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The Fiscal Management and Accountability (Amendment) Bill 2013

The Fiscal Management and Accountability (Amendment) Bill 2013

Hits: 4229 | Published Date: 10 Jan, 2013

| Speech delivered at: 35th Sitting- Tenth Parliament

| Speech Delivered by : Hon. Carl B. Greenidge, MP

Mr. Greenidge: Thank you very much Mr. Speaker, I will perhaps be much more appreciative of your congratulations after we will have passed it but nonetheless I would not… [Interruption] Thank you very much. I hope that we would be able to entertain and pass a number of others in the wake of this particular one.
Mr. Speaker, it is perhaps especially significant, the point that you make, in the light of the fact that this Bill has been the subject of a motion that was extensively debated, and which motion pertains to concerns about the constitutionality of at least one act of Parliament which is inconsistent with the Constitution that we currently embrace. The motion to which I made reference gave rise to Resolution No. 11 of 2012, and as I am indicating the concerns that have caused us to still be looking at the issues are the concerns that, notwithstanding that motion, we drew to the attention of the Government the fact that the schedule of the Fiscal Management and Accountability Act itself infringed directly the provisions of article 222 and 222A of the Constitution. We remain in the situation where that Act is un-amended by the Government. That is the reason why we have brought this Bill to the House, In essence what we are saying is that the Bill deals with a number of agencies which are meant to be part of the framework that are intended to protect our fundamental rights. I am speaking here of the Judiciary, the Service Commissions, the Ombudsman, the Public Procurement Commission, the Auditor General’s Office, which has subsequently been fixed as it were, and GECOM. The safeguards are intended primarily to protect our individual rights as well as the collective rights; those rights that we enjoy, and which the Government in exercise of its functions can sometimes be in conflict. I would say the Bill, and the attempt to deal with this issue, is particularly important at this point in time when I think a number of people feel, and a number of public debates point to challenges of these individual rights that are enshrined in the Constitution.
I would like to, perhaps, make a couple of opening observations, as it were, before turning to the specifics of the Bill. And I make these observations in light of some comments you yourself flagged when the Paper was laid for the first reading, and some of which arose from the interventions of the other side when they were attempts to have the Bill not considered. Amongst the first of those was a suggestion that the Opposition should be required to present a white paper prior to the submission of this Bill on constitutional issues. I would like to say that apart from the fact that under the dispensation that we have, which is similar to that of the Westminster system, white papers are matters of policy for the Government. When the Minister of Finance in 2003 introduced the entire Fiscal Management and Accountability Act, not an amendment, he did not see it fit to do so with a white paper. That Bill, in fact, is the Bill that I am arguing which actually jeapordised our rights in the sense that it infringed articles 222 and 222A of the Constitution. Somehow the Government, at the time, did not feel it necessary to implement a white paper for such a sweeping bill, but certainly for an amendment we are being asked to present a white paper. In any case, I see under the current dispensation this is out of order. When the motion was announced on Order Paper No. 20 the Minister of Finance reacted by taking the Auditor General’s Office from the schedule and no white paper was involved. This is as it should, because I am contending there is absolutely no constitutional requirement for a white paper and it is inappropriate for the Opposition to be required, and let alone a Private Member’s Bill, to be accompanied by a white paper.
The other observation is that the amendment of the schedule requires an amendment of the Constitution. That is an interesting view but, again, it would have been a lot more persuasive if when the Government itself modified the Act by taking the Auditor General’s Office from the schedule they had seen it fit to do so by way of a constitutional change. So I fail to see any justification for such a recommendation and, in fact, I suspect the recommendation that was being made was made on the assumption that a two-thirds majority would have been required to make the constitutional change effective. I am sorry to disappoint our colleagues on the other side. In fact, as we will show in a few days time when we seek to effect that change in the Constitution, it requires no two thirds majority. I am saying that we are going along with their recommendation, and I hope they will find it fit to lend their support to this as well as that amendment.
