At least 15,000 former Tanzanian employees of institutions that operated under the defunct East African Community, EAC, are yet to be fully paid their terminal benefits over 33 years after the collapse of the Community on February 6, 1977.
The process towards the settlement of retirees’ terminal benefit was started in earnest by the third phase administration of President Benjamin Mkapa who had vowed to ensure that all former employees of the defunct EAC were fully paid their terminal benefits by the time he stepped down from the leadership.
In one of his May Day speeches, President Mkapa said his government would pay the former EAC employees 450bn/- in terminal benefits.
However, when the government finally decided to implement the president’s pledge, for inexplicable reasons, the then Minister for Finance, Mr Basil Mramba told the nation in a press conference he convened in Dar es Salaam that only 50bn/- would be paid out to the former EAC employees.
Mr Mramba could not however, explain to the nation why the government had decided to pay out 50bn/- instead of what the president had pledged, 450bn/-!
Perhaps the worst part about the whole affair was that as Mr Mramba assumed the roles of the government’s chief spokesman and paymaster general, the very man who had told the nation for the first time that his government would honour its obligation to the former employees of the defunct EAC, President Mkapa, elected to keep mum in the whole affair until he stepped down at the end of 2005!
Unfortunately for the former EAC employees they had not heard the last confusing announcement!
For a few weeks later the same controversial minister told the nation that those entitled for the payment were 31,000 employees!
The latest announcement shocked the former EAC employees because if there were any organizations in Tanzania that were second to none when it came to record keeping such organizations included the former EAC institutions.
The institutions record included, among others, employees’ employment dates, when they were promoted and above all, how much each was entitled to in terms of terminal benefit.
According to existing employment record of Tanzanian employees in the defunct EAC, those entitled for terminal benefit were 15,000 and not 31,000!
What had led Mr Mramba and his equally controversial Permanent Secretary, Mr Gray Mgonja to come up with the 31,000 figure is open to conjencture.
Before payment of terminal benefits was effected by the government in 2005, Mr Mramba announced that the government had resolved to increase 67bn/- over and above 50bn/-, hence bringing the total sum to 117bn/-.
What was interesting about the Tanzania government’s 31,000 as opposed to 15,000 was that it had (government) decided to include former employees of what had come to be known as the cargo Handling Services which was not part of the EAC institutions!
And as if that was not enough, there had been reports, during the time of payment of part of the terminal benefits, that some of those paid had never worked for the EAC institutions in their lives!
Again why the government, through the ministry of finance led by Mr Mramba and Mr Mgonja, had decided to bring into the list employees who had never been part of the defunct EAC institutions is difficult to fathom.
The seriousness of the ministry of finance’s decision to double the employees’ figure, lies in the fact that the terminal benefits was a result of deductions 15,000 bona fide Tanzanian employees in the EAC institutions had been subjected to in the course of their services.
The deductions were effected differently, in accordance with one’s salary earnings and were collected by a British company, Crown Agents.
After the collapse of the Community on February 6th 1977, the then East African Authority constituted by the three East African heads of state, President Julius Nyerere of Tanzania, President Jomo Kenyatta of Kenya and General Idi Amin Dada of Uganda appointed a Swiss diplomat, Dr Victor Umbritch to look into how the defunct EAC’s assets could be equally distributed to the three states.
The assets had included, among other things, planes that had been owned by the East African Airways, engines and coaches that had belonged to the East African Railways and other immovable property located in different EAC states.
Finally it was decided, under a commission led by Dr Umbritch, that terminal benefits payable to the former EAC employees would every year gather 7 percent compound interest, meaning that the best way of avoiding such interest was to pay out as soon as possible.
Unfortunately despite the institution of the 7 percent compound interest, the Tanzanian government behaved as if such payment did not exist hence reaching 450bn/- as had been rightly announced by President Mkapa when he first made public his intention of honouring payment of the terminal benefits before he stepped down.
However, unlike Tanzania, its neighbours, Kenyan and Ugandan governments paid, as usual, promptly their former employees of the defunct EAC’s institutions.
Meanwhile in order to ensure that payment of terminal benefits in accordance to what each employee was supposed to, depending on how much one earned in salary, was ignored.
And instead the majority of people whose salary had been somewhat low were paid 2m/- regardless of the number of years they had worked for the EAC’s institutions!
Most of those who were each paid 2m/- were from the additional 15,000 emplouyees from the erstwhile Cargo Handling Services who had not only never worked for the EAC’s institutions, but had during their working tenure never had their salaries deducted for any kind of terminal benefit!
In a nutshell, to the latter group, the 2m/- was nothing but free money!
Roughly, 30bn/- was paid out to a group that was not supposed to be paid anything in the first place, hence robbing the first bona fide group of 15,000 employees of their rightful terminal benefits!
In short, the bona fide group of 15,000 former employees of the defunct EAC’s institutions were, again for reasons best known to Mr Mramba and Mr Mgonja, twice robbed of their rightful terminal benefits.
Firstly through the inclusion of the additional group of 15,000 employees from Cargo Handling Services and secondly, through the reduction of their terminal benefits from 450bn/- to 117bn/-.
It was after being subjected to such injustices that the former employees decided to seek redress from the country’s law courts where they won the case but two Tanzanian governments, under Presidents Mkapa and now, Jakaya Kikwete, have until now defied court order to pay the employees their terminal benefits in full.
However, there are unconfirmed reports that President Kikwete may finally pay the former EAC employees before the General Election scheduled for October 31st 2010.
By Attilio Tagalile
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