Opposition Leader Godwin Friday has renewed his call for the government to explain what he says is a discrepancy between the government and bank balances on the overdraft account amounting to more than EC$100 million.
“At the very least, it is sloppy accounting; at the very most it could be wasteful spending; or it could be worse,” he said during the debate of the Estimates of Revenue and Expenditure for 2024.
“It could be money that was improperly used. We don’t know because, as the Director of Audit herself said, … ‘in the absence of a bank reconciliation statement, it could not be determined what contributed to the difference’,” Friday told Parliament.
The opposition leader pointed out that the Director of Audit had noted a few years ago that there was an EC$95 million difference between what the government and the Bank of St. Vincent and the Grenadines said was the balance on the overdraft account.
“… and this is the problem we have with these documents being so late. The most recent one is 2019 and it speaks to the same problem,” he told Parliament of the Director of Audit reports, which are several years behind schedule.
He pointed out that the 2019 report said that the statement of assets and liabilities shown by the bank and as given by the accountant general, showed that the overdraft was $22.5 million.
“… but the certificate of balances issued by the bank of St. Vincent and Grenadines as at 31st December 2019 said that the overdraft was $13.4 million.
“That’s a difference of $7.6 million that the government has not accounted for, does not account for,” Friday told Parliament during the Dec. 19 debate on the EC$1.6 billion Estimates of Revenue and Expenditure for 2024, which lawmakers approved during the early hours of Dec. 20.
“Where did that money go? And I raise it again because it is a considerable amount of money.”
Friday further noted that the Director of Audit pointed out that the approved overdraft for 2019 was $50 million.
“If you don’t know what caused the difference. That is a terrible position for a minister of finance to be in with so much of the people’s money,” Friday said.
He told lawmakers that these are specific examples “of how the government, basically the Minister of Finance, who’s responsible for following the financial regulations and laws, just disregards them and says this is something that has been done time immemorial”.
He said that every year, the government comes to Parliament and lawmakers approve an overdraft of $50 million.
“Now, you’re not supposed to exceed that,” he said, noting that the Estimates said that the amount spent via overdraft was $118.4 million.
“So, I’m asking myself how is it that you could have an outstanding amount of $118.4 million when you’re only allowed to borrow by overdraft up to $50 million? Where does the authority come from to have that sort of money on your books?
“… What is that comprised of? If you’re only allowed to have $50 million, how can we reach to a level of $118 million?”
He said another problem in addition to the overdraft being exceeded is a failure to reconcile what the bank says is the amount that is outstanding and what the government says.
The opposition leader said the figure in dispute amounts to over $100 million.
He said another issue is that the government then converts the overdraft to a loan.
“… there are two loans” the accountant general overdraft loan of 7%; Accountant general loan, again Bank of St. Vincent and the Grenadines — they must be under a lot of pressure — at 6.5% and there’s a total of $44 million thereabouts.
“That is a loan essentially that the government authorised itself to do because what happened is when the overdraft exceeded a certain amount, and they couldn’t bring it back down, to just essentially convert it into a long-term loan,” Friday said.
“There is no authority from Parliament to do that. And when I raised it a couple of years ago, … the minister said that these are things that are done from time immemorial. That is just the normal way in which is done, never mind that is wrong or it’s illegal. That’s the way it’s been done. And that’s the way obviously that they’ll continue to do it,” the opposition leader said.
“That, again, is a failure on the part of the government to follow the laws and to be honest, in the process of preparing these estimates.”
Friday said he would like to see “a commitment on the part of the minister and maybe this is something that can start here to do something about the reconciliation”.
He pointed out that in the estimates, one of the strategic priorities of the Minister of Finance is to continue to strengthen strategic cash and debt management mechanisms.
“And there they spoke about getting assistance to do bank reconciliation of the development fund account and to continue on the reconciliation of the Consolidated Fund General Services account.
“I see no reference here to the overdraft account. And this cries out for urgent attention,” Friday said.
“And the fact that we have raised this publicly, the fact that the Director of Audit has raised it and there is no attempt on the part of the minister to acknowledge at least this is a problem and we need to address it.
“That is, unless, of course, in the intervening period between 2019 and now that this practice has been discontinued, which I very much doubt because they would have said so in their defence for the longest one.”
He said the government has “tried to make it out to do is some small clerical error, which accounts for this huge discrepancy.
“But here, it’s quite clear that the minister himself in his strategic priorities has paid attention to the reconciliation in certain other accounts. And I would urge that this particular account that the same treatment be given so that we have a proper reconciliation and so that the people can know that this 100-and-something million dollars that is unaccounted for, that the minister has never properly accounted for, has never said how that could ever come about, that that is being addressed. We need to know,” Friday said.
Can you put a rat to watch cheese?
Too much ginal around the bargain table.
A day will come when we all will have to give account for everything in what we have done in words and deeds and what we have failed to do. A day will soon come when the wicked shall cease their troubling.
No wonder they do all they do to stay in power! They are afraid of the consequences