OP PS admits to not returning money to Consolidated Fund in 2016
Monday’s session of the Public Accounts Committee (PAC) got underway with public officers being grilled over breaches of the law when it comes to unspent monies intended for the construction of an Environmental Protection Agency (EPA) building being kept by the agency at year-end.
During the questioning, current Permanent Secretary at the Office of the President Abena Moore admitted that permission was sought from the Finance Secretary to allow them to retain funds at 2016 year end, in breach of the Fiscal Management and Accountability Act (FMA).
Section 43 of the FMA Act states, “Except as otherwise provided in this Act or in any other law, at the end of each fiscal year, any unexpended balance of public moneys issued out of the Consolidated Fund shall be returned and surrendered to the Consolidated Fund.”
According to Moore, permission was sought and granted all on the same day – December 31, 2016 – to retain $33.275 million. It was explained that permission was sought and granted for the monies to be kept because the construction of the building was a multi-year project.
However, Accountant General Jennifer Chapman explained that as per the FMA, the amounts should have been refunded and re-budgeted, even if it was earmarked for a multi-year project. It was explained that the Financial Secretary can approve the rollover of funds, but not the retention of funds.
“Section 55 of the Fiscal Management and Accountability Act speaks about multi-year contract. It says an official can enter into a multi-year contract or arrangement for the supply of goods and services, without prior written authorisation of the Minister,” Chapman explained to the Committee.
“It also says it shall be the expressed provision of any multi-year contract that any payment falling due under the contract is subject to their being an appropriation for that payment for that fiscal year in which the payment falls. Therefore, the amount should have been re-budgeted in the next fiscal year and the amount in the past fiscal year refunded to the Consolidated Fund.”
While PAC member Ganesh Mahipaul noted that the Finance Secretary was within his rights to approve the rollover, he questioned whether it was not Moore’s responsibility to ensure unspent monies are returned to the Consolidated Fund, to which she agreed.
“And Ms Moore, you would agree with me that it is your responsibility as the accounting officer, to return unspent dollars to the Consolidated Fund?” Mahipaul pressed, at which point Moore said: “yes Mr Chair.”
The project in question included design and construction of a building to be used by the EPA, as well as the purchase of global positioning systems, noise meter, radiation monitoring system and environmental monitor.
The retention of the money was flagged in the Audit Office’s 2016 report, currently being examined at the PAC. But there were also issues relating to the project being delayed. The project, which was supposed to be constructed from 2017 to 2019, was only completed in June 2020. EPA Administrative Officer Joshua Muridall explained the challenges associated with the construction of the building.
“The contractor delayed in terms of their schedules, in terms of fixing their deadlines to meet the estimation of work. There were other parts of the contract that allowed for the provision of additional services, such as insulation of elevator systems, air conditioning, plumbing and electrical.”
“Those were not met with the timelines of the contract spelt out by the contractor and the EPA. So basically, it was a prolonged process and the project ran out of its duration time because of those delays,” Muridall said, noting that many of these delays were further compounded by the sub-contractors. (G3)