THE Ministry of Finance and Treasury has welcomed the call by the Parliamentary Opposition, urging the government to carry out an audit in each of the Government Ministries following claims that ‘ghost’ companies have embezzled millions of dollars from the state coffers.
The call was carried in an article published in the Solomon Star last Thursday, 1st June 2016.
In a statement issued on the same day of the article’s publishment, the Ministry of Finance and Treasury said, “We would like to commend the Opposition Leader, Jeremiah Manele, for urging the government to carry out an audit in each of the Government Ministries, following claims that local ‘ghost’ companies have embezzled millions of dollars from the government over an unspecified time.
“We are certainly aware and equally concerned that there have been instances of ‘ghost’ companies corruptly gaining financial advantage from the Government.
“We are also aware and believe that as businesses grow and the business landscape changes, corrupt business dealings will continue to grow and thus the deterrence of these practices will continue to be a challenge,” the Ministry of Finance and Treasury said.
Against that backdrop, the Ministry of Finance and Treasury revealed that a lot of effort and resources had been invested into protecting government finances in the past years and these investments will continue to safeguard the state coffers.
“We have invested a lot of effort and resources to strengthen governance processes across the Government and will continue to do so and we believe we will be successful. We will always need to be vigilant against those who see Government money as an easy target.”
And further to strengthening existing controls in the procurement and governance areas of the Government machinery, the Ministry of Finance and Treasury announced that it will introduce the following measures:
Introduction of a new Procurement Regulation which will provide the Solomon Islands Government with the policies, rules, and procedures that govern the procurement of goods, works and infrastructures, non-consulting services, and consulting services required in the delivery of public services;
Requiring each Ministry to provide the Ministry of Finance and Treasury with their annual procurement plans so that the Ministry of Finance and Treasury can make an initial assessment of each Ministry’s procurement program, and to investigate further where it is considered necessary;
Introduction of a new Internal Audit Regulation which will strengthen the capacity of the Government to audit procurement and governance systems more effectively. The Regulation will contain penal provisions for anyone who attempts to mislead auditors. It will also allow for the establishment of an Audit Committee, a high level function which will oversight audit findings and recommendations and ensure that financial systems are tightened up; and
Requesting the government to support the employment of up to an additional 16 internal auditors by 2017 so that the Government will have the actual capacity to audit Ministries more comprehensively.
The Ministry of Finance and Treasury added that the Internal Audit Office is currently conducting an audit into the Central Tender Board which oversees large procurement contracts.
It said this audit will take place every two – three years and can be re-scoped to include individual Ministerial Tender Boards, depending on the findings.
The Ministry of Finance and Treasury said the Internal Audit Office, as well as the internal audit units in other Ministries, also devotes considerable effort into investigating suspicious procurement activities.
For instance, it pointed out that the Internal Audit Office investigated procurement contracts valued at about $36 million in 2015 alone.
Source: PM Press