PPP set up irregular account at Ministry of Culture
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Accountant General (ag),
Jennifer Chapman
Accountant General (ag), Jennifer Chapman

…AG orders its closure at PAC hearing

A SPECIAL Project Bank Account being operated by the Ministry of Culture, Youth and Sport came under scrutiny on Monday during a hearing of the Public Accounts Committee (PAC) resulting in acting Accountant General, Jennifer Chapman, calling for its immediate closure.

Former Permanent Secretary, Ministry of Youth, Sport and Culture, Alfred King

The Audit Report of 2015 has observed that the Account, which funds from various sources, including the Guyana Lotteries Commission and the National Stadium, have been deposited and was inappropriately managed by the Ministry.

Chapman recommended that the Ministry of Culture, Youth and Sport (Department of Culture) “close the Special Account Fund and transfer all money to the Consolidated Fund immediately.” She advised that in the case of funding received from international donors; she must be written to requesting approval for the establishment of a Deposit Fund Account, where those transactions will be deposited to the Consolidated Fund, “where we will have full accountability and transparency on these transactions.”

The Audit office said that the Ministry continued to “inappropriately meet unrelated expenditure from this account.” In 2015, the Ministry deposited revenues totalling $367.192M into the Bank Account, instead of the Consolidated Fund of which $22.052M, $176.530M, $164.610M and $4M were from the rental of the Guyana National Stadium, refund to the Permanent Secretary of the Ministry, Guyana Lottery Commission and Digicel respectively.

In 2013 and 2014, the sum of $106.096M representing unexpended balances was withdrawn and deposited into a special account. Amounts totalling $99.734M were expended at December 31, 2015 and the unspent balance of $6.362M was refunded on September, 2016 to the Consolidated Fund.

Though as of July 29, 2016 revenues collected from the rental of the National Stadium were being paid to the Consolidated Fund, the Audit Office recommended that immediate steps be taken to ensure that all revenues are deposited into the Consolidated Fund.

Permanent Secretary, Melissa Tucker, appeared before the Committee accompanied by former Permanent Secretary of that Ministry, Alfred King. PAC member Nigel Dharamlall questioned why deposits were still being done to the account as opposed to the Consolidated Fund. “I am advised that the officers are in the process of reconciling the accounts. Since assumption, I brought the matter to the Finance Secretary. I am in the process of having the account closed and funds transferred to the Consolidated Fund,” she replied.

She was then asked by PAC member Juan Edghill whether any withdrawals occurred from the Account during the period of review to which King answered in the negative. “I am told no Mr Chair,” said King but his answer was quickly shut down by PAC Chairman, Irfaan Ali. “That cannot be correct. Review that answer,” Ali requested.

By this time Auditor General, Deodat Sharma, made it clear that at the time of the exit conference payments began for the National Stadium and the Guyana Classic. “But in 2015 they were not doing so… from June 29, 2016 they started to do so,” Sharma added.

“Are you still saying no?” asked Ali who provided Tucker with time to provide clarity on the matter.

During this time, advisors to the Permanent Secretary were cautioned to pay full attention to their roles. Ali told them that their role at the PAC is very important and should not have large advisory teams appearing before the PAC unprepared. “Take your roles seriously,” he stressed as Dharamlall chimed in to note that the Auditor General had indicated that the Special Account was never reconciled at the time of the audit. He asked Tucker to tell the Committee the extent of reconciliation that has been accomplished.

The Permanent Secretary noted that reconciliation is being done for the 2014 account. This prompted Edghill to ask why the process of reconciliation would have taken so long. It was then that Tucker corrected her initial statement and noted that the reconciliation for 2014 is completed and 2015 is on-going currently. She anticipates that the process would be completed by August.

Meanwhile, King stated that the resources from the Guyana Lottery Commission’s Fund are paid into the Special Projects Account. As such, PAC member Volda Lawrence questioned the purpose for opening the Special Project Bank Account.

The former Permanent Secretary for the Ministry of Culture was unable to tell the Committee when the account was opened but noted that it was established to consider the flow of Special projects funded by UNICEF, UNDP and other organisations. He explained that he was associated with the fund for nine years. King said during those nine days he could not recall a transfer being done to the Consolidated Fund.

At that point the PAC chairman indicated that while the money is placed into the Account for a special purpose, if it is unused it must be transferred to the Consolidated Fund. “These balances cannot be kept in this account,” said Ali.

Lawrence posited that there is need for the Ministry to plan its affairs better, while Ali stressed that the Financial Management and Accountability Act of 1997 speaks clearly to how the transfer of money to the Consolidated Fund should be done. “We have to ensure we follow the guidelines.”

Meanwhile, when asked, King was unable to state the number of projects birthed and or materialised through the Account but committed to having the Ministry’s accountant provide a print out of the information. Member Jermaine Figueira asked, “Which was the most expensive project and how much would it have cost?”

King replied: “I can’t single out any single project.” However, Ali made it clear that there is nothing inherently wrong with the setting up of the Special Projects Fund. Additionally, King told the PAC that activities such as Emancipation, Carifesta, Mashramani, along with the UNICEF projects, would have been funded through the Account.

The Permanent Secretary was asked to provide the PAC with the number of activities conducted under the period of review, along with the balance of the account at the end of the financial period.
Caption: Former Permanent Secretary, Ministry of Youth, Sport and Culture, Alfred King

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