Public Accountability

Most times when there is an appeal for public assistance, it is the Police seeking help finding a suspect or some vulnerable community or needy individuals in search of government aid.  This time the call for public assistance is about a call for public accountability.  Instead of the government giving to the public, the public could return the favour and give to the nation by insisting that the Public Procurement Commission (PPC) be established by the 10th Parliament. As remote as it might appear from people’s minds, the issue of public accountability is not a trivial matter.  It is about how effective public dollars are in lifting living standards and improving the quality of life for Guyanese.  It is about the scope and quality of healthcare. It is about access to good public education and the enjoyment of a healthy and aesthetic public space.  It is about well-designed and well-built buildings, roads, bridges and river and sea defences, and other infrastructure to facilitate commerce and industry.  Linked to public accountability are the sloppy record-keeping of the Ministry of Health and the irregular tender and selection practices of the Ministry of Education that appeared in the recently released report of the Auditor-General.  It is also about the poor safety and protection services that are gotten from the Disciplined Services.  Extremely poor work habits, insensitive customer service linked to poor training and pay, and inefficient production and monitoring systems are added burdens on public accountability.  The public therefore needs to pay attention since this is a direct assault on the income and Value-added Tax (VAT) that they pay into the public purse.

LUCAS STOCK INDEX The LSI declined 4.84 percent in the fourth week of trading in March 2012. The decline was on account of a 9.33 percent drop in the price of the stock of Banks DIH (DIH) and the light trading on the exchange this week. The stocks of DIH were joined by those of Demerara Distillers Limited (DDL) in trading this week, with the latter showing no change. The loss pushed the index down to just 2.43 points above the Treasury yield.

Ever since the public procurement law was passed in 2003, there have been renewed expectations about public accountability with respect to the use of public funds.  The law was designed to promote and achieve fairness and transparency among other things in the procurement process. Over the last eight years, the government has spent in excess of G$322 billion on various public works, commodities and services. This is money accounted for under the public records.  Aware that money is also spent from other sources like the Lotto Funds and the kitty of the National Industrial and Commercial Investment Limited (NICIL), the expenditure of the government could be far higher than publicly known or acknowledged.

Public Investment

In addition to uncontrollable spending, there are the issues of equity and competition in the contracting process, as well as real concerns about value for money with incomplete and shoddy work coming from unqualified and incompetent contractors.  The annual audit report of the public accounts reveals alarming details of mismanagement of funds and questionable procurement practices.  Despite investing an average of 30 percent of the gross domestic product between 2003 and 2010, for the most part, Guyana has been recording three and four percent growth.  While public investment over the last eight years amounts to G$419,000 per person, the Auditor-General’s reports suggest that the real per capita cost of the work is much higher on account of the inefficiencies and irregularities found in the public service.  The need to bring this per capita cost down so as to improve the returns to the country is among the other reasons the Public Procurement Commission is needed, and the Guyanese public can help have it established.

Straightforward

Setting up the PPC should be a straightforward task.  The responsibility for setting up this body is shared between the Public Accounts Committee (PAC), the wider National Assembly and the President.  According to the Constitution of Guyana, the PAC is required to recommend the five persons who shall sit on the Commission.  Once the PAC makes its recommendation, the full National Assembly votes on it and, if at least two-thirds of the National Assembly approves, the recommendation goes to the President for signature.  The importance of the PPC is not merely the role that it will play in ensuring fairness, equity and integrity, but it is the independence that it will enjoy to do its work.  Under those circumstances, it becomes easier to believe the decisions of the various tender boards and in the probity of contract allocations.

Difficult Task

Despite the simplicity of the process for establishing the PPC, and the new configuration of the National Assembly, the creation of the PPC remains a difficult task.  The present administration is already unhappy with its status in Parliament and is displaying occasional signs of unwillingness to co-operate with the Opposition.  That in itself is a bad omen.  More importantly is what the administration has done already outside of Parliament that makes matters sticky.  It may be recalled that the President included among his ministerial appointments a Junior Minister in the Ministry of Finance.  According to newspaper reports, that Minister reportedly has responsibility for procurement matters.  In the belief that the Junior Minister is acting on behalf of the Minister of Finance, his authority for procurement matters is extensive.  According to the Procurement Act of 2003, the management structure of the procurement process consists of the Procurement Commission and its institutions and the National Tender Board and its institutions. However, until the PPC is established, all power resides in the National Procurement and Tender Administration.  The National Procurement and Tender Administration is managed by the Tender Board, and all appointments to that Board are made by the Minister of Finance.  The Board also reports to that office.  It is evident that, in the absence of the PPC, the government retains full and unfettered control over the procurement process.

No Incentive

It is not unreasonable to believe from the foregoing that there is no incentive for the administration to co-operate in setting up the PPC.  It is 16 years since the Constitution was amended to include the creation of the PPC and it has not happened.  Up until the 10th Parliament, the National Assembly was controlled by the PPP/C and it did not see it fit or proper to create the Commission.  Even though the administration has lost control of the Assembly, it still is in a position to stymie the process.  To reach the President’s desk, the recommendation of the PAC must enjoy support from at least two-thirds of the parliamentarians.  This means that at least 11 members of the administration must support the recommendation of the PAC.  That will only happen with the blessing of the President who has no incentive to do so.  The challenge by his administration in the Courts about the configuration of committees in the National Assembly is further evidence of a readiness to resist change.

Independent Audit

There are several ways to skin a cat and that is where the public comes in.  Of course the Opposition could block a vote on the budget in exchange for the PPC, but that might only frustrate everyone and prove counterproductive.  The Opposition, instead, might consider proposing that all businesses that perform work for the government be subject to an independent audit if they are not already required to have one by law.  Such a requirement would take the issue of public accountability out of the realm of politics and put it in the hands of economics where questions of performance, resource allocation and efficiency are better examined.  Since it is the private sector that the administration turns to for performance of the contracts, the review of their performance makes sense.  The Auditor-General’s report tends to focus on one side of the equation and misses a big part of the picture.  As a public document, the independent audit report would provide a more objective basis for judging procurement decisions and the use of public funds.  An independent audit also could serve as a disincentive to bad business practices and could make it harder for serial abusers of the public purse to escape notice and possible prosecution.

Return the Favour

The audit requirement will help the country to achieve the same goals as if the PPC was in place.  The President can refuse to assent to the decision of the National Assembly and cause this suggestion to require a two-thirds majority vote for passage.  Like all other options, the only way this idea would pass is if the public insists on it.  Thus, the public can insist on the formation of the PPC.  Alternatively, it can insist on the requirement of an independent audit.  Support for either option would be one way Guyanese could return the favour to the nation for all the good that it has done for them.  It will reveal also how serious the country is about tackling corruption.