Five years after the Auditor General’s office unearthed massive financial breaches in the procurement of dietary supplies for Region Eight, the Guyana Police Force is still to institute charges, the Public Accounts Committee (PAC) heard on Monday.
The 2016 audit report had highlighted discrepancies in the payment of 60 transactions totalling some $33.6 million. These payments were related to purchases of dietary supplies for the Kato, Region Eight, school feeding programme.
During the audit it was discovered that the supplier had encashed a cheque for $2.432 million on July 29, 2016. However, auditors found no evidence of the items being entered into the Goods Received ledger, nor any evidence of the Regional Tender Board’s approvals.
The auditors in their investigation also found that items were being purchased at a higher price than that offered by other suppliers the Region usually procures its items from.
Accountant General (Ag), Jennifer Chapman explained that the police were informed upon the discovery of the “total breach” of the regional financial system. Despite the report, however, no criminal charges were imposed against the individual responsible.
A special investigation was also warranted in 2017 to investigate what transpired with the Region’s spending, with Chapman at one point indicating that there was evidence of collusion between the involved parties. The findings of the special audit were circulated on Monday to PAC members for perusal.
From the special audit, records from the Kato School showed that they received supplies valued at only $16.2 million while receiving 18 payments valued at $68.8 million from the Region.
Former Permanent Secretary of the then Ministry of Communities, Emil McGarrell, said that the issue was a result of not having competent and qualified staff in the accounting department. He told the committee that during 2016, the Assistant Accountant had to perform the duties of Accountant and Chief Accountant. This scenario created the conditions for the breaches in the payment process.
When the discovery was made, he explained that they could not find an immediate replacement and the officer remained on duty despite the findings. This, he said, was done to prevent the region’s works coming to a halt.
McGarrell provided the response to a question by government member, Gail Teixeira, who sought clarity as to whether the implicated officer was sent on administrative leave pending investigations.
Teixeira rebutted by stating that she did not accept the explanation provided since the ministry, which is large, has a number of personnel that could have been transferred temporarily to man the post. McGarrell nonetheless stated that finding the staff member with the requisite experience to match the Region’s needs was difficult. He pointed out that what was needed to streamline the region’s accounts was a senior officer and that was not available.
As they sought to remedy the issue, he disclosed that they recruited retired accountants with the experience to function in the positions of Accountant and Chief Accountant to better manage the department and the region’s spending.
The government questioned how was it the transactions were allowed to be processed and whether the then Regional Executive Officer (REO), Rafael Downes, was executing his duties or “was asleep or wasn’t living in the region.”
McGarrell responded that disciplinary action was taken against the REO as he was removed from the post in 2017.
Government member Sanjeev Datadin after a perusal of the special audit pointed out that during the period, $4 million per month was being paid to the supplier who is based in Parika, but only supplies amounting to $825,000 were delivered.
“How is it that this could not have been known? … How it is from February 2016 to July 2017 this lengthy period, this was able to be perpetuated? This is a service that feeds children… I am asking about the effect, the children should receive food… was it not happening? If it was not happening, how it is it goes on and no one addressed it? … Nobody is aware that this is going on? Who would have had to be checking…?” Datadin challenged during the perusal of the 2016 Auditor General report.
The member questioned on what grounds the payments were allowed to continue for more than a year and why it wasn’t flagged by the authorities.
However, the committee was unable to receive any answers from the Region’s team as it was ruled by its chairman, Jermaine Figueira, that not all members were in receipt of the report, as David Patterson and Teixeira were attending virtually and the other members were unable to examine the document.
Opposition Member, Juretha Fernandes, also suggested that the paragraph that was debated remain open and the committee return to it after perusal of the special audit report. Her suggestion was accepted by Figueira.
Meanwhile, Regional Executive Officer for Region Eight, Peter Ramotar, informed the committee that measures have been put in place and such instances are no longer occurring.
He assured that the region is currently adhering to the accountability and procurement guidelines to avoid such issues from recurring.
