Anguilla Tourist Board Disaster

 

29 June 2020 saw a new era dawn in Anguilla’s political history.  The Anguilla Progressive Movement under the leadership of Dr Ellis Lorenzo Webster took the reins of government.  As a result, the Anguilla Tourist Board is under new management.  It desperately needs it.

The latest published Chief Auditor’s Report on Anguilla Tourist Board (ie, for 2017) is devastating:

http://www.gov.ai/documents/hoa/ATB%202017%20Final%20Audited%20FS%20including%20signed%20CA%20report.pdf).

  It reveals an extreme degree of incompetence and negligence in failing to follow the requirements of the Tourist Board Act.  The new government must never allow this to be repeated.

The ATB must:

·        Ensure its estimates of revenue and expenditure are approved by the Minister of Finance, as well as the House of Assembly, as required by the Act, before a penny is spent.

·        Put in place written procurement policies for entering into contractual agreements and appointing agents to represent the Board, as required by the Act.

·        Ensure it receives reports on the various overseas marketing representatives’ performance during the year, before renewing their contracts.

·        Make sure it reviews, as stipulated in the contracts, each marketing representative on the status of their marketing activities.

·        Ensure the auditor can corroborate the expenses recorded to the planned initiatives of each of the representatives.

·        Put in place written policies on international travel and subsistence so that the auditor receives approved budgets for each international travel to make sure expenses incurred were valid and within approved limits.

·        Make and follow written policies for purchase of supplies, furniture and equipment used in trade shows and exhibits and account properly for monitoring and future usage.

·        Put in place policies for sub-contracted services made by overseas representatives as required by section 24 of the Act, so that never again can the situation arise where the Portfolio Management Group in the USA contracted Live Communication, Cision, and PR Newswire, while the UK representative contracted White Tiger for its public relations activities, without approved contractual arrangements.

·        Ensure that never again will a situation arise where the Portfolio Management Group was appointed to be the Board’s marketing representative for the USA and Canada without guidelines on how the budget of $1,745,000 would be spent, nor any review or assessment of the key performance indicators, and without the stipulated pre-approval by the Board of administrative expenses of US$1,000 or more.

Never again must the ATB be run as if it were a private family business.  This is public money and public business.  The highest standards of probity and responsibility are the minimum we expect.

Two Editorials

£60 million of Humanitarian Aid

There are two recent editorials in The Anguillian newspaper that I want to comment on.  They are critical of the conditions that come with the £60 million (EC$250 million) of humanitarian aid that the UK has offered to Anguilla post-Hurricane Irma.

The editorial on page 2 of the issue of 30 March asserts that “it is difficult to reasonably conclude that the UKG, by stipulating stringent conditions for the release of the grant funds, is acting primarily in the interests of Anguilla and its people.”  The piece then goes on to criticise the “insistence on the placement of a UK official within the Ministry of Finance . . . who would have considerable responsibilities over the public finances of Anguilla.”  This is described as a “slap in the face of the Minister of Finance and his finance officials.”  The proposal is said to be “abhorrent to all right thinking Anguillians as it can only be seen as seeking to diminish the dignity of resilient and persevering Anguillians.”

The editorial on page 2 of the later issue of 6 April continues to play the same theme.  The author urges that when the aid was originally offered, “it was taken at face value with no mention whatsoever of onerous and discouraging conditions.”  Then, “All of a sudden enter Mr Ben Merrick, Director of Overseas Territories, and Lord Ahmad, the Minister of the Overseas Territories, springing the surprising conditions on the people of Anguilla.”  The UK Government is urged to “quickly release the promised 60 million pounds in humanitarian aid . . . and exercise faith in the Anguilla Government and the highly-qualified and responsible local financial and economic experts in the Ministry of Finance.”

These two editorials are part of an expected smokescreen.  Humanitarian aid by way of a gift of money that is not subject to safeguards over its spending is money that is often thrown away.  Which donor country in its right mind would release any sum of its own taxpayers’ money, far less such a significant amount as £60 million, to a government which many, including Anguilla’s Chief Auditor, believe has proved itself incapable of properly accounting for its own taxpayers’ funds, unless it puts in place the most stringent safeguards?

