Luncheon: Forensic auditor did not allow me a response on NIS

May 15, 2016 News

Former Chairman of the National Insurance Scheme (NIS), Dr. Roger Luncheon, has broken his silence over

Dr. Roger Luncheon

the findings of a critical forensic audit report that has been released by Government.

The report flagged several issues. It was also critical of the management of that entity which is charged with managing social insurance in the country.
In a letter to the Editor on Friday in the Kaieteur News, Dr. Luncheon, the former Cabinet Secretary, claimed that neither he nor his Board of Directors was afforded an opportunity to respond to some of the findings.
Dr. Luncheon was Chairman of the NIS Board for a number of years until the People’s Progressive Party/Civic (PPP/C) lost its two decades grip on power last year May, following early general elections.
The report covered the review period of December 2011 to May 31, 2015.
Luncheon said that the Board was unceremoniously relieved of its appointment and responsibilities in May 2015 by the new government and eventually replaced en bloc, with the exception of one APNU-nominated member who had been appointed while the coalition was in the Opposition.
Luncheon added that the General Manager of the NIS is by law, a member and Deputy Chairman of the Board.
The former Chairman also wanted to know whether there was evidence unveiled that the previous Board obtained financial benefits from “irregular” actions.
“The findings that have been displayed by the Forensic Auditor, in the press, should and must be answered. Were the Financial Auditor or the Granger Government so inclined to solicit such an intervention it should be directed to the competent authority,” Luncheon wrote in his letter.

Dr. Roger Luncheon, former NIS Chairman, is complaining that he did not get to submit a response to forensic auditors.

The audit was one of several ordered last year by the new government.
In its findings, the auditor flagged a 2011 construction of a new office at Corriverton, Berbice, as being too costly. Rather a valuation two years after the office was built placed the cost at only $38M.
Many times, it seems, the decisions by Cabinet were handed down and the Board accepted them without question.
The Corriverton branch had made the news in a very bad way for the previous administration after documents relating to the construction revealed what appeared to be high costs for the building.
It was an embarrassment for NIS which is also facing tough financial times as its expenses are outstripping income.
Auditors decided to take it upon itself not to have the contract handled by the National Board for Procurement and Tender Administration.
Rather, the bids were handled by the Tender Evaluation Committee. The reasons given were because of delays in the procurement at the National Tender Board.
The audit also flagged a $2.5B investment in the Berbice Bridge.
NIS is facing problems with little returns on its investments. It has lost almost $5B in the bankrupt CLICO and the Berbice Bridge would be its second biggest investment.
The bridge, commissioned in December 2008, is in deep financial trouble now, with claims that it has racked up $1.5B in accumulated losses based on the 2014 audited financial statements. It has been unable to pay NIS dividends for over a year now.
It was found that, under Luncheon, NIS had little say with the bridge’s operation despite its massive investments.
The forensic auditor, HLB R. Seebarran & Co., in its report wants all that changed now with the current ‘Concession Agreement’ restructured to allow NIS to have a more dominant role in view of its shareholdings.