Gov’t warns Air Tanzania board to stay compliant
The Tanzanian government has warned the new board of Air Tanzania (TC, Dar es Salaam) that it will be monitoring its performance closely and will fire those who fail in their duties.
Speaking at the appointment in Dar es Salaam of the state-owned airline’s new seven-member board on December 6, Works and Transport Minister Makame Mbarawa said: “The Government has done its part. It is time for you to do yours [and] for Air Tanzania to excel in the airline business. We need to feel the value for [our] money,” he was cited by Tanzania’s The Citizen newspaper.
“The government needs to see the results of the 11 aircraft purchased to bring benefits to the organisation and to operate commercially”, he was quoted by the Swahili-language Habarii news site.
Mbarawa’s warning followed the dissolution of the boards of the state-owned Tanzania Ports Authority (TPA) and the Shipping Corporation by President Samia Suluhu Hassan on December 4 over non-performance issues. She also directed the country’s corruption watchdog, the Prevention and Combating of Corruption Bureau, to investigate the two entities’ boards in connection with financial losses and irregularities highlighted in the country’s Controller and Auditor-General’s annual report (2019/20) published on March 28, 2021.
Mbarawa directed Air Tanzania to market the airline aggressively, make utmost use of its fleet, and excel at customer service. He said by 2023, the airline’s fleet would total 17 aircraft of which five are already in the procurement process. According to the ch-aviation fleets advanced module, Air Tanzania’s active commercial fleet comprises four A220-300s, two B787-8s, one DHC-8-Q300, and five DHC-8-Q400s.
For his part, Air Tanzania Chief Executive Officer Ladislaus Matindi reiterated his call to the government to review the current aircraft ownership structure where the state-owned TGF – Tanzania Government Flight Agency (TGFA) owns all government aircraft and leases them to Air Tanzania. This, he said, meant the airline by default inherited the government’s debt. “This plunges us into failure to expand our operation networks because of underutilisation of the fleet.”
As reported, the public spending watchdog – the National Assembly’s Public Accounts Committee (PAC) – in September had raised warning flags concerning contentious issues in contracts between Air Tanzania and the TGFA. Matindi had previously spoken out about the state-owned fleet ownership structure, flagging that it was affecting operations and the carrier’s ability to clear its debt.
The review by the Controller and Auditor-General revealed shortcomings in the Air Tanzania/TGFA operations, including unpaid monthly leases and maintenance fees by Air Tanzania to the TGFA for eight government-owned aircraft, including four DHC-8-Q400s, two A220-300s, and two B787-8s.
The Auditor-General noted that TGFA had invoiced Air Tanzania a sum of TZS79.6 billion shillings (USD34.5 million) in rental and maintenance fees, of which Air Tanzania had paid only TZS8.1 billion (USD3.5 million). Air Tanzania had claimed it could not afford the rates due to the persisting difficult business environment.
Following a complaint from the TGFA, the Ministerial Advisory Board (MAB) had ordered a review of the lease rates, but still, the Auditor-General was concerned that the non-payment of TZS71.4 billion (USD30 million) by Air Tanzania had raised the risk that TGFA would fail to carry out regular maintenance of the aircraft, reducing their lifespan and safety.
Tanzania’s National Five-Year Development Plan (2021/22 – 2025/26) has the government budgeting TZS2.9 trillion (USD1.2 billion) until 2025 to grow Air Tanzania to an airline operating 19 aircraft, uplifting 1.5 million passengers per year to 15 domestic destinations including Arusha, Bukoba, Dar es Salaam, Dodoma, Kilimanjaro, Kigoma, Mbeya, Mpanda, Mwanza, Mtwara, Songea, Tabora, and Zanzibar.