Despite the registered level of economic growth, there has been no corresponding reduction in poverty. The average income per capita in US $ grew by about 10 percent from 240.2 in 1997 to 264.1 in 2001. In 2002 income per capita was 268 US $, 2003 was 276 US $ and in 2004 was 303 US $ ( Bank of Tanzania 2006 Selected Economic and Financial Indicators). The Poverty and Human Development Reports of 2002 and 2003 assesses the trends of poverty in the 1990s based on the Household Budget Surveys (HBS) of 1991 and 2000/01. These surveys indicate that about 36 percent of Tanzanians were living below the poverty line in 2000/01; only 3 per cent less than the 39 percent estimated in 1991/92. The incidences of poverty in rural areas decrease was from 41 to 39 percent; in Dar-es-Salaam the decrease was from 28 to 18 percent. Other urban areas recorded a small decrease in poverty in 1990s from 20 to 26 percent of households. With this trend it is only in Dar-es-Salaam that the target to halve incidences of poverty by year 2010 is likely to be reached. Poverty levels are highest in rural areas followed by urban areas except Dar-es-Salaam as shown in the table below. Table No. 13 Poverty head count ratios for food and basic needs 2000/01 Food (%) Basic Needs (%) Dar es Salaam 7.5 17.6 Other Urban 13.2 25.8 Rural 20.4 38.7 Total 18.7 35.7 Source: Household Budget Survey 2000/01 The first Poverty Reduction Strategy (PRS) (2000/2001 – 2002/2003) was prepared with focus on pro – poor sector, which were education, health, agriculture, rural roads and water by allocating more funds to these priority sectors. The PRS also focused on children as a crosscutting concern, with capacity built for the Ministry of Community Development, Gender and Children to coordinate with other ministries on children rights and welfare. Despite the implementation of the strategy, income poverty has remained 100