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Nandlall did no research in relation to Transparency International before making his comments

Attorney General Anil Nandlall has joined the attack on Transparency International (TI) on the publication of its 2012 Corruption Perceptions Index. Because Mr Nandlall is a member of a profession which calls itself learned, and which is known for its members researching before speaking, and speaking with a certain sense of responsibility and decorum, I thought it might be useful to examine how Mr Nandalall’s statement stacks up against those standards.

Mr Nandlall accused TI of:

1. Failing to disclose “the empirical data or sources that they examined to arrive at those conclusions.”
2. Not stating the methodology as to how the organisation ended up at its findings [sic].
3. Not disclosing whom they spoke to and which institutions and organisations, or which documents they consulted.
4. “Gross dereliction” by arriving at baseless disclosures.
5. Failure to say where corruption exists, be it in the government, public or private sector.
6. Failure to examine the institutional mechanisms which are in place constitutionally, legislatively or departmentally.
7. Being insulting and disrespectful to Guyana and Guyanese.

Points 1, 2, 3 and 4 are all on the same issue: that Transparency International did not disclose vital information and sources.

If Mr Nandlall had taken the elementary research step of going on TI’s website he would have learnt that the basis for inclusion of a country/territory in the CPI is a minimum of three of the CPI’s data sources. The website also identifies CPI’s 2012 data sources as: i) African Development Bank (ADB); ii) Bertelsmann Foundation (German non-profit foundation); iii) International Institute for Management Development (IMD); iv) World Competitiveness Yearbook; v) International Country Risk Guide (ICRG); vi) World Bank; vii) World Economic Forum (WEF); viii) World Justice Project; ix) Economist Intelligence Unit; x) Global Insight; xi) Political Economic Risk Consultancy (Asian); xii) Transparency International Bribe Payers Survey; and Freedom House (no, not that one).

If he had acted more responsibly, he would have learnt that in the case of Guyana, there were four sources: ICRG, WB, WEF and Global Insight, and that a country’s score on the index is a simple average of its data sources.

Point 5 is even worse in terms of Mr Nandlall’s research efforts. I find it embarrassing that the Attorney General of this country does not by now know that the definition of corruption in the TI lexicon is “misuse of public office for private gain.” Perhaps he is more familiar with relevant examples such as Pradoville 1 and 2; the misuse of duty-free concessions; and paying out of the Treasury so-called advisors to the President and the Local Government Minister to work at Nandlall’s party in Freedom House.

Mr Nandlall should and could have served his and the country’s interest by challenging the local Institute to start speaking out on private sector corruption, including tax evasion and money laundering. He must be personally aware that members of his and other professions as well as aggressive law firms not only engage in these practices for their own direct benefit, but also in aiding and abetting others to do so.

Once Mr Nandlall understands my comments on points 1 to 5 above, he will realise that point 6 is not relevant to his argument. I cannot believe that the holder of such a distinguished public office does not recognise that in his attempt to discredit others, he ought not to be relying on laws that are on the statute books but not in operation. Any person would know that rather than prevent and punish, it actually perpetuates corruption if the Procurement Commission is not established ten years after it became a mandatory constitutional requirement; if there is an Integrity Commission without commissioners; an Access to Information Act not brought into force sixteen months after passage; and a Judicial Review Act not brought into force two years after passage.

On disrespect and insult, readers might wish to consider whether Mr Nandlall’s failures do not amount to an insult to his own intelligence, that of the legal profession and to the expectation of Guyanese to have an Attorney General who is informed, responsible, temperate and accurate.

Finally Editor, I researched the recent publications of leading newspapers in Zimbabwe and Pakistan which had much worse ratings than Guyana in the 2012 Index. In fact, in the case of Pakistan, the 2012 CPI was sensationally misreported by stating that Pakistan was the 33rd most corrupt country in the world. That report wrongly assumed that all the countries of the world were covered in the survey. Some twenty countries were not.

Yet I could not see any article or statement in which the governments of Pakistan and Zimbabwe engaged in any attack on Transparency International or their national chapters, let alone in the crass, vulgar, shameless and disgraceful manner in which Mr Nandlall, Ms Gail Teixeira, the PPP/C and the PYO did in the case of Guyana.