The UK conditions in question were analysed in my two-part ‘Anguilla: Sustainable Recovery and Resilient Development Post Irma’ published on my website on March 11[1] and March 18.[2]  They were both published in recent weeks in The Anguillian newspaper.  In my view, few of the conditions that are asked of us in Mr Merrick’s letter are unreasonable.  None of them is new.  Nearly all of them are conditions that we should have imposed on our Ministry of Finance when they were spending our own money.  The only shame is that instead of us imposing those conditions on ourselves we had to wait for someone else to force them on us.

As for the threat of imposing an all-powerful ‘Chief Financial Adviser’ on us, we were warned about this since the year 2015 when we were first threatened with its imposition by Order in Council.[3]  We opposed the creation of a ‘finance tsar’ then and, as I explain below, we should oppose it now.

Such an appointment is not a matter of “seeking to diminish the dignity of resilient and persevering Anguillians.”  Those emotional words are an appeal to false patriotism.  There is a real principle at risk here.  As a matter of background, while it is true that some of our past Ministers of Government were irresponsible in their handling of public funds, they did it under the negligent supervision of the UK appointed Governor.  The Governor had the constitutional power to insist on our Ministers and senior Administrators, such as Permanent Secretaries and Heads of Department, following the existing provisions of the Financial Administration and Audit Act.  Instead, successive Governors neglected their duty to ensure good governance.  The Chief Auditors complained about these defects for years as they repeatedly refused to give our Public Accounts a clean certificate for just this reason.  No Governor or British official it seems took notice.  There was no one else in our system of government to follow up on the Chief Auditor’s complaints.  It is only in the past two years that, for the first time in the history of Anguilla, a Public Accounts Committee (the PAC) has begun to meet and to call public officials to account for their spending of public monies.  We can hope the PAC will begin to demand that the Chief Auditors complaints are heeded.

The principle that is at risk here is that, as a developing society, we must constantly strive to improve our systems of government.  Where we are negligent or ineffective in this struggle, it is the constitutional duty of the FCO to help us stiffen our spines.  They can do this by loudly and openly insisting that we follow the correct path, instead of apparently shutting their eyes to our financial transgressions.  They can tell the Governor to do his duty in insisting Ministers follow the law.  In this way, with our own efforts propped up by the guidance of those UK administrators (theoretically with more experience in good governance than us), our democratic institutions will grow in strength.  Imposing, instead, a ‘finance tsar’ who will simply set aside bad decisions of our Ministers of Government and bad laws of the House of Assembly (after those decisions were made in ExCo under the chairmanship of the Governor) will teach us nothing except how to become very angry and insubordinate.  The appointment of an all-powerful Chief Financial Officer, however named, will amount to an increase in the democracy-deficit in our society, not to an improvement in our democratic systems.  In my view, no good can come of such an imposition.

Calling such an appointment a “slap in the face” is mere propaganda.  Those words are designed to appeal to our nationalistic emotions and to stir up a misguided patriotic fervour.  They are used in an attempt to “pull the tam down” over the collective eyes of the FCO.  The idea behind these editorials is that the FCO will be made so guilt-ridden that they will release the funds to us with no effective controls put in place for their proper use.  We must sincerely hope they are smarter than that.

And so to return to the so-called “stringent conditions” that we must meet to receive the grant.  I am not going to repeat why the conditions in question, even if stringent, are right and reasonable.  I already did that in the two articles referred to above.  If we can meet the conditions, and the grant begins to be disbursed, this will be “the best-managed economic reform and infrastructure development programme ever enjoyed in Anguilla.”  If we can maintain the conditions, even after the grant is exhausted, we will be well on the way to proving that we can handle public funds responsibly and in accordance with law.  What an improvement that would be on the existing practice!

