The government has warned underperforming public entities to urgently improve their performance, stressing that institutions that continue to post poor results over an extended period will not be tolerated.
The warning was issued by the Treasury Registrar, Mr Nehemiah Mchechu, during a special interview in Dar es Salaam on Friday ahead of the Gawio Day event, which is scheduled to take place at State House on Tuesday, June 30, 2026.
Mr Mchechu said all public entities required to remit dividends and other statutory contributions to the government must do so on time, noting that failure to meet the obligation deprives both the government and citizens of revenue that rightfully belongs to them.
"Public entities do not belong to boards of directors or management teams. They are public assets held in trust by the government. Returning what rightfully belongs to citizens is therefore not a favour, but an obligation," he said.
He stressed that leaders of public entities must deliver on the profitability targets assigned to their institutions in order to maximise their contribution to the national economy.
"Our institutions must live up to the profit targets we set for them. Any leader who consistently fails to deliver dividends over a prolonged period is simply not fit for the job," Mr Mchechu warned.
He also cautioned institutions against borrowing funds to finance dividend payments or other statutory contributions, saying such practices create a false picture of financial performance.
"If you borrow money simply to pay dividends or other government contributions, you are misleading Her Excellency President Samia Suluhu Hassan and ultimately deceiving yourself," he said.
Responding to a question on whether institutions that fail to perform well in this year's dividend exercise could be dissolved, Mr Mchechu said the merger or dissolution of public entities follows an established review process and is not determined solely by Gawio Day results.
“We do not dissolve institutions based on Gawio Day results. We first allow time for improvement, and only take appropriate action if they fail to demonstrate meaningful progress,” he explained.
During the 2024/25 financial year, the Office of the Treasury Registrar (OTR) collected Sh1.028 trillion in dividends and other contributions from public entities and companies in which the government holds minority shareholdings the highest amount recorded since the office was established in 1959.
Despite the achievement, Mr Mchechu said the government believes there is still considerable potential to increase collections by strengthening the performance of public entities and enhancing oversight of public investments.
Looking ahead, he said OTR believes that ongoing improvements in the operational and financial performance of public entities will be reflected in this year’s final results, with further gains expected in the coming years.
"We are entering the new financial year with renewed determination. We expect to break last year's record this year and set an even higher benchmark next year," Mr Mchechu said.
His remarks echo those of the Minister of State in the President's Office (Planning and Investment), Hon Prof Kitila Mkumbo, who recently warned that persistently underperforming public entities risk being merged or dissolved if they fail to improve.
Prof Mkumbo said it was unacceptable for some public institutions to continue failing to pay dividends despite the substantial public investment committed to them.
He said the government would give underperforming entities sufficient time to implement corrective measures before making decisions on mergers or dissolution where necessary.
"It is better to have fewer commercial public entities that consistently deliver meaningful returns to the government than many that fail to perform," Prof Mkumbo said.
According to OTR, the government holds shareholdings in 308 public institutions and companies, of which 91 operate on a commercial basis while 217 are non-commercial service-delivery institutions.
Prof Mkumbo said the government expects Tanzanians to derive greater value from the Sh92.3 trillion invested in public institutions and enterprises.
To support that objective, OTR said it is continuing to strengthen performance management across public entities in order to improve service delivery and maximise returns on public investment.
Ms Lightness Mauki, Director of Performance Management, Monitoring and Evaluation for Commercial Public Entities at OTR, said the office remains committed to enhancing institutional performance through stronger performance management systems.
"We believe that effective performance management is the foundation for sustainable transformation across public institutions and enterprises," Ms Mauki said.
She added that stronger performance oversight would boost productivity, stimulate economic growth and increase both tax and non-tax revenues, thereby strengthening the government's capacity to deliver development programmes and quality public services.
Meanwhile, Mr David Shambwe, the Director of Non-Commercial Public Entities at OTR, said although non-commercial entities are not established to generate profits, they are expected to demonstrate efficiency in service delivery and prudent use of public resources.
He said OTR continues to strengthen monitoring and evaluation systems to ensure such institutions operate efficiently, remain accountable and deliver value for money.
"Our goal is to see non-commercial public entities providing high-quality, impactful services that meet citizens' expectations. Their efficiency is critical to ensuring that public investment delivers meaningful outcomes for national development," Mr Shambwe said.
