Government spent in excess of $305 million dollars from the Lottery Fund on projects, such as the D’Urban Park rehabilitation, without seeking needed parliamentary approval, according to the latest Auditor General’s report
The 2015 report, which was laid in the National Assembly on October 13, explains that while the Ministry of Finance budgeted for Lottery Receipts of $1billion under the category of Miscellaneous Revenue and transferred $1.069 billion from the lottery fund to the Consolidated Fund, spending from the fund continues to occur without parliamentary approval.
As a result, it has recommended that expenditure from the proceeds of the National Lottery should be accounted for by having a supplementary estimate passed in the National Assembly and recorded in the public accounts.
According to the report, aside from the amount transferred to the Consolidated Fund, significant sums, which include prior year balances of $369.294 million and the proceeds of $421.754 million received for 2015, still remain in the bank account and were used to meet expenditure.
It said $305.826 million was spent, comprising $36.509 million for the rehabilitation of D’Urban Park, $65,060 million for Carifesta, $63.700 million for Mashramani, $51.583 million for music, $38,256 million for Amerindian Heritage celebrations, $28.573 million for the Department of Youth, Culture and Sport, $18.260 million for Emancipation, $14.591 million for tourism and $2,003 million on miscellaneous.
The Auditor General’s report explains that the agreement between the Government of Guyana and Canadian Bank Note Ltd (CBN), which established the lottery, requires CBN to pay licence fees equivalent to 24% of gross revenue. In 1996, the Guyana Lotteries Commission was established by a Cabinet decision to manage the Licence fees received and ensure that amounts spent are within the national sector and in accordance with the guidelines for access to the lottery funding. Over the years, the Lotteries Commission received proceeds from the lotto games that were used to make payments approved by Cabinet. These proceeds were retained in a special bank account and no amounts were paid over to the Consolidated Fund.
This decision has regularly been criticised by the Auditor General, who has said in his reports that it violates Section 43 of the Fiscal Management and Accountability Act.
Section 43 of the Act says that “except as otherwise provided in this Act or in any other law, at the end of each fiscal year, any unexpended balance or public moneys issued out of the Consolidated Fund shall be returned and surrendered to the Consolidated Fund.”
Political activist and former MP Desmond Trotman had sued the former government over its failure to pay monies obtained from the Guyana Lottery Company into the Consolidated Fund, saying the practice, as well as disbursements without parliamentary approval, was illegal.
Trotman, a member of the Working People’s Alliance (WPA), which now forms part of the ruling APNU+AFC coalition, had called on the court to declare that the then PPP/C government’s action with respect to the lottery funds were unconstitutional and illegal. The case was dismissed in 2012 on what Trotman’s lawyer referred to as a “procedural point.”
Other APNU and AFC officials while in opposition had also condemned the sequestering of the lottery funds and the manner in which expenditure decisions were made.