Also, may I say there is the apparent conflict arising from section 82 of the Fiscal Management and Accountability Act which section says the Minister may by order amend the schedule. There was a re-interpretation of this which suggests that if the Minister may amend the schedule then the House could not amend the schedule. I have sought advice on this since I myself am not well versed in these areas, and I am persuaded that the drafting of the Act in that manner could never have intended to disenfranchise the House. The House then delegates responsibilities to Ministers, the Minister passes an order and that could never mean, and it ought not to have intended to mean, that if the Minister has the power to pass an order to modify the Act then the House has not any power in that regard. Of course, it cannot mean that because the House itself could repeal the Act which has been done at times in the past. So I as I said, having consulted feel the House retains its power to amend any legislation which the House itself passes.
The other observation I will tackle a little later, but the idea is that the deletion of agencies from the budget agencies listed on the schedule would somehow disenfranchise those entities that are removed. I, again, challenge this because there are many entities that are not on that schedule which receive State moneys. They receive the moneys which is reflected in the Estimates of annual revenue and expenditure and is therefore not required to be on the schedule. There are also many entities that are neither mentioned in the FMAA Act directly nor in schedule 222A of the Constitution and they also receive state moneys. So the suggestion that if the entities do not appear under the Fiscal Management and Accountability Act they cannot get funds is not really accurate. And I will give you an idea of the specific ones a little later.
We might now turn to the substance. If you have a look at the Constitution you will find that article 222A lists a number of agencies in the Third Schedule and those entities include, and I am not going to read all of them, the Ethnic Relations Commission, the Human Rights Commission, and for our purposes now, the Judiciary, and the Office of the Auditor General. That is what article 222A says. But article 222 itself tells you something about the entities so listed. What it tells you in the body, sections 5 to 7 which deal with the properties or characteristics of those agencies, is that they are independent and no other agency should interfere with their operations. More specifically article 222A says they are to be (a), and I quote:
“…a direct charge on the Consolidated Fund and determined by a lump sum way of annual subvention approved by the National Assembly.”
Let me just take the time, Mr. Speaker, to draw to your attention that if you look at the Estimates you will find lump sum payments specifically in the sections that deal with Details of Subsidies and Contributions, meaning it is a one line allocation; and you will find them in the subsequent section that deals with the Details of Subsidies and Contributions to International Organisations. The entities in question are not listed here, all the entities that I will highlighted. This means that although the Constitution on the one hand says these agencies should receive lump sum payments not subject to financial management that will infringe their financial independence the Ministry of Finance has a number of these agencies under the FMAA Act called budget agencies, and when they are budget agencies certain things follow from that.
The FMAA list, its own schedule, has 39 agencies which could be divided into five categories; specific ministries - Office of the President, Office of the Prime Minister; Georgetown Public Hospital Corporation is the secondary category; GDF is a third; Regions 1 to 10 a fourth, then there are what I call others. These make up the 39. But in or amongst the 39 are others that are in direct breach of the Constitution. The Constitution says that the Judiciary is supposed to be independent and should have lump sum payments. We have on this legislation the Judiciary named here as a budget agency not in receipt of any lump sum payments. As you might see from the front of the Estimates the Supreme Court of Judicature and the Elections Commission, for example, have specific pages which the Minister of Finance may amend before it reaches the House, and it comes with the Ministry’s recommendations. This was never the intention or the meaning of independence in the Constitution. So the Supreme Court, the Chamber of the Director of Public Prosecutions actually is not specifically mentioned or treated as a budgetary agency.
Budgetary agencies have some characteristics that I would like to draw to the House’s attention. Budgetary agencies are agencies that in addition to being subject to line by line management by the Ministry of Finance in the sense of when the budget proposal goes to him he can change any of the line items and not the sum total in a lump sum manner, these agencies on the schedule are answerable to the Finance Secretary for all matters falling in the purview of the officer answerable for the agency. They are not, and I stress, they are not required to be answerable on all financial matters. The court, for example, could find itself being quizzed by the financial secretary on matters pertaining to court cases. And except for Order No. 20, which the Minister of Finance passed, these agencies remain subject to supervision by the Ministry of Finance. The Minister can amend their budget submissions, he can terminate or delay disbursements within the fiscal year notwithstanding the budget approved by this House if, and to quote the words of the Fiscal Management and Accountability Act section 33(4):
“He may delay or terminate those disbursements if at any time he believes that the exigencies justify them.”