---

[1]       https://donmitchellcbeqc.blogspot.com/2018/03/sustainable-recovery.html

[2]       https://donmitchellcbeqc.blogspot.com/2018/03/sustainable-recovery-part-2.html

[3]       https://donmitchellcbeqc.blogspot.com/search/label/Chief%20Financial%20Officer

2012 Accounts and Report

Commentary on the recently published Government of Anguilla 2012 Accounts

The latest Report on the Government’s Accounts by the Chief Auditor of Anguilla has now been published.  You can download it from the Government of Anguilla’s website: http://www.gov.ai/documents/hoa/Government%20of%20Anguilla%20Accounts%202012.pdf.  This Report relates to the income and expenditure of the Government of Mr Hubert Hughes in the year 2012.  It is over 75 pages long, but you don’t need to read all of it.  It is sufficient to read his Summary Report on the first 13 pages to have a full understanding of what a disaster zone the government’s accounts for 2012 appear to be. 

The Internal Audit Department must be congratulated on the hard work they have obviously done.  They have enabled the Chief Auditor to get the 2012 Report out a mere six months after the 2011 Report was published in November 2015.  The 2011 Report was the first report on Anguilla’s public accounts published in the nearly 50 years that Anguilla has managed its own finances.[1]  This is nothing short of remarkable.  It took 50 years for the first set of public accounts and auditor’s report to be published, and now the second one has been put in the public domain in a matter of a few months.

As in his 2011 Report, the Chief Auditor’s Certificate on the 2012 Report is a “qualified” one.  The use of this word “qualified” by an auditor is a serious matter.  It indicates that the opinion he expresses is not a clear or a clean one.  In his Certificate at pages A, B and C of his Report, he explains why his Certificate has to be a qualified one.  I summarise his reasons below, in case you don’t get a chance to read it for yourself.

The Consolidated Fund:  All money received by or paid out by the government of Anguilla is required by law to be paid into the Consolidated Fund.  The law is the Financial Administration and Audit Act (the Act).  The purpose for this provision is obvious.  If all money is paid into and paid out of one account, it makes it easy for an auditor to check what money was received, and what money was paid out.  If the money is paid into multiple accounts, or not deposited at all, it becomes impossible to say with certainty what money was received.  Chaos will reign in the accounts.  The law requires that this not be done.

Role of House of Assembly:  All money paid out on government expenses is required to be authorised by the House of Assembly.  The Assembly does this each year by approving the estimates of government’s income and expenses in what is called the Appropriation Act.  Each government department puts together its estimates for its income and expenses, and the Ministry of Finance puts them all together in a budget called the Estimates.  When the House of Assembly approves government’s total income and expenditure, it passes the Appropriation Act.  If, half-way through the year, a department discovers it needs to increase its estimate of income, or of its expenses, it puts together a request to the Assembly to approve this variation, and the Assembly passes a Supplementary Appropriation Act.  Without the approval of the Assembly, any payment of public funds is illegal.

Contingency Warrants:  The Minister of Finance is permitted in an emergency to authorise a department to make a variation from the amount approved, but he is expected by the Act to seek and obtain the approval of the Assembly from time to time.  Only the Minister, not a public servant, can sign the authorisation varying the amount approved for a particular purpose.  General Orders, the contract signed by every public servant in the employ of the government, provides that if any Permanent Secretary authorises an expense or payment that is not approved in an emergency by the Minister of Finance, or more generally by the Assembly, he will be made to reimburse the public funds out of his own pocket.  This is all set out in the law and in General Orders.

Chief Auditor’s Qualified Certificate:  You don’t have to be an accountant or even qualified as a book-keeper to understand what the Chief Auditor is describing in his Qualified Certificate.  What he sets out in his Summary Report at the four pages marked H, I, J and K appears to show that the public service of Anguilla treats the Consolidated Fund as a gigantic ‘slush fund’.  One definition of ‘slush fund’ is “money earmarked for a loosely defined, but legitimate, purpose that is instead surreptitiously used for an illegitimate purpose.”

The Chief Auditor’s Certificate is qualified for a number of reasons, all which he sets out.  In summary, some of the payments made by government departments, or exemptions from payments that were supposed to be made by taxpayers, were not legal.  In his opinion, a number of matters were not regular or in compliance with the legal requirements.  These are some of them.

Company registrations:  The Companies registration law sets out the fee to be paid to government for forming a company.  During 2012, government entered into arrangements with certain company registration agents to form companies in bulk at a discounted fee.  These discounts amounted to EC$2.3 million.  However, these discounts were not authorised by law.  They were illegal.

