The Tribune

BY FAY SIMMONS

TRIBUNE BUSINESS REPORTER

jsimmons@tribuneemedia.net

OPPOSITION leader Michael Pintard yesterday questioned how the Government could have transferred $700M in excess borrowing into the National Investment Fund while there is still no evidence that the fund's governing board was established or that the account receiving the money was opened.

Speaking to reporters, Mr Pintard said the Government has failed to demonstrate where the $700M in excess borrowing went, despite Finance Minister Michael Halkitis previously stating that the Government's excess borrowing had been transferred to the NIF.

“We see no evidence of $700m that the minister claim is in the NIF, but what we do know is that the government's own fiscal reports show that the NIF fund held $265.3M,” said Mr Pintard.

“In just three months, that balance had effectively disappeared, dropping to some $200,000.”

The NIF's $265.3M drawdown has previously come under scrutiny, with questions raised over the fund's safeguards and the Government's use of the money for airport infrastructure.

The Davis administration has argued that the fund will provide a mechanism for mobilising capital and supporting long-term national investments, particularly through infrastructure and public-private partnership (PPP) initiatives.

Mr Pintard, however, said the broader issue was how the Government could have moved the money into the NIF in the first place.

“We want to know by what authority did they move the money, and then they have to then show us: Do you have any account that would show $700M having ever been placed in the fund? And if so, how did you set up that account? Because you need a board of directors in order to do so, and again, we have no evidence that a board has ever been established or any fund has ever been opened.”

The FNM leader said Parliament's approval to borrow money did not itself give the Government authority to move those funds into the NIF.

“Because if you first put it in the consolidated fund, you've borrowed the money. You need parliamentary approval to take the money out of the consolidated fund and put it in the National Investment Fund.”

“So even if you move a resolution in Parliament to borrow funds, that does not give you the authority to put those funds wherever you like. You need an appropriation bill to do so, and we have no record of the bill.”

Mr Pintard's position echoes concerns he raised earlier this year over the Government's handling of the $700m in excess borrowing, when the FNM demanded greater transparency over the borrowing and the legal authority for transferring the funds into the NIF.

However, yesterday's comments placed greater emphasis on the mechanics of the alleged transfer, with Mr Pintard questioning whether the NIF had the governance structure or account necessary to receive the funds.

“We are unable to find any fund registered. We are unable to find a board that has the authority to set up the fund. We have not found any officials who sit on the board.”

Mr Pintard said he had also written to Central Bank governor John Rolle seeking clarification on the Central Bank's role in the matter and had copied the Auditor General on his correspondence.

He said the Government should identify where the money was held and what it was used for.

“We are also concerned that to date, no member of the government, of substance in terms of the Minister of Finance or the Prime Minister, has seen it necessary to answer the straightforward question: Why did you borrow the $700M? Where exactly is it? Since, in your own words, you've transferred it into the fund, which bank today is holding the fund? How were you able to transfer it if there is no board to first open the fund? Where have you stashed the money?”

“So this is not a political question. This is a financial question.”

Mr Pintard also challenged the Government's explanation that NIF funds were being used to support airport development, arguing that the NIF was intended to function as The Bahamas' sovereign wealth fund rather than as a substitute for the capital budget.

“I remind the public the NIF fund, and I sat in Parliament when it was approved, is really the sovereign wealth fund of the Bahamas, and so the sovereign wealth fund of the Bahamas was not designed necessarily to do capital works.”

“You have a capital section of the budget that address capital works, and so this discussion about having moved the funds, a portion of those funds to fund airport, flies in the face of what the NIF was designed to do, and it also contradicts what the government's own budget in the capital section of the budget said it intended to do during the financial period.”

Mr Pintard said the Government should identify the projects funded with the money and provide a full accounting.

“What has the government done with the $700M of excess borrowing? Where is that money? Who did they give it to? Can they release the names? Can they identify the projects?”

He added: “Can they even identify, even what they said went to the various airports, since we were told by them that these airports were funded by various sources already?”

The NIF controversy comes as the Government continues to face questions over the reported depletion of its $265.3M balance. Mr Pintard said the latest questions should be answered directly by the Prime Minister and Minister of Finance.

“The Prime Minister should be speaking. He should not be using or hiding behind anyone else. He should speak to this matter and do so urgently.”

Mr Pintard said the Government's failure to account for the money raised wider concerns about public finances.

“The Bahamian people have $700M they must pay back. The PLP has borrowed the money, and we don't know where the money is. They have stashed the money.”

“It can only be corruption. It can only be corruption that a government would not answer a question of that magnitude. Where is the $700M that you borrowed on our behalf that our children will have to pay back? That is the central issue.”