CASE STUDIES PCJ

Page 92 Compendium of a Review of Aspects of Petroleum Corporation of Jamaica

(PCJ) and a Comprehensive Audit of Petrojam Limited December 2018

canteen designs, along with a net price increase of 17.3 per cent on the accepted changes. This led to an

addendum dated January 30, 2017, which provided for a $4.5 million increase in the contract value to

$27.1 million. PCJ paid the Firm $10.76 million for the conceptualization phase and obtained the related

documents and subsequently decided to undertake the project in manageable phases as it did not have

the financial capability to pursue the revised scope. PCJ, however, did not recover the mobilization

advance of $2.26 million paid to the Firm (Table 28).

Table 28 General Services and Upgrading of Existing Services and New Works

Particulars Initial Contract ($)

Revised Contract ($)

General services and upgrading of existing facilities (30%)

3,403,500 3,403,500

New Works (30%) - 3,165,000

Variation - 1,331,775

Sub-Total 3,403,500 7,900,275

Reimbursables - 592,010

Sub-Total - 8,492,285

Total paid to Contractor - 10,756,785

Overpayment - 2,264,500

Mobilization Advance (10%) - 2,264,500

Source: PCJ Data

Auditor General’s Department – Information Technology Audit Report of FSL 14

(d) The Chairman of the Board and the Head of the Procuring Entity shall not sit on the Procurement Committee.

2.6 We however, found that FSL does not have an appropriately constituted Procurement Committee in accordance with the GoJ Procurement Procedures outlined above. The functions of the Procurement Committee were instead being undertaken by a sub- committee of the Board+of+Directors">Board of Directors – the Technical and Research & Development sub- committee. This sub-committee is made up entirely of Board members including the acting Managing Director. We were able to identify procurements totalling US$ 6,025,816.64 and JA$100,126,659.71 that were approved by this committee over the last three years [2008- 2010].

2.7 This level of involvement by the Board and the MD in the procurement process may lead to possible conflicts of interest especially in relation to the MD since certain procurements will require his specific approval and authority. FSL should therefore reconstitute its Procurement Committee in keeping with the provisions of the Government of Jamaica Handbook of Public Sector Procurement.

2.8 The management of FSL subsequently informed us that they have recognized the breach and will take the necessary steps to establish a Procurement Committee in accordance with the procurement guidelines.

FSL Issues Multi-million Dollar Employment Contracts without the Ministry of Finance’s Prior Approval 2.9 Fiscal Services Limited, as a public body, is subject to the directions of its portfolio ministry

as well as to the provisions of the Public Bodies Management and Accountability (PBMA) Act. Section 20 of the PBMA Act requires that in relation to emoluments the board shall act in accordance with such guidelines as are issued from time to time by the Minister responsible for the public service. Additionally, FSL’s Human Resources’ Policy Manual requires that for fixed term employment contracts at the level of Department Head and above, approval must first be obtained from one of the following:

a. Portfolio Ministry; b. Ministry of Public Services; c. Attorney General.

2.10 We found that despite having a formal policy and other guidelines relating to fixed term

employment contracts, FSL was guilty of engaging persons on fixed term employment contracts without the prior written approval of the Ministry of Finance and the Public Service (MoFPS). We noted the engagement of at least seven individuals at senior levels within FSL on fixed term employment contracts without the prior approval of the Ministry of Finance and the Public Service costing approximately $33.7M per annum.

6 Auditor General’s Department Performance Audit Follow-Up – National Environment & Planning Agency September 2016

Executive Summary was published in 2011, the 2013 SoE report is yet to be published. NEPA advised that the 2013 report was delayed due to inadequate funding support from the Government of Jamaica.

3. NEPA made greater use of its enforcement tools to increase compliance. Over the 5-year period

April 2010 to March 2015, enforcement activities totalled 3,604 compared to 922 for the previous assessed period. Further, NEPA’s record keeping of enforcement actions improved when compared to the prior audit period.

4. NEPA’s response to environmental threats reported by the public improved significantly. NEPA

investigated 90 per cent of complaints during the period April 2010 to March 2015, compared to 42 per cent reported in the prior audit report.

5. NEPA’s monitoring targets were not appropriately aligned with the number of approved

permits/licences. Further, NEPA did not conduct the required monitoring on a timely basis to ensure that approved activities were being carried out in accordance with the terms and conditions of the permits/licences. For example, we found that for 60 permits/licences, there were significant gaps of up to 5 years between the time of licence issuance and the conduct of the first monitoring visit. We also observed that NEPA did not strictly adhere to its procedures in relation to the periodic monitoring of permits/licences.

