Both Minister of Natural Resources Vickram Bharrat and Guyana Extractive Industries Transparency Initiative (GYEITI) Head Prem Misir remain mum on their respective roles in the country’s suspension from the EITI, as civil society group Policy Forum yesterday warned of even more serious sanctions if actions are not rectified and systems upgraded.
GYEITI Multi-Stake-holder Group (MSG) member Mike McCormack, who heads Policy Forum said in a statement yesterday, “…Should further sanctions be triggered for violations to the EITI Standard, the Government of Guyana will not need to seek ‘villains’ to blame: it will have achieved this all by itself.”
Stabroek News reached out to Bharrat on Tuesday and he acknowledged and said he would respond on Wednesday. However, his response to date has been a mere “OK”, with no answers to the questions posed.
When this newspaper reached out on Tuesday, Misir’s office said he had left for the day. On Wednesday, the response was that he was in a meeting that had no set conclusion time. Yesterday, someone answered the phone and said that he was not in the office.
Following Stabroek News’ report last week on Guyana’s suspension from the Norway-based EITI for failing to meet an end-of-year submission for the 2020 report, President Irfaan Ali posted a Facebook video stating that his government was firmly committed to openness and accountability, and blamed members of the MSG for the country’s predicament.
However, GYEITI MSG members Vanda Radzik and Mike McCormack subsequently cleared the air on the issue saying that Ali’s ire came from a place of misinformation, as among a number of reasons, their abstaining from voting could not have impacted the decision. Policy Forum yesterday explained that all four MSG members had abstained from voting and not two as was being peddled in the public.
In a letter to the President that they made public, Radzik and McCormack had said, “Judging from the opinions attributed to you in the press concerning developments in the GYEITI, it seems that you are badly advised both about the Extractive Indus-tries Transparency Initia-tive rules and procedures for producing Terms of Reference (TOR) for the EITI Report and
also about what prompted our vote to abstain on the TOR at the MSG meeting of February 22nd 2023.”
Policy Forum yesterday said that recognising that the ultimate authority in the EITI is the MSG is the critical issue at stake. The civil society body explain-ed that a member government has a great deal of flexibility about how it administers its national EITI body as long as it is in conformity with the principles and objectives set out in the EITI Standard.
“What it cannot do is join or remain a member on its own terms when these are incompatible with the standard,” the statement explained.
“EITI developed and takes very seriously the tripartite arrangement whereby the government, the extractive industry and civil society jointly run the EITI, both at the national and international levels. This formula can only function successfully where compromise is the dominant strategy for decision-making. To the extent that compromise is the essence of EITI politics, the denouncing, confronting, monopolising, and boycotting which has characterised Guyanese politics for decades is incompatible with the democratic culture of the EITI.”
According to Policy Forum, from the outset the MSG that runs the GYEITI adopted the three-step system of decision-making recommended in the EITI Standard: firstly, seek compromise; secondly, accept the results of a vote if at least one member from each sector is part of the majority; thirdly, the co-chairs of each sector seek compromise; and finally, when all else has failed, take an up-and-down vote.
It pointed out that in its seven-year existence, the EITI has taken only one vote prior to the recent one that provoked the current commotion.
It stated that the body believes the EITI provides a crucible for refining governance techniques applicable to a much broader spectrum of Guyana’s political life.
“Ironically, the lack of trust that characterises Guyanese politics creates favourable circumstances for EITI’s formula of working in awkward alliances. It enables movement from modest to meaningful goals as trust is developed. All sides have something to gain from it and a lot to lose if it doesn’t work,” the organisation stated.
Policy Forum Guyana (PFG) and a network of civic organisations, came into being prior to the 2015 elections to promote financial and environmental transparency, the statement said, in a background to its formulation.
