United Nations Public Service Awards Case Studies

The Government of the United Republic of Tanzania has since 1990s being undertaking a number of social economic reforms as well as political reforms in the country. The objective was to empower Tanzanians to participate in the growing economy that will ultimately reduce extreme poverty. However, the pace of growth of the economy both from the Individual point of view to the country at large was significantly very low.

This has became obvious in the years 2003/2004 when it was clearly seen that despite the efforts being exercised at various levels of the government, the trickle down effects on the Reforms being undertaken could not be felt by the poor Tanzanians. This was due to the existence of parallel systems in the same economy in the country. Efforts were seem to be directed to the formal system where majority of Tanzanians do not belong to. This was particularly true in respect of property ownership as well as business operation framework.

The Diagnostic study carried out from the month of November 2004 to July 2005 through the Property and Business Formalization Program has proved existence of the problem which warranted for an immediate intervention. It was discovered that 98% of businesses were being operated outside the legal framework and 89% of real estate’s assets were owned extralegally making the assets owned to be dead capital since could not be used in the process of capital formation. Extra legal assets are those assets owned and used outside the existing legal framework or do not fully comply with the law.
Specifically they would lack any of the following mechanisms for creating wealth:-
• Legal and economic mechanisms that increase productivity through the creation of “distinct legal entities”, incorporating “asset partitioning” and an efficient “division of labor”.
• Legal means for enterprises to operate in the expanded market, acquiring the capacity to gain access to networks beyond family members and circles of acquaintances.
• Formal, fungible property rights that not only allow assets to be identified but also allow ordinary people to move them in the expanded market to capture as much economic value as possible.
It was further observed that citzens have created their own ways of doing things outside the legal framewrok. The researchers called such traditional ways of doing things as “Archetypes”.

According to the research carried out by a team of experts from the Institute of Liberty and Democracy (ILD) of Lima Peru assisted by a team of local professionals in the country, the value of the assets owned and operated outside the rule of law was Valued at US 29.0 Billion (say US$ Twenty Nine Billion).

As a result of the above situation, it was even difficult to coordinate the growth of the economy since no body was able to know who is who, who does what, who owns what. Specific model of navigating the reforms was necessary if the problem was to be solved.

What is the initiative about? (the solution)
The Government have created MKURABITA for the purpose of Designing and Operationalising systems and procedures towards existence of a unified intergrated registy to avoid the existence of duo and parallel systems in property ownership and business operations. The gist of the matter is seen at the third phase of the four phases Program. This is the Implementation of the legal and institutional reforms designed in the second phase (The Reform Design Phase) to address the findings of the the Diagnostic study carried out in the first phase. One of the finding was that our laws are difficult, cumbersome and expensive to adhere to. In a nutshel there was no incentive to adhere to the laws relating to properties and businesses. The implementation phase entails among other things, amendment, enactment and change of some property and business laws. Before the initiative the respectiv e ministries could have just decided on the required change, follow the normal steps in the government until it reaches the parliament. Experience has shown difficulties in implementing such laws dsinged using Top - down approach. The initiative proved the importance and the magic of using a participatory approach in amendment and enactment of various laws and policies. The root of the changes was strengtherned during the reform design which used the “Convergence analysis” to design the proposed reforms. Convergence analysis approach entails the Top – Down approach where by laws were critically looked at in order to establish the reasons for non adherence of the laws. Therefater the reformers agreed on the need to simplify the laws towards the needs of the people/ the citzens. The Convergence analysis also entails the Bottom - Up approach where by the peoples’ ways of doing things was analysed to find seeds of good things which can be standardised towards the requirements of the laws. The Botom – Up and Top – Down converged at the middle to get a unified rule of law which all Tanzanians can respect and be identified with. This means that the need for the change arrised grom the people themselves, and the proposed changes considered their ways of doing things. Therefore enforcement of the changes have been easier. The key benefits of the initiative are in the following areas; Sensitization of stakeholders has become easier since the beneficiaries were involved in proposing the required changes. The formation of taskforces for the process to review the reforms will facilitate the mainstreaming process and hence will easy the implementation and enforcement of the proposals. Reduction and or elimination of bureaucracy in the system which has always been the case in the government systems. Cost of implementation of the reforms will be minimised due to the local ownership melement embed in the reforms. Will enhance the participation of citzens in the economig growth and poverty reduction effors. People will own properties and operate their bussinesses in a legal framework and will therefore enhance capital formation. From the baseline survey before and after the initiative the quaitative achievements will be measured.

