Dear Editor,
I refer to the article, `Six years after oil discovery, Govt. now scrambling to boost GRA’s capacity’, which was published in Kaieteur News, Monday, March 29, 2021. This headline is quite misleading, as it does an injustice to the accomplishments of the Coalition Government in strengthening the capacity of the Guyana Revenue Authority (GRA) to meet the challenges posed by not just the burgeoning oil and gas sector, but other critical areas of revenue administration and management.
The boldness of the KN headline emanated from an interview with Dr Ashni Singh, Senior Minister in the Office of the President with responsibility for finance. On reading the article, one gets the impression that the efforts to build and strengthen capacity in GRA are new, rather than on-going. Indeed, I make bold to say that nothing outlined or disclosed by Dr Singh is new; they were all initiated during the Coalition’s term in Office and, at the time of demitting Office, were in various stages of implementation. This can be substantiated by examining the comprehensive report prepared by GRA, entitled “Progress Report for June 2015 to June 2020”. As you would notice immediately, this report mirrors closely the period of the Coalition Government’s tenure in Office. It was prepared as part of the handover process that should characterize any change of government. I am urging GRA to make this report available to the public.
The Report speaks to the major initiatives undertaken during 2015-2020, the accomplishments, challenges and failures. In the area of oil and gas, it identifies a major shift in focus of the GRA in 2018. Specifically, the Customs Petroleum Unit (CPU) was conceptualized. In this regard, a number of workshops, roundtable discussions, seminars and simulation exercises were organized. These activities were supported by various international organizations and agencies, including IMF, IDB, IMO, Chatham House, and the Commonwealth Secretariat.
Two missions from the IMF – September 5, 2019 and February 2020 – resulted in the presentation of technical reports. The first mission’s report, “Customs Administration of the Oil and Gas Sector” focused on the establishment of an interim CPU while that of the second mission established a detailed roadmap for a permanent CPU.
The Petroleum Revenue Audit Department (PetRad) was operationalised in September 2019 with a mandate to administer taxes in the petroleum sector and execute cost recovery audits. A robust and detailed implementation plan was developed by GRA to guide PetRAD. The Report identifies major capacity building initiatives that were undertaken in the department, including creation of a repository for oil and gas resources, drafting of new legislation for extractive industries (yet to be introduced into the National Assembly), creating the operational framework for the department, and participating in the initial Cost Recovery Audit of the Stabroek Block for period 1999-2017. The complement of personnel in PetRAD is 14, with 11 directly involved in audits. Their efforts so far have contributed $577 million in revenues to the Treasury.
Clearly, a lot of miles still need to be travelled before the GRA is able to achieve the competencies to effectively manage the nascent, but fast-growing, oil and gas sector. The current government has inherited a platform on which to rapidly build capacity not only in GRA, but in other agencies in the financial sector within the remit of the Minister, such as the Bank of Guyana, Bureau of Statistics and the Ministry of Finance. The Office of the Auditor General should also be a beneficiary of such initiatives.
Yours faithfully,
Winston Jordan
Former Minister of Finance