— major overhaul coming for MARAD

AS the Ministry of Public Works awaits word on a recently requested forensic audit of the Maritime Administration Department (MARAD), the subject ministers are moving ahead to execute a major overhaul of the agency. This was confirmed by Minister within the Ministry of Public Works, Deodat Indar, who said that the findings of a recent internal audit hinges on fraud, as opposed to mere mismanagement of public monies.
Speaking with the Guyana Chronicle, minister Indar referred specifically to the four vessels at the dock yard: the Seamang, the ML Allan Young, the MB Baramani and the MV David P, which all amounted to $657 million in rehabilitative works that were not done.
“The contracts were all awarded and the monies were paid, and paid in full, but no works were done on any of these vessels,” minister Indar said.
Site visits conducted by the ministry’s internal auditor showed that little to no works were conducted on the vessels which remain in dry dock, overrun by bushes.
He explained that as the ministry awaits a response from the Audit Office, efforts have been made towards instituting policy changes that will eliminate possibilities of misconduct in relation to public works being undertaken by the government.

“There are also operational changes and there will also be structural changes at the level of the board, and there will be procedural changes in respect to issuance of payments and verification of works; the whole thing,” Indar asserted.
Apart from the new structures being implemented by MARAD’s Board of Directors, minister Indar said that he will personally be working closely with the agency to “deal with systems and controls…putting a regime of systems and controls, stores regulations and so on to make sure that these things do not reoccur”.
Minister Indar added: “We have to institute proceedings to recover taxpayers’ monies; we have to institute proceedings for the people culpable to answer to these things.”
Asked whether sanctions would be dependent on the findings of the forensic audit being requested, Minister Indar responded in the negative. He said that the current internal report provides adequate information for the ministry to embark on some amount of action against those found to be liable.

GOOD ENOUGH

“The report is good enough; if the police have to be called in, the police will be called in,” Indar asserted.
The recently concluded internal audit of MARAD revealed a number of troubling occurrences relating to contract awards and spending made towards vessel repairs and acquisition of spares. The findings, which were released to the media on Tuesday, found that between 2015 and 2020, MARAD spent a total of $3.84 billion for the procurement of spares and equipment and docking and rehabilitation of vessels. The audit found that 92 per cent of these funds were expended on contracts awarded to Courtney Benn Contracting Services and Brenco Shipping Company (a subsidiary of Courtney Benn).
The report highlighted that while payment to other contractors had all relevant documents affixed, Courtney Benn and Brenco Shipping contracts and payments did not have relevant supporting documents attached.

The audit, conducted by Dexter Smith, specified that despite several requests to have Bill of Quantities (BoQs) submitted, none were provided for Courtney Benn and Brenco Shipping contracts. As such, documents not being submitted for audit scrutiny affected the verification process.
“None of Courtney Benn’s or Brenco Shipping contracts had Bill of Quantities (BOQ) affixed; hence, no breakdown was seen for the $3.551 Billion spent for works and spares,” the report noted.
Mobilisation advances were also flagged as cause for concern. While the National Tender and Procurement Administration Board (NPTAB) permits mobilisation advances up to 30 per cent, advances as high as 95 per cent were paid by MARAD.
“A contract (NPTAB: 397/2019/32 Add) valued at $400,204,530 for spares and equipment was awarded to Brenco Shipping and stated 80 per cent mobilisation advance; however, the entire amount was paid upon signing the contract. No bond was provided for scrutiny,” the executive summary of the report stated.

NO ACCOUNTABILITY

There was also no accountability for hundreds of millions of dollars’ worth of spares and equipment in the stores and no comprehensive physical verification of the items in the stores was ever conducted by MARAD.
The internal auditor opined that there was a deliberate attempt to frustrate the audit. He noted that BoQs form part of the submission for National Tender & Procurement Administration Board and Cabinet’s deliberation and approval and was at a loss on how they could have conveniently gone missing. He recommended that “there is a need for an immediate and total review of the general system of operations, policies and procedures at MARAD; with an aim of documenting and regularising same.”
“Persons found culpable through dereliction of duties or willful acts to the detriment of the agency, should be sanctioned with penalties that match the nature of the infractions,” the recommendations further stated.
MARAD is the second agency under the Ministry of Public Works, formerly the Ministry of Public Infrastructure, to be mired in controversies relating to mishandling of public monies.
Only recently, a massive investigation was launched into a multi-million dollar gift-giving scandal involving the former General Manager of the Demerara Harbour Bridge Corporation, along with former Public Infrastructure Ministers, now Opposition Members of Parliament, David Patterson and Annette Ferguson.