Who proposed the solution, who implemented it and who were the stakeholders?
The creation of the Program to formalize properties and businesses in Tanzania was done by the Government through a senior government officials meeting that involved also members of partliament and ministers. It is the Goverment with the advice of the Consultant who decided on the phases for MKURABITA. However, the decision to the approach was made by the Program Management Unit MKURABITA as it continued to implement its activities. The need for local ownership and participation from all levels began at the second stage when it was necessary to even change the approach by creation a Local Reform Design Team in order to make sure that the needs of the people and the on going program activities are being adequately addressed during the process. A local Reform design nteam of 5 individuals from ministries strategic to the operations of MKURABITA. It is the work of the team which produced the reforms that are now being implemented. These ministries are Lands, Housing and Human Settlement, Constitutional Affairs, Ardhi University responsible in academic development on Property matters, The Ministry of Energy, Construction and Lands for Zanzibar as well as Co nsrituional Affairs for Zanzibar. Local Goovernment have always been at the forefront and that the implementation is mainstreamed to the local government. The empowernment and Capacity Building initiative is being used to facilitate the Local Government’s ability to work on reforms. Regular stakehoders meetings have put every stakeholder accordingly on board. To facilitate implementation of the reforms by the people had sstart from ther Ministries themselves. The following five task forces have been created; • Taskforce between MKURABITA and the Ministry of Lands, Housing and Human Settlement for the purpose of reviewing reform proposals related to land matters for Tanzania Mainland. • Taskforce between MKURABITA and ministry of Industries, Trade and Marketing for the purpose of reviewing proposals related to business matters for Tanzania Mainland. • Taskforce between MKURABITA and Ministry of Local Government Authorities for discussion of proposal that touche the Locval Government directly. • Taskforce between MKURABITA and Ministry of Energy, Constgruction and Land for Zanzibar mandated to discuss on reforms relate to property matters in Zanzibar. • Taskforce between MKURABITA and Ministry of Trade and Investment also in Zanzibar for business matters. Stakehoders were categorised into beneficiaries who were directly getting thebenefits of the exercise e.g owners of the properties and those doing businesses. The second groupd is for the involved parties. These are those who were not directly benefiting from the process but were directly involved in implemetation, making various decisions or cordination of impelemtastion. These ranges from Government sector minisrtries, Government agencies, Other reform programs, members of paprliament, Academic Institutions etc.

Describe how and when the initiative was implemented by answering these questions
a. What were the strategies used to implement the initiative? In no more than 500 words, provide a summary of the main objectives and strategies of the initiative, how they were established and by whom.
The design stage ended on May 2008 after which the Program embarked itself on the preparation of the work plan. The work plan was prepared by involving most of the stakeholders from the sector ministries, Local government, NGOs with interest on property and business issues, academic institutions and private organizations. The work plan was set for 10 years but categorised into long term, medium term and short term plans. The Long term plan coverd 10 years. The ten years work plan reflected the overal picture of what MKURABITA wants to do to attain the government objective of transforming awners of properties and operators of businesses in the informal sector to the formal sector. All the activities were centred around five areas. These are; • Activities to facilitate formalization of Rural and urban land in Tanzania Mainland. • Activities to facilitate formalization of businesses in Tanzania Mainland • Activities to facilitate formalization of Rural and urban land in Zanzibar. • Activities to facilitate formalization of businesses in Zanzibar. • Activities to facilitae economic use of properties and business assets From the ten years work plan, a medium term plan of five years was developed focusing on the same main areas of concentration. The medium term plan was more detaile than the ten years plan. The third category is the short term plan which was a one year plan extracted from the five years plan. The plan considered the mainstreaming of the activities to the local authorities (District, Municipal and Town Councils). Implementation started in July 2008 after having the work plan completed and approved by the appropriate authorities. Implementation entailed the following; • Institutionalising and navigation of the legal and institutional Reforms designed during the second phase. • Building capacities within the Local Government Authorities (LAGs) for sustainable and cost effective formalization of real properties and businesses as well as facilitating their effective participation in regulating the property markets in their areas of jurisdiction. • Institutionalizing development and strentherning at national level to establish the machinery for developing, funding and overseing implementation of the Property and Business Formalization • Implementing MKURABITA Communication Strategy that seeks to build stakeholders consensus on the proposed changes and to establish a platform for strategic dialogue between the beneficiaries and other stakeholders on the one hand and the Government Authorities and the main non state actors in the informal sectors of the economy on the other hand • To facilitate Capital Formation and Good Governance that will lead to beneficiaries using formalized assets to access credit and other economic benefits available in the formal economy.

