By KHRISNA VIRGIL

Tribune Staff Reporter

kvirgil@tribunemedia.net

THE operations of the 52-week job initiative programme, implemented under the previous Ingraham administration, have been found “severely deficient” which created an environment highly vulnerable to fraud, an audit of the programme has revealed.

The 2012/2013 report, executed by Auditor General Terrence Bastian, revealed that the Ministry of Finance did not undertake any on-site inspections of participating businesses to determine their legitimacy.

In addition, the ministry did not verify whether those businesses had current business licenses or whether their National Insurance Board contributions were current, the report said.

“This exposed the possibility,” the report read, “that some entities were operating illegally and uncollected revenue may be due to the government and the (National Insurance) Board.”

A litany of other deficiencies were reflected in the report, with the auditor noting this came as a result of the Ministry of Finance’s inability to effectively facilitate the programme’s operations.

The report noted that in one instance, a worker was able to pocket more than $2,000 in continued payments despite leaving the job programme for the private sector.

According to Mr Bastian, the Ministry of Finance did not adequately maintain accounting records of the payments made under the job plan. He said auditors were not provided with evidence that monthly expenditure reports and reconciliations were prepared.

“Tracking expenditures was a cumbersome exercise and as a result this increased the risk of understating expenditures, inaccurate reporting and budgetary inefficiencies,” the report noted. “The budget section at the ministry assumed direct responsibility for managing the entire programme. This responsibility, coupled with the section’s existing duties and their inexperience in this area, made it more difficult for this unit to efficiently and effectively execute this assignment.

“This reality created the potential for additional risks associated with manpower shortages, inadequate monitoring procedures and overall lack of independence in programme execution.”

The programme had an initial budget of $25 million, which was approved in the 2011/2012 fiscal year. However, the programme’s cost ballooned to $48 million with supplementary funding of $23 million allocated in June 2012. While the Free National Movement has touted the initiative as a major success, the auditor general noted that only 239 people of the 4,100 who participated were permanently hired.

The report notes that 16,000 people throughout the Bahamas originally enrolled in the programme.

Participants received a weekly stipend of $210 with the exception of the Bahamas Technical and Vocational Institute (BTVI) participants. Those people received a weekly stipend of $150.

Family Island operations

The 52-week programme was not limited to New Providence, but extended throughout several Family Islands. In the audit, Mr Bastian noted issues with administration in these areas. This was because there were no standardised operation procedures implemented, the report said.

Up to the time of the audit, officials were unable to confirm whether unused funds allocated for Family Island use were returned to the Public Treasury.

In Grand Bahama, auditors could not find any proof that companies that participated were legitimate.

“A high percentage of the time sheets had only a signature and no official company stamp,” the audit report said.

“No documentation was on file to verify that inspections were carried out by the ministries responsible for the programme to ensure that participating companies were legitimate and participants worked for the hours paid.”

Moving forward, it was recommended that surprise inspections be carried out to ensure legitimacy of companies and that those enrolled in the programme actually worked for the periods paid.

Auditors found evidence of abuse in Eleuthera when it was discovered that a participant who voluntarily left the programme to take up work at private company, continued to collect cheques totalling $2,210.91. The report said the participant was requested to return the funds. However, the report said there was no evidence that the money was returned.

Mr Bastian recommended that the appropriate actions be taken to collect the outstanding funds.

In the Berry Islands, the auditor reported that taxpayer dollars in the form of a cheque was issued for the job readiness programme in the name of an officer from the Ministry of Finance, as the island administrator was not available to pay workers.

The programme ended in Grand Bahama on April 5, 2013 and in New Providence on April 12, 2013.

The programme was cancelled nearly a year after the Progressive Liberal Party took office. Prime Minister Perry Christie has heavily criticised the 52-week programme, justifying its cancellation by saying many participants did not show up for work, but were still paid.

However, during his budget communication last week, he announced that his administration will institute an apprenticeship programme with the private sector and allocate $20m to arrest the high rate of youth unemployment.

The audit was tabled in the House of Assembly yesterday. House Speaker Dr Kendal Major has ordered that it be passed on to the Public Accounts Committee for review.