He may also suspend the payment of any expenditure of public moneys and, as I mentioned, the details of the proposals can be amended. I am saying that these discretions that are exercised by the Finance Secretary and the Minister of Finance are unconstitutional because the Constitution at article 222 is unambiguous, it is very clear. It says no one should interfere with their independence in the exercise of their functions, and that their money should be provided specifically as lump sum payments. So the agencies, Office of the Ombudsman, GECOM, Parliament Office, the Service Commissions – Police, Public, Teaching - and the Public Service Appellate Tribunal, are agencies listed in the Constitution as independent. The Ombudsman, for example, is under title 5, subtitle 2, and so forth. Under the Constitutions of these individual entities, as I had indicated at the time of the motion, and as well under Chapters 2, 5, 6, and 7 of the Constitution these agencies are supposed to be treated as independent. The specific references to paragraphs or sections are Public Procurement Commission 212W to 212EE; the Service Commissions section 5 title 7, the Human Rights, Women, Gender and so forth are all there, and the Public Service Appellate Tribunal. Article 212G (2) says commissions in general shall be independent and a direct charge on the Consolidated Fund. That is just in case one has forgotten that article 222 actually says that.
The article 217(4) also goes on to say that in respect to service commissions Parliament prescribes the manner in which the withdrawals may be made from the Consolidated Fund or any other public fund. So I think it is very important we recognise, acknowledge and remedy this breach of the Constitution as a matter of urgency; it has being there in existence for over nine years. And for those who are concerned that the power of a lump sum payment hands a blank cheque to agencies such as the Judiciary, let me say Mr. Speaker, you will remember we had this exchange in the course of the motion, that the terms governing accountability of these, what I call constitutional agencies, are specified in the Constitution under articles 216, 217 and 218 as well as 222A and B. I believe that those provisions are adequate. Notwithstanding all of this, the agencies remain inappropriately listed as budget agencies.
And may I go on to say that in March 2012 the A Partnership for National Unity (APNU) in the preliminary discussions, before the Alliance For Change (AFC) was involved in those exchanges, when we had gone to speak to the People’s Progressive Party/ Civic (PPP/C) about their willingness to change the budget, we had given them a list of items that we wanted to see treated in the budget. Amongst those listed was this particular item. I would like to say - because I know we have colleagues on the other side who are very fond of rendering their versions of reports of joint discussions - that we did actually engage in an exchange over the removal of these items. It was in that exchange, if I may say, that Dr. Luncheon waxed very warmly on the sympathy of the Government in correcting these oversights but saying, unfortunately, almost with tears in his eyes, that this could only be done if it had the benefit of a two thirds majority. As I have indicated to you, I do not need to be delayed by that now, but my reading of the Constitution is that particular matter article 222A requires no two-thirds majority. Therefore, we will be seeking in a few days time to lay a bill to amend the Constitution and bring the entities that are constitutional entities properly under schedule 3 of the Constitution.
However, the motion on this matter of the constitutionality of including constitutional agencies as budgetary agencies did require the Government to do some things fairly specific; and I just want to be sure at this stage that we understand what is being proposed. I know there are a number of queries raised about whether the agencies need to be on one list or the other, as I mentioned before. Let me just say to You, Mr. Speaker, and to colleagues, that agencies currently receive state funds although they are not mentioned on either list; I mentioned that earlier. If you look at the list of agencies which receive state funding in one form or the other these include GNNL, you will probably know this as one of the subsidiaries of NICIL; there is the Lethem Power Company, which we had cause to devote a lot of time to last year; NICIL itself receives resources although it is not mentioned under either list – the Constitution or the Fiscal Management and Accountability Act – National Communications Network (NCN); and statutory bodies like CHPA, which we were just chatting about, the Cheddi Jagan International Airport, Lands and Surveys Commission, University of Guyana (UG), Guyana Revenue Authority (GRA) and National Trust, all of these are agencies mentioned in neither of the two documents, neither one the lists nor the schedules, but they receive moneys. I am reacting to a query that arose during the course of the exchanges which suggested that if the entities were not mentioned, if they were taken off of this schedule of the Fiscal Management and Accountability Act they would be in limbo and therefore you would not know their rights. That is the observation I would like to make here.
I would go on to say that even egregiously many agencies, which do not enjoy the statutory standing of these constitutional agencies appear in this section that deals with lump sum or block votes - Lethem Power Company is one of them - and they have privileges which the Constitution sought to endow the constitutional agencies with, but which the constitutional agencies do not enjoy.