Reallocation warrants:  The Minister of Finance is allowed by law to reallocate surpluses enjoyed by a department to be spent even though in excess of the amount authorised by the Assembly.  He does this by way of what is called a “reallocation warrant”.  However, all reallocations issued in 2012 were authorised by the Permanent Secretary and not by the Minister.  The reallocations made during 2012 were not authorised in the manner required by the Act.  Not some of them, but all of them.

Tax revenue:  He reports that the Government of Anguilla has not been able to satisfy him that all payments due for property tax, the interim stabilisation levy, or taxes on goods and services have been paid.  So, government cannot show it has collected all the tax revenue it is supposed to collect under existing legislation.

Advances:  The law permits the Minister by an “advance warrant” to authorise the Accountant General to make advances to a government department from the Consolidated Fund.  However, advances made in 2012 were not authorised by the Minister.  This practice of unauthorised advances continues to be made despite our reading in the earlier report his warning that the practice must stop.

Remissions:  Once the Assembly has said what amount is to be paid in tax, no government official may excuse a particular taxpayer from paying the amount due.  Any forgiveness of a tax requires approval by the Assembly for it to be lawful.  That is so basic that it should not need emphasising far less repeating.  But, yet again, the Chief Auditor reports that Executive Council continues its practice of selectively excusing certain taxpayers from payments due under the law.  This amounts to ministers illegally granting favours to selected taxpayers.

The Chief Auditor expresses a “qualified” opinion on the government’s financial statements for the year 2012 for several reasons.  The illegal discounts, unauthorised reallocations, incomplete records on property and other taxes, unauthorised advances from the Consolidated Fund, and illegal approvals of remissions, cause the Chief Auditor to find that the accounts are irregular or not regular.

His opinion is “qualified” further because government does not maintain adequate accounting records to support the completeness, accuracy, and validity of advances, deposits, arrears of revenue, remissions, and gifts made to government.

The question we all ask is whether his report on the coming 2013 Accounts will show any significant improvement.  Or, will the Consolidated Fund continue to be nothing but a gigantic slush fund manipulated by senior public servants on a whim?

---

[1]     Government has recently put this 2011 Report up on its website, and it may be downloaded or read at: http://www.gov.ai/documents/hoa/Government%20of%20Anguilla%20Report%20and%20Accounts%20of%20the%20Consolidated%20Fund%202011%20New.pdf. 

The PAC in Anguilla

Engaging Civil Society Organisations in the Work of the Public Accounts Committee of the House of Assembly of Anguilla –

Proposals by the Constitutional and Electoral Reform Committee for Reform.

-------------------------------------------------------------

As we all know, Anguilla is at the beginning of another constitutional reform exercise, the fifth since David Carty’s Committee started considering the matter in June 2000.  The new AUF Government set up a Constitutional and Electoral Reform Committee in September 2015 to revise the various reports and draft constitutions prepared in the past 15 years by the earlier review bodies.  Its membership consists of all the senior lawyers, and representatives of every political party and movement in Anguilla.  I have the honour to be its chair.  We are working at assimilating all the existing Constitutions of other British Overseas Territories in the West Indies and the various suggestions for reform that have been made by earlier Commissions and Committees.  Our plan is to come to the public and to the Government with a discussion draft for a new Constitution within a few months’ time.

The Committee was set up by Government in fulfilment of its 2015 Election Manifesto.  Section 8 of the Manifesto promised as follows:

Section 8: GOVERNANCE, SECURITY, IMMIGRATION, CITIZENSHIP

CONSTITUTIONAL AND ELECTORAL REFORM

Vision 2020

A revised constitution will be introduced, the electoral system will be reformed and expanded, democratic participation will be increased, the political climate will be improved, conduct in the House of Assembly will improve and participation in the democratic process will be increased.

PRINCIPAL STRATEGIC OBJECTIVES

1)   Increased constitutional autonomy.

2)   A reformed and updated electoral system.

3)   Greater public participation in governing Anguilla and in determining policies.

