Radar money to be paid through BoT,with interest.

The 29.9million pounds penalty that was slapped on arms manufacturer, BAE Systems, by the UK court for accounting irregularities in the sale of military radar to Tanzania will be channelled to the government through the Bank of Tanzania (BoT). The National Assembly was told here on 22nd July 2011, that the penalty follows a ruling by a South work court in UK, after BAE agreed to an out of court settlement with Serious Fraud Office (SFO). Foreign Affairs and International Co-operation Minister, Mr Bernard Membe, said the UK parliament had supported the Tanzania’s government bid to have the money channeled to its coffers.


The British arms maker had several occasions insisted on paying the money through charity organizations. 
Mr Membe said this while winding budget estimates for the ministry for fiscal year 2011/12, that he had asked Finance Minister, Mr Mustafa Mkulo, to provide the company with bank details to wire the cash. “I have asked Mkulo to provide them with the account number, the bank and route number to transfer the money.I have also asked my counterpart Mkulo to give them a deadline to transfer the money. They should also pay interests for the funds for the past six months that they have kept us waiting,” he said.If the UK’s arms maker fails to pay the money on time, the foreign affairs minister said he would consult the Attorney General to take actions on the company. 

He said the UK parliament and Conservative government resolve to have BAE Systems pay the money to the Tanzanians government since the UK has been channelling aid money through the Official Development Assistance(ODA), General Budget Support (GBS) and Department for International Development since independence. “All this time the UK government has never complained of its funds being misused, the £29.9m is nothing. (BAE Systems) is an arms maker since when was it involved in politics,” queried the seemingly perturbed minister. He stressed that the money should be channelled to the government since it was taxpayers money and not otherwise. “It must come and come it must. Read my lips…it will be transferred to BoT and BoT only,” he said, rather seriously. 

Meanwhile, the minister said those involved in the shoddy contract that must be brought to books.He said his ministry was charged with recovering the funds while the Ministry of Justice and Constitutional Affairs, Good Governance as well as Prevention and Combatting of Corruption Bureau (PCCB) have been charged with following up with the suspects.“The suspects are there and they will be nabbed along the way. The responsible organs will mention them,” he said. The British arms manufacturer had earlier pleaded guilty to failure to keep "reasonably accurate accounting records" for its activities in Tanzania. The firm was required to pay £30 million as "ex gratia payment" to the people of Tanzania. 

In law, an ex gratia payment is a payment made without the giver recognizing any liability or legal obligation. 
President Jakaya Kikwete said in 2007 Tanzania would seek a refund from the UK if the long-running corruption probe into the sale of a British radar system reveals it was overcharged. A parliamentary sub-committee headed by Deputy Minister, Mr Job Ndugai (Kongwa-CCM), was dispatched to the UK to make follow up on the matter. 
The committee also comprised legislators Mussa Azzan Zungu (Ilala-CCM), Ms Angela Kairuki (Special Seats - CCM) and Mr John Cheyo (Bariadi East-UDP). 

Minister Membe hailed the team for their efforts to ensure that the funds are channelled through the government.While in UK, the MPs managed to meet and convince representatives from both the House of Commons and House of Lords that channelling the money through charities would undermine credibility of Tanzania.The SFO has been investigating a $39.5m (about 53bn/-) contract signed in 1999 to supply a radar system to Tanzania and relates to payments of $12m to Shailesh Vithlani, BAE's former marketing advisor in Dar es Salaam.


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