Irregularities exposed in 2015 government spending at Presidency

May 23, 2017 News

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…vehicle, security cameras among questionable purchases

A number of financial irregularities were found to have taken place within the Office of the Prime

Minister and the Ministry of the Presidency for purchases and the financing of projects.
These discoveries were made yesterday during the meeting of the Public Accounts Committee of the National Assembly on the Report of the Auditor General for the year 2015
There, Permanent Secretary of the Ministry of the Presidency, Ms Abena Moore, was questioned on a number of issues including the purchase of a New Toyota Cruiser Station Wagon GX for the Office of the Prime Minister. These issues among others raised would have had their genesis while former Permanent Secretary of the Ministry, Omar Shariff, was serving.
Described as an interesting transaction, PAC member, Juan Edghill, asked Moore to tell the committee what system of procurement was used to purchase the vehicle. She told the committee that the vehicle was sole sourced.
The vehicle was purchased from Beharry Automotive Limited. The reason given for the sole sourcing of the vehicle was that the auto dealer is the only company in Guyana that usually imports such vehicles.
However, Edghill was not satisfied with that answer. He said, “Monies were appropriated through an Appropriations Act for the purchase of a vehicle for the Office of the Prime Minister. It didn’t say a Toyota vehicle. So after the monies were appropriated, you need to go out and tender using some procurement process of where you will buy this vehicle from. So to tell me that only Beharry sells Toyota, is to tell me you decided to buy Toyota before the monies were appropriated.”

Edghill pointed out that in the quotation of the purchase it was stated that 50 per cent of the price must be paid down when a ‘Firm Order’ is made. He then asked Moore why it is that the total sum for the vehicle was paid to the supplier at the time of the order.
The cost of the vehicle was $13.820M. The total sum which was appropriated for the vehicle was $22M. The balance was used to buy one Toyota Corolla motor car at a cost of $5.3M from Beharry and one motorcycle from Jialing Motorcycles at a cost of $200,000. Both automobiles were sole sourced.
Edghill said that the vehicle was paid for on January 4, 2016 using two cheques and not one. At this point, the Principal Assistant Secretary-General in the Office of the Prime Minister, Christine Mohan, said that the two cheques were paid at the same time by mistake. She said that one cheque was to be paid before the other.
Edghill said that if the vehicle is to be purchased and 50 per cent is to be paid in the first instance, paper work has to be prepared to show order; based upon that, the first cheque is cut and prepared. He said that when the time arrives for the second cheque to cut the same process is engaged.
However, Mohan said that both were cut at the same time with the intention of holding one. She later admitted that it is not usual practice to cut both cheques at the same time. The PS then intervened and informed the committee that she will commit to providing an explanation within three days as to why both cheques were cut at the same time.

The vehicle was supposed to be delivered in July 2016 but was supplied seven months later, in September 2016.
Edghill then reminded the PS that in procurement there are rules that need to be followed and that it was unacceptable that the Ministry would have sole sourced an item, paid in full and receive the item seven months later.
However, Ms Mohan provided an explanation for the late delivery. She said that the company’s bond in Japan was affected by a fire which delayed the process of shipping the vehicle.
Further, the PAC member highlighted that as of December 2015, the money used to purchase the vehicle was not spent. The PS was then asked if permission was granted from the Finance Secretary, Hector Butts, to retain the money and use it after December 31, 2015. Funds which are left over from the budgetary allocations to state agencies are to be returned to the consolidated fund at the end of each fiscal year.
Mr Butts advised that in such a situation where money needs to be rolled over, an application should have been made to the Ministry of Finance.

Presidency Ministry
Moore was quizzed about the purchasing of Closed Circuit Television (CCTV) systems at the National Intelligence Centre. The items totalled $19.108M. The money used for this purchase was taken from the Contingency Fund. This transaction was also done while Mr Shariff was PS for the Ministry.
Chairman of the PAC, Irfaan Ali, asked Moore to explain under what conditions are purchases made from the contingency fund. Moore informed the committee that such purchases are only made in emergency situations.
It was later clarified that purchases from the Contingency Fund are only made for unforeseen, urgent and unavoidable situations.
Ali said that the items were paid for in 2015 and as of September 2016 they were not received. Based on this he said, the purchase of the items does not satisfy the criteria of the Contingency Fund. He then asked whether the equipment has since been installed. Moore then informed the committee that the items have still not arrived.
The PS explained to Ali that the Ministry had an established relationship for the past six years with the company from which the equipment was purchased. She said that through correspondences with the company, assurances were given that the equipment would have been supplied on time; however this did not materialise since the company is reportedly now bankrupt.
Ali questioned whether there was a bond or bid security that the government could cash-in on to get back some of the money. However, Moore informed that there is no bond. She said that contact is being made with one of the partners in the contract to arrive at a solution.
Moore added that since the company is based in the United States of America, the American Embassy in Guyana is being engaged.

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