Full staffing of the Guyana Revenue Authority’s Petroleum Revenue Department (PRD) is being affected by uncompetitive remuneration packages according to the Auditor General’s report for 2020.
In July 2020, GRA was granted approval by its Board for the establishment of the Petroleum Revenue Department with an approved staff complement of 67. To date, the staff complement is just below half of the required number at 26. That means that GRA still has to fill 41 vacancies.
The Auditor General’s report highlighted that GRA’s Human Resource Management Division is currently conducting job evaluations to grade the respective posts within the PRD. It pointed out that GRA is training officers for various audit functions in an effort to build a team with the necessary skill sets and competencies.
Multiple training sessions were held by the Office of Technical Assistance and the International Monetary Fund to build capacity to ‘Administer Domestic taxes within the Oil and Gas Sector’ and ‘conduct Cost Recovery Audits’ from March 2017 to July 2019, according to the report. The Auditor General noted that further expansion of the Department is being curtailed by the employment freeze which results in adverse effects to the Department’s work programme and the full operationalisation of the newly instituted Divisions.
In response to the Auditor General’s observation, the GRA said that the Department is set up to provide for growth in staff as the industry demands, and activities in the oil industry ramp up.
“It further allowed that since this was a new industry for which the skills were virtually non-existent in Guyana and current salary levels could not attract expatriate staff. As a consequence, thereof, the decision was made to have GRA do its own internal training through help from the Agencies aforementioned, and to build a cadre of officers (who) can pass on their training to other staff. This is being slowly achieved,” GRA told the Auditor General.
However, GRA noted that because of better salaries and working conditions in the private sector, many of its officers are leaving as soon as they undergo the training. It pointed out that there is a great need for better remuneration packages.
“Further, since this is a new section from which the future of the nation depends, Management of the GRA has been at pains to build a cadre of patriotic and learned officers that will be a shining light for others to follow. Management, therefore, had moved to sources external to the GRA for qualified accountants, auditors and financial analysts,” GRA said in its response.
Additionally, GRA said that the structure of the department also allows for a petroleum engineer and a cost recovery audit section staffed with 20 officers, neither of which have been filled. Again, GRA was unable to hire an engineer because of salary constraints while clarity in relation to whether the Authority would be conducting cost audits is needed before it staffs the department.
However, GRA did say that its team can do just as well or better than their external counterparts when it comes to cost oil audits.
In 2018, GRA began the audit of ExxonMobil’s US$460 million pre-contract and cost recovery charges. That report was subsequently submitted to the Department of Energy.
In August last year, the PRD’s mandate was extended to include VAT refund verification, objections and appeals, debt management and assessment and accounts examination for the oil and gas section.
GRA explained that it received $3.757 billion in applications for VAT refunds from 61 companies operating in the oil and gas sector. According to the Auditor General’s report, at the end of 2020 $673.517 million were paid, $8.018 million were rejected, VAT credits totalling $66.215 million were disallowed and $773.925 million in VAT Refunds were being processed by the Authority.
