The signing bonus has to be deposited in the Consolidated Fund

The signing bonus has to be deposited in the Consolidated Fund

Dec 17, 2017 Features / Columnists, Peeping Tom, https://www.kaieteurnewsonline...e-consolidated-fund/

It is disappointing to hear the arguments which are being made by government officials – those who should know better – in relation to the banking of the US$18M received from Exxon Mobil as a signing bonus. There seems to be an attempt to claim that these moneys do not have to be paid into the Consolidated Fund.

They do. And it is shocking that government officials will claim otherwise. This is really one of the biggest disappointments of the new government. How can it be so ingenious in defending what is indefensible – the manner in which it has kept secret the signing bonus and its failure to have it passed through the Consolidated Fund.

The Constitution of Guyana is explicit on the treatment of moneys received by the government. The government has received public moneys from Exxon Mobil. The definition of ‘public moneys’ is provided for under the Fiscal Management and Accountability Act (FMAA). Public moneys which are received by, or on behalf of, the government. Moneys are deemed to be ‘received’ once they are not deposited into the Consolidated Fund.

The Constitution provides that all moneys raised or received, except those which are revenues or moneys payable under an Act of Parliament into some fund established under such an Act, shall be paid into the Consolidated Fund.

The Fiscal Management and Accountability Act makes this clearer. It states that all public moneys raised or received by the Government should be credited fully and promptly – please note, fully and promptly – to the Consolidated Fund, except (a) moneys credited to an Extra-budgetary Fund as stipulated in the enabling legislation establishing that fund; (b) moneys credited to a Deposit Fund; and (c) as stipulated in the Constitution.

An Extra-budgetary Fund has to be created by law, not by letter. There is also a requirement for quarterly reports to be published about the operation of the Fund. The accounts of the Extra-budgetary fund are subject to scrutiny by the Auditor General. If none of these are done, then it means that the operations of the fund are in contravention of the Fiscal Management and Accountability Act.

In the case of Deposit Funds, the Minister of Finance is required to notify the National Assembly of the establishment of the Fund. This has to be done on the establishment of the Fund, not one or more years after it was established. None of these have been done in relation to the signing bonus.

The signing bonus is not being held in a Deposit Fund or an Extra-budgetary Fund. It is being held in a foreign currency bank account. This means it should have been passed through the Consolidated Fund in accordance with the Constitution and the Fiscal Management and Accountability Act.

The President is saying that he is prepared to ensure that the moneys are passed through the Consolidated Fund, once he is told by the Court, or by advice that the present arrangements are in contravention of the law. But from whom will he accept such advice?

Will he accept such advice from outside of his government? And what is wrong with the President reading for himself, the provisions of the Constitution and the FMAA and deciding for himself whether the holding of the signing bonus in a foreign currency account is ultra vires the Constitution and the FMAA?

The language of these documents is simple to understand. It can be understood by any high school student. It does not require the intellect of a Minister for someone to understand what the Constitution says and what the FMAA states.

These provisions are not novel to the government. APNU and the AFC used these very provisions to argue against moneys from the Lotto Fund, which incidentally is an Extra-budgetary Fund, and from NICIL, being held outside of the Consolidated Fund. The government is now having selective amnesia when it comes to the interpretation of these provisions.

The government has found itself in a bind. This is what happens when you try to keep secrets from the people. There was no credible reason for not revealing that the government had received a signing bonus. But the government could not reveal this  because it knew that persons would question why any government sitting on three billion barrels of oil reserves, would agree to a signing bonus of only US$18B and then devote that bonus to paying legal fees and training.

There is something amiss here. Something is smelling rank.

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