Parallel treasuries
Dec 09, 2017 , https://www.kaieteurnewsonline...parallel-treasuries/
The buck stops with Granger! He shall have to decide now what action will be taken against those persons who deceived this nation in relation to the signing bonus which the government received.
The President will also have to explain to the nation whether this signing bonus was done behind the backs of the Cabinet and why, in the first place, was a signing bonus necessary.
The whole idea of a signing bonus is offensive. It has a terrible connotation, almost as if the country, which over the long-term will receive billions of US dollars in revenues from oil exploration, is taking a pay-off.
The government is now boasting shamelessly that Guyana will get over US$300 million per annum for the disgraceful rate of 2% in royalties which the APNU+AFC renegotiated with Exxon Mobil. The world average is four to five times that amount. So it means that Guyana, has robbed itself of at least US$1Billion per year by not pressing for higher royalties. It is this context which makes it ill-advised for the government to be receiving a ‘signing bonus’. Such a bonus will lend to the perception that the government sold-out the future of Guyana for a few pieces of silver.
Guyana should return the ‘signing bonus.’ It is a curse upon this nation. They should ask for the cancellation of the 2% royalties. If not, the President has to explain to the people of this country why the royalty rate is so low.
If Cabinet had adjudicated on the renegotiated royalty, then the President must indicate the justification for the rate negotiated. He must also state if Cabinet approved of the ‘signing bonus’ and, if so, why it was so negligible, relative to what Guyana’s oil reserves are worth.
The President has some answering to do. If, on the other hand, Cabinet did not approve of the renegotiated royalties and/or the ‘signing bonus’, the President must indicate why it took him so long to fire those who were involved, if indeed this deal was struck behind the backs of the government.
The President must also explain why it is that his government denied that there was a ‘signing bonus’ when evidence is now emerging that persons within the government knew about this more than one year now.
Guyana owes a debt of gratitude to Christopher Ram for making this matter public. Had he not revealed that there was a ‘signing bonus’, the matter may have remained silent. And this raises a number of other questions relating to what the signing bonus was intended to do.
The President must state whether the money has been received. If it has been received, then the President must state where, in the Budget estimates for 2017 and 2018, are references to the ‘signing bonus.’
The Fiscal Management and Accountability Act is very clear. Public monies received by the government are treated as revenues until such time as they are deposited into the Consolidated Fund or some Extra-budgetary Fund created by statute.
The Budget for 2017 was read after September 2016. The Budget for 2018 has just been debated. There is a letter from the Ministry of Finance to the Bank of Guyana, dated September 20, 2016, which was before the 2017 Budget was read, asking for the monies to be placed into an account. Now if the money was received before the reading of the 2017 Budget, it should have been reflected as revenues in those Estimates.
If it was received after the reading of the 2017 Budget, then it should have been reflected in the 2018 Budget. The President has an obligation to tell this nation whether the monies have been properly accounted for in accordance with the provisions of the Fiscal Management and Accountability Act.
The President must explain why it was the intention of the government to have these funds deposited in an extra-budgetary account, and the intended purpose of the monies. The government which is headed by the President had pilloried the PPPC for having what the APNU+AFC called ‘parallel treasuries.’ This is how the APNU+AFC referred to the holding of public monies outside of the Consolidated Fund. It even demanded that the funds held by NICIL be transferred to the Consolidated Fund.
Now look what it is doing! It is creating accounts for funds outside of the Consolidated Fund.
If, however, the monies have not yet been received from Exxon, then the President must tell the nation the purposes for which the monies would be used. If it is extra-budgetary, it cannot be used to pay a 200% increase in wages for teachers. To do that, the monies would have to have been paid into the Consolidated Fund.
The government is claiming that there is no money available to pay workers a bonus this year. It is not likely also that the teachers will see another cent for 2017, other than the interim increases which they received. But if that US$20M was placed in the Consolidated Fund, then there can be no such excuse anymore.