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Teixeira was very wrong

In his presentation at the awards dinner of the Georgetown Chamber of Commerce and Industry last Thursday Mr Clinton Urling, the Chamber’s President included in his wish list for Guyana a stronger civil society. In the course of his presentation Mr Urling not only referred to the work of the Transparency Institute of Guyana Inc but also echoed a recent call by that young organisation – made on the day Transparency International released its 2012 world Corruption Perceptions Index – for measures to enhance accountability, combat corruption and strengthen governance.

Mr Urling would most likely have been aware that only a few hours before he spoke the youth arm of the ruling party had attacked Transparency Institute, singling out its highly respected Vice-president Dr Anand Goolsarran for its vituperation, and severely chastising Transparency International for daring to include Guyana in its 2012 survey. Significantly, even if Mr Urling was aware of the attack, he offered no comment or defence of a civil society organisation in the presence of two Ministers of Government, Messrs Irfaan Ally and Robert Persaud.

One day later, PPP/C governance czarina Ms Gail Teixeira took the PYO vulgarity one notch down when she dismissed the 2012 CPI by stating that “only four persons were surveyed [by TI] as it related to Guyana.“ She even suggested that they must all be male! Surely anyone who knows anything about surveys would know that no sane person would regard a sample of four as reliable or representative of any population and that such a statement simply could not be right. Indeed, Ms Teixeira was wrong, very wrong.

The Transparency International website discloses that for its 2012 CPI with respect to Guyana, TI used four surveys, which in total, and even allowing for overlap, would have covered hundreds of individuals and organisations. The four surveys were Global Insight, World Bank’s Control of Corruption Index (WB), World Economic Forum and the International Country Risk Guide.

If this better information does not have any impact on Ms Teixeira and her “youths”, it is inevitable that any discourse in Guyana would continue to be backward-looking, uncivil and profoundly infected by manipulation and distortions. The leadership of the PPP/C must be in dreamland if it does not realise that for many Guyanese, the ‘C’ in PPP/C has long since ceased to represent any evaporated Civic and now, on empirical evidence as well as well-founded perception, unmistakably stands for Corruption.

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Clico and immunity

Introduction
Perhaps it is the constant stream of news coming out of Trinidad about Commissions of Enquiry, referring files to the Director of Public Prosecution or about police investigations in that country. Or perhaps it is the knowledge that Clico Guyana is partly responsible for the sorry state in which the NIS finds itself, or that the individual who directly contributed to the loss to this country of close to seven billion Guyana dollars walks free, or the unsatisfactory conduct of the liquidation of the company, or the fact that so far my request to the courts for access to relevant files has come up with nought.

Then we have the rounds of telephone interviews being given by politicians to the newspapers and speeches made at hugely expensive dinners in which words like crisis at the NIS or the resolution of the Clico debacle are regarded as taboo. After all, the self-employed could not care two hoots about whether the NIS sinks or swims or whether anyone is held responsible for the failure in which so many authorities are in an incestuous game to protect each other.

To square the circle we have the political opposition which has spent inordinate energy on the “symbol” of Rohee. It is now close to four years since I wrote an open piece in which I said that the parliament must do something about Clico and suggested a number of measures they should consider.

In that call I noted that the National Insurance Scheme (NIS) alone is exposed to Clico for well in excess of six billion dollars or more than 20% of the funds accumulated by the NIS over its forty years of existence. I pointed out that members of Parliament ought to be aware that under the National Insurance Scheme Act any temporary insufficiency in the assets of the (NIS) Fund to meet its liabilities has to be met from appropriations by Parliament. In other words, they would have to approve the money to be funded by taxpayers. The politicians’ response has been less than adequate.

Red ink
Shortly before the call on the National Assembly, I had written about the widening financial instability enveloping Guyana as a result of Clico and Stanford and wrote that when the dust settles, the taxpayers, NIS contributors and beneficiaries, members of pension and medical schemes and depositors in Clico and potentially in Hand-in-Hand Trust (HIHT) and the New Building Society could lose collectively several billions from the fall-out in the financial sector. Of these only the NBS came out largely unscathed since its own $70 million loss had nothing to do with the Clico or Stanford.

