THE Ministry of Education.
By KHRISNA RUSSELL
Deputy Chief Reporter
krussell@tribunemedia.net
A DAMNING report from the Auditor General’s probe into the Department of Education has uncovered collusion among employees to defraud the government of nearly $450,000 by manipulating a system for stipends and honoraria.
The report covered the period from July 1, 2014 to February 28, 2018, and was sent to the Ministry of Education in September last year but not tabled in the House of Assembly.
While a House official confirmed the report is expected to be tabled tomorrow, Education Minister Jeff Lloyd told The Tribune yesterday he had no knowledge of it.
Meanwhile, one official said there was a “shake-up” at the ministry in the aftermath of the report’s findings.
During this special probe, Auditor General Terrance Bastian said a team observed what appeared to be several irregularities perpetuated by staff members using an array of honoraria codes.
The report defines honoraria as being granted to officers who are required to perform extra duties in addition to their normal duties for a specified period.
While the director approved these payments, there was no accompanying formal approval from the Ministry of Finance, Ministry of Education and the Ministry of Public service as is required. This meant there were no project justification letters including cost, financial clearance, virement of funds and appropriation transfer warrants provided by the Department of Education.
A virement is an administrative transfer of funds from one part of a budget to another.
“Since staff were able to perpetuate a fraud to the tune of $448,230.68 using the honoraria description it would be reasonable to ascertain that other unethical uses of other codes could have been used,” the report dated September 12, 2018 read.
In one instance an assistant accountant received 43 honoraria payment of $125,505.82 in 44 months. At a separate time another accountant received $61,113.18 in 32 instalments in 20 months while those with lesser jobs including a general service worker received nine honoraria payments of $12,650 in 17 months.
There were at least 12 instances where this happened.
Auditors further noted a finance officer was signing on behalf of the head of department and authorised ten virements from the salary block totalling more than $2m for the 2016 and 2017 fiscal years.
There were also instances where auditors found that individual staff members received over $10,000 and as much $125,505.82 in honoraria payments in “unreasonable” time periods. A head of department also authorised $1.3m over two years.
“The department has an authorised budget amount of $4,000 per annum for the honoraria line item, which amounted to $16,000 for the period under audit,” the report read.
“This amount was consistently exceeded by the department and resulted in an overall expenditure of $448,230.68.
It further noted: “The $432,230.68 in excess of the approved budget was derived from the accounting department utilising 18 item codes to pay themselves as well as other staff members with requisitions stating ‘payment for services rendered.”
When each year was analysed, there was significant cost over run. In 2014/2015 there was an excess of $5,055; 2015/2016 saw a difference of $73,131.38; 2016/2017 $252,745.83; 2017/2018 $101,298.47.
While the report does not name employees, it assigned letters to eight officers two of which received large cheques for $76,063.43 and the other $20,850 respectively. Auditors ultimately found that between these two officers $24,900 and $20,350 could not be accounted for.
In six of the instances there were no signatures for the receipt of cash.
Auditors found that these payments were processed a number of ways including as honoraria, exam supervision fees, school quality assurance programme, security services contract, special employment projects, fees and other charges, and the national lunch programme among other things.
“It was further noted that there were payments made to some staff members that did not correlate to processed requisitions for example staff members received less or more than the amounts allocated on the requisition.
“An accounting staff member from another agency was allowed to perform accounting services during overtime hours and was paid $26,060 in honorarium payments for services rendered.”
The report said the majority of documentation received was incomplete meaning there were no minutes, justification letters, time sheets ad evidence of receipt of funds, adding one staff members receive $7,600 in cash for lifting and moving boxes.
In all, 93 requisitions were missing from the support presented for audit inspection.
“Payments related to these requisitions amounted to $109,890.37.”
Requests for honoraria should be submitted to the permanent secretary in the Ministry of Public Service for approval. These requests are to be accompanied by a definition of scope of work; duration of the project, level of responsibility or expertise or role and position; hours or work either during or after normal work hours, the proposed fixed payment amount; and availability of funding in the relevant ministry or department budget.
In some cases honoraria can be granted for special projects and may be referred to Cabinet for approval.
A stipend, according to the report, is a predetermined amount of money that is provided periodically to help offset expenses. They are often provided to those who are reassigned to assist in another government agency, non-government officers and individuals no on a government agency payroll.
In the completion of this special probe, the Auditor General made several recommendations including immediate discontinuation of officers receiving cheques in their name in order to pay other officers in cash for services rendered.
He said once a budget is approved by Parliament, ministries and departments are only authorised to spend money consistent with the final appropriations for each line item.