b. What were the key development and implementation steps and the chronology? No more than 500 words
Navigation of the MKURABITA Reforms started after the successful completion of the diagnosis and begining of the reform design. The cronological steps for the process were as follows: Step 1:Confirmation of findings established during diagnosis. Step 2: Establishment of the Local Reform Design Team (LRDT) with the objective of ensuring a local ownership, sustainability and cost effectiveness. Step 3: Specific Training and orientation to the Local Reform Design Team by the Consultant who was driving the seat during phase 1 and part of phase 2. Step 4: Addressing the convergence analysis by analysing the Top – Down and the Bottom Up approoaches Step 5: Preparation of Draft Reforms for discussion with stakeholders. Step 6: Incorporating views of the stake holders conference resolutions. Step 7: Consesus building on the reforms at various levels including Ministers, Permanent secretaries, Members of Parlianment, Councilors, District executives, as well as the general public. Step 8: Formation of Task forces with relevant sector ministries to review reform proposals related to the respective ministry. The respective ministries are those mandated with Property, business as well as local government issues. There are three ministries for Tanzania Mainland and two mof them for Tanzania Zanzibar as follows: o Ministry of Lands, Housing and Human Settlement o Ministry of Industries, Trade and Marketing o Ministry of Local Government o Ministry of Energy, Constgruction and Land for Zanzibar o Ministry of Trade and Investment also in Zanzibar. Step 9: Reporting and discussing the work of Task forces with the management of the responsible ministry and MKURABITA. Step 10: Validation of the Taskforce report with the Stakeholders. Step 11: For proposals requiring amendment, enactment and change of laws the respective sector minisitry is left with the normal government machinery of changing laws. For proposals that do not require change of laws they are set for implementation. Step 12: MKURABITA’s respobility at this point is the navigation and follow up to various ministries and continue to build concensus with the general public through media, and other channels. The reform proposals documents are considered to be living documents that in a course of implementation where an obvious need for change is envisaged MKURABITA doors are open for the proposal since they are public documents for public economic development. Along with the normal channels of communication and awareness raising, MKURABITA has prepared a simplified (usualy called popular version) version of the reform proposals in both english and kiswahili which is our local language just to make sure that every Tanzanian get access to the document. This has so much facilitated the implementation since everything is owned by everybody.

c. What were the main obstacles encountered? How were they overcome? No more than 500 words
MKURABITA has been created to deal with properties and businesses which belong to specific Ministry. MKURABITA is not established by law hence no legal mandate other than that of being under the President’s Office State House. As a result, in some places changing the way some government offices used to work become a bit difficult as it will interfere with some peoples’ interests. Furthermore, in areas where we carried out some frontruners as a way to lkickstart implemetation, it has created great demand whcich with the resources available it becomes difficult to fulfill the demand. Most of the activities have been reported in the Ruling Party manifesto, This nis a challenge bnecause we must make sure that everything goes to the expected speed and zeal to afeguard the rulling party. Inadequate Financial resources is great obstacle. Duriong the first two phases the Program activities were vbeing funded by the Government budget and the government of Norway. The Government of Norway financing agreement was for the first two phases which ended May 2008. It has been difficult for the government of Tanzania alone to adequately finance the Program activities. Lack of workable credit policy. The economy has never addressed the credit systems adequately. As a rsult most activities are being done on cash basis which in our opinion can not be sustainable. Narrow outreach of the financial institutions. Most of the Tanzanians are leaving i n the rural areas where the financial institutoions are not operating. The narow outreach of the financial institutions makes the beneficiaries ate the rural areas not to adequately benefit from the initiative. Undeveloped land market. The land market in the country is not very well developed to allow smooth exchange transactions on land. A study is needed to make sure that the land market is being developed. Low level of education on the use of avaialble opportunities for economic development. This is especially true on business operators. MKURABITA carried a study in two business centers where most small and medium businesses are conducted the results shows that over 90% of business operators have no formal education. In the circumstance trainging them on how to keep books of accounts for instance becomes very difficult.