Let me briefly fast-forward to today. As of now, while several pension funds and the NIS are still holding anywhere between six and seven billion dollars of worthless paper, the majority of Guyanese including the several politicians have quietly recovered most of their money and some of them began counting their blessings around this time last year. They are not going to open their mouths, while when they do it amounts to nothing, and the private sector is only willing to repeat all kinds of platitudes or safe criticisms sent with signals to the government that this is for show only.

Part of the problem with Clico is that the approach to Clico from the very beginning has been without resort to facts, a point made ad nauseam over the years. Some of it was clearly carelessness or laziness. For example, when the President assured the nation on February 5, 2009 shortly after the collapse began that Clico’s assets were sufficient to meet its liabilities he was repeating a company line without having read the December 31, 2007 analysis showing that 81% of the company’s assets was invested in related parties, all of which were under various degrees of threat (SN February 7; Business Page Feb 8 2009).

Collective failure
But it was partly skin-saving as well since Clico was a collective failure of a number of institutions and individuals. In transactions that came under the supervisory lens of both the Commissioner of Insurance and the Bank of Guyana, no one it appeared noticed or felt competent to deal with a company that issued “insurance policies” with premiums running into billions of dollars having a statutory fund of less than fifty million dollars. As pressure mounted on the President and on those with direct responsibility for the sector, the President in his typical style threatened prosecution against the directors and management of Clico if fraud were found. That threat could not be serious for the simple reason that the President knew that the sole Guyanese director and officer was the company’s CEO who would have been the decider over who should be favoured in getting their money back from the fast sinking ship. That is one secret that never saw daylight.

We knew from the newspapers here that the government of Trinidad and Tobago had moved against CEO Lawrence Duprey and finance specialist Andre Monteil for civil and/or criminal conduct in the collapse of the insurance giant Clico and its parent CL Financial. I reported that a civil lawsuit was brought by Trinidad’s Central Bank and Clico against Duprey and Monteil for alleged mismanagement and misappropriation of Clico assets and that Attorney General Anand Ramlogan had directed that all files coming out of the probe into the collapse of insurance giant Clico should be forwarded to Director of Public Prosecutions (DPP) Roger Gaspard to determine if criminal charges should be laid against Duprey and Monteil.

The story is different in Guyana because of the political and personal relationships that control Guyana. The key players in the Clico saga three years ago were President Jagdeo, Finance Minister Dr Ashni Singh, Clico’s CEO Ms Geeta Singh-Knight all of whom currently hold and enjoy various forms of public office, and Ms Maria Van Beek, former Commissioner of Insurance who left the country following an attempt on her life.

Complicity
They all knew but did nothing about the company breaching the provisions of the Insurance Act and compounded its unlawful conduct by failure to comply with a demand/request by the regulator to repatriate the Statutory Fund. They did nothing of consequence.

It is not as if there are no penalties. Section 19 of the Insurance Act provides that any person who contravenes any provision of the Act, or any of its regulations or any direction or requirement made by the Commissioner of Insurance, is guilty of an offence. Unlike the normal presumption in law where the prosecution has the burden of proving beyond reasonable doubt the guilt of the accused, the Insurance Act shifts the burden to the “person” to prove that s/he did not knowingly commit the offence of omission or commission.

In what in normal circumstances would be real noose-tightening, the law goes on to provide that where an offence is committed by a company – in this case Clico – and the offence is proved to have been committed with the consent or connivance of, or to have been facilitated by any neglect on the part of, any director, principal officer, or other officer or an actuary or auditor of the company, he, as well as the company, shall be deemed to be guilty of the offence. Ms Singh-Knight was both a director and principal officer of the local company and most certainly it would have been to Ms Singh-Knight that the Commissioner of Insurance would have been addressing correspondence and directions.

Playing a supporting role then was the Central Bank Governor who failed to appreciate the nature of the product that Clico was offering and the Bank’s responsibility to regulate it.

