Dec 24, 2015 News
Every Finance Minister since 1992 has grossly abused the use of the Contingencies Fund, says a reputable financial analyst.
The Chartered Accountant said that this is a well documented fact given the evidence outlined in the annual reports of the country’s Auditor General, Deodat Sharma.
While this is the case, he emphasized that if the government is serious about cleaning up the “financial mess” which has polluted the state of the country, then sanctions need to be imposed against those who abused the Contingencies Fund.
He said that sanctions need to be imposed against former Finance Minister, Dr. Ashni Singh. He said that under his watch “some of the most appalling violations of the Fund took place.”
He noted that this Fund is only supposed to be used to meet expenses that are “unforeseen, urgent and for which expenditure has not been appropriated for in the National Budget.”
He said that the Finance Minister, Winston Jordan recently brought a schedule of supplementary provision on the current and capital estimates totaling $3,239,601,366 for the period 2011 to the end of 2014. The Financial paper to clear the unapproved spending under the former government was laid in the National Assembly last week and will be considered on December 30.
However, after examining the purpose for which some of the monies were taken from the Contingencies Fund, the forensic auditor noted that they simply don’t meet the requirement. He noted that the monies which were taken for the Ministry of Home Affairs, is a clear example to support this point.
The Finance Analyst said, “Under the former Ministry of Home Affairs, $105M was taken for expenditure incurred in relation to increased patrols in interior locations and given the increase in fuel prices. Another $2M was incurred for increased usage of fuel for cooking at the Guyana Prison Services.
Then over $40M was expended on additional security guards in certain regions. Are these expenses emergencies, urgent and unforeseen? This is a very clear cut case which shows the abuse of the Contingencies Fund and the administration needs to impose sanctions. It is simply in a mess.”
He said that because of the actions of the former Finance Minister, the Contingencies Fund has found itself in a position where it hardly has any money to properly deal with a real emergency case if the need arises tomorrow.
“The Contingencies Fund, at this point, does not have enough money to truly service any unforeseen circumstance. All of these unapproved spending under the PPP has to be cleared. The Finance Minister has a real predicament before him.
“Furthermore, the administration has a responsibility to see that Dr. Singh is made to face the music for breaching the financial laws of the country. The country’s accounts are in a chaotic state. Law and order needs to be restored to the accounting system of this country. Government is saying all the right things, now it needs to act.”
The abuse of the Contingencies Fund is one that has been well documented by the country’s Auditor General.
In his 2010 report, Sharma pointed to the abuse of amounts totaling over $550M drawn from the Fund and utilized to meet expenditures that did not meet the eligibility criteria as defined in the laws. In his 2012 report, he said that $95.661M in advances was illegally drawn from the Fund.
For the year 2013, he reported that $510M was withdrawn from the Contingencies Fund which did not meet the specified criteria. The 2014 report once again flagged the inappropriate use of the Fund under the previous administration, as $962M was withdrawn without meeting the specified criteria.
The Financial Analyst questioned, “Who is going to account for this? Does government intend to forgive the sins of those who abused the country’s laws in this manner?”
Over the years, the abuse of the Contingencies Fund was a topical issue for A Partnership for National Unity (APNU) and the Alliance For Change (AFC) while they served as the Parliamentary opposition.
AFC Leader Khemraj Ramjattan had emphasized on several occasions that the National Assembly is the first device or mechanism for which emergency advances can be protected from abuse.
The politician had asserted, “The (PPP) has been abusing its understanding of the criteria of an emergency under the Fiscal Management and Accountability Act.
“When we run to the Fund it is only to be used for emergency cases, like if there is a serious flood in Mahaicony and we need to remove citizens, money would be used in that case. But I understand that they are using the Contingencies Fund to relieve the National Communications Network.”
He had even appealed for the former President, Donald Ramotar, to assent to the amendment made to the FMA Act.
“The amendment seeks to clarify a part of the Act which has to do with officers who can be prosecuted for the abuse of the Fund. But it is the Minister (Former Finance Minister, Dr. Ashni Singh) we understand to be giving such directions.
“He gives the permission for the money to be used, and as such he needs to be held accountable. The (former) President, by not assenting to this amendment, is also condoning this and allowing criminality to continue.
“I am begging the people of this nation to understand that it is their money that is being abused and to realize what kind of government they had,” Ramjattan had said.
The Public Security Minister was also one who constantly called for sanctions to be imposed against Dr. Singh for his financial transgressions.
The Fiscal Management and Accountability (Amendment) Bill 2015 was tabled by Finance Minister, Winston Jordan in the National Assembly and was passed.
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