This should be supported by executive management within the Department along with budget analysts in the Ministry of Finance reviewing significant escalations above the approved budget to ensure spending is appropriate.
Absence of this kind of continuous oversight the report said could cause malfeasance in other service related payments without the knowledge if responsible parties.
“Since staff were able to perpetuate a fraud to the tune of $448,230.68 using the honoraria description it would be reasonable to ascertain that other unethical uses of other codes could have been used.”
The report also said: “We noted there are opportunities for improvement in strengthening the management of many areas with the DOE. Management has to ensure that the DOE has the appropriate level of skilled staff to achieve its goals in order to maintain a sound system of internal controls.
“Strong internal controls require continuous monitoring by management throughout the accounting process. This dictates that duties are appropriately segregated across the accounting staff to minimise the opportunities for collusion in the purchasing process.”
“Excessive honoraria payments in unreasonable and unrealistic time periods lends to overarching concerns relation to how the remuneration of $448,230.68 was determined. Management should ensure that there are documented measurements for all requests for overtime type payments.”
The report went on to caution that although it was clear collusion occurred in manipulating the system around issuing honoraria payments, management should not allow trust to negate its role of providing oversight.
Last year two Ministry of Education employees were charged in a Magistrate’s Court with defrauding the ministry of nearly $7,000 in salaries over a five-month in July 2017.
A former chief clerk at the ministry doctored overtime records so a friend could get a pay increase was ordered to serve three months in prison for her crime.
Paulette Wilson, 60, doctored pay sheets for her longtime friend Andrew Bridgewater, increasing his take home pay from $130 per week to $691 weekly, resulting in Bridgewater being overpaid $6,657.12 between October 2015 and March 2016.
Bridgewater was sentenced to one year in prison for fraud by false pretences and conspiracy to commit fraud by false pretences.
Comments
bogart 5 years, 10 months ago
WE NEEDS TO BESTOW SOME OF THE NATIONS HIGHEST HONOURS ON DESE AUDITORS......EXCELLENT....KEEP UP THE EXCELLENT WORK...!!!!!!!!
tell_it_like_it_is 5 years, 10 months ago
Now we know why they can't find supplies to give the students to help them improve the D average!
The Department of Education headquarters have a lot of house cleaning to do! So many crooks taking things under the table - it ain't even funny!
TheMadHatter 5 years, 10 months ago
So we have people in Government with take-home pay of $130/week and we expect no theft? I thought slavery was outlawed in this country. No?
Naughtydread 5 years, 10 months ago
Someone told them to work for the government ay? People like you are the problem with this country. Bunch of entitled, uneducated, lazy people who feel as if they are doing you a favor when they are actually just doing their job. The PLP created a nation of ignorant entitled bums.
TheMadHatter 5 years, 10 months ago
NaughtyDread - you are right. Nobody probably told him to work for $130/week, but likely not finding any better job he decided to swallow the crumbs off the table. Bahamians, especially women, do a lot of "swallowing" in this country just to barely survive. Unfortunately, your rose coloured glasses keep you unaware.
InaugaBahamas 5 years, 10 months ago
It should "READ" his take home pay "INCREASE" by $130 per week.
DDK 5 years, 10 months ago
The Nation has an alarming number of light-fingered civil servants. The true percentage would probably be rather shocking. Wonder if they feel they are given a nod from those in Cabinets?
DDK 5 years, 10 months ago
"A former chief clerk at the ministry doctored overtime records so a friend could get a pay increase was ordered to serve three months in prison for her crime." These minimal sentences from the bewigged group are a mere slap on the wrist. It is always amazing to notice the difference in fines/prison time meted out to Bahamian and Haitian bothers and sisters as opposed to foreigners from, say the U.S., Canada, or Europe.
ohdrap4 5 years, 10 months ago
i do not think it is what is reported.
when things unravel, it will show that the heads of dept had authorized stipends regardless of budget.
sometimes people work positions with stipends for years without pay until they quit or demand a lumpsum or receive a back pay dating back several years,
hrysippus 5 years, 10 months ago
The people in charge of giving our children education, . . .. .. . Shaping the future citizens that gonna be making up our nation. . . .
