We must set our face sternly against corruption and extravagance. We cannot have a Cadillac style living with donkey cart economies. Our leaders must set the example of democratic, accountable, clean and lean government, and efficient governance.
Cheddi Jagan at CARICOM Heads of Government Meeting
Last week, we briefly referred to certain disclosures about the Government’s medical assistance programme that have so far caused intense public outrage. This reaction is quite understandable considering the extent to which certain senior public officials, including Ministers and their relatives, benefitted from of the assistance provided, as well as the enormous sums expended on their behalf, in stark contrast to that provided to other beneficiaries.
The assistance programme
The objective of the medical assistance programme is to assist individuals who do not have the financial means to meet the cost of medical treatment, especially if such treatment is not available locally. Access to the benefit is subject to an application process and an independent assessment by a panel of doctors on the merits of each case vis-à-vis detailed guidelines established by the Ministry of Health and made publicly available. The quantum of the assistance is dependent on budgetary allocations approved by Parliament; the expected number of beneficiaries; and the types of medical conditions that qualify for assistance. Dental services are not eligible since they are not life threatening. As such, the concerned individual is expected to personally meet the cost of such services. In Canada, the Ontario Health Insurance Programme (OHIP) does not cover cosmetic surgery and other dental services, except if done in hospital.
The assistance is not an entitlement, and in administering the programme, no-one is expected to be given priority or preference over another, regardless of the position he/she holds in society. The overriding considerations are fairness, equity and catering for those in dire need of assistance. The programme covers 25 per cent of the cost of CT scans, MRIs and angiograms. If the individual is unable to meet the full cost, a determination is made on a case-by-case basis.
If, after a review of an application, it is decided that the State will fund the full cost for the treatment of a life-threatening condition, there must be procedures in place to ensure reasonableness of the cost incurred. One does not expect the recipient to utilise the services of expensive medical institutions overseas while another factor relates to the frequency of visits overseas. After all, it is the taxpayer who has to foot the bill and therefore the overriding consideration should be: if the beneficiary were to meet the cost of treatment using his/her personal resources, would the person have incurred that level of expenditure for which he/she is asking the State to bear?
Senior public officials, including Ministers of the Government and their families, are not expected to benefit from the programme. Ministers enjoy decent monthly salaries of $580,000 each while the Attorney General and the Prime Minister receive $1.6 million and $1.5 million respectively. They are also in receipt of a range of benefits including: duty-free concessions on one motor vehicle every three years; house allowance of $25,000 per month or official residence; 24-hour guard service; chauffeur allowance of $107,000 per month; free electricity, telephone and maid and handyman/gardener services; vacation allowance of $420,000; and generous per diems while on overseas travel.
What happened?
The media was able to obtain information that 932 persons received medical assistance amounting to $364.4 million during the period 2012-2013. However, in terms of dollar value, the main beneficiaries were Government Ministers and their immediate families as well as a number of senior public servants. Heading the list is a former Minister and Presidential Advisor (now deceased), on whose behalf the sum of $116 million was expended on cancer treatment overseas, in contrast to the maximum of $5 million that was paid out on behalf of other cancer patients. There were two other cases of life-threatening conditions where amounts totalling $18.4 million were expended. In addition, the Attorney General and the wife of the Minister of Finance were reimbursed sums of $4.9 million and $3.4 million respectively for unspecified treatment overseas.
Since the early 1990s, the Georgetown Hospital, a public corporation with its own board, has been the recipient of significant funding from the Central Government as well as from the Inter-American Development Bank by way of loans and grants to upgrade its operations. One would therefore expect that the beneficiaries would have first sought the services of this institution. If the specified treatment is not available, the next alternative is to seek to access the services of private hospitals. It is only when these two options have been exhausted that overseas treatment should be considered.
As regards dental services, the media reported that the State paid out amounts of $2.1 million and $1.3 million respectively on behalf of the Minister of Amerindian Affairs and the Minister of Human Services. The Prime Minister’s wife also benefitted to the tune of $789,000. These amounts must be viewed in the context of the prevailing costs of various services, such as tooth extraction ($3,000 – $3,500), general cleaning ($6,000- $8,500), filling ($5,500), root canal ($30,000), available at local dental institutions. The Cheddi Jagan Dental Centre charges nominal fees of $100 for extraction and $300 for cleaning and for filling.
Government’s response
The Ministry of Health accused the media of being “unethical and disingenuous” in what it claims the disclosure of private medical details of certain government officials. One suspects that the Ministry was referring particularly to the Minister who undertook surgery overseas for a heart condition and for which the sum of $12.5 million in public funds was expended. Since the resources of the taxpaying are involved, citizens have every right to reasonable access to information about who the beneficiaries are, the amounts expended, and the general nature of the medical condition that necessitated State intervention. Had it not been for disclosures by the media, such access would not have been forthcoming.
In an earlier statement, the Attorney General contended that reimbursement for medical expenses is an entitlement by virtue of his being a member of Cabinet while the Head of the Presidential Secretariat (HPS) argued that the programme is not rule-based but one which requires the exercise of discretion. The HPS further stated that Cabinet members and other individuals benefit from the programme as a condition of service. The Home Affairs Minister, however, expressed a different view when he stated that he meets all his medical expenses from his personal resources. This suggests that medical assistance is not a condition of service. In any event, it is not for the Cabinet to decide on a particular benefit to be conferred on its individual members, as this would pose a serious a conflict of interest. Rather, such a decision rests with the Legislature.
The widespread use of discretionary powers poses significant risks for abuse of authority and misuse of public resources, especially for partisan interests. It also facilitates corrupt behaviour. Why would one discard a rule-based system with all its merits in favour of one based on discretion? As regards the HPS’s second contention, I was a senior public servant from 1985 to 2004, and more specifically Auditor General from 1990 onwards. I, however, never came across a single case where medical assistance was a condition of service of any public servant regardless of his or her position!
Auditor General’s response
The Auditor General stated that he found no discrepancy in relation to the medical assistance programme and that audit sampling procedures were used. He also referred to the risk-based approach that the Audit Office adopts in its audits and the materiality of the amounts involved. He contended that the Audit Office’s approach is no different from that of private auditors.
Risk-based auditing involves an assessment of the risk of something going wrong and the probability of its occurrence. Using a matrix involving high, low medium and low, and a further assessment of the controls in place to mitigate the risk, a determination is made. Given: (a) the apparent breakdown in the controls; (b) the extent of the use of discretionary powers by the political directorate; and (c) the materiality of the amounts involved, it is evident that the medical assistance programme is a high risk area for abuse/misuse and indulging in extravagance, thereby warranting special attention. If the Auditor General had asked for the list of beneficiaries, the most casual inspection of it would have been a revelation for him! The sad part though, is that his number two is one of the beneficiaries.
Unlike commercial auditing, State Audit is far more rigorous and requires the Auditor General to be the watchdog of public accountability and the eyes and ears of the taxpaying public. Instead of the stout defender of the public interest, the Audit Office has become the pliant, malleable and cosmetic oversight outfit serving the interest of the political directorate. How unfortunate!
Conclusion
The Government’s medical assistance programme has been abused/misused for the benefit of the selected few in positions of power and influence, with minimal benefits trickling down to the ordinary citizens. It also reflects extravagance. This was the result of setting aside a rule-based system and replacing it with one based on the discretion of the political directorate.
An urgent review of the programme is therefore necessary, and a forensic audit should be undertaken to ascertain whether any irregularities have occurred. Meanwhile, those who have benefitted from dental work undertaken at the expense of the State should, as a minimum, refund the related amounts to the Treasury.
