The Public Accounts Committee on Monday found the Environmental Protection Agency (EPA) guilty of breaching the Fiscal Management and Accountability (FMA) Act in 2016 after it retained $33.2 million rather than return it to the Consolidated Fund, as it sought to utilise the sum to fund the construction of its headquarters in Ganges Street.
Defending the agency’s action, Permanent Secretary of the Office of the President (previously referred to as the Ministry of Presidency) Abena Moore, under whose purview the agency falls, told the committee that approval was given by the Finance Secretary at the Ministry of Finance for the multi-year project to be rolled over.
Under grilling from members of the committee at Parliament, Moore explained that it was an oversight on her part for the sum not to be returned to the Consolidated Fund. She explained that the request for the sum to be rolled over was made on December 31st, 2016, and was approved the same day. However, it was later revealed that the Finance Secretary at the time approved the rolling over of the multi-year project, but not the aforementioned sum.
APNU+AFC MP Ganesh Mahipal questioned why the sum was not catered for in the 2017 budget for the completion of the project.
“It probably was an oversight but we could have reflected it in the 2017 budget… I will try my best for something like this not to reoccur,” Moore assured the committee.
She noted too, that in some instances, a contractor gives the undertaking that the project will be completed in the shortest possible time and it is on that note that permission for a rollover was requested.
When questioned by the Minister of Parliamentary Affairs and Governance, Gail Teixeira, as to whether the Finance Secretary has the authority to approve the retaining of funds, a technical officer from the Auditor General’s office, present at the hearing, responded in the negative.
Following up on the issue, Mahipal asked whether the EPA’s request was for the rollover of the project or the retention of the funds.
The Auditor General’s office clarified that approval was given for the multi-year project and that the EPA erred in failing to return the unspent funds. Moore acknowledged that while it was her responsibility as the accounting officer to return all unspent money to the Consolidated Fund, she had failed to do so.
According to the Auditor General 2016 Report, the subvention agency was awarded $47 million and this was released to Environmental Protection Agency for design and construction of a building, as well as the purchasing of global positioning systems, a noise meter, a radiation monitoring system, cameras, chairs, a water dispenser, a soil analyser, air conditioning units and a photocopier, from the 2016 budget.
During the audit it was revealed that amounts totaling $13.725 million were expended. The difference of $33.275 million was retained by the Agency and not refunded to the Consolidated Fund as required.
The building was constructed to accommodate additional staff and works began in February 2017. It was scheduled to be completed in June 2019 but was completed a year later. The EPA explained that the year-long delay for the completion was due to sub-contractors for plumbing, air conditioning and electrical installation and elevator installation not being able to meet the deadlines set. The contractor, the agency said, also failed to meet his deadlines as spelt out in the contractual agreement.
Additionally, it was also explained that modifications to the building design and foundation contributed to the delay.
Teixeira further questioned the rationale behind retaining the sum and if there was proof that the money was used for the project given that the total cost of the building ($235.4 million) was catered for in the 2017 budget. She questioned too whether the allocation was reduced or did the project cost more than estimated.
Moore in response stated the agency was anticipating to pay the mobilisation fee from the $33.2 million that was not returned to the fund.
However, Ministry of Natural Resources Permanent Secretary, Joslyn McKenzie, whose ministry was responsible for the agency prior to July 2016, told the committee the EPA building was budgeted for in the 2016 budget and monies allocated catered for initial payments, design, and supervision.
He explained that in 2017 when the construction was funded by the Ministry of Finance, the sum withheld from the Consolidated Fund was factored into the total cost of the construction.