“This orientation explains the early interest in EITI by PFG and also its acceptance of the invitation to take responsibility for devising the process by which civic candidates to MSG-Civic are selected. Since selection to the MSG is based on individuals, not organisations, PFG also provides a support platform to enable the MSG-Civic members to communicate collectively
with the broader civil society. It would be fair to say the collective governance experiment worked well in the formative stages. Three factors influenced this progress, namely the first Champion of EITI, Raphael Trotman, allowed the process to evolve and encouraged independence; the Permanent Secretary at MNR successfully guided awkward administrative challenges and thirdly, rotation of the MSG Chair through the three sector co-Chairs underlined the equality of status,” Policy Forum stated.
“In addition to these factors, recognition of Guyana as a full member of EITI was facilitated by complementary conditions at that time, including a range of legislative and administrative measures that strengthened government’s accounting procedures. These included creating constitutional agencies directly responsible to Parliament in budgetary matters rather than to a single ministry; creation of the agencies SOCU and SARA, all of which contributed to Guyana moving up the Transparency International index.”
However, it said that since the Forbes Burnham era, it believes that Guyana has become adroit in projecting a progressive international image alongside a domestic democratic deficit.
“On the one hand, trumpeting a range of legislation such as an Integrity Commission, Ombudsman, Information Act, anti-corruption laws and ratifying the Convention on Corruption, while on the other, domestic implementation is practically zero, outweighed by money-laundering, gold smuggling and drug sales amounting to billions of dollars along with fostering new, dubious alliances with autocratic countries and disreputable corporations,” the Policy Forum statement highlighted.
“Sustaining this contradiction is now proving a challenge due to the EITI system of continuing assessment, known as Validation. EITI allows member countries seven years since their inception to get their house in order,” it added.
Policy Forum said Guyana “is now in its seventh year without noticeable democratic progress.
“For example, the last monthly Minutes of MSG Meetings posted on the website – a requirement of the standard – are those of the 42nd Meeting while the last meeting constituted the 59th. Likewise, little effort has been directed at implementing recommendations from the Validation exercise and the Annual Reports, eg the Guyana Revenue Authority (GRA) provisions on confidentiality remain in place severely limiting the quality of EITI Reports. EITI standard rules on open data are not respected – byzantine procedures are required to access mining information on the GYEITI web-site; Beneficial Ownership – creating a register of the real names of the people who own extraction companies – is progressing at a snail’s pace and public outreach is almost non-existent.”
Token gestures have been made to encourage broad-based cooperation of the gold mining sector in providing data to participate in the reporting process. It is difficult to convey how
under-developed the concept of accountability has become as reflected in Guyana’s primitive and obsolete system of auditing public accounts, it added.
Along with Cuba, it said, Guyana is the only country in the entire Carib-bean with no Electronics Transactions Act.
“Trinidad has had such an Act since 2000 and the rest followed a few years later. Guyana still relies on cash-based accounting, best suited to a cake-shop and hopelessly inadequate for any public accounts, much less those of an oil producing nation. A modern accruals-based system has been resisted for years. Our ramshackle accounting system, for example, cannot alert Guyana to dangerous financial risks such as not monitoring over-runs on the budget or borrowing too much money,” the statement posited.
“When a parallel situation developed in Ghana, shortly after it became an oil producer, recourse to an IMF for bail-out was required. Agencies such as the World Bank, IMF and the Inter-American Development Bank know exactly what is going on, but with Guyana on the spectrum of oil-producing nations, they choose to be more deferential than demanding. Political will for financial reform is feeble, as evidenced by the following gaps. The National Audit Office has never carried out any forensic audit required for legal prosecution of officials who may be suspected of financial fraud; the current Auditor-General was only appointed the year he was to retire and, therefore, can be dismissed at any time and the Parliamentary Accounts Committee’s last report was for 2010-2012.”
Modernising public accounts in Guyana, Policy Forum believes, cannot get the attention it deserves since the Annual Report of the Auditor-General restricts itself to the exact format required by the Audit Act which predates such things as electronic transactions.
“This combination of inaction on implementing accountability reforms together with dismantling those already in place provides a consistent and serious incompatibility with the democratic culture required of EITI member countries,” Policy Forum stated.
