seen saluting and no reporter was allowed to cover the visit. When asked later who the visitor was, the security guards said they did not know him but as he was accompanied by three people from the company they had allowed him in.

Speaking later, Mr Al Adawi said that he was touched by the power problems affecting Tanzanians and was ready to assist. “With good intentions and in the spirit of an amicable resolution, it is my sincere hope that Tanesco, the government and the people of Tanzania will listen to us so that we can together see how to work to alleviate the current electricity crisis.’

Richmond was ‘technically poor.’
In mid April, in a court case involving Richmond’s Tanzania Director, evidence was given which alleged that the Richmond Development Company LLC of Texas, had been ranked last among eight companies which had submitted bids for the original tender to produce 100 megawatts of emergency power. It was alleged that in the evaluation of the bids Richmond failed in the technical specifications but at a later stage the tender documents were taken over by the government – Majira.

The Radar scandal
The Citizen reported in February that former Attorney General Andrew Chenge had said that investigations by the Serious Fraud Office (SFO) of the United Kingdom and the Prevention and Combating of Corruption Bureau (PCCB) had confirmed his innocence from the 1999 corruption case. “I am happy that the truth has finally been revealed,” he said about allegations that he was involved in the controversial purchase of a military radar system from BAE Systems, which he partly oversaw while serving as Attorney General….. The purchase of the radar followed all procurement procedures in the country as proved in the court,” he said…..”I am very faithful. I have worked in all four phases of the government and when I resigned I was not fearing about losing my job because I knew that I had done nothing wrong.”

Mr Chenge resigned on April 20, 2008 as minister of Infrastructure at the height of the radar scandal investigations. His resignation followed a public backlash after it was revealed by the SFO that he had stashed about $1 million away in an offshore account as kickbacks from the military radar deal – Guardian. Tanzania and Kenya have unveiled plans to replace the radar system in their air traffic control with Automatic Dependent Survey Broadcast (ADS-B).

PCCB Employees sacked
The Prevention and Combating of Corruption Bureau has fired six of its employees and mutually agreed not to renew the contracts of five others due to unethical conduct.

At the annual PCCB workers’ convention in Arusha the head of the Bureau said that last year the PCCB had prosecuted 10 major corruption cases and 8 others had been submitted to the Director of Public Prosecutions for consent to prosecute.

Speaking at the same meeting the new Vice President of Tanzania, Dr. Mohammed Gharib Bilal, told leaders that they should concentrate their efforts on local government authorities and construction sector projects….. “We have major problems in procurement as we have little value for money in most such projects” he said – Mwananchi.

President Mkapa
Former President Benjamin Mkapa and his wife, Anna, have wound up their company (voluntary liquidation), ANBEM Limited which was alleged to have been linked with the controversial acquisition of the state-owned Kiwira coal mine. According to the Citizen, the ANBEM saga has damaged the legacy of Mr Mkapa, who was credited with transforming the economy and enhancing public accountability during his 1995-2005 tenure. But several politicians have strongly defended the former President, terming certain allegations of abuse of office as ‘baseless’.

Minister uncovers massive fraud
Minister of Construction John Magufuli has exposed a massive plot to cheat the government of an amount to the tune of Shs 5 billion for a Dar es Salaam road construction project. The Minister went to the site to find out the actual number of houses that would need to be compensated to allow the project take off. It was alleged that evaluation officials from Ilala, Kinondoni and Temeke municipalities had plotted to increase the costs. In some cases houses were ‘ghost’ ones. The minister directed all Dar Salaam District Commissioners to review the situation and report back to him as soon as possible – Mtanzania.

Suspected shoddy deal in Tanesco
The Parliamentary Standing Committee on Energy and Minerals has ordered Tanesco to submit to them all contracts entered into with gas exploration firms after the Committee became suspicious of the terms awarded to some firms. The Committee discovered that Tanesco had entered into a contract with a foreign firm that obliged it to buy gas for electricity production in US dollars rather than Tanzanian shillings which was not correct – Tanzania Daima.

Public Funds
The Controller and Auditor General (CAG) has released a new report that shows massive faults in keeping proper government accounts.

The report queries over-expenditure of a TShs 48 billion stimulus package, meant for rescuing businesses affected by the global financial and economic crisis. Speaking to journalists in Dodoma, the CAG, Ludovick Utouh, said he found no records to show who benefited with the package. Utouh also queried the delay in implementation of the national identity cards project saying it caused great losses to the nation – Mwananchi.

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