Dear Editor,
My blog of April 20, 2014 was captioned Doubts about Government respecting the budget non-approvals. That e-column followed the passage of the Appropriation Act 2014 introduced by the Minister of Finance and passed on April 16, 2014. In that column, I noted that the passage of the Appropriation Bill had given way to scepticism, suspicion and speculation and I expressed three possible responses by the government: returning to the courts; bringing the first Supplementary Appropriation Bill for 2014 to restore the noncontroversial items which were victims of collateral damage, or thirdly that the Minister of Finance would “simply release the funds that [had] been removed by the Opposition and accepted by the Government in the amended Appropriation Act.”
It is now known that the government, through the Minister of Finance, chose to spend public moneys on items in programmes that had been specifically rejected by the National Assembly. Last Thursday, by way of Bill No 12 of 2014 he presented to the National Assembly for rubberstamping $610,404,711 for current expenditure and $3,943,357,280 for expenditure under the capital programme, a total of $4,553,761,991.
Here I seek to explore whether the Minister of Finance has acted properly, legally and constitutionally and the potential consequences of his action which he no doubt undertook on the advice of the Attorney General Mr Anil Nandlall. According to the Bill presented by the Minister of Finance which comes up for debate and approval/non-approval next Thursday, the expenditure is authorized under Article 219 of the Constitution and sections 24 and 41 of the Fiscal Management and Accountability Act.
The Constitution and the Fiscal Management and Accountability Act
Article 219 gives Parliament the power to make provision for authorising the Minister of Finance to withdraw moneys from the Consolidated Fund to meet expenditure for up to four months of the year, or until the Budget is passed. Parliament makes financial provisions regarding the receipt and payment of public moneys only in the FMA Act, or specific acts, referred to in the preceding paragraph. That provision is contained in section 36 of the FMA Act and limits such pre-budget spending to normal services of government.
The Minister also claims reliance on section 24 of the FMA Act the marginal note to which is described as “Supplementary Appropriation Acts.” Here again, there appears to be certain difficulties since sub-section (1) of the section refers to “Any variation of an appropriation…” Since there has been no appropriation for the programmes on which the Minister expended public monies for which he now seeks approval it can be argued that this section does not help him. He may therefore have to invoke article 219 (2) which provides for statements of excess to be the subject of a supplementary Appropriation Bill.
Article 219(3) of the Constitution suggests that “excess” applies only to cases where the amount expended exceeds the amount appropriated by an Appropriation Act, or possibly where there is likely to be an insufficiency. In the situation of Bill No 12, 2014 there was no appropriation but rather an express non-appropriation and this provision could hardly therefore be used as a justification for the expenditure under another guise.
Reliance on section 41 of the FMA Act seems even more tenuous since that section deals specifically with the Contingencies Fund. Each of the fifty attachments to the Financial Paper #1 of 2014 is headed Statement of Excess – 2014, a different concept from Contingencies. In any case, any explanation that the narrative in the Bill is generically worded can hardly be used to make a case for approval for $4.6 billion of public expenditure.
Accident or design
In my view the most relevant Article of the Constitution and the section of the FMA Act were overlooked or ignored by the government and its Attorney General, whether by accident which I doubt, or by design. Article 217 is clear: monies can only be withdrawn from the Consolidated Fund where:
(1) The expenditure is charged upon the Fund by the Constitution or by an Act of Parliament;
(2) The issue of the money has been authorized by an Appropriation Act;
(3) The issue of the money has been authorized under Article 219 of the Constitution.
Section 16 of the FMA Act states that “There shall be no expenditure of public monies except in accordance with article 217 of the Constitution.” Of course, the very Act provides for a Contingencies Fund advance as expenditure out of the Consolidated Fund.
Crocodile tears
Whatever criticisms may be levelled at the drafters of the Constitution including failure to make clear whether “approves” excludes “approves with amendments” and what “excess” means, no amount of legal linguistics can support any interpretation of any provision of the Constitution or the FMA Act that allows the expenditure incurred by the Minister of Finance for which he now seeks parliamentary approval. I cannot see on constitutional and legal technical grounds how the National Assembly can support the Bill approving the expenditure.
Over the past several months, various spokespersons of the government have been lamenting the consequences of the budget cuts, particularly the subvention to the student loan revolving fund at the University of Guyana, payments for GINA, NCN and CJIA and the payment of activists under the so-called Amerindian Youth Entrepreneurship and Apprenticeship Programme. We now know that the tears and lamentation were those of the crocodile and that while pretending to cry wolf and wipe tears, the government was systematically and flagrantly violating unanimous decisions of the National Assembly not to approve expenditure under particular programmes.
Abuse of the Consolidated Fund
Over the years we heard a lot about persistent abuses of the Contingencies Fund. That has now been extended to the Consolidated Fund but on this occasion Bill 12 of 2014 raises real constitutional, legal and administrative challenges. What if the National Assembly does not approve the Bill when it resumes next week? There is an un-replenished amount of $29 million to the Contingencies Fund which no one seems able to address.
Bill 12 of 2014 is for a vastly different amount – $4.6 billion. Under normal circumstances support could have been assured since significant elements of that sum were justifiable. I recall the AFC pleading for some of those items to be brought back to the National Assembly for prior approval of the expenditure. What the AFC did not know was that the government, presumably on the advice of its legal adviser, had already been spending the money so there was no need or urgency to bring back any of the items, at least not until now.
Conclusion
The opposition in the National Assembly may consider that they face a dilemma. Can they now not approve those items of expenditure with which they had already said they had no difficulty? Or do they try to legalise by their approval actions that are in violation of the Constitution and decisions of the National Assembly?
It is apposite to point out that the Bill and its attachments gave no indication as to how the government intends to deal with expenditure for the rest of the year. Bill 12 of 2014 is for expenditure incurred to June 2014 which suggests that the government intends to engage in the same unconstitutional and illegal conduct for the second half of 2014. That alone might sway a vote against Bill 12 of 2014. If that happens we have a serious constitutional financial issue where $4.6 billion from the Consolidated Fund has been spent without approval. That is without precedent.
Yours faithfully,
Christopher Ram