Government has gone some way towards restoring public financial accountability
November 18, 2001
Please permit me to state, at the onset, that I welcome your sustained interest in the subject of public accountability in Guyana, most recently displayed in your editorial of 15 November 2001 captioned "The Minister of Finance must act" [ please note: link provided by LOSP web site ] . This subject is undoubtedly one at the centre of the public interest, and I am happy that you draw attention to it from time to time. I would, however, like to offer a few comments of my own on the issue.
Return to accountability
In my opinion, your assertion that "the culture of non- accountability and financial depredation that flourished in the Burnham era is still alive and well" is an unfair exaggeration and seeks to trivialise the achievements of the current Government in restoring public accountability.
It is also completely inconsistent with your allusion, later in the same paragraph, to the fact that the Auditor General's report for the year ended 31 December 1992 was the first such report for over a decade and was laid before the National Assembly during 1993. This return to accountability in 1993 was a major achievement by the new Government. Since then, the annual financial statements of the Government, along with the Auditor General's reports thereon, have been consistently prepared, laid before the Legislature, and made public every year in a timely manner. They have also stimulated wide discussion, evidenced by your editorial, as is appropriate in a democratic environment.
The state of the accounting records in relation to all the years from 1982 to 1991 was such that preparation of financial statements in relation to those years continues to be practically impossible. I therefore have a difficulty accepting your likening of the current era of timely financial reporting to a previous era where the financial results of Government were not disclosed, if ever, until they became largely irrelevant.
While I would be among the first to acknowledge that there remains room for improvement, I would also submit that the renewed culture of timely financial reporting to the Legislature represents an important step in the restoration of public accountability. Other major achievements of this Government have been reactivation of the Public Accounts Committee, improved transparency in the procurement process, and a more accountable and inclusive parliamentary process.
Support of the Auditor General's Office
As a further demonstration of our commitment to public accountability, this Government has been exerting every effort to strengthen the Auditor General's Office, within the limited resources available to us. We also have supported several externally funded initiatives to strengthen that Office.
The draft Poverty Reduction Strategy Paper, which was recently the subject of public consultation, commits the Government to strengthening the Auditor General's Office by providing training in key areas of auditing. The implementation of this initiative has already commenced, the Government having co-financed with the UNDP an extended attachment by one of the Auditor General' s senior officers at the US General Accounting Office earlier this year. Another senior officer is currently in India, under the ITEC programme, undergoing specialised training in the audit of public works.
Yet another material manifestation of Government's support to the Auditor General's Office has been this year's provision of funds for the hiring of external consultants to assist in auditing of public works. We are hopeful that this initiative will result in recommendations that will enable us to strengthen our own monitoring and control over the implementation and execution of public works projects. Indeed, we regard all reports of the Auditor General as a useful management tool, and as an extremely useful signal of areas that require intervention.
Quality of staff and competing demands for scarce resources
You suggest that accounting staff such as those employed by the Government "would not last for three months" in "the most run down private sector business". I believe that this is an excessively harsh judgement on the professionalism of public servants, and fails to take cognisance of the need to allocate scarce resources across competing demands.
While I honestly believe that there are many competent, diligent and dedicated public servants, I share your view that there is need for better qualified and motivated accounting staff. Indeed, if the public purse had the unlikely fortune of being endowed with unlimited resources, I might be inclined to increase the quality and quantity of accounting staff employed in Government Ministries and Departments at the stroke of a pen.
Unfortunately, as stated earlier, the resources available to Government are limited. The allocation of these limited resources invariably involves difficult decisions regarding the determination of relative priorities. We are faced with, and have been responding favourably to, legitimate demands for more expenditure in social sectors such as health, education, water and sanitation. In-creased expenditure for the purpose of upgrading the quality of our accounting staff is only achievable at the expense of some other need.
However, with the assistance of CIDA, the Government is currently approaching Phase III of the Guyana Economic Management Project. This Project aims to modernise the treasury, will involve the full implementation of programme budgeting, and will achieve increased efficiencies in economic and financial management.
Public service reform
The Government is committed to a process of public service reform. In fact, very shortly, a meeting of Permanent Secretaries and Heads of Departments will be convened to discuss this theme. An integral aspect of any comprehensive public service reform process will be the issue of financial management. My Ministry is committed to financial management reform, as a component of broader public service reform, with a view to achieving more effective and accountable governance.
Without wishing to pre-empt the outcome of the requisite deliberations, I see financial management reform as involving, at the very least: (i) better strategic planning to achieve objectives and targets set at national and sectoral levels (ii) updating, simplification and consolidation of financial management and accounting rules and procedures to facilitate more effective programme implementation; (iii) greater use of information technology to increase efficiency in all processes; (iv) use of performance benchmarks and indicators at macro- and micro-levels; and (v) provision of requisite training to staff.
Most importantly, in order for serious reform to be achieved, it will be essential that we are able to effect sanctions against proven defaulters and non-performers without risk of destabilisation triggered by industrial or political reprisal. As you quite rightly suggest, this will require commitment from other parties in addition to the Government.
I commend you again for drawing attention to a most important issue.
Minister of Finance