Auditor General Office should be middleman between oil expense auditors and parliament – Transparency Advocates

Jan 17, 2023 News

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Kaieteur News – In the absence of oil audit information regarding the overdue ExxonMobil expenses, local transparency advocates are suggesting greater involvement of the Office of the Auditor General (AG) to filter information between the Guyana parliament and oil auditors.

The transparency advocates say that the AG’s office is the sole agency responsible for auditing State funds, and should be involved in the review of oil monies spent by the Stabroek Block Consortium.

Economist and former Presidential advisor Ramon Gaskin highlighted that the Constitution gives the AG specific powers as it relates to the auditing of State funds. He said that the law gives the AG’S office priority in reviewing State revenues, but also allows for the government to have additional audits by private entities. In the absence of timely oil expense audits and the failure of “governments” to have by now, capable, competent individuals to readily scrutinise oil expenses, Gaskin believes that more must be done to involve State mechanisms that promote the checks and balances of State funds.

“Why is the auditor general not involved in audits that affect the revenue of the country?” the economist questioned. “The constitution says that he (AG) is supposed to be the Auditor General for all of Guyana’s money. So, he is supposed to be overlooking what is going on and if necessary, give regular updates to Parliament,” Gaskin said. He pointed out that while the law gives the government the power to have external auditors review State funds, “in the interest of transparency and accountability, there is no reason why the government cannot have the AG’s office closely associated with the oil audits.” Gaskin related that Guyana has failed to build the necessary capacity; the audits continue to overshoot due dates and information remains minimal to nil. He noted therefore, that if government is serious about its oil money, it must find additional ways to keep up with its revenue.

Opposition Economist and Youth advisor Elson Low also believes that the AG’s office could be useful in monitoring oil expense audits. He believes that the AG’s office could allow for greater transparency as it would be the middleman between the auditors and the Parliament. “It will facilitate closer collaboration between parliament and auditors so that the nation is kept up to date on the status of audits, as opposed to the dark as we are currently,” Low said. He continued that it would be “very useful to have the auditor general’s office involved in the cost oil audits because his office already lays audits before the Public Accounts Committee, which is where we want to see the current audit ventilated.”  This will only be truly meaningful, Low reiterated. He opined however that for a greater effect, the government could look toward strengthening the AG’s office by building oil auditing capacity there and at the Guyana Revenue Authority. “This will enable us to have the comprehensive audits we require,” Low posited.

Guyana’s Audit Act says in relation to functions, “(1) that the Auditor General shall be the external auditor of the public accounts of Guyana and, in the discharge of his functions, shall have complete discretion in examining and reporting on the receipt, disbursement, and control of public moneys and on the economy, efficiency and effectiveness in the use of such moneys.” It says that “without prejudice to subsection (1), the Government may cause an additional audit to be conducted by an auditor other than the Auditor general where an agreement entered into between the Government and an international financial institution so dictates. Without prejudice to subsections (1) and (2), the Minister responsible for finance may request the Public Accounts Committee to cause an additional audit to be conducted by an auditor other than the Auditor General.” At (4) the Act clarifies that “Notwithstanding anything in this Act or any other law, Government’s right to conduct or cause to be conducted internal audits remains unimpaired.”

Stakeholders, including the parliamentary opposition have been demanding more information from the government in relation to various aspects of the oil sector, particularly, the handling of oil revenues. Stakeholders are concerned that despite a minimal two-year timeline to audit and make objections to the oil expenses, Guyana continues to drag its feet in developing capacity to audit the multi-billion-dollar expenses.

Vice President Bharrat Jagdeo, who leads the oil industry, has warned Guyana that the country does not have co-management status and therefore has no say in how the Exxon Consortium develops the local oil sector, despite all monies spent by the oil company being recovered as cost oil. He urged that the country’s only means of monitoring its cost oil is through the oil expense audits.  Given the “lax” attitude toward the oil audits, the opposition said it is working on ways to make the government accountable for oil funds. So far, it has laid a motion in parliament to have the government divulge information relating to construction of a US$1.3B pipeline which will be built by the Stabroek consortium through cost oil.  The Opposition contends that the pipeline is too costly for government to spend without parliamentary oversight.  It is demanding from the government all agreements surrounding the billion-dollar project.

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• Economist and former Presidential Advisor Ramon Gaskin, ExxonMobil, Office of the Auditor General (AG), Opposition Economist and Youth advisor Elson Low, Stabroek Block Consortium, Transparency Advocates

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