6.05 p.m.
So that is the observation I would like to make here, further emphasising the unconstitutionality or the unconstitutional nature arising from the inclusion of a number of these agencies under the Fiscal Management and Accountability Act.
I would also like to say to you that again this question of whether taking them off the list would make a difference, if you look again at the Estimates themselves, you will find under Agency Code 11- GECOM and under Agency Code 7 – Parliament Office and so forth, these are the agencies we are taking off. They are already in the Estimates. Therefore, the Estimates specify that they can receive resources.
My quarrel or my contention is that, insofar as they are under these Agency Codes, Supreme Court, for example, under 55, Public Prosecution under 56, the Appellate Tribunal and so forth. They are not treated in the manner specified by the Constitution and we need now to make sure that the Appropriation Act reflects the requirement of the Constitution, so that they receive moneys by way of block votes and you can treat them, if you want, as are the Statutory Expenditures shown under 4.5 of these Estimates, where a number a agencies whose moneys cannot be changed after they have been approved are listed. You can do the same with the Constitutional Agencies.
Mr. Speaker and colleagues, these are the main points I would like to make in relation to the Bill. It is quite a straightforward Bill. It simply seeks to take off the schedule, those agencies that should not be here. They should not be here, not because we do not like them on there, but because the Constitution, which is the supreme law of the land, requires that they be treated as financially independent. The supreme law of the land cannot be subsidiary to the Fiscal Management and Accountability Act, especially when the Act includes a number of agencies that conveniently fall under the control of the Ministry of Finance and in many instances appears under the Office of the President, which is an even more egregious mode of treatment.
In the light of these points, Mr. Speaker and colleagues, I would like to commend to you the Bill and to urge that you lend it your support since it is worthy. May I make one point before closing? It is to pick up an observation made by I think by the Hon. Minister of Finance when they were trying to block the consideration of this particular Bill. The first item that is listed in the Draft is the Judicial Service Commission and the Service Commission actually does not appear on the Schedule, so that we can amend. I do not think it is a big issue, but all the others appear on the Schedule of the Fiscal Management and Accountability Act. I thank you very much for your patience. [Applause]

Mr. Greenidge (replying): Thank you very much, Mr. Speaker. I wish to thank colleagues for contributing to the deliberations on this particular item and to say that the observations made by the distinguished Minister of Finance as regards the additional items turned out to be the every item that I drew to the attention of the House. It is a little bit of a “Columbus” here. We agree that that element could be removed.
Secondly, as regards the intension of the bill: The intension of the bill was the same intension that it informed the Minister when he removed the Auditor General's Office from the schedule; exactly the same. Now he is telling us that it has no merit. They removed it for the same reason except, of course, the arrangement surrounding the Auditor General and the Auditor General's Office are a little less transparent. Let us leave it that way. We will see in time. It was removed as it should have been removed and as the others should have been removed at the same time also. It should not have needed us to bring it here because it was drawn to their attention. [Mrs. Backer: We would have supported it.] Yes.
As regards, if you like, the operational dimension of the Fiscal Management and Accountability Agency for these constitutional offices may I say, again, that I did also draw attention now and in the course of the debate on the motion to the fact that the entities are to be held to the same accounting standards and auditing standards as all the others so again that is nothing new. I said it and I think that we have no difficulty with that idea.
Mr. Speaker, may I take the opportunity to say to you that it is true that removing these entities from the list would not, by itself, ensure that they are constitutional offices exempt from what I call the discretion of the Minister of Finance and the Financial Secretary but in order to ensure that the progress in this House was not held up we went ahead with this amendment and we will be brining an additional amendment which will help to clarify some of the very points made by the Minister. They will be laid within a day or two; not arising from anything he said but just to reflect the points that he made. It is good that we share with him the idea that additional factors are needed.
We are not here to determine whether Article 164 applies to Article 222 and not Article 222 A or Article 222 A and not Article 222 B. We will deal with that when we come with the constitutional amendment but for the moment let it be noted that Article 222 A - we agree with the Minister - is not reflected in Article 164 and that is sufficient for us for the time being; when in fact the amendment there made by way of the introduction of these items under the Fiscal Management and Accountability Act was done by way of a simple majority. Thank you very much, Mr. Speaker. I commend the bill to colleagues.