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Whose money? - Funds from incoming phone calls at centre of brewing controversy.
published: Tuesday | July 3, 2007
Tyrone Reid and Edmond Campbell, Gleaner Reporters
Conflicting views over the status of more than $28 million in legal fees that was paid to an attorney out of the Universal Access Fund in contravention of established government procurement guidelines, is at the centre of a brewing controversy.
On the one hand is Auditor General Adrian Strachan, who has maintained that all the money in the Universal Access Fund is public funds. On the other hand, Minett Palmer, the attorney-at-law who received the payments insisted that the money does not belong to the State.
"It is not a tax, which is why it does not go to (Ministry of Finance). It is not the country's money, the money belongs to the carriers. All the Fund does is administer it, it is still the carriers' money to spend on a project the carriers agree to, that is why the carriers are on the board," explained Ms. Palmer, who was a board member of the Universal Access Fund Company Limited, which manages the funds gained from the levy, when the payments were made.
On the contrary, Mr. Strachan was forthright with his views. "It is public funds. It is government revenue as described by the Financial, Administrative and Audit Act," he said.
The matter was raised by the Auditor General in his latest report. The report only covered the payments made between June 2005 and July 2006 to the tune of approximately $23.4 million for the provision of various legal and other services. However, Access to Information (ATI) documents showed that Ms. Palmer received payments up to January 2007.
Former Government Minister Colin Campbell, who previously chaired the Board of the company, signed the majority of the cheques, most of which were paid in US dollars. Ms. Palmer was also an advisor to Phillip Paulwell, the Minister of Industry, Technology, Energy and Commerce, who has portfolio responsibility for the Fund. Her contract ended in August, 2006. The Auditor General's report raised concerns about the nature of the agreement. "There was no evidence that a written contract existed setting out the deliverables and agreed rates. There was no indication that the selection of the firm, a partner of which was a member of the Company's Board of Directors, was done in the required competitive basis or the necessary approval of the National Contracts Commission and Cabinet obtained," read a section of the report.
It continued: "There was also no evidence that payments were made on the basis of deliverables provided in keeping with written terms of engagement. Given these breaches of the Government's procurement rules, I was unable to satisfy myself that the charges incurred were fair and reasonable".
At the same time, Ms. Palmer said that there was no conflict of interest because the Board of the company was aware of the agreement. While Mr. Strachan said he was relatively satisfied that there was no conflict of interest, he said that he still does not know if the country got value for money.
The Universal Access Fund Limited is a government entity, which collects a levy on incoming international calls to Jamaica. The revenue earned from the charges, which stood at $1.4 billion in July 2006, should go towards financing the implementation of the national e-learning project, which is designed to enhance the education process through the use of information technology.
Mr. Strachan's report charged that the manner in which the Fund was being managed was in breach of the country's Constitution. According to him, the Financial Administration and Audit (FAA) Act, requires that Government revenues collected should be paid forthwith into the Consolidated Fund unless some other Act provides otherwise. Mr. Strachan argued further that it was noted that contrary to these legal stipulations, the levy imposed on incoming international telephone calls was paid to the Universal Access Fund Company Limited.
"This arrangement improperly excluded parliamentary control over the use of these funds. The company was advised to bring funds derived from this levy in full compliance with the requirements of the Constitution and the FAA Act. The Ministry subsequently advised that legislative change would be sought to exempt the levy from being paid into the Consolidated Fund," the report stated.
published: Tuesday | July 3, 2007
Tyrone Reid and Edmond Campbell, Gleaner Reporters
Conflicting views over the status of more than $28 million in legal fees that was paid to an attorney out of the Universal Access Fund in contravention of established government procurement guidelines, is at the centre of a brewing controversy.
On the one hand is Auditor General Adrian Strachan, who has maintained that all the money in the Universal Access Fund is public funds. On the other hand, Minett Palmer, the attorney-at-law who received the payments insisted that the money does not belong to the State.
"It is not a tax, which is why it does not go to (Ministry of Finance). It is not the country's money, the money belongs to the carriers. All the Fund does is administer it, it is still the carriers' money to spend on a project the carriers agree to, that is why the carriers are on the board," explained Ms. Palmer, who was a board member of the Universal Access Fund Company Limited, which manages the funds gained from the levy, when the payments were made.
On the contrary, Mr. Strachan was forthright with his views. "It is public funds. It is government revenue as described by the Financial, Administrative and Audit Act," he said.
The matter was raised by the Auditor General in his latest report. The report only covered the payments made between June 2005 and July 2006 to the tune of approximately $23.4 million for the provision of various legal and other services. However, Access to Information (ATI) documents showed that Ms. Palmer received payments up to January 2007.
Former Government Minister Colin Campbell, who previously chaired the Board of the company, signed the majority of the cheques, most of which were paid in US dollars. Ms. Palmer was also an advisor to Phillip Paulwell, the Minister of Industry, Technology, Energy and Commerce, who has portfolio responsibility for the Fund. Her contract ended in August, 2006. The Auditor General's report raised concerns about the nature of the agreement. "There was no evidence that a written contract existed setting out the deliverables and agreed rates. There was no indication that the selection of the firm, a partner of which was a member of the Company's Board of Directors, was done in the required competitive basis or the necessary approval of the National Contracts Commission and Cabinet obtained," read a section of the report.
It continued: "There was also no evidence that payments were made on the basis of deliverables provided in keeping with written terms of engagement. Given these breaches of the Government's procurement rules, I was unable to satisfy myself that the charges incurred were fair and reasonable".
At the same time, Ms. Palmer said that there was no conflict of interest because the Board of the company was aware of the agreement. While Mr. Strachan said he was relatively satisfied that there was no conflict of interest, he said that he still does not know if the country got value for money.
The Universal Access Fund Limited is a government entity, which collects a levy on incoming international calls to Jamaica. The revenue earned from the charges, which stood at $1.4 billion in July 2006, should go towards financing the implementation of the national e-learning project, which is designed to enhance the education process through the use of information technology.
Mr. Strachan's report charged that the manner in which the Fund was being managed was in breach of the country's Constitution. According to him, the Financial Administration and Audit (FAA) Act, requires that Government revenues collected should be paid forthwith into the Consolidated Fund unless some other Act provides otherwise. Mr. Strachan argued further that it was noted that contrary to these legal stipulations, the levy imposed on incoming international telephone calls was paid to the Universal Access Fund Company Limited.
"This arrangement improperly excluded parliamentary control over the use of these funds. The company was advised to bring funds derived from this levy in full compliance with the requirements of the Constitution and the FAA Act. The Ministry subsequently advised that legislative change would be sought to exempt the levy from being paid into the Consolidated Fund," the report stated.
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