One big happy family
Now we have moved on to phase 2 in a liquidation that breaks many of the rules, some players have changed. Ms Van Beek has gone and her place has been taken by a lawyer Ms Tracy Gibson whose supervisory responsibility of the insurance sector is conflicting with her unlawful role as an assistant to the liquidator. Mr Jagdeo is busy with his accolades and ventures while Dr Singh remains as Minister. The Bank of Guyana has seen its Governor appointed liquidator over a company to the demise of which his Bank contributed in no small measure. Ms Singh-Knight has been promoted and for all practical purposes granted a pardon, Chartered Accountant Mr Maurice Solomon is another unlawful assistant liquidator to Mr Williams while Senior Counsel Ashton Chase is the attorney. Mr Solomon in turn has been appointed a liquidator of Caribbean Resources Limited, one of Clico’s big debtors. Given that tens of millions of dollars of fees are being paid out by cheques signed by Mr Solomon and Ms Gibson one might have expected some better accounting with the reporting of the transactions under the liquidation and compliance with the Companies Act.

Conclusion
It is not that some people are receiving moneys outside of the law that bothers me. It is that a responsible and competent liquidator has a duty to look for wrongdoings by the company prior to the order for liquidation. Mr Williams is an extremely decent man in the best tradition of that word. But inexperience alone does not explain his unwillingness to date to have pre-liquidation transactions and conduct reopened for examination.

I am sure our private sector leaders read the regional pages of the Stabroek News. The news coming out of Trinidad and Tobago must surely suggest to them that an enquiry into Clico for possible criminal conduct is long overdue. We have been duped before by President Jagdeo who responded to calls for action on Clico by insisting on a similar investigation into Globe Trust. When his bluff was called he changed tack – no investigation into Clico in consideration for no investigation into Globe Trust. What a clever deed!

Let us hope that the next leader of the private sector to speak at a function will at least recognise the twin issues of Clico and the NIS.

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Things we have not noticed – conclusion

Introduction
This week I continue to raise questions on matters we may not have noticed in areas of public finance and management in Guyana. If former President Bharrat Jagdeo is rightly credited as the mastermind for the circumventing the financial provisions of the constitution and the financial laws, the credit for the execution of any schemes go to his choice as Minister of Finance, Dr Ashni Singh. Dr Singh as an accountant and former deputy Auditor General has used all his knowledge to confuse all and sundry over the Consolidated Fund and its sub-fund the Contingencies Fund, and other funds known and unknown.

Minister Clement Rohee should justifiably feel aggrieved that he is the only Minister of this government to have been targeted with a no-confidence vote in the National Assembly. After all, Dr Singh must at least have been aware of the deception over the rate of the VAT and the $4 billion for which Irfaan Ally was taken before the Committee of Privileges in the last Parliament while he, Dr Singh, was creatively spared by the then Speaker. He was central to the Clico debacle which has not been followed by any investigation into the serial illegalities that continue to this day; is solely responsible for the annual abuses of the Contingencies Fund; would have played a major role in moving more than $30 billion, yes thirty billion dollars, in dormant bank accounts without proper accounting; and is the minister with responsibility for the state of the National Insurance Scheme. And let us not forget that he is the Chairman of the NICIL Board that has been central to the breaches of the constitution and the inappropriately named Fiscal Management and Accountability Act. NICIL under him is several years in breach of the Companies Act and basic rules of accounting but he continues merrily on. Mr Rohee has every reason to think that there has been some goat in his past.

No more lottery accounting
We can assume that the Minister of Finance has had no hand in the decision to have Mr Ramson offer opportunistic advice on the lottery funds, but he clearly has no problem with the discontinuance by the Audit Office of the annual reporting of the funds collected and how they have been spent. It would be excessively charitable, however, to believe that he has not been consulted and has played no part in ensuring that his colleagues who were targeted for budget cuts earlier this year remain funded, parliament or no parliament, cut or no cut.

