HEADLINES

Frigate Bay Development Corporation Produces Audited Financial Statements for the First Time in almost a Decade

GOVERNMENT LAYS LONG-OVERDUE AUDITED FINANCIAL STATEMENTS IN PARLIAMENT AS PART OF ITS GOOD GOVERNANCE AGENDA

The Team Unity Administration, just two years in office, has laid the long-overdue audited financial statements of the Frigate Bay Development Corporation in Parliament, while pledging to lay others shortly, as part of its good governance agenda.

Hon. Lindsay Grant

 

 

Basseterre, St. Kitts, February 24, 2017 (SKNIS): The Team Unity Administration, just two years in office, has laid the long-overdue audited financial statements of the Frigate Bay Development Corporation in Parliament, while pledging to lay others shortly, as part of its good governance agenda.

Audited financial statements of corporations, statutory bodies and foundations were not laid in Parliament for several years under the former Douglas-led Labour Party Administration. Some of these entities include the National Housing Corporation (NHC), the Frigate Bay Development Corporation and the Sugar Investment Diversification Foundation (SIDF).

In laying the audited financial statements in Parliament for the Frigate Bay Development Corporation for the years ending 31st December 2007, 2008, and 2009, on the second anniversary of the Government of National Unity, the Honourable Lindsay Grant, Minister of Tourism, hauled over the coals the former administration for what he termed “bad governance”.

“I laid the accounts for Frigate Bay Development Corporation in the House of Parliament. That is good governance. That had not been done since 2006, 11 years ago,” said Minister Grant, while adding “that’s bad governance and the fact that we have now done it that is good governance.” 

Minister Grant was speaking at the Good Governance and Accountability for Prosperity Town Hall Meeting in West Basseterre on February 21 at the OOJJ’s Conference Center.

He said that while some are calling for Freedom of Information and Integrity in Public Life laws, good governance is also about proper fiscal management and accountability to the people of the country by the government of the day.

“You would appreciate (that) to run a business without accounts for 11 years, you probably don’t know the state of the business 11 years later,” Minister Grant said.

Additionally, Minister of Public Infrastructure, Transport and Urban Development et al, the Honourable Ian Patches Liburd, laid the audited financial statements of SCASPA for the year ending December 31, 2015, in Parliament on February 16.

Also, Minister of Human Settlement, Lands and Cooperatives, the Honourable Eugene Hamilton, has indicated that he will soon lay the audited financial statements of the NHC in Parliament, which have not been laid for about 20 years.

Speaking on “Working for You” recently, Minister Hamilton said that in response to the lack of proper auditing of the NHC, the government added personnel to the accounts section of NHC.

“We have strengthened the accounts department to be able to put before auditors in 2017, the audited statements of the institution dating back to the turn of the century,” Minister Hamilton said. He said he is hopeful he will be able to lay these accounts in Parliament this year.

Ernst and Young, a multinational professional services firm headquartered in London, United Kingdom was contracted by the Team Unity Administration to do a review of the SIDF.   

The preliminary assessment of Ernst and Young “revealed that the SIDF was operated in a manner unbecoming of a multimillion dollar entity. The board of councilors and senior management operated with scant regard for proper procedures and best practices expected of those with fiduciary responsibilities,” Prime Minister Harris reported.

On December 13, 2016, Prime Minister Dr. the Honourable Timothy Harris, gave an update on the status of the SIDF.

Dr. Harris noted that there had been a number of issues with the SIDF leading up to the 2015 elections to which the Team Unity Administration spoke to with respect to the establishment and operations of the organization. He noted that concerns were based on the view “that (I) a body set up to receive funds derived from the Citizenship by Investment Programme must be accountable to the people of this country through its Parliament, and must not just be deposited into a private foundation and out of sight with no direct accountability to the Government and by extension the people of St. Kitts and Nevis, and (II) the very significant amount of funds deposited into the SIDF were being used to further projects, the viability of which has not been demonstrated, nor was the ability of those projects to diversity or grow the national economy clearly ascertainable”.

Dr. Harris told the nation that Ernst and Young in its report also informed the SIDF Board “that the SIDF has made decisions and spent vast amounts of funds without keeping proper records, such as board meeting notes, reports, opinions, or minutes of meetings – any of which would reveal on what basis certain decisions were taken with respect to these vast levels of expenditure.”  

“A relevant minute with respect to a decision to spend millions of dollars, if it existed at all, would take up only a few lines, and there would be no detailed reason given as to why the particular decision was made,” Prime Minister Harris said.

“The Ernst & Young report has shown that since its inception, to the year 2014, the SIDF has been the beneficiary of just about EC$1.5 billion dollars,” he said.  “However, over the same period the SIDF has spent approximately 1 billion dollars with approximately EC$500 million spent in the two years prior to the 2015 General Election, almost double the normal annual expenditure of the SIDF since its inception. Among those rather startling levels of expenditure, was the discovery that about $150 Million dollars was spent on miscellaneous grants and donations in the two years leading up to the 2015 General Election. Most unfortunately but not unexpectedly, the SIDF operations were just another example of the gross profligacy for which the last administration had achieved most notoriety.”

Dr. Harris noted that the Board was also informed that the SIDF operated for well over eight years “without by-laws and also without any formal internal process for feasibility assessments, return on investment analyses, and risk assessments, despite distributing vast sums of money which belonged to the people of St. Kitts and Nevis”.

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