The Controller and Auditor General (CAG), Dr. Charles Kichere, has presented the main audit report for the 2023/2024 financial year to President Dr. Samia Suluhu Hassan at the State House in Dar es Salaam.
The report highlights significant financial challenges facing the Tanzania Railways Corporation (TRC), which recorded a loss of TSh 224 billion—more than double the TSh 102 billion loss from the previous year.
Dr. Kichere attributed the sharp increase in TRC’s financial deficit to a decline in transportation revenue caused by a shortage of locomotives and wagons.
This limitation hampered the corporation’s operational efficiency, while prolonged heavy rainfall forced the closure of railway lines for four months, further exacerbating revenue losses.
“The Tanzania Railways Corporation (TRC) recorded a loss of TSh 224 billion, compared to a loss of TSh 102 billion in the previous year. This was largely due to a decrease in transportation revenue caused by a shortage of locomotives and wagons, as well as heavy rainfall that led to the closure of railway lines for four months,” Dr. Kichere stated.
To mitigate the financial shortfall, the government provided TRC with a subsidy of TSh 29.01 billion. However, Dr. Kichere pointed out that without this support, the total loss would have ballooned to TSh 253 billion, underscoring the corporation’s heavy reliance on government funding.
“The corporation received a government subsidy of TSh 29.01 billion. Without this support, the total loss would have amounted to TSh 253 billion,” he added.
Dr. Kichere emphasized that the audit report only covers the period ending June 30, 2024, before the Standard Gauge Railway (SGR) became operational.
Therefore, revenues generated from the SGR were not factored into TRC’s financial assessment. This suggests that with the full operation of the modern railway system, the corporation’s financial outlook may improve in the future.
“It is important to note that this report covers the period ending June 30, 2024, before the Standard Gauge Railway (SGR) trains became operational; therefore, SGR revenues are not included here,” he clarified.
To address the financial challenges and ensure sustainability, Dr. Kichere recommended that TRC focus on enhancing operational efficiency, boosting revenue collection, and implementing cost-cutting measures.
He also urged the corporation to develop a strategic plan for acquiring additional locomotives and wagons to meet growing transportation demands.
“Your Excellency, I recommend that TRC concentrate on improving operational efficiency to enhance revenue collection and adopt effective cost-reduction measures. The corporation should also develop a comprehensive plan to acquire train engines and wagons to meet transportation demands adequately,” Dr. Kichere advised.
The audit report underscores the urgent need for TRC to strengthen its financial and operational strategies.
Reducing dependence on government subsidies while maximizing revenue potential will be crucial in ensuring the sustainability of Tanzania’s railway sector.
The findings are expected to influence future policy decisions on railway infrastructure development and transport sector reforms in the country.