Wednesday, July 6, 2022

Board overlooking oil fund protects country from whims of lone official, says Ali in public message

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Guyana’s President, Dr. Irfaan Ali on Tuesday put forward an impassioned case in support of the Natural Resources Fund (NRF) Bill 2021 which his administration laid in Parliament this month, saying key provisions in the document takes away extraordinary powers that were vested in the minister of finance and instead passes most of this onto a board.

Referring to the NRF framework that was developed by the previous administration, Mr. Ali said not only did they not have a board, but they also vested all the power that would have been in a board to one individual—the minister of finance.

So, we sought to remove that in the new Act,” he said in a public commentary to the nation, pointing out that the primary role of the board will be to guide the investment of the fund.

“So, the old Act did not allow for any of this. As a matter of fact, it was the soul…authority of the minister of finance doing all of this; determining the fiscal sustainable amount, determining the economic sustainable amount that was in his opinion the best possible framework or scenario for Guyana.”

The government has proposed the establishment of a Board of Directors in the new bill, which it says is necessary to provide regular management and oversight. The Ali-led administration has argued that the powers vested in the board would create a new dispensation that prevents political overreach into the operations of the Fund.

“So, when we talk about the powers that existed in the old Act, we have to speak about the powers that was vested in a singular individual—the minister of finance. So, what we sought to do was to remove the extraordinary powers that was vested in minister of finance by addressing these flaws,” he stated.

Critics of the new measure have said the bill is silent on the process for selecting directors of the board, and that this would give the People’s Progressive Party Civic government an opportunity to install supporters of the administration, since it is the President who appoints these officials.

But Mr. Ali lashed out at these claims, asserting that his government was given a clear mandate by the Guyanese people at the March 2020 elections, and he has every intention of delivering on their expectations.

“The president will not just wake up and collect a few men and women and put them on a board and say this is the Board of Directors,” he stated. “The bill makes it very clear; the minimum qualifications of board members are stipulated in the law and the membership of the board is required to be published in the Gazette.”

He said the composition of the board will be publicly known and the country has his assurance that its establishment will be in keeping with the law.

“The shareholders in this country are the electorate. The electorate elect the government, elected the president, so who should appoint this board? Who should appoint the board? The government was elected, I was elected as president by the shareholders, the citizens of this country. Are you saying that those persons who appointed the government through their vote did not repose the confidence in them?” Mr. Ali asked.

Transparency and Accountability

The Guyanese head of state said new proposed legislation explicitly requires the minister of finance to publish information in the official gazette on all receipts into the fund within three months and table this information in the National Assembly.

“Every single cent of revenue that comes into the fund has to be published, but much more than this, he then has to table that in the National Assembly so that the entire Parliament which includes all members of the opposition, the media, the government would be there…” Mr. Ali said.

He reminded that failure to do this will result in harsh penalties that were not previously in place.

“The consequence will be three to ten years imprisonment. So, not only are we setting out the principles, enhancing transparency, but we are willing to put the harshest of penalties because we do not intend to keep any information in relation to the management of the Natural Resource Fund away from the public,” he pointed out.

The country’s finance ministry in a statement on December 17 said there is an immediate need for transformative investments, and that the first year of the life of the Fund, as an exception, presents pressing development needs which should be financed by the country’s resources, instead of debt. It said the Bill promotes prudent management of Guyana’s natural resources, for the benefit of both present and future generations.

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