Nagamootoo’s office ‘misused’ Contingency Fund


AG 2015 Report

… used advances for tax-free bonus

Auditor General Deodat Sharma in his 2015 Report has cited the Office of Prime Minister Moses Nagamootoo for misuse of the Contingencies Fund and diverting monies drawn down from the Contingencies Fund for purposes it was not intended for.nagamootoo-211x300

Sharma in his Report stated that Nagamootoo’s Office in December 2015, requested an advance of $11 million from the Contingencies Fund and stated the reason for the advance was for the Government Information Agency (GINA) to offset a part of its debt to the Guyana National Newspapers Limited (GNNL), publisher of the Guyana Chronicle newspaper. However a portion of that sum was used for another purpose, which constitutes a breach of the financial regulations.

This is based on the fact that the payment of GINA’s debt to GNNL does not constitute an emergency but rather a routine expenditure and therefore, the Contingencies Fund should not have been used. This expense should have been budgeted for in the annual budget.

The use of the Contingencies Fund for the routine expenditure is a breach of the financial principles.

The Prime Minister, who always portrays himself as a bastion of accountability, was found wanting with the report revealing that his Office did not just misuse the Contingencies Fund, it went a step further to use the advance for purposes it was not intended.

According to Sharma’s Report, an examination of the requisite payment vouchers and other supporting documents revealed GINA paid GNNL the sum of $9.450 million, whilst the remaining $1.550 million was used to pay employees of GINA non-taxable bonus for 2015.

This constitutes a further breach of principles governing the use of public funds.

It is important to note that while in opposition, Nagamootoo was at the forefront of a campaign against the GINA, including the reduction of that entity’s annual budget to $1 in 2013 and 2014.

Auditor General Deodat Sharma

Sharma’s Report stated that during 2015, the APNU/AFC Government abused the Contingencies Fund through a total of 11 advances for which the requisite laws did not cater for.

He said that the advances abused the Contingencies Fund by an amount in excess of $600 million with the Guyana Defence Force (GDF) being the biggest recipient of almost $300 million.

Other breaches

Sharma’s Report also highlighted other breaches by Nagamootoo’s Office which include flouting of the Stores Regulation.

Sharma observed that the Office’s inventory was not being kept up-to-date and as such it was difficult for the auditors to verify the accuracy of stock on hand.

Sharma urged that the Office ensure that it adheres to the Stores Regulation.

Meanwhile the PM’s Office was also cited for a breach of a purchase agreement involving vehicles.

The AG Report stated that under the Office’s Capital Expenditure, a sum of $19.405 million was used to purchase a $5.3 million Toyota Corolla car, a motorcycle at a cost of $203,000 and a Toyota Land Cruiser valued at $13.8 million.

Sharma said while the Office would have received the car and motorcycle, the issue was with the Land Cruiser.

He explained in his Report that the procurement of the new Toyota Land Cruiser was awarded to the lone bidder and according to the quotation, 50 per cent of the cost must be paid on “Firm Order”, while the remaining 50 per cent is to be paid on delivery.

“However, the full amount was paid to the supplier on 4 January 2016 via cheques numbered 05-612925 and 05-612926. Notwithstanding this, the vehicle was delivered in September 2016,” Sharma observed in his Report.

He has since recommended that the Office ensure there is “full compliance” with purchase agreements.

Similar instances are replicated across ministries of the government during 2015.

The Auditor General complained in his Report that despite his recommendations for measures to be implemented to tackle issues of this nature, there continues to be very little action by officials.

“The Audit Office continues to view the lack of action towards the implementation of prior recommendations with serious concerns and suggest stringent action be taken to address these findings, especially those related to overpayments on construction works, lack of weak internal controls, including poor record keeping and breaches of relevant Legislation,” he stated.