PROGRAMME PRIORITIES

i) Introduce a revised and improved constitution within 24 months

ii) Update and modernize the elections system.

iii) Increase public input into determining national polices laws, strategies and plans.

iv) Develop a local government system in Anguilla’s villages and constituencies.

v) Institute an ongoing public education process for greater self-rule and independence.

vi) Review and revise the Rules and Procedures of the House of Assembly to limit abuse of its privileges and improve its operations.

These promises are, essentially, the mandate of the present Constitutional and Electoral Reform Committee.

Professor Simeon McIntosh has described[1] constitutional reform as an event which should address the most profound issues about constitutional essentials and basic justice.  It is, he suggests, a sort of re-enactment of the founding of the Constitution.  It requires a critical engagement with the constitutional past.  It will examine both what the constitutional framers accomplished and what they failed to accomplish.  To do this, we need to seek out the most appropriate ends or purposes for which the text was constructed, and to work within that framework.

Constitutional reform is, therefore, not a revolutionary act.  It does not seek a radical transformation of the character of the Constitution.  Nor does it seek to abandon the primary principles of the Constitution.  The process properly places itself in a continuity of the temporal development of the legal order.  It helps us to better realise the substantive values already present in the legal order.  It makes changes or corrections that experience has revealed to be required either by justice or for the general good.  It helps us to strengthen the political values to which we have committed ourselves.  It adjusts basic constitutional values to changing political and social circumstances.  The process seeks to reform our basic institutions in order to remove weaknesses that have come to light in practice.  The existing structures must, therefore, be changed only to the extent that experience has shown it to be required by political justice or the general good.

One of these political institutions that we seek to reform in order to achieve increased political justice and promote the general good is the Public Accounts Committee of the Anguilla House of Assembly, or the PAC.

The PAC is a standing committee of the Assembly.  It is one of the most important institutions for good governance in our system of government.  Yet, it is notorious that the present Constitution does not refer to the PAC at all.  A search of the Constitution of Anguilla, 1982[2] will not find any mention even of the term “public accounts”.  Indeed in the entire Constitution, there is only one mention of the word “accounts”, and that is in section 79, which reads:

Chief Auditor

79. (1) There shall be a Chief Auditor whose office shall be a public office.

(2) The accounts of the Assembly and all government departments and offices (including the Public Service Commission) shall be audited and reported on annually by the Chief Auditor, and for that purpose the Chief Auditor or any person authorised by him in that behalf shall have access to all books, records, returns and other documents relating to such accounts.

A similar search for the word “committee” finds no mention of the PAC.  Indeed a search for the word “standing” finds lots of “notwithstandings”, but no mention of any standing committee at all.  From the section we see a provision that the Chief Auditor audits the public accounts and reports annually, but it is not clear who he reports to, or what happens to his report.

For the first time in the history of Anguilla’s public accounts, Government last year published the Report of the Chief Auditor on the accounts of Anguilla.  They were for the year 2011.  In prior years, it was the invariable practice of Government to shelve the report which was never to be seen by any member of the public.  A perusal of the certificate of the Chief Auditor on the accounts for 2011 reveals the atrocious state of the public accounts of Anguilla.  He reports, in effect, that not one department of the government of Anguilla appears to keep proper accounts.  They could not show him where all their income comes from nor where their money goes to.  He reports that there are at least four different accounting systems in use in government, and none of them talks to the other.[3]

We find the PAC mentioned only in Rule 66A of the Legislative Assembly (Procedure) Rules 1976,[4] having been inserted there by an amendment to the Rules in 1992.  This provides:

Public Accounts Committee

66A. (1) There shall be a Standing Committee of the House of Assembly to be known as the Public Accounts Committee.

(2) The Public Accounts Committee shall consist of not less than three nor more than five members of the House, drawn from both sides of the House, whose appointment to the Committee shall be moved by a resolution of the Minister of Finance and subject to the approval of the House.

(3) The House of Assembly shall from time to time appoint a Member of the Committee who is a member of the Opposition in the House to be Chairman of the Committee and may appoint another member of the House to fill any vacancy in the membership of the Committee occurring from time to time.