However assiduously, and at times clumsily, Attorney General, Mr Anil Nandlall, has rushed to position himself for entry into the Guinness Book of Records for the highest number of cases brought by an attorney general against his own parliament, the responsibilities and the powers of the minister of finance make his office the next most important one in the land. For that reason, while we just cannot afford not to notice the things the does, he and his government, with the help of a hardly working parliamentary opposition, a media that is at best poorly informed, a conflicted and handicapped Audit Office under an unqualified Auditor General, an equally unqualified Accountant General and a Finance Secretary with his own challenges and biases, have made sure he is the only brainer in the country, to use a word he employed recently to disparage his hosts at a public function.

As a specific example, how else does one explain the failure by the Audit Office, the National Assembly, the Public Accounts Committee and the press to demand an explanation for the non-tabling of a mandatory annual report on tax holidays granted by the Minister of Finance? There is sufficient anecdotal evidence that tax concessions alone cost this country about a half as much again as the taxes we collect, to make us take the Minister’s cavalier attitude to tax holidays a matter of substance and seriousness. Yet we as a country choose not to notice. We must have lost our marbles along the way.

Unrestrained powers
Who in the political opposition, the wider National Assembly or the Economics Affairs Committee have taken the time to consider and understand the powers the laws give to the Minister to grant all forms of tax concessions without any disclosure or accountability? I am convinced that the reason tax reform is not on the agenda is that it might expose the lawlessness as well as the ease and impunity with which even illegal concessions can be granted to friends and family alike. We have all forgotten that it is now one year since President Ramotar set up a Tax Review Committee while ensuring that it would not function. As the GMA, the Chamber of Commerce and the Private Sector Commission head into the fund-raising activities and the fun of the cocktail circuit, maybe one of their leaders would ask about the fate of that committee as well as the state of the NIS.

But let us stick to the question of taxes and see the extent of the powers of the Minister of Finance in addition to the power to grant tax discretionary holidays.

The Minister of course has powers to make laws under what is referred to as delegated legislation, and should have these tabled in the National Assembly and published in the Official Gazette. While this tool is seen as useful in enhancing the efficiency in public administration and is available generally to all ministers, the proliferation of such subsidiary legislation has aroused increasing scrutiny. As a result, countries around the world and more recently Australia have introduced legislation to regulate when and how such delegated legislation is used.

I thought it might be useful in an article of this nature to separate the powers of the minister of finance into those that have been used to help in curbing corruption from those which enhance public financial management in Guyana.

The incumbent has done nothing on corruption other than to challenge the Transparency Institute and question Guyana’s place on the Corruption Perception Index. He has centred procurement in his office, and his ministry was the biggest defender of Fip Motilall who cost this country so much.

The incumbent has to consider himself the luckiest man alive for not having been subject to a motion that he be brought before the Privileges Committee of the National Assembly.

Tax laws
Let us now look at some of the powers of the office granted to him by various laws. The Minister can effectively make laws to provide that the interest payable on any loan charged on the Consolidated Fund or guaranteed by the government is exempted from the tax; to approve as a mortgage finance company any company which has entered into an agreement with the government whereunder the company agrees to finance housing development; for the introduction of a presumptive tax on the income from self-employment of individuals who have annual turnover from self-employment of less than ten million dollars (not done); for the introduction of a minimum tax on the income from self-employment of individuals whose annual turnover from self-employment exceeds ten million dollars (not done); exempting under defined circumstances the income of non-resident shipping companies; deciding which sectors and products receive export allowances; designating the allowable expenditure for development of agricultural land; designating the central authorities for transacting diamond business; providing for minimum tax on self-employed professionals (not done); exemption from filing returns by persons whose income comes mainly from employment or interest (not done); specifying the books and records to be maintained by persons carrying on any business; appointing an agent in the UK for the purpose of facilitating the assessment of the income of persons residing in the United Kingdom (a clear throwback to the days when England was the Mother Country); appointment of the Board of Review (which has not been done for several years); making and revising Double Taxation Agreements (which has not been done for nearly two decades); entering into agreements with other countries for the exchange of information for the prevention of evasion or avoidance of income tax and the carrying out of those agreements (not done); prescribing the times for the payment of taxes by companies; and providing for the remitting wholly or in part of the tax payable by any person or category of persons on such income, in respect of any year of assessment, and in accordance with such conditions as may be specified in the regulations.

