OAG report finds $26M given to MPs through Shipping Grant, but no ship
By Alfred Sasako
JUST as the anger surrounding payments of hundreds of millions of dollars to JQY Enterprise Ltd – a Government Preferred Supplier – begins to subside, another potentially controversial scheme involving the misuse of public funds has emerged.
This time it involves payments of tens of millions of dollars to successful applicants in what was known as the National Shipping Grants Initiative. It was administered by the Ministry of Infrastructure Development (MID).
The scheme known as the Shipping Grants for short, operated between 2013 and 2015. In that time some $45.4 million in grants were dished out, largely to members of Parliament, to buy ships for their constituencies.
Of this amount, vessels bought and registered represent only $19.1 million, according to a Performance Audit Report on the scheme, undertaken by the Office of the Auditor General (OAG).
The balance ($26.3 million) were given out to successful applicants, but no ships have been bought, according to the report, which revealed instances of missing files, advanced payments of grants and more.
Island Sun has obtained a copy of the Report, which had been widely circulated to key government ministries, including the Ministry of Finance and Treasury as well as the National Parliament.
Among other things, the report recommended that legal action be taken to recover monies from those who received the grants but have failed to provide any progress report on their vessel purchases.
The audit also found that the scheme operated without formal government policy for two years (2013 and 2014). A formal policy guideline was introduced in 2015.
Despite its damaging findings, both MID and the Ministry of Finance and Treasury, appear to have ignored its findings and recommendations to address the anomalies found in the administration of the Programme.
“OAG collected a total of 24 transactions from the government general ledger account for all shipping grants made during the period 2013 to 2015 and conducted a review of all supporting documentation for each of the transactions. 17 of the 24 transactions were for vessel purchases,” the report said.
It found for example that only two of the eight purchasing transactions totalling $17.8 million complied with the guidelines introduced in 2015.
Despite the policy guidelines, the audit found that “All but 2 of the 2015 vessel purchase grants issued did not comply with the requirements of the policy guidelines.
“It is recommended that the guidelines be made clear to all grant applicants and a condition be inserted whereby any failure to abide by the conditions will result in a demand for the grant amount to be returned to the government which can be enforced through the courts,” the report said.
Recipients shared some $26.3 million in grants purposely to buy ships but none was bought, according to the report. The report also shows that of the 17 successful applicants, 13 (thirteen) were members of Parliament (MPs).
Some have yet to buy their ships.