(4) The duties and powers of the Public Accounts Committee shall be as follows—

(a) to ascertain that the authorised expenditure during each financial year, including supplementary expenditure, has been applied to the purposes prescribed by the Legislature;

(b) to scrutinise the causes which may have led to any excess over authorised expenditure, and to verify applications of savings on other authorised items of expenditure;

(c) to make an effective examination of public accounts kept in any Department of Government; and

(d) to summon any public officer to give any information, or any explanation or to produce any records or documents which the Committee may consider necessary in the performance of its duties.

(5) The Minister of Finance may provide office and secretarial facilities to the Committee.

(6) The Public Accounts Committee shall submit its reports to the House from time to time.

From this, we deduce that under the present constitutional arrangements the PAC has no express authority to involve Civil Society Organisations (CSOs) in its work.  Its membership is prescribed, and it has no power to co-opt.  This structure severely limits opportunities for the PAC to invite into its meetings the expertise existing outside its membership, and which may assist the PAC in its work.  It is not clear if it has the power to summon a Minister to answer questions.  Additionally, its work is limited to examining the accounts of government departments.  Its resources depend entirely on the good-will of the Minister of Finance.

As we all know, this session of the House of Assembly of Anguilla is the first in which a PAC has been properly established under the chairmanship of the Hon Pam Webster MLA, Leader of the Opposition.  Attempts have been made in earlier sessions of the Assembly to establish the PAC, but other than the Chief Minister naming a member of the Opposition in the Assembly to be chair of the PAC, no meeting of the PAC has ever produced any work product.  The Anguilla public have great hope that the PAC will now begin to function in the way in which it was intended.

The Constitutional and Electoral Reform Committee has been giving a great deal of thought to the question of the establishing of the PAC within any reformed Anguilla Constitution.  Perhaps the most important weakness in our existing Constitution has been the lack of any institutions protecting good governance.  The absence of the PAC is only one instance of this void.  There are few or no provisions in the Constitution that are designed to ensure accountability, transparency and integrity.  We know, particularly from events in recent years in the Turks and Caicos Islands, how important such provisions would be.  The TCI have gone a long way to filling the gaps in their new Constitution, and we can learn a great deal from examining and adopting where possible some of their new institutions.

The Committee is preparing a draft discussion document which, although it is not finalised, is not a confidential document, and which the members of the Committee are happy to share with any member of the public at any time, as we work to bring it to a more polished form prior to engaging in public discussion.  If you read it, you will notice that it contains a number of matters relevant to the PAC.

We are proposing that the PAC should take centre-place in any new Constitution.  The present draft provision for the PAC is taken directly from the Turks and Caicos Constitution.  It is found at section 119 of the discussion draft.  Its ten subsections read as follows:

Public Accounts Committee[5]

119. (1) There shall be a Public Accounts Committee of the House of Assembly which shall consist of:

(a) at least three members of the House appointed by the Speaker from among members who are not Ministers; and

(b) two persons expert in public finance who are not members of the House, one of whom shall be appointed by the Speaker and one of whom shall be appointed by the Governor acting in his discretion.

(2) the Chairman of the Public Accounts Committee shall be a member of the House of Assembly in opposition to the Government (without prejudice to the appointment of other such members to the Committee).[6]

(3) A person appointed under subsection (1)(b) shall cease to be a member of the Public Accounts Committee:

(a) at the expiration of the period for which he was appointed;

(b) if he becomes a member of the House of Assembly; or

(c) if the person who made the appointment revokes it, acting in his discretion.

(4) If in respect of any item of business before the Public Accounts Committee the Governor, acting after consultation with the Speaker and the Chairman of the Committee, considers that a member of the Committee has a conflict of interests, the Governor, acting in his discretion, may appoint another person (whether or not a member of the House of Assembly) temporarily to replace that member of the Committee for the purpose of dealing with the business in question, and a member so replaced shall not sit on the Committee when the Committee is dealing with that business.

(5) The Public Accounts Committee shall examine and report to the House of Assembly on:

(a) the reports submitted to the Committee by the Chief Auditor under section 122 of this Constitution; and

(b) such management letters and reports of the Chief Auditor as have been submitted to the Committee or as have been laid before the House or as the Chief Auditor has brought to the attention of the House;

and shall have and exercise such other functions, and shall operate under such procedures, as may be prescribed by this Constitution or as may be prescribed by Act or by Standing Orders.

