Government is ignoring the Constitution and finance laws by clearing contracts for new projects in the absence of a budget, attorney Christopher Ram has said.
“If the Constitution and the (Fiscal Management and Accountability Act) FMAA were to be respected and applied, the government can legitimately spend on salaries and wages, repairs and maintenance, pensions and utilities and other recurrent expenditure on existing programmes and projects but not to commence any new projects, incur any new capital expenditure, grant any subsidies or make any payments not related to the ongoing delivery of normal services of Government,” Ram wrote in a posting on his blog. He said that there are several developments that suggest that this is not an abstract question but a real, practical one.
“Offering evidence of a complete disregard for the Constitution and the FMAA, Cabinet Secretary Dr. Roger Luncheon announced that Cabinet has (cleared) contracts valued at some $876 million even as President Ramotar was in India agreeing to significant borrowings from that country for expenditure in Guyana,” Ram, who is also an accountant, wrote.
Last week, Luncheon announced that cabinet had cleared $876 million in contracts including $235.9 million for the construction of a maternity ward at the Georgetown Public Hospital.
Ram, in his posting, noted that in Guyana, the financial year is the calendar year but the Constitu-tion allows the Minister of Finance up to the end of March to present the budget for the current year and allows another month for debate and approval in whatever form. To facilitate expenditure for these four months, Article 219 (1) of the Constitution grants the Parliament the power to make provision for the Minister of Finance to authorise the withdrawal of moneys from the Consolidated Fund to “meet expenditure necessary to carry on the services of the government of Guyana” until the expiration of four months from the beginning of that financial year or the coming into operation of the Act, whichever is the earlier, Ram pointed out.
He pointed out that the FMAA which was passed by the National Assembly in 2003, sets out in some more detail, the authority for expenditure during the four-month period. The Act gives the Minister the power to issue month-to-month drawing rights “sufficient to fund the ongoing delivery of normal services of Government in accordance with Article 219(1) of the Constitution,” the attorney said.
“The amount however is restricted for each month in respect of each budget agency “to one-twelfth of the amount that was expended by that budget agency in the immediately preceding fiscal year…” A further restriction imposed by the FMAA is that the Minister cannot issue a drawing right in relation to a subject matter or for a purpose for which there was no appropriation in the immediately preceding fiscal year,” Ram asserted.
Serious restrictions
In other words, the attorney said, there are several, serious restrictions on spending by the Minister during the next four months – regardless whether or not the National Assembly is re-convened or whether it is dissolved. According to Ram, Presi-dent Donald Ramotar’s indifference to serious matters makes him unpredictable but what is certain is that the prorogation proclamation of November 10, 2014 expires on February 10, 2015, i.e. six months since the end of the preceding session of the Parliament on August 10, 2014.
Meantime, Ram said that urgent action is necessary in the ongoing case where Opposition Leader David Granger has approached the court to stop unauthorised spending by government. Early in December last year, Granger made an application to the Court for an order to halt any unauthorised spending by the government and also for spending on programmes that were disapproved by the National Assembly to be stopped. His application was the result of concerns raised by the opposition about government spending public monies without any parliamentary scrutiny after Parliament was suspended by Ramotar on November 10, 2014.
Ram said that even as acting Chief Justice Ian Chang considers this case alleging unauthorised public expenditure of over $4.6 billion between January and early June 2014 involving one article of the Constitution, another case is probably in the making over spending of further billions in violation of another article of the Constitution.
He said that the question has been raised as to why the action was not brought immediately when it became known in June last year that the Minister of Finance had authorised the spending of moneys expressly disapproved by the National Assembly. It is obvious that several billions more would have been spent since June 14 in similar circumstances, he added.
Attorney General Anil Nandlall has argued that the court cannot issue an order to stop all government spending not approved by the National Assembly as there is no allegation that anyone’s fundamental rights has been breached.
Ram said that there is considerable relevance between the current case and 2015. “If the court’s decision is that the Minis-ter of Finance exceeded his spending authority then it is reasonable to assume that such spending cannot be taken into account in calculating the one-twelfth of the preceding year expenditure,” he wrote.
“It would be stretching it indeed for any court in one breath to rule a spending as unauthorised and improper in one period and yet valid for the purpose of qualifying expenditure for another,” he said while adding that cynics might say that stranger things have happened but persons should wait and see how the current case goes before allowing cynicism to take hold.
Instinct
According to Ram, the instinct of the PPP/C particularly since Bharrat Jagdeo became President has been to spend and spend and damn the Con-stitution and that instinct has now become a practice. “With a poodle for Auditor General, no Public Accounts Commit-tee and no National Assembly the temptation increases. With elections looming and electoral defeat more than a possibility that temptation will become irresistible,” he said. He added that hopefully, the case dealing with 2014 spending will be settled soon, if only to lay down markers for future conduct and for its relevance to spending in the four months January to April 2015.
The attorney said that Granger who brought the action now being argued in the court no doubt recognises the dangers of unrestrained public spending at this time. “Unauthorised spending in 2014 carries over into 2015. The parliamentary opposition with its array of lawyers now freed of parliamentary duties ought to treat this matter as much as of national importance as of their electoral self-interest. Time is of the essence and urgent action is necessary,” Ram asserted.
