Approval of $8.7B from Contingencies Fund an embarrassment

Jun 24, 2014 News

…Finance Minister still personally liable for unapproved $700M-Goolsarran

Former Auditor General, Anand Goolsarran, yesterday had a stinging rebuke for Minister of Finance Dr. Ashni Singh

Former Auditor General, Anand Goolsarran

as well as the National Assembly, over what he maintains in a continued abuse of the Contingencies Fund.
Goolsarran was responding to Dr. Singh’s attempt to explain that the Contingencies Fund was not being abused since of the $9.4B brought to the House since 2011, an Opposition controlled Parliament approved $8.7B representing 92.2 per cent.
He had asked the question: Where is the abuse?
Goolsarran’s position is that the Assembly was extremely generous in approving expenditure out of the Contingencies Fund that did not meet the criteria, notwithstanding that such expenditure might have been incurred to finance legitimate Government operations.
“The Assembly would have done so with a very heavy heart in view of the fact that it was deprived of the ex ante opportunity to scrutinise and debate a request for supplementary funds… Indeed, it would have been an exercise in futility for the Assembly to engage in a debate about the merits of any expenditure that has already incurred.”
According to Goolsarran, “the milk has already been spilled, and the Assembly was merely asked to rubber-stamp expenditure already incurred.”
Goolsarran was adamant that, “the fact that it has approved any such expenditure should therefore be a source of embarrassment and not one to rejoice.”
Goolsarran further charged too that while the Minister should consider himself extremely fortunate that the Assembly approved 92.2 per cent of the expenditure from the Contingencies Fund, he cannot escape liability for the 7.8 per cent, or $700 million, which was not approved.
According to the former Auditor General, “This represents unauthorised expenditure and a loss of public property for which appropriate sanctions are provided for under Section 76 of the Fiscal Management and Accountability Act.
He noted that the section of the Act reads: (1) If a loss of public property should occur and, at the time of that loss, a Minister or official has caused or contributed to that loss through misconduct or through deliberate or serious disregard of reasonable standard of care, that Minister or official shall be personally liable to the Government for the amount of loss; (2) Where the misconduct or disregard of the person is not the sole cause or the loss referred to in subsection (1), the person shall be liable to pay only so much of the loss as is just and equitable having regard to the person’s share of the responsibility for the loss; If a loss of public property should occur and, at the time of that loss, a Minister or an official had nominal custody of that property, that Minister or official shall be personally liable to the Government for the amount of the loss.
The sitting Auditor General, Deodat Sharma, in his 2012 report had stated that advances continued to be issued from the Contingencies Fund which did not meet the required criteria for such advances resulting in monies being drawn from the Fund and utilised to meet expenditure that did not meet the eligibility criteria as defined in the Act.
He noted too that according to the Statement of Receipts and Payments of the Contingencies Fund, amounts totalling $4.7B were drawn from the Fund by way of thirty-nine advances.
“Previous reports highlighted instances where the criteria were not fully met for the granting of some advances.”
The Audit Office again recommended that the Ministry of Finance adopt stringent measures to ensure that there is compliance with the FMA Act concerning the criteria for the granting of advances from the Contingencies Fund.