(6) The Public Accounts Committee shall have power to compel the production of documents and evidence from Ministers, departments of government and public officers, and shall meet in public.

(7) The Public Accounts Committee shall report to the House of Assembly by the date set by the House or by its terms of reference, whichever is the earlier; and except as otherwise provided in the Committee’s terms of reference, such a report may be with or without recommendations.

(8) If the House of Assembly adopts a report of the Public Accounts Committee, and requests the responsible member of the Cabinet to advise the House of the action proposed to be taken by the Government in respect of the report, the member concerned shall convey the Government’s response to the House not later than the first sitting day following the expiration of six weeks after the date of the House’s request, unless the House extends the time for the response.

(9) The Chief Auditor shall be adviser to the Public Accounts Committee, and the Committee shall not meet without the presence of the Chief Auditor or his nominee.

(10) The Public Accounts Committee may invite any person to assist it in its work and to participate in its proceedings.

These provisions involve the following innovations for the Constitution:

(a) The Speaker and not the Premier has the responsibility under section 19(1)(a) for establishing the PAC.  The thinking behind such a proposal appears to be that it has been found necessary in some countries to remove the establishment of the PAC from the portfolio of the Premier, as a political decision might be taken to starve the PAC of resources in order to stifle its work;[7]

(b) Civil society is introduced into the membership of the PAC by section 19(1)(b) providing for the Speaker and the Governor to name two persons with accounting expertise to its membership;

(c) As is evident from subsection (9), the Chief Auditor is essential to the proper functioning of the PAC, and his or her presence, or that of his or her nominee, is required for the PAC to meet.  The thinking behind this provision may be that in some countries the operation of the PAC has been dictated entirely by political considerations and there may be a need to ensure the professionalization of its deliberations;

(d) Subsection (10) is perhaps the most relevant to the discussion here today.  This expressly provides the PAC with power to co-opt expertise from civil society, which would include CSOs.

The proposed discussion draft presently contains two different provisions for the establishment of the office of the Chief Auditor.  The more detailed is the first, taken from the Turks and Caicos Constitution, while the second is more skeletal and is taken from the Virgin Islands Constitution.  They presently both read as follows:

Audit[8]

122. (1) The Chief Auditor shall audit and report on the public accounts of Anguilla, including the House of Assembly, the courts, the institutions protecting good governance, and any public corporations or other public bodies or organisations established by or under any Act.

(2) For the purposes of subsection (1):

(a) accounts shall be provided by the authorities referred to in that subsection to the Chief Auditor within four months of the end of each financial year; and

(b) the Permanent Secretary Finance shall, as soon as practicable after the end of each financial year, cause to be prepared for submission to the Chief Auditor a statement of accounts reflecting the financial operations of the Consolidated Fund and any other public fund or account for that financial year.

(3) The Chief Auditor and any person authorised by him shall have a right of access at all reasonable times to all such documents as appear to him to be necessary for the purposes of conducting an audit under subsection (1), and shall be entitled to require from any person holding or accountable for any such documents such information and explanation as he thinks necessary for those purposes.

(4) Each year the Chief Auditor shall, as soon as practicable and in any case within four months of receiving the accounts under subsection (2)(a), submit to the Public Accounts Committee of the House of Assembly a report of the accounts audited by him under subsection (1) for the immediately preceding financial year, and shall send a copy of each report to the Governor, who shall publish the audited accounts and report as soon as practicable.

Alternatively, as provided for in the Constitution of the Virgin Islands:

Audit[9]

122. (1) There shall be a Chief Auditor whose office shall be a public office.

(2) The accounts of the Assembly and all government departments and offices (including all Commissions and individual Commissioners) shall be audited and reported on annually by the Chief Auditor, and for that purpose the Chief Auditor or any person authorised by him in that behalf shall have access to all books, records, returns and other documents relating to such accounts.

(3) The Chief Auditor shall submit his reports made under subsection (2) of this section to the Speaker of the Assembly who shall cause them to be laid before the Assembly; and the Chief Auditor shall also send a copy of each report to the Governor.

