Govt. engaged in unprecedented abuse of national coffers

By Gary Eleazar

Financial Analyst, Christopher Ram

Government had for nearly two months been quietly spending money in violation of an expressed non-approval of the National Assembly while it searched the Constitution for what it opportunistically considered loopholes to disregard the concept of separation of powers and to have its own way.
The action by Government represents a major unprecedented abuse by the Executive of the Consolidated Fund which comes under the control of the Legislature.
At least this is according to Financial Analyst, Christopher Ram, who in an analysis of the $4.5B Statement of Excess brought to the House last Thursday by the Finance Minister, Dr Ashni Singh and its accompanying Bill, said that there is no legal basis on which the government’s action could be based.
Ram is of the opinion that a potential financial crisis looms in Guyana as a result of the actions of the Government.
According to Ram, the Minister’s reliance on section 41 of the Fiscal Management and Accountability (FMA) Act seems even more tenuous since that section deals specifically with the Contingencies Fund.
Ram points out that each of the 50 attachments to the Financial Paper, brought to the House by Dr Ashni Singh, is headed Statement of Excess – 2014, a different concept from Contingencies.
“In any case, any explanation that the narrative in the Bill is generically worded can hardly be used to make a case for approval for $4.6B of public expenditure,” according to Ram.

Accident or design
Ram in his analysis said, “in my view the most relevant Article of the Constitution and the section of the FMA Act were overlooked or ignored by the government and its Attorney General, whether by accident which I doubt, or by design.”
He said Article 217 is clear: monies can only be withdrawn from the Consolidated Fund where: the expenditure is charged upon the Fund by the Constitution or by an Act of Parliament; the issue of the money has been authorized by an Appropriation Act; the issue of the money has been authorized under Article 219 of the Constitution.
Ram points to the fact that section 16 of the FMA Act states that “There shall be no expenditure of public monies except in accordance with article 217 of the Constitution”.
He points out that the very Act provides for a Contingencies Fund advance as expenditure out of the Consolidated Fund.
Ram said too that “whatever criticisms may be levelled at the drafters of the Constitution, including failure to make clear whether ‘approves’ excludes ‘approves with amendments’ and what ‘excess’ unambiguously means,”
no amount of legal linguistics can support any interpretation of any provision of the Constitution or the FMA Act that allows the expenditure incurred by the Minister of Finance for which he now seeks parliamentary approval.
“It would take some convincing to make constitutional anything that is unconstitutional and I cannot see on constitutional and legal technical grounds how the National Assembly can give their approval to the Bill.”
Ram posits that if they do, the Minister can then argue that none of the expenditure was unconstitutional, illegal or improper since the National Assembly subsequently approved them.

Crocodile Tears
According to Ram, “over the past several months, various spokespersons of the government have been lamenting the consequences of the budget cuts particularly the subvention to the student loan revolving fund at the University of Guyana, payments for GINA, NCN and CJIA and the payment of activists under the so-called Amerindian Youth Entrepreneurship and Apprenticeship Programme…We now know that the tears and lamentation were those of the crocodile and that while pretending to cry wolf and wipe tears, the government was systematically and flagrantly violating the Appropriations Act 2014 which they themselves introduced in the National Assembly and supported following the non-approval of the six programmes.”
According to Ram “It would seem to me that at the root of this violation and deception are Dr. Roger Luncheon, who has resumed responsibility for the Cabinet’s press conferences and the Attorney General Anil Nandlall, the principal legal adviser to the Government of Guyana.”
He said that acting on their direction and guidance the Government has used its executive authority to usurp the powers and functions of the Constitution and the National Assembly, a mockery of democracy.

Abuse of the Consolidated Fund
Ram reminded that over the years the nation has heard a lot about persistent abuses of the Contingencies Fund.
“That (abuse) has now been extended to the Consolidated Fund,” according to Ram, who also pointed out that the Bill for which the Minister is now seeking approval, raises real constitutional, legal and administrative challenges.
“What if the National Assembly does not approve the Bill when it resumes…There is an un-replenished amount of $29M to the Contingencies Fund for the Specialty Hospital which no one seems able to address.”
Under normal circumstances, according to Ram, parliamentary support for the $4.6B spent without approval could have been assured since significant elements of that sum were justifiable.
“I recall the AFC pleading for some of those items to be brought back to the National Assembly for prior approval of the expenditure…What the AFC did not know was that the Government, presumably after consulting with its constitutionally designated legal adviser, had already been spending the money so there was no need or urgency to bring back any of the items, at least not until now.”
According to Ram, the opposition in the National Assembly may consider that they face a dilemma.
“Can they now not approve those items of expenditure with which they had already said they had no difficulties? Or do they take the position that they cannot approve transactions that are in violation of the Constitution and decisions of the National Assembly and that can create a precedent that may come back to haunt them?”
Ram is adamant that the current predicament is not simply a difference of opinion or interpretation: it is a major unprecedented abuse by the Executive of the Consolidated Fund which comes under the control of the Legislature.
He said too that it is apposite to point out that the Bill and its attachments gave no indication as to how the Government intends to deal with expenditure for the rest of the year.
The details refer to expenditure for January to June 2014 which suggests that the Government intends to engage in the same unconstitutional and illegal conduct for the second half of 2014, according to Ram.
According to Ram, Parliamentary support now would only embolden the Government to repeat the illegalities for the period July – December 2014.
“If that happens we have a serious constitutional financial issue where $4.6B from the Consolidated Fund has been spent without approval…To treat it merely as unauthorised expenditure would trivialise a development with no precedent in the country.”