New Tobago House of Assembly (THA) Chief Secretary Farley Augustine yesterday revealed some damning details of pre-election spending in Tobago by the former executive.
Augustine was speaking during the THA’s second Plenary meeting and blasted the former executives book-keeping and accounting, saying that the debt management was in a “sick state”.
Augustine said that within the new executive’s first month in office, a single contractor hit them with a bill for over $100 million.
“Can you imagine that within your first month in office, as Secretary of Finance, Trade and Economy, a single contractor will send for you from his accountants a list of works he claimed he has done for the Tobago House of Assembly and for that single contractor we are owing in excess of $100 million based on his claim,” Augustine said.
He said that while the electorate was waiting on the election date to be announced, in November 2020 the then THA executive sole-selected contractors for work and ensured that it was the ones “that would give them a kickback to fight elections”.
“They would realise that that was a wasted investment,” he said.
At this point, the lone voice of Opposition in the THA, Kelvon Morris, PNM’s MP for Darrel Spring/Whim raised an objection and accused Augustine of imputing improper motives but was shot down when Augustine said the improper motives defence only served those who were in the House.
“Not a single one of them is back here in this House,” Augustine said.
He detailed a number of sole-selected firms to do restoration works which amounted to over $99 million.
Augustine said that some two weeks before announcing the election date, the THA made two decisions, one was to begin a road resurfacing program at a cost of over $168 million and the other was emergency restoration works. The two decisions right before the December elections, Augustine said, amounted to over $200 million “without indication of the source of funding”.
Augustine described the accounting as “troubling data” but caveated his presentation by saying that he was presenting the financials collated by the former administration.
“This is their report, not we own, their report for those two fiscal years. Remember this is what we met here. So what I am reporting on is based on their records and their reports,” he said.
He said that the reports have not yet been “reassessed” by the new THA executive as yet.
Augustine reported an $8,551,287.20 million overdrawn position at the end of the fiscal for 2020.
The THA’s Contingency Account, Augustine said, stood at $3,920,322, while Contingency expenditure was reported at over $78 million, with an additional commitment of over $190,000 and Unspent Balances stood at $147 million.
Augustine said that it was “challenging” to get the actual liabilities figure as “records are all over the place”.
He said that the THA accounting was cash-based, where revenue was recorded in the income statements when actually received and expenditure are only recorded when payments are actually made.
“The unpaid expenditures incurred are recorded as commitments and show up on the balance sheet as liabilities,” Augustine said.
“Therefore, this financial assessment was based on three key indicators; revenues, expenditures and liabilities, to put it simply, the money we spend, the money we make and the money we owe,” he said.
He questioned why measures were not put in place to pay down overtime instead of having this massive payment owed.
“I am saying categorically right here, right now on this very day that we are going to fix this,” he said.
Augustine said that the total development expenditure was reported as over $383 million, which was more than was budgeted and received from subventions.
Augustine questioned what measures were put in place to “pay down” on liabilities over time.
“With prudent cash flow management, there is likely to be a positive cash flow from one financial year to the next, but, it pains me to remind this House that the inverse or the opposite is also true and can happen and has happened,” he said.
