Chief Executive Officer (CEO) of the Guyana Water Incorporated (GWI) Shaik Baksh on Friday said that a forensic audit is currently ongoing into the “reckless spending” by the utility company over the preceding five years and that the Special Organised Crime Unit (SOCU) has been informed of financial irregularities that were uncovered.
Addressing the company’s financial position during a virtual press conference, Baksh said that an internal audit was carried out, during which a series of financial irregularities were discovered.
The findings, Baksh said, show “poor financial management” at the utility company.
According to Baksh, GWI was on the verge of collapsing in 2020 with a sum of $800 million owed to suppliers.
When the new management took over office in August last year, he said, “certain” steps had to be taken to reduce that amount, which now stands at $200 million.
“And when I took office I was bombarded on a daily basis. People crying out for payments. It affected our image. It affected our credit-worthiness as a utility and we had to move quickly and dissolve this to the extent that it has been reduced….Its only just over $200M now that we owe to suppliers out there,” Baksh explained.
Among the irregularities found, Baksh said, was an overpayment of $87 million to a contractor who was contracted to do the Vlissengen Road pipeline project.
“…In 2019, we have the figures showing $55 million being spent for Old Year’s Night party anniversary and staff Christmas party. $55 million. We have all the invoices, all the vouchers, everything. This can be subject to any audit…..$55 million when you’re in a sad state of affairs as a company. You can’t maintain your treatment plants….These are things that were happening in this company,” he noted.
As it relates to overseas travels, he said in 2018, $26.8 million was spent and another $26 million the following year.
“…As for meals, oh my. In 2019 alone, $50 million alone for meals, total, for the company. Compare that to 10 months of new management from August 2020 to May 2021, $16.7 million,” Baksh said.
Additionally, Baksh noted that there were instances where the necessary procurement rules were not followed.
Among these was the usage of the SeaQuest, a drinking water corrosion control sequesterant.
The SeaQuest, according to Baksh, cost the company a sum of $1.8 billion over four years but it appears that there was sole-sourcing of the product and a “middle man” was conducting the procurement.
While the SeaQuest was in use, Baksh said, a number of water treatment plants were not maintained.
The CEO explained that the Auditor General’s reports for the years 2013 to 2015, when he was previously at the helm, point to “prudent” financial management by the company.
The reports for 2018 to 2020, he said, are “lagging,” while the 2017 Audit General’s report points to “gross” mismanagement.