6. Model B Executive Agencies are required to earn between 40 per cent and 90 per cent of

budgeted expenditures from fees. Total fees collected by NEPA for the period 2010/11 to 2014/15 averaged 11.1 per cent of actual expenditure for the 5-year period. However, NEPA processes planning and subdivision applications for the Local Authorities, from which it earns no revenue and for which the expenditure is not recoverable. As a consequence, NEPA continued to rely heavily on Government subvention, which accounted for an average of 94 per cent of total expenditure.

17

Section 2:

Executive

Summary

EXECUTIVE SUMMARY

2.1.1 The Report of the Auditor General of Jamaica is submitted to the Speaker of the House+of+Representatives">House of Representatives in accordance with Section 122 of the Constitution of Jamaica and Section 29 of the Financial Administration and Audit Act. My annual report embodies the results of the examination of the accounts and financial transactions of various entities. It contains the findings arising from my audits of the accounts and financial transactions of Accounting Officers and Principal Receivers of Revenue for the financial year ended 31st March, 2012. Reference is also made to the accounts and transactions of subsequent or previous financial years, as well as the accounts of local government agencies, other statutory bodies and government companies where considered necessary for the information of Parliament.

2.1.2 Examination of the accounts and financial transactions of the Government is

conducted in conformity with Section 122 of the Constitution and Section 25 of the Financial Administration and Audit Act. Section 25(1) of the Act states as follows:

“The Auditor General shall, in performing his functions under Section 122(1) of the Constitution ascertain whether in his opinion-

a) the accounts referred to in that section are being faithfully and properly kept;

b) the rules and procedures framed and applied are sufficient to secure an effective check on the assessment, collection and proper allocation of the revenues and other receipts of the Government;

c) all money expended and charged to an appropriation account has been applied to the purpose for which the provision made by Parliament was intended and that any payment of public money conforms to the authority which governs it, and has been incurred with due regard to the avoidance of waste and extravagance”…

Committee">Public Accounts Committee

2.1.3 The Committee">Public Accounts Committee of the House+of+Representatives">House of Representatives is a standing bi- partisan committee chaired by the opposition spokesman on Finance. Under the Standing Orders of the House, all accounts of government agencies and annual reports of the Auditor General tabled in the House are automatically referred to the Committee. In examining the reports of the Auditor General, the Committee calls upon Accounting Officers, other heads of agencies and their support staff to explain their stewardship of the public affairs and resources assigned to them. It seeks to identify the causes for weaknesses mentioned in the Auditor Generals reports, obtain information on what is being done to rectify the situation, and

JAN. 15, 2021] PROCLAMATIONS, RULES AND REGULATIONS 5

4.—(1) A person seeking to enter Jamaica at any time during the period from January 15, 2021, to April 15, 2021, who is ordinarily resident in Jamaica shall, on being permitted to enter Jamaica, be required to remain in quarantine, in isolation from other persons, in accordance with—

(a) a home quarantine order; or

(b) a Government facility quarantine order,

issued to the person by a Medical Officer (Health).

(2) A home quarantine order under this paragraph shall be in the form set out as Form B of the First Schedule.

(3) A person to whom any of the requirements of this paragraph applies—

(a) shall comply with all applicable directions given, and requirements imposed, by an authorized officer;

(b) shall not attend for work at the person’s place of employment (but may work from home), during the period that the person is required under this paragraph to remain at the person’s abode or place of residence or in quarantine, and the period during which the person does not attend for work, pursuant to this sub-paragraph, shall not be counted against the leave entitlements of the person if the person and the person’s employer agree that the period should not be so counted; and

(c) shall comply with the provisions of paragraphs 9 to 12 and with all applicable directions given, and requirements imposed, in respect thereof by an authorized officer.

5.—(1) This paragraph applies in respect of a person—

(a) who is not ordinarily resident in Jamaica;

(b) who seeks to enter Jamaica as a tourist; and

(c) whose intended abode or place of residence in Jamaica is at a place within the area of the Resilient Corridor described in the Second Schedule.

(2) Where the person seeks to enter Jamaica at any time during the period from January 15, 2021, to April 15, 2021, the person shall, prior to boarding the vessel destined for Jamaica, provide at the port of departure such COVID-19 test, in respect of that person, as may be specified by the Ministry with responsibility for health and wellness.

(3) Subject to sub-paragraph (6), a person to whom this paragraph applies and who is permitted to enter Jamaica shall—

(a) in accordance with a stay in the Resilience Corridor order issued to that person, remain at that person’s abode or place of residence

Form B,

First Schedule.

Procedure following risk assessment of person who is not ordinarily resident in Jamaica, visiting as a tourist in the Resilient Corridor.

Second Schedule.

Procedure for entry of person ordinarily resident in Jamaica.