And that list is under the Income tax Act only.

Under the Corporation Tax Act the Minister can declare as exempt the income of any institution established for the encouragement of thrift or any income arising from investments of any fund or scheme established for the provision of annuities to designated persons.

But his real opportunities for acting in the most unaccountable and irresponsible manner lie in his power to grant tax holidays and two other lesser known provisions of the laws, one in the Income Tax Act and another in the VAT Act. Under the Income Tax Act, the Minister has the power to reduce the rate of withholding tax on any distribution or payment for the purpose of giving effect to any agreement relating to tax between the government and any person not resident in Guyana. Neither the GRA nor the Commissioner General has any say in the matter but must simply do as the Minister says. Nor is there any reporting of the exercise of this discretionary power.

And under the VAT Act, in order to zero-rate a supply of goods and services, all the Minister has to do is sign with a person an investment agreement for which there is no definition, specified contents or penalties for non-compliance with any promises by the investor.

Additionally, the Minister of Finance makes all the delegated legislation under the Value-Added, Excise and the Customs Acts and appoints directly or indirectly all the members of the Revenue Board which exercises wide policy-making powers over the administration of all the revenue collecting agencies.

These are enormous powers that are hardly regulated, if at all. True, the Financial Management and Accountability Act has certain guidelines on the charging of expenditure on the revenue of the country; how sums due to the revenue be remitted; and the authority for the remission, concession, or waiver of taxes.

Conclusion
The Minister has shown himself time and again to be irresponsible and willing to bend and if necessary to circumvent the law. There is hardly a qualified accountant in the traditional public service, and both the posts of Auditor General and the Accountant General are held by unqualified persons. It is not the ideal environment in which the Minister of Finance is a Dr Ashni Singh. Rather than allowing Deodat Sharma to misdirect them with petty cash issues, the PAC must make a concerted effort to rein in the excesses of Dr Singh which have cost this country tens of billions.

The Economic Affairs Committee has work to do.

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Things we have not noticed

Introduction
Following, but not as a result of last week’s column addressing the parlous state to which Cabinet Secretary Dr Roger Luncheon has brought the National Insurance Scheme, I had two very interesting conversations, one with a business leader and the other with an MP. In advance of consultations to be held with the actuary on his draft report on the eighth five-yearly actuarial report on the NIS, they both wanted to know my thoughts on the report’s findings and recommendations. Both seemed not to be in the least bit uncomfortable to admit that while they had last week’s Sunday Stabroek they did not get around to reading the newspaper or the full-page column on precisely that topic. We can only guess about their contribution to a consultation for which they would have been so hopelessly unprepared on a matter of such grave national importance, a matter that has been the subject of several articles over a recent two-week period.

It is even worse. By now we all should have been aware that the government of which Dr Roger Luncheon is the Cabinet Secretary and the Board of the NIS of which he is the Chairman, did not implement the recommendations contained in the sixth and the seventh actuarial reports on the Scheme at December 31, 2001 and 2006. But the two persons I spoke with apparently did not know about the parlous state of the Scheme, while my politician friend was bold enough to ask seriously but rhetorically, how did we “allow that?” Perhaps our politicians have been reading too much Lewis Carroll.

A second issue on the NIS is the location of the consultation. Now you would expect that anyone consulting with the actuary would want to meet with him outside of the framework of the NIS Board or its chairman. But that kind of liberal and rational thinking would in Dr Luncheon’s eyes be too dangerous. The consultation had to take place with Dr Luncheon, whose leadership of the Scheme is not insignificantly responsible for its parlous state, at Luncheon’s office and under his chairmanship. Dr Luncheon may strike many as a bumbling incompetent but he remains a dangerous practitioner of artful politics. The idea to hold the consultations on his turf and in his presence was clearly designed to control any criticisms of his government’s abominable management of the Scheme, now facing its worst crisis in 42 years.

