Region 10 officials were on Monday flayed for a second time this year by the Public Accounts Committee (PAC) of Parliament for overpayments and the sitting also saw an overseer and an audit office official get into a muddle over an abandoned West Watooka project.
PAC members were particularly frustrated that regional officials, including Regional Executive Officer (REO) Yolanda Hilliman, Senior Superintendent of Works Patrice Johnson and Overseer Elander Marks, were unable to provide satisfactory responses to questions relating to two discrepancies where over $9 million in overpayments were made to contractors.
The first problematic issue involved overpayments amounting to $2,896,000, made to contractors for various works between 2008 and 2010. The works included repairs to a fence at Amelia’s Ward Primary (2008), rehabilitation of the Kwakwani Health Centre (2009), the reconstruction of a bridge at Victory Valley (2009), External works at Agriculture Office Compound Christianburg (2009), backfilling of a revetment at One Mile Primary (2009), Reconstruction of a fence, trestle and walkway (2009), and repairs to building No. 130 at Hipani Oval (2010).
Responding to the Auditor General’s report on these discrepancies, the region stated that the amounts overpaid were reduced dramatically, while the overpaid amounts in two other instances were nullified and negated.
Despite these successes in recouping the amounts though, members of the committee were not pleased that the mistakes were made in the first place, especially since the region had been chastised for the same issue when it faced the PAC in January. During the meeting earlier this year, Region 10 (Upper Demerara/Upper Berbice) officials received a failing grade after it was found that over $27 million in overpayments had been made to contractors. They were also criticised for not doing enough to recoup sums from these contractors.
On Monday, People’s Progressive Party Civic (PPP/C) MP Gail Teixeira asked how the region continued to make payments for substandard and incomplete work if designated persons are supposed to physically verify these works before payment is authorised.
Teixeira also noted that some of these overpayments came up when the region appeared before the PAC previously, but that the explanations given on Monday were not offered during that meeting. Hilliman, responding to the question, said that the details were not found until officials from the Auditor General’s Office visited the site and identified the issues.
APNU MP Jaipaul Sharma refused to accept the explanation, arguing that the region was supposed to have competent persons to physically verify their projects. If this is done, Sharma reasoned, instances of overpayment would not occur. He said that it was unacceptable that the region had to wait on the Audit Office to do its work.
Johnson, who was a Superintendent of Works at the time the projects were carried out, said that though he was one of the signatories to the order approving payment, he was not involved in the physical verification of the projects. He explained that prior to 2012, despite being superintendent, his responsibilities were of an administrative nature, while Carlyle October, the then Senior Superintendent of Works, took care of the physical verification of the projects. Whatever was handed to him by his superior, Johnson said, he considered to be valid, and therefore gave his signature.
Sharma, once again, was not moved by the explanation and scolded Johnson. He said that Johnson should have never put his signature on any of the documents since he did not physically verify the projects himself.
Teixeira said that the region’s practices were in violation of Guyana’s financial rules. These rules, she said, exist to ensure transparency and accountability. Disregarding them, she said, inhibits these assurances.
Hilliman, who agreed with the committee members’ remarks, said that this is exactly why she changed the process when she became REO in 2012. She said that instead of depending on the Senior Superintendent of Works to physically verify the region’s various projects, the region’s Overseer as well as a Clerk of Works now are also involved in the physical verification of the projects to determine the quality of the work, and whether or not it has been completed. Furthermore, all three officers are required to sign off on the project before any payment is authorised.
Furthermore, Hilliman said that since January, steps have been taken to deal with contractors who owe the region money. In January the region admitted that contractors who owed them money had been awarded contracts for other projects. Hilliman and the team which represented the region in January were criticised for this.
On Monday though, Hilliman said, contractors who owe the region money are not given additional contracts unless they have repaid the owed amounts, commenced repayment of the owed amounts, or have expressed an interest in repaying the amounts.
The region was commended for this development but his praise did not last long.
PPP/C MP Manzoor Nadir pointed out that the procedure currently employed by the region is still inefficient since the Auditor General’s report found that amounts totalling $6.788 million were overpaid. The money was intended to facilitate the construction of a headwall and installation of HDPE tube/culvert in West Watooka.
Furthermore, he said that Johnson, while the Senior Superintendent of Works, had approved payment for the structure which collapsed since it was not built to specifications.
An official from the Auditor General’s office then however said that the structure collapsed because “it did not have enough steel in it.” He added that the steel was not properly connected and this therefore compromised the sturdiness of the structure. These deficiencies, the official said, led to the eventual collapse of the bridge.
Marks however, said that the structure was, in fact, built to the contractual specifications, but collapsed under the weight of a vehicle way above the structures weight limit. He also argued that the structure was indeed completed. The Auditor General’s office however maintained that their inspection of the structure revealed that it was not completed, even though payments of $3.4 million were made to the contractor, and a cheque for the remaining amount was prepared for the contractor to uplift.
Upon re-examining his notes, Marks accepted that the structure was, in fact, not completed. He then said that his inspections revealed that the contractor abandoned the work, and as such only received about half the contractually agreed sum.
The Auditor General’s office still challenged Marks’ statement, arguing that their documents showed that the contractor was paid the full contract sum after the region would have inspected the work which he did.
After an explanation by the REO that the final payment was prepared but withheld after the works were abandoned, the representatives from the Auditor General’s Office, upon rechecking their documents, said that what the region was saying was true. The representative blamed a typographical error for the misunderstanding.
Nadir again reproved Johnson for authorising payment for the incomplete work, and also questioned Clive Peter, a Civil Engineer with the region, why, after finding that the project was incomplete, he signed the document authorising payment. Peters though, argued that when he signed the document he did not do it to say that the work was complete, but to ok the preparation of payment for the contractor.
It was at this point that Teixeira noted that the region has “a serious problem.” PPP/C MP Bibi Shadick was also highly annoyed at what she was hearing and said that clearly the persons responsible for these issue need to be surcharged. Though the PAC does not have the power surcharge any of the officials, Shadick said that she would like to see persons surcharged for their irresponsibility.
Finance Secretary Neermal Rekha also noted the confusion and said the region was in this position because it was not following the system which exists to guide these transactions. Rekha said that there are several recommendations which govern these transactions and contribute to simplifying the process.
The fact that they are not being used he said, is a sign that “something is fundamentally and systematically wrong” in the region.
Ultimately, Teixeira said that the region’s inability to answer questions on the discussed matter raised concerns that they would be able to answer question on the almost 30 remaining discrepancies.
“We have spent three hours on just two paragraphs and at the end of the three hours we are not satisfied,” PAC Chairman Carl Greenidge said as the meeting drew to a premature conclusion, and advised the region to confer with the Auditor General’s Office, and return next Monday.