A GOVERNMENT team will conduct an audit on the management of office leases by the State from next week, according to Chief Secretary Isaac Lupari.
Lupari said in a statement the audit followed Prime Minister Peter O’Neill’s directive to review the operation and management of all State office leases in the country.
The technical team, comprising officers from the departments of Works, Finance, Prime Minister and National Executive Council, State Solicitor and Personnel Management, discussed the directive yesterday.
“The State is spending close to K250 million a year on these office leases,” Lupari said.
“This is a huge expense for the government. As such, the government wants to ensure that it is getting value for its money and is able to reduce this cost over time.
“In addition, the government intends to streamline the management process to ensure there is transparency in the procurement of these leases.
“Outsourcing of the management of leases will be part of the consideration of the audit investigation.”
The audit team will:
- Inspect the buildings to ensure all spaces let are used and the buildings are safe and fit for occupation;
- Review the lease agreements to ensure that State is paying the correct market rates;
- Review the lease agreements to ensure the lessee and lessor obligations are clearly defined. In many instance, the State is paying for all the outgoings and some landlords are sub-leasing empty spaces despite the State leasing the entire spaces;
- Review the current management process, including the process of procurement, whether it complied with the Public Finance Management Act.
Lupari expects every government department and agency in leased offices to cooperate with the audit team to ensure the exercise is completed in six weeks.