Govt. operates a parallel treasury

Apr 09, 2014 News

– Budget cut long before it was presented – AFC

The Alliance for Change (AFC) has charged that the budget has been cut long before it was even presented to the nation, as the government operates a parallel treasury in the form of the National Industrial and Commercial Investments Limited (NICIL), the Guyana Geology and Mines Commission (GGMC) and the Guyana Forestry Commission among others which hold an additional $50B not accounted for in the national estimates.

AFC Leader,
Khemraj Ramjattan

This is according to the AFC Leader, Khemraj Ramjattan, who in his presentation on the final day of the general policy debate yesterday, also brought into sharp focus the need for the constitutionally mandated Public Procurement Commission (PPC).
Ramjattan charged that with a PPC in place, instances such as the drug purchases from the New Guyana Pharmaceutical Corporation (GPC), resulting in significant overpayments, would not have occurred.
Ramjattan said that Government has continued to resist the establishment of the Procurement Commission because “they want to continue to gorge at the trough.”
The AFC leader said that what the current administration would instead want to do is “have the tender board write up guidelines so that friends and family will forever benefit from those criteria…They don’t want to stop the gravy train.”
He spoke of the recent changes in the qualifications for the supply of pharmaceuticals “so that only one can benefit…is only one person gonna get it and we all know that person….all of we know de man.”
According to Ramjattan, the losses being made in the absence of the Procurement Commission is tenfold greater than the cost mentioned by the Junior Finance Minister, Juan Edghill, who according to the AFC Leader had called the setting-up of the Commission, “too pricey”.

BAILOUT
Ramjattan in his budget presentation also spoke of the $6B bailout for the sugar industry which, “touches a chord in all of us.”
According to the AFC Leader, it is important that “we ensure that the sector succeeds but not with bailouts every year.” He pointed to the US experience when President Barack Obama was forced to bail out a number of companies and had demanded that the money be repaid and that the boards of directors be replaced
Ramjattan stressed, “We can’t give good money to the same bad managers.”
“When they come saying they have plans for the sugar industry we have to check them properly, we have to ensure what they talking about reduces the cost of production.”
The AFC Leader also suggested that there must be a rehabilitation of all factories, not just the one at Skeldon, as well the need to resort to more private cane farmers and the increased mechanization.
“You have to get the skills back into the factory. What we see at management level, a lot of people who want to make assessments to make the industry are going to be asked to shut up. If we are going to move from where we are to where we ought to be it is better management, better governance…We could make lots more profit if it (the sugar industry) is managed better.”

PARALLEL TREASURY
In expounding on his position of a parallel treasury, Ramjattan told the House that, “If government tightens up, the opposition will lighten up.”
He said even if the opposition is to use its proverbial scissors, “the hatchet and shears have already been used” prior to the Budget reaching the House.
The cuts have already been made, according to Ramjattan, because all of the revenue streams are not accurately reflected.
The AFC Leader claimed that “if we put all revenue streams in the budget we would have lots more, it is in the vicinity of $50B cut, since before being laid here, monies are being hived off to accounts that belong to certain bodies”
He noted that the Guyana Forestry Commission had a balance at the end of last year of $1B that was never put in the consolidated fund
GGMC, according to Ramjattan, held $12B while the Lands and Surveys Commission, held $365M that has not been put into the coffers.
He said that the Guyana Civil Aviation Authority held another $742M in its accounts while the Central Housing and Planning Authority held $ 2.7B in its accounts.
The AFC Leader spoke too of the lotto funds, some $1.1B, and NICIL hoarding some $9B.
“These bodies have government monies or what is called public money, some $27.7B that is not there.” He said that it was akin to a husband earning $100,000 but only gives his wife $60,000 to manage the affairs of the home
“This is what we have here in the budget; we will not be in the position to know what is in the consolidated fund so that we will be in a position to know how much we can spend on what.”
The AFC Leader spoke too of a number of bank accounts that hold billions of dollars that are not being put into the consolidated fund.
According to Ramjattan “unless we have all that is there we will not have a true representation of the state of our finances.”
He charged that Government representatives go on television and complain that the opposition has cut the budget but “I want the point to made, billions have been hatcheted and axed…Not that Cabinet don’t know, they know.”
Ramjattan maintained that the constitution demands that the money must go into Consolidated Fund, “a lot of additional spending is done without National Assembly approval.”
He suggested that this could possibly be the case with the Marriott Hotel where the works are continuing despite the fact that there is no financial closure with respect to millions of dollars.
The AFC leader lamented also that several billions are also being lost through the numerous tax exemptions.

SPECTRUM
Ramjattan spoke too of the literal giveaway of national resources and pointed to the national spectrum. He drew reference to a recent auction in Jamaica which saw their spectrum being sold for US$25M.
In Guyana, he said, friends, family and close associates will benefit from something that should be sold and the earnings placed in the Consolidated Fund.
“The Constitution is supreme,” Ramjattan emphasised.”We must not have parallel treasuries…Don’t go and say we are chopping the budget when you chopping ten times more…that is why we can’t have money to increase pension to $15,000.”
According to Ramjattan, with money in separate bank accounts and not being placed in the Consolidated Fund, Guyanese are being denied their rights.