Ashni, Nandlall, Bharrat to pick members for NRF Investment Committee

Jan 06, 2022 News

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Kaieteur News – The PPP/ Government has made provisions for an Investment Committee to manage the oil account, but three individuals, of the seven member body will be selected by the Minister with responsibility for Finance, Dr. Ashni Singh, Natural Resources Minister, Vickram Bharrat and Attorney General, Anil Nandlall.

This information is outlined in the newly gazetted Natural Resource Fund Act of 2021. According to the amended laws under Section 8 (1), three of the seven-member body, of which only five will be allowed to vote, will be appointed by the Cabinet members.
In fact, the legislation states that; “a nominee of the (Finance) Minister who shall be the Chairperson of the committee, a nominee of the minister responsible for the administration of the petroleum sector (Natural Resources Minister), a nominee of the Attorney General, a nominee of the Leader of the Opposition, a nominee of the private sector and two ex-officio non-voting members…the Senior Investment Adviser and Analyst (and) a nominee of the Governor of the Bank” shall be appointed.
Notably, the body with major Ministerial control will be responsible for merely advising the Board of Directors on the Investment Mandate, Section 9 of the Bill outlines.
In doing so, it shall take into account “the overall objectives of the Fund in this Act, the current conditions, opportunities and constraints in relevant financial markets, the need to ensure sufficient funds are available for withdrawals from the fund, international best practices in investment portfolio management, the principal of financial diversification with the objective of maximizing risk-adjusted financial returns…”
It must be noted that while the Investment Committee is just tasked with “advising” the Board of Directors, it is this group who will determine how the funds generated from oil and gas will be used.
Section 5 (1) of the Act states that “there shall be a Board of Directors of the Fund which shall comprise of not less than three and not more than five members who shall be appointed by the President, one of whom shall be appointed Chairperson by the President”.
Furthermore, it explains in Section 5 (5) that the Board shall be responsible for “the overall management of the Fund, reviewing and approving policies of the Fund, monitoring the performance of the Fund, ensuring compliance with the approved policies of the Fund, exercising general oversight of all aspects of the Fund and ensuring that the Fund is managed in compliance with this Act and all other applicable laws”.
Even though there is an Investment Committee, it is the President appointed Board of Directors who will be tasked with preparing the investment mandate.
The law says that the Directors of this Board shall be selected from among persons experienced in legal, financial, business or administrative matters.
The Directors shall be appointed for a two year period and may be eligible for reappointment with no definitive restriction on timeline. However the amended Bill makes it clear that certain individuals will not be considered for the position. These include: Members of Parliament, persons serving on other oil committees, who are or has been declared bankrupt, are medically unfit, has been convicted of an offence or has a conflict of interest, due to family interests or investments, among others.
In addition to these two groups, the NRF Bill also leaves room for a nine member Public Accountability and Oversight Committee which shall comprise of a nominee from the National Assembly, three representatives from the religious community, two representatives from the private sector, two representatives of organized labour and one representative of the professions.
This Committee shall provide “non-governmental oversight of the Fund” according to Section 6 (7).

NRF Act 2019
In the previous act, assented to by former President, David Granger, provisions were also made for the three bodies outlined in the law. However, the committees were governed differently. With regard to the Investment Committee, the NRF Act of 2019 said six members would have been appointed to a four year contract, inclusive of; a nominee of the Minister who shall be the Chairperson of the Committee, a nominee of the minister responsible for the administration of the petroleum sector, a nominee of the Leader of the Opposition, a nominee of the Guyana Association of Bankers; and two ex officio non-voting members comprising the Senior Investment Adviser and Analyst and a nominee of the Governor of the Bank. The NRF Act of 2019 did not make provisions for a Board of Directors.
It however spoke to the establishment of a Public Accountability and Oversight Committee, which was tasked with; “monitoring and evaluating the compliance of the Government and other relevant persons with the provisions of this Act, monitoring and evaluating whether the Fund has been managed in accordance with the principles of transparency, good governance and international best practices including the Santiago Principles, providing independent assessment of the management of the Fund and utilization of withdrawals from the Fund and facilitating public consultations on the management of the Fund and utilisation of withdrawals from the Fund”.
The then act had stated that the 22-member Committee should be comprised of; a representative nominated by a consortium of civil-society organisations and community-based organisations; a nominee to represent women nominated by a consortium of civil-society organizations and community-based organizations which represent women; a nominee to represent youth nominated by a consortium of civil-society organizations and community-based organisations which represent youth; a nominee of the Bar Associations of Guyana; a nominee of the Guyana Consumers Association; a nominee of the Guyana Extractive Industries Transparency Initiative; a nominee of the Transparency Institute of Guyana Inc; a nominee of the Guyana Press Association; a nominee of the most representative associations of trade unions; a nominee of the Institute of Chartered Accountants of Guyana; a nominee of the Private Sector Commission; one nominee from each of the ten Regional Democratic Councils; and a nominee from academia nominated by the governing council of the University of Guyana.
The Opposition as well as several members of civil society blasted the government when it signaled it intent to remove the Public Accountability and Oversight Committee.
In this regard, the administration decided to keep the Committee but reduce the body to only nine members. The NRF Bill was effectively passed in Parliament on December 29, 2021 amid protest action by the Opposition members, who said they would not assent to a “thieving bill”.

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