(4) In the exercise of his functions under this section, the Chief Auditor shall not be subject to the direction or control of any other person or authority.

(5) Within one month of the laying of a report before the Assembly, the Speaker shall cause such report to be published in a widely accessible form.

Both the Turks and Caicos and the Virgin Islands versions include these reforms:

(a) the role of the Chief Auditor is more clearly defined; he now has an enlarged responsibility to audit all the public accounts of Anguilla;

(b) in the TCI version, but not in the VI version, the public authorities are constitutionally mandated to provide their accounts to the Chief Auditor within 4 months of the end of the financial year;

(c) in the TCI version, the PS Finance is given the constitutional duty to supply the Chief Auditor with the accounts on the operation of the Consolidated Fund as soon as practicable after the end of each financial year, while in the VI version the provision is merely that the Chief Auditor has access to all books and records of all department and offices;

(d) in the TCI version, the Chief Auditor is given a 4-month deadline to provide his report to the PAC and the Governor, and the Governor is required to publish it as soon as practicable.  In the VI version, the Speaker is required to publish it within one month.

Whichever version is preferred, the proposed section 122 falls within a new Chapter 10 of the Constitution which will deal with public finance and good governance issues.  While the PAC is a committee of the Assembly and could logically be placed within Chapter 6 which deals generally with “Powers and Procedure in the House of Assembly”, and where the provision for Standing Committees is located, the members of the Committee consider its role in protecting the public finances of Anguilla so fundamental that we believe it is better placed in the proposed new Chapter 10 which contains ten provisions protecting the public accounts.  The PAC is one of the most important of these provisions.

In this Chapter 10, we also locate the provisions taken from the draft Order in Council circulated in September of last year and which was designed to provide for mandatory good governance in matters of public finances in Anguilla.  We also propose that Anguilla make provisions for an Appropriations Committee; for funding the institutions found in Chapter 9 that will be established to protect good governance; for the appointment and functions of the Chief Auditor and Accountant General; and for the remuneration of the Speaker and other members of the House of Assembly to be provided for.

Needless to say, the Committee welcomes the members of the PAC and all concerned citizens and well-wishers of Anguilla examining our draft proposals, and critiquing them and offering suggestions for improvement.  The Committee aims to finish its deliberations within a matter of a few months, to take the proposals to the public for the widest discussion, and to submit its recommendations to Government before the end of the year.  If you would like to see how the work on the discussion draft is proceeding, I should be happy to share the latest draft with you if you would email me at the address below.

A presentation made at a workshop organised by the Public Accounts Committee of Anguilla and held at the House of Assembly on 6 April, 2016

---

[1]     Simeon C.R.McIntosh: Caribbean Constitutional Reform: Rethinking the West Indian Polity. (Kingston: The Caribbean Law Publishing Company, 2002) pages 53-61.

[2]       SI 1982, No 334, as amended.

[3]       This report is not available for you to read or download on the government’s otherwise admirable website, but I can email you a copy if you request it.

[4]       SRO 10/1976, as amended.

[5]       As recommended by paragraph 126 of the 2006 Report of the Constitutional and Electoral Reform Commission.  Based on section 122 of the Turks and Caicos Constitution 2011, SI 2011, No 1681

[6]       Note that section 70 provides, among other things, that the PAC is a Standing Committee of the Assembly, and the Leader of the Opposition shall be Chair of the PAC.

[7]       In this context it may be worth noting that the proposed new section 118 requires the PAC each year to submit to the Appropriations Committee of the Assembly a bid for its budget for that financial year.  The Appropriations Committee meets in public to scrutinise each bid.  It reports to the Assembly which may pass or reject the recommended PAC budget, which then forms part of the Appropriation Act for the year.  If the bill is repeatedly rejected by the Assembly, the Governor may over-ride it by causing a bill for the budget to be published in the Gazette and assenting to it.

[8]       Taken from section 126 of the Turks and Caicos Constitution 2011, SI 2011, No 1681.

[9]       Based on section 109 of the Virgin Islands Constitution 2007, SI 2007, No 1678.