President Samia Suluhu Hassan addresses various leaders before officially opening the Working Session of Board Chairs and Chief Executives of Public Institutions at the Arusha International Conference Centre (AICC) on August 28, 2024.Photo: State House
By Adonis Byemelwa
President Samia Suluhu Hassan has taken a bold stance against recent decisions by the Office of the Treasury Registrar, which led to the dissolution and merger of several underperforming public organizations.
Her remarks, delivered on August 28, 2024, at the second working session for board chairs and chief executives of public institutions, have ignited a spirited debate on the future of these entities.
In her address, President Samia described the widespread reactions to the Treasury Registrar's decision, which combined 19 organizations into seven. She expressed frustration with the resistance to reform, noting that some organizations, despite their lackluster performance, have generated undue controversy.
Taking the National Development Corporation (NDC) as a focal point, President Samia highlighted its long-standing inefficacy. "Since my early days in 1977, the NDC has been a name in the background," she remarked. "It was once known for producing 'National' radio batteries and General Tires, but its projects have been failures."
She highlighted the contrast between the NDC’s historical prestige and its current obscurity, suggesting that its projects have not lived up to expectations.
Prof. Damian Gabagambi, the former Managing Director of the NDC, had a different vision for the corporation. In January 2020, Gabagambi articulated ambitious plans to revitalize the NDC’s moribund projects and reduce dependency on government funding.
“We are working hard to revive all the long-dead projects and lessen our reliance on the government,” he stated. Under his leadership, the NDC managed to sell 684 tractors valued at over Sh30 billion and create 2,000 jobs.
Prof. Gabagambi also highlighted the success of rejuvenating rubber tree plantations, which saw production rise to 86.7 tons valued at Sh210 million and provided 288 Tanzanians with employment.
Despite these efforts, President Samia criticized the NDC's overall impact. "While the NDC had noble goals, it seems those goals were outdated and needed to be reconsidered," she said. "It’s evident that some organisations must be re-evaluated or phased out if they fail to contribute meaningfully."
In contrast, President Samia praised the effectiveness of the merger that led to the creation of the Plant Health and Pesticides Authority (TPHPA). The TPHPA was formed by merging the Tropical Pesticides Research Institute with plant health services, streamlining operations, and achieving international certification standards.
"The consolidation of these functions into TPHPA has enabled Tanzania to secure international quality certifications, enhancing our global market standing and revenue collection," she explained.
The President emphasized that while merging or dissolving organizations may be controversial, it can lead to greater efficiency and effectiveness. "If an organization created in the past is no longer performing well, there’s no harm in dissolving it," she said. "We must not protect failing institutions or positions that don’t yield results."
The Head of State’s comments also touched on the broader implications of these organizational changes. “Our goal is to ensure that public institutions are productive and contribute to economic growth,” she said. She contrasted this with foreign companies that secure contracts and generate revenue for their home countries. “Our local organizations must be able to compete effectively and generate value,” she asserted.
The President’s remarks on the controversial merger and dissolution of public organizations have sparked a fierce debate, reflecting a broader conversation about public sector efficiency in Tanzania. Her criticism of the National Development Corporation (NDC) underscores a critical juncture for Tanzania’s public institutions.
She denounced the NDC’s historical failures, contrasting its decline with the successful reform stories from around the world. Nations like South Korea and Singapore have demonstrated the benefits of modernizing and streamlining state-owned enterprises. For instance, South Korea's transformation of its industrial sector through strategic mergers and privatizations has fueled its rise as a global economic powerhouse. Similarly, Singapore’s Public Utilities Board has become a model for efficiency after consolidating multiple agencies into one streamlined entity.
President Samia pointed out that, despite efforts to revitalize the NDC by reviving old projects and creating jobs, the corporation’s impact remained minimal. Prof Gabagambi had ambitious plans to reinvigorate the NDC, aiming to cut dependency on government funds and boost productivity. “We are working hard to revive all the long-dead projects,” he stated, highlighting achievements like selling 684 tractors and rejuvenating rubber plantations. Yet, President Samia's critique suggests these efforts were insufficient in addressing the NDC's systemic issues.
The contrast with successful global reforms is stark. Countries that have embraced similar transformations, such as the consolidation of public institutions to enhance efficiency, offer compelling examples.
In Africa, Rwanda’s streamlined approach to governance and service delivery has positioned it as a regional leader in public sector management. These examples illustrate the potential benefits of rethinking and restructuring public organizations to meet modern demands.
The Head of State's stance is clear: outdated institutions that fail to perform must be re-evaluated or phased out. She argued that protecting failing organizations, even with good intentions, hinders progress. “If an organization created in the past is no longer performing well, there’s no harm in dissolving it,” she asserted. Her comments reflect a broader push for reform that aligns with successful global practices.
In contrast, Prof. Gabagambi’s vision for the NDC, which focused on revitalizing old projects and reducing government dependence, faced significant hurdles. His ambitious plans, though well-intentioned, seem to have fallen short of the transformative impact needed to align with modern standards of efficiency and effectiveness.
The debate over these changes in Tanzania mirrors broader global discussions on public sector reform. As countries around the world streamline their public institutions to better serve their citizens, Tanzania stands at a crossroads. The decision to embrace these reforms will be crucial in determining whether Tanzania can emulate the success of nations that have effectively restructured their public sectors.
The unfolding discussion highlights a critical decision for Tanzania’s future: whether to continue protecting outdated institutions or to embrace a reform agenda that promises greater efficiency and effectiveness.
In closing, President Samia reinforced her call for genuine change and reform within public institutions. “The time for change is now. We must be willing to embrace reform and ensure our organizations are serving their intended purposes effectively,” she concluded.