Even as we ponder the serious medicine prescribed by the actuary to address the crisis the NIS faces, my hope is that the media would now ask the private sector as well as the political parties and the trade unions in particular, for a report on the consultations. As I indicated last week, I am particularly concerned that if the recommendations are accepted the burden of the adjustments would be felt mainly by the workers of the country.

Now you see it, now you don’t
Today’s subject seeks to raise questions on other matters we may not have noticed. It touches on the disproportionate sharing of the benefits and burdens of the taxation system and the inequality it has spawned in the vast disparity of wealth among those who are part of the power structure and those outside of it. This column has addressed such disparity time and time again and for emphasis captioned a column on January 29 of this year drawing attention to the US system under the topic, “If Mitt Romney was in Guyana, his 13.9% tax rate would have been lower.” The reason is that our tax system favours the employers, those with capital over the workers, who often struggle to make ends meet and who at the end of their working lives which the actuary now says should be extended to sixty-five have nothing but an NIS pension to look forward to. I will deal with that disproportionality next week and look at how different types of income are taxed differently in Guyana.

For starters, let us look at the system of remission of duties granted by the government which was reported on each year in the annual report of the Auditor General up to 2005.

There is a lot to argue with on whether some of the figures do not defy the logic of the reported performance of the economy during the six years. The wild swings between 2003 and 2005 seem to make little sense, but that is really not relevant here, except perhaps to reflect the quality of some elements of the work done by the Audit Office. As for the revenues of the country and their impact on the resources available to spend on education, health, security and infrastructure, it matters little whether the authority to grant remission of duties since 2003 is vested solely in the Commissioner General as the Audit Office seems to think.

But even if the Audit Office is correct, and regardless of where the range of authority lies, there should surely be some formal manner in which the body vested with the powers of remission reports to taxpayers and the National Assembly on the extent and value of remissions granted. If the power is vested in someone else, the one person who should insist on the publication of the information is the Minister of Finance who has constitutional responsibility for the national budget. Any taxes required to meet public expenditure which are borne, if at all, at lower effective rates by one segment of the population, must inevitably be met by those who do pay. But coincidentally or otherwise, the Audit Office ceased to report on remissions from the time Dr Ashni Singh became Finance Minister.

Dr Singh and tax remissions
Dr Singh has been egregiously reckless on the expenditure side of the Budget, misdirecting public funds to NICIL of which he is the Chairman, making unlawful withdrawals from the Contingencies Fund for which he is solely responsible, and authorising the transfer of billions of dollars from the 2000 series bank accounts which requires statutory authority. Under the Jagdeo presidency – and quite possibly still – spending outside of the authority of an Appropriation Act became normal with not even a hint of protest from the Finance Minister. After his role in the unlawful granting of concessions to the former President’s friend, it is difficult for anyone to believe that he is any less careless with the country’s tax revenues than he is with its expenditure.

Yet, our laws give the Minister of Finance enormous powers to give away tax revenues, over what may appear to be a small range of taxes but which have substantial fiscal implications. We start with the first and perhaps best known concession, the tax holiday. Under the Income Tax (In Aid of Industry) Act, the Minister of Finance has discretionary powers to grant an exemption from corporation tax with respect to income from new economic activity of a developmental and risk-bearing nature, or from dozens of economic activities. Without putting too much of an emphasis on it, the ease with which Mr Jagdeo and Dr Singh amended the law for friends shows how elastic and discretionary the law is.

And bear in mind that in approving tax holidays, the Minister is also extending exemptions from Property Tax and the Capital Gains Tax act.

Here again there is a silence feeding the appetite of the conspiracy theorists. Tax holidays can extend from five to ten years and cost billions. So the law requires some accountability. Under the Investment Act the Audit Office is required to carry out annual audits of the tax holiday incentives granted by the Minister, but the Audit Office has failed in its obligations under section 38 of the Investment Act to have laid in the National Assembly such a report for any year. The deadline for this is six months after the end of each financial year.

I have repeatedly raised this omission with no reaction from anyone. Surely the Public Accounts Committee has a duty to deal with this blatant disregard for the law with the potential of massive cover-up of tax giveaways. All to the detriment of those who pay taxes.

To be continued