Are busy lying, cheating and stealing just as much as they can, . . . . . … . Thinking this alright because they taking from "the man". . . . . Our children learning from these crooks how best to lie and cheat, . . . . . The ones who learn the best could earn a future cabinet seat. . . . .. The country in the meanwhile swirling quickly down the drain, . . . . . . . The corrupted civil servants casing the treasury much strain. . . …. … And greedy union leaders will say it's not our members fault, . . . . And we calling out a strike if try this entitlement to halt. . . . . ..
sheeprunner12 5 years, 10 months ago
Do not mix up Education HQ untrained or seconded PSC line staff ............ and professional trained teachers. They are two different groups.
geostorm 5 years, 10 months ago
@hrysippus, you have said it so well. This is why I dislike unions and their leaders. They defend their members and the nonsense that they do. Meanwhile, no one wants to take responsibility for the poor shape our country is in. We the PEOPLE have done this to ourselves.....we have stolen from, lied to and cheated ourselves for many years and felt that this was acceptable. How else can the government make up for all these shortfalls? We have to be taxed (VAT), charged for services like healthcare and squeezed for every minimum wage dollar that we make.
ThisIsOurs 5 years, 10 months ago
I suspect een nuttin change anywhere. Just a different set of completely unqualified friends being appointed to top posts. Just look at finance. It's inexplicable, all those big time appointments, but when the Big people put question to the PM he have to go grabbing consultants from all over the place to answer
TalRussell 5 years, 10 months ago
Yes, no - on the day big news splashed over the alleged petty money sized couples hundreds dollars Junkanoo telephone captured bribing - even without any prior kinds knowledge - I had posted redirect paying much closer attention those comrades in and around government manipulating how PeoplesPublicPurse's monies in the hundreds thousands which could very well be disappearing.Yes, no?
sealice 5 years, 10 months ago
So this is what Fitzy was doin besides telling the people in Marathon to GF themselves over their water pollution issues? He was aiding and abetting theft as well as ruining the lives of an entire constituency....
stoner 5 years, 10 months ago
It is a shame to see such stealing going on in the different govt departments. There has to be better controls and more auditing going on regularly and not just once a month.People who steal, know how to steal but they must have an accomplice to do it.The audit controls are too relaxed and employees who work together and know each other personally seemed to trust too much.
Well_mudda_take_sic 5 years, 10 months ago
Not one person will be charged with a crime and face the possibility of doing some hard time. And that's why outright theft has become an uncontrollable free-for-all in every government corporation, department and agency. The thieves know they will not be held accountable for their crimes and therefore have absolutely no reservation about stealing whatever they can whenever they can. Honest and hardworking Bahamians are being taxed to death to support all massive system of thievery throughout government, perpetrated on a daily basis by the most senior government officials right on down through the ranks. The likes of Frank Smith (Snake's son-in-law), Shameless Shane Gibson and so many others like them are laughing at all of us. And to think so many of you were duped by Minnis into believing a government led by him would be different. Instead all we hear about now are crimes being identified everywhere within government without any consequence or penalty whatsoever for the perpetrators. Perhaps we would all be better off in not knowing about all of these crimes since Minnis and our corrupt law enforcement authorities, and equally corrupt judicial system, are all obviously unable or unwilling to punish the guilty in any significant way. Yep, we're going to need to pay a much higher VAT rate, a much higher national insurance contribution rate, much higher light bill rates, much higher vehicle gasoline taxes and a whole hell-of-a-lot more fees and other taxes of every kind imaginable in order to support a government so heavily laden and widely infested with thieves. LMAO
TalRussell 5 years, 10 months ago
Yes,no ma comrades, walk out a store without making pit stop at cashier pay that Oh Henry tucked under ya clothing - you just might be arrested upon exit and sent for year or 3 years forced confinement up at Fox Hill. Yes, no, this is kinds incarnation injustice outlook some we differ on with Justices positions that all fine we justice deliverance.
birdiestrachan 5 years, 10 months ago
Why is the audit done for four years, instead of each year??
Economist 5 years, 10 months ago
Birdie, you crack me up!
SP 5 years, 10 months ago
This is mostly smoke, mirrors, and steaming bullshedo! MOE has, and always had one of the largest budgets of all ministries.
$450k is nothing compared to the unaccounted for $millions that have been disappearing from MOE for decades!
Truth be told, if the auditors even remotely tried, they would easily find a massive, loosely -organized, crime ring at MOE that has been consistently defrauding the treasury across the political divide for decades.
The good news is the auditors are finally allowed to do their jobs in the best interest of the country, and we can only hope the Minnis administration has the BALLS to allow the guilty to face justice!!!
BONEFISH 5 years, 10 months ago
That scam was going on for years.The media needs to find out who ordered the audit,the recommendations and subsequent actions.The media needs to step their game up,investigate and stop simply printing what is given to them.
Greentea 5 years, 10 months ago
If the government, or media are not willing to NAME and SHAME these people- this is just sensational foolishness. Aint nuttin will change because there are no real consequences for wrongdoing.
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