Tanzania PM sidesteps calls to quit over graft claims

Reuters News
Posted: Nov 27, 2014 12:57 PM

DAR ES SALAAM (Reuters) - Tanzania's prime minister on Thursday sidestepped calls from a parliamentary committee to resign over accusations that he had approved illegal payments to a private power company.

Tanzania has discovered massive gas reserves off its coast, but the energy sector has long been dogged by allegations of graft, causing delays in disbursement of aid by donors.

Earlier this month, parliament received a report on an investigation into corruption charges made by opposition MPs, who said senior government officials had fraudulently authorized the transfer of at least $122 million of public funds.

On the basis of the report, the watchdog parliamentary Public Accounts Committee (PAC) called for Prime Minister Mizengo Pinda' resignation, accusing him of dereliction of duty.

"Let us wait until we conclude this debate and we will make a decision afterwards," Pinda said when asked by an opposition lawmaker if he would step down.

Pinda, who last week tried to block a debate in parliament over the graft report, is expected to make a formal statement to lawmakers on Friday over the affair.

"The prime minister should be made accountable for ... his failure to execute his constitutional duties," said PAC chairman, Zitto Kabwe.

The PAC also called for the resignation of Energy and Minerals Minister Sospeter Muhongo, saying he and other top officials had unlawfully authorized payment of the funds to the owner of an independent power producer, IPTL.

The funds held in an escrow account opened jointly by state-run power utility TANESCO and IPTL were paid to IPTL's owner, Pan Africa Power (PAP) in 2013. PAP said the transfer was legal.

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Muhongo told parliament the money in the escrow account had been deposited by the government as part of a power purchase contract it had signed, and therefore rightly belonged to IPTL.

Lawmakers are expected to conclude the debate on Friday and vote on the PAC recommendation for ministerial resignations. If parliament adopts the recommendations, Pinda and Muhongo will be required to resign.

A group of 12 international donors said last month they will only pay out outstanding pledges of budget support worth nearly $500 million if the findings of the investigation into the graft claims were published and appropriate action taken.

(Reporting by Fumbuka Ng'wanakilala; Editing by Duncan Miriri and Crispian Balmer)