d. What resources were used for the initiative and what were its key benefits? In no more than 500 words, specify what were the financial, technical and human resources’ costs associated with this initiative. Describe how resources were mobilized
At the beginning the initiative was financed by the Governnemnt of Norway through a financing agreement signed by the Government of Norway and the Government of Tanzania. However, the government of Tanzania through its annual budgets, it managed to finance operating expenses for the initiative. The technical resources and expertiose were originally acquired from the Institutite of Liberty and Democrqcy (ILD) of Lima Peru who entered into contract ewith the government of Tanzania to lead the process in the first two phases of the Program .However, as we went on and in the spirit of locsal ownership and sustainability, the approach was changed to allow a formation of a local team to take the driving seat. However, the team of experts from the Institute of Liberty and Democracy had to train the local team on the conceptual framework of the reform dessign. The initiative to navigate the reforms was put in place by the local team and the Program Management Unit without any assistance from the consultant. This is because by the time of beginning the implementation the consulting agreement with the ILD and the Government of Tanzania was completed. It was also a locally owned initiative and arrangement. With regards to the Human resource, we have been focusing on the spirit and strength of the initiative in local ownership, sustainability and participation that allows mainstreaming of the entire process. Therefore the human resource elements cuts accros from the MKURABITA Management Unit to the Secta Ministries and the Local Government Authorities who are the main implementers. Costs associated with ythe reforms include that of capacity building, awareness raising, actual formalization of property and businesses, stakeholders meetings, and the purchase of equipment necessary for the formalization activities. The purcxhased equipment are surrendnered to the District Coucils for them to proceed with the formalization even after MKURABITA have exited the project. For sustainability purposes establishment of District Formalization revolving funds have been thought of snd at the moment the con sultant is working on how effective the establishment is going to be. The government of Tanzania will to put a seed capital to each district and let it revolve and gerow sustainably. Furtherm ore the coucils will have to include the formalization element in their annual budgets instead o9f waiting for the central government to act upon.

Is the initiative sustainable and transferable?
One of the main forces of coming up with the initiative for participatory and navigation approach to the reforms is to ensure sustainability and transferability. The overal objective of the Program which every initiative within the Proogram have to draw from it is the need to have “a unified rule of law through which all Tanzanians can respect and be identified with”. The work plan which was participatory prepared considered the element of transfering ownership to the Local government level. Taking from the convergence analysis whereby the team looked at the laws (Top/Down) and looked at what the citzens are used to do (Bottom Up) and making them closer to each other to get the rule of law. This is a very good verifiable indicator that the initiative is from the people themselves and that it can be left to the people to act. This covers social ecconomic issues, cultural background, environmental matters as well as the institutional and regulatory issues. The Development Communication Strategy in place is used as a vehicle to make the the initiative known to the people and respected by all the people. These are reforms which are aimed at being for the entire country and that its implementation will be for the entire country. As explained earlier on that a pupular and simplified version of the reforms have been prepared so that they can be read by all Tanzanias of different levels of education and capability. This is also an institutiuonal arrangement in the sence that it is aimed at making all Tanzanias follow the same steps when making any change or reforms design issues and respective implementation. Furthermore, before deciding on the reforms MKURABITA reviewed programs which have synergies with what MKURABITA have been doing and those with conflict to avoid dublication of efforts and conflicting ideas and interests.

What are the impact of your initiative and the lessons learned?
The initiative has been very fruitful and the respective Sector Ministries have seen the importance of the steps taken along the initiative. The initiative will reduce the cost of sensitization and awarenness raising since the changes were bottom up and they were also approved by the ministries. Ministries responsible for properties and business in both Tanzania mainland and Zanzibar are now in the process of changing various laws, regulations and procedures as proposed in the reform document. The key elements that made our initiative a success can be grouped as folows; The bottom up approach has made a great impact on the consesus buildiong process for the reform proposals. It has enhanced ownersship of the proposed reforms and hence enforce its implementation. Along with the bottom up approach, the participatory mechanisms (Stakeholders involvement) used from the planning to the implementation stage has made a great difference. Formation of task forces between MKURABITA and the respective sector ministries has minimised the troubles we could encounter in trying to build consesus with the ministries. MKURABITA receives the required cooperation at the right time because every body regardless of where he or she belongs, feels part of the process. The Development communication strategy whose development was also shared with stakeholders has contributed so much in the process of consesus building. We have learnt that it can be done and every one is a stakeholder if given opportunity.


Institution Name:		Property and Business Formalization Program, for Tanzania
Institution Type:		Government Department
Contact Person:		Seraphia Mgembe
Title:		Director of Finance and Administration
Telephone/ Fax:		+255 22 212650/3
Institution's / Project's Website:		+255 22 212652
E-mail:		smgembe@gmail.com
Address:		P O Box 7975
Postal Code:		255
City:		Dar es salaam
State/Province:
Country:		Tanzania

The Problem

Solution and Key Benefits

Actors and Stakeholders

(a) Strategies

(b) Implementation

(c) Overcoming Obstacles

(d) Use of Resources

Sustainability and Transferability

Lessons Learned

Contact Information