The National, Friday, 27th May 2011
By FRANK SENGE KOLMA
PARLIAMENT was yesterday asked to declare that there are no public accounts for 2007.
The parliamentary Public Accounts Committee (PAC) made the recommendation after it found that the records of financial receipts and expenditures for that year were “unreliable, incomplete and not based on proper records or accounts”.
This state of collapse persisted across the entire public sector in 2008 and, despite slight improvements in 2009, the condition persisted last year and in the first four months this year, the PAC reported.
The three reports tabled yesterday, covering 2007, 2008 and 2009, were scathing and pointed. No department, provincial government and national agency or entity was spared.
Treasury and Finance Minister Peter O’Neill described the reports as “embarrassing”.
O’Neill said this after PAC chairman Martin Aini presented the reports.
“It is quite embarrassing. We all know of the systematic breakdown in the public service and it is a matter that the government is addressing,” O’Neill said.
“We will take the PAC recommendations very seriously and we will deal with certain officers implicated in the report.”
The following was typical language throughout the reports tabled yesterday: “Corporate governance remains poor, internal controls are weak or non-existent, accounting is poor or failed, financial statements remain unavailable, accountability and transparency are poor, reconciliation of internal finances is poor or non-existent and staff competence and resourcing of a majority of entities is inadequate.
“The situation with trust accounts is no better.
“By 2007, the public service had illegally assumed unfettered power and discretion over the use and application of trust monies regardless of appropriations in many instances.”
It had become so that parliament had been asked to exert its authority over the entire public sector to return fiscal discipline and accountability by censuring departmental heads, chief accounting officers and to dissolve and restructure the entire Department of Finance.
Presenting the reports, Aini said: “The committee rejects the public accounts of PNG for the financial year 2007 as unreliable, incomplete, misleading, untimely and of limited value to users.
“This is a serious finding and one that requires immediate address by parliament.”
The auditor-general, whose constitutional role was to inquire into and report on all public accounts, had disclaimed the public accounts for the same year.
Among others, Aini said his committee had found that:
.Monies had been spent in excess of the appropriation limit or without valid appropriation;
.Monies were spent in breach of the constitution;
.Cheques where backdated to the previous financial year;
.Constitutional requirements were ignored;
.Entire departments were incapable of reconciling their own small internal back accounts for years;
.Huge and illegal cash advances were made to officers;
.There existed no accounting manuals, no performance plans and reports; and
.Heads of departments and senior public servants were untrained, ignorant of their duties and were incompetent and in many cases immune to the operation of the law.
This indictment on public accounts and records on the handling of money continued into 2008 where, in addition to national departments, provincial governments and local level governments, hospital boards’ business arms and statutory corporations and all provincial authorities were also found to be non-existent and unreliable and incomplete.
This state of affairs pervaded at the district level where the government’s popular district services improvement programme (DSIP) funds had been distributed.
The PAC reported “slight improvement” in the making, keeping and submission of accounts in 2009 but, for the most part, the overall management and recording of transactions with public monies, property and stores “remain poor and failed in many cases”.
Asset lists did not exist so it was difficult to keep track of what was owned by the state.
Aini said: “These failures have resulted in deteriorating services to our people and a failed system of delivering development to our citizens.
They are also matters of profound national embarrassment.
“These failings continue to the present time, unaddressed.
“The committee has tabled 20 reports to this house with similar findings and detailed recommendations, yet, they have not been debated or considered.”