Govt. looks to cement control of oil fund board

Jan 19, 2022 News

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– tables motion for government-dominated Parliamentary committee to nominate director

Kaieteur News – Government has tabled a motion to mandate the Parliamentary Committee of Appointments of which it has the majority to select a nominee to sit on the controversial board of directors of the Natural Resources Fund – the mechanism set up to manage the proceeds from this country’s oil resources.

The full members of the appointments committee are government ministers: Gail Teixeira, Dr. Vindhya Persaud; Kwame McCoy, PPP/C Members of Parliament Alister Charlie and Yvonne Pearson-Fredericks. For the coalition the members are: Khemraj Ramjattan; Nicolette Henry; Tabitha Sarabo-Halley and Annette Ferguson.
Observers say, given the divisive nature of the current parliament it will come down to a vote and the PPP/C Government with a majority on the committee would more than likely have their nominee go forward. Section 5 (1) of the Natural Resource Fund Act 2021 provides that there shall be a Board of Directors of the Fund which shall comprise of not less than three and not more than five members who shall be appointed by the President, one of whom shall be appointed Chairperson by the President. According to the act, the National Assembly and the Private Sector Commission (PSC) will be identifying one candidate each for the board, which leaves the President with three nominees. As such, with the National Assembly nominee in the bag and the PSC, given its coziness with the government, the PPP will have total control over the board.
The motion which is in the name of Senior Minister in the Office of the President with Responsibility for Finance, Dr Ashni Singh, restates the provisions in Section 5(1) of the NRF Act 2021 and added that the directors shall be selected from among persons who have wide experience and ability in legal, financial, business, or administrative matters, one of whom shall be nominated by the National Assembly and one of whom shall be a representative of the private sector.
Additionally, Section 5(10) of the said Act provides that a person shall not be eligible for appointment as a director if that person, inter alia, is a Member of the National Assembly. It pointed out that Standing Order 84(3)(b)(iii) provides that it shall be the duty of the Committee on Appointments to make recommendations to the National Assembly on any matter referred to it by the Assembly from time to time. As such Dr Singh’s motion calls on the National Assembly to task the Committee on Appointments with making a suitable recommendation to the Assembly for the candidate to be identified as the nominee of the Assembly to be appointed by the President to serve on the Board of Directors of the Natural Resource Fund in accordance with Section 5 of the Natural Resource Fund Act 2022.
The new NRF Act has been widely condemned, but it was rushed through Parliament late last year. In addition to the board of directors, the Act makes provisions for other committees, all of which would be dominated by government nominees.
For example, provision has been made for an Investment Committee, but three individuals, of the seven member body will be selected by the Minister with responsibility for Finance, Dr. Ashni Singh, Natural Resources Minister, Vickram Bharrat and Attorney General, Anil Nandlall. Under Section 8 (1) of the ACT, three of the seven-member body, of which only five will be allowed to vote, will be appointed by the Cabinet members. In fact, the legislation states that, “a nominee of the (Finance) Minister who shall be the Chairperson of the committee, a nominee of the minister responsible for the administration of the petroleum sector (Natural Resources Minister), a nominee of the Attorney General, a nominee of the Leader of the Opposition, a nominee of the private sector and two ex-officio non-voting members…the Senior Investment Adviser and Analyst (and) a nominee of the Governor of the Bank” shall be appointed.
Notably, the body with major ministerial control will be responsible for merely advising the Board of Directors on the Investment Mandate, Section 9 of the Bill outlines. In doing so, it shall take into account “the overall objectives of the Fund in this Act, the current conditions, opportunities and constraints in relevant financial markets, the need to ensure sufficient funds are available for withdrawals from the fund, international best practices in investment portfolio management, the principal of financial diversification with the objective of maximizing risk-adjusted financial returns…” The new NRF Act also leaves room for a nine member Public Accountability and Oversight Committee which shall comprise of a nominee again from the National Assembly, three representatives from the religious community, two representatives from the private sector, two representatives of organised labour and one representative of the professions. This Committee shall provide “non-governmental oversight of the Fund” according to Section 6 (7).

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