Report claims EHP govt abuses trust account

THE Eastern Highlands government had established a trust account without complying with the statutory requirements under the Public Finance Management Act, a report claims.
The Ombudsman Commission’s report of July 2018 tabled in Parliament on Wednesday accused the provincial government and administration of abusing the account in 2009 and 2010.
The report claimed that it was discovered that the trust account, holding K7,383,989.06 was established unlawfully, resulting in abuse and misappropriation of funds.
Former EHP administrator Munare Uyassi said the trust account referred to was opened during his term.
Uyassi said the report was not entirely inaccurate, deficient and with legal ramifications.
According to the report, under the Public Finance Management Act (PFMA), the trust account was established on the approval of the Finance secretary. In this case it was done well before the approval was granted.
The PFMA also required the state solicitor to be consulted before the opening of a trust account.
Further, the PFMA also required the minister for finance to sign the trust instrument before opening the account. But this too was not complied with.
The report said the account was not monitored because the trust code 330-606 was not registered in the trust ledger by the Department of Finance.
It was revealed that the Eastern Highlands administration had rolled over unspent funds in the trust account, in breach of the PFMA.
The Eastern Highlands administration also failed to comply with the requirements of PFMA when it awarded contracts, with payments made from the fund held in the trust account.