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Other Articles from The Villager

Does anybody ever listen to this man?


by Staff Writer
Business

 

Auditor General Junias Kandjeke says Government does not always act on his office’s recommendations.Kandjeke, whose office is seeking financial independence through an Audit Bill that will be presented in Parliament later this year, also says he would rather have councils bailed out than parastatals.

 

“We have a lot of inaction from our recommendations on local authorities. Yet, if they are not doing well, people flock to the capital because it’s booming. We have recommended on debt collection, infrastructural investment among others.

“True, not every recommendation is implemented.  Mine is to recommend. Government has its own priorities and that’s understandable considering the huge pool they have. I have recommended that to save MVA and enable them to meet its N$120m that they need per annum, they must increase the levy by 53 cents. Obviously doing so would increase fuel prices and affect food prices, something which Government would not want it that way. 

Recently, the Motor Vehicle Accident Fund (MVA) Chief Executive Officer Jerry Muadinohamba questioned the purpose of the AG “if Government has not been listening to its accountant”.

This after Government has seemingly dragged its feet following recommendations by the AG that the MVA requires between N$50-N$100m to remain functional. 

Last Wednesday, Kandjeke challenged Government to bail out the MVA. 

Most of the AG’s recommendations are left to the Parliamentary Standing Committee on Public Accounts which has the power to sanction different Government organs and push for the implementation of recommendations from the AG’s office.

“The other option we recommended on MVA is to increase the tourism levy, but still it will affect tourists coming to Namibia because other neighbouring countries do not have such high tourism levy. So Government rightfully chooses what it sees has less impact on its programs and priorities,” says Kandjeke.

Kandjeke says what has been lacking with Parliament despite the Standing Committee on Accounts is implementation, which follows the recommendations.

Last year, the AG’s Office produced 185 reports and according to Kandjeke, only the Ministry of Home Affairs put much effort and worked on the recommendations by improving services, such as introducing electronic passports and mobile vehicles for ID issuing.

“The worry is that those long queues are back at Home Affairs, why? Because there is no mechanism of implementation in Government.”

The Auditor General is worried by inaction on the recommendations sent to local authorities.

Most local authorities, if not all, have received a qualified audit opinion from the AG, which means that all is not in order and millions of dollars have not been accounted for despite some of them closing the year with an accumulated surplus.

“Failure to be accountable by local authorities is a let down to the electorate because whatever money the authorities get, is part of the political parties campaign manifestos. 

“So I urge leaders, political and traditional to make sure they do not leave recommendations from the AG to the CEOs alone. They should sit with our recommendations and get feedback as to why these things are happening,” Kandjeke further says.

He says he would prefer a situation where bailouts are not given to parastatals, giant companies that only use the money for bonuses and hefty salaries, but given to local authorities to invest in servicing land and selling it to the people. 

 

 

. . . and can he get financial independence?

 

The Auditor General’s Office is pushing for the financially empowering Audit Bill to be presented in Parliament later this year, as it seeks to enhance its independence from the Executive, The Villager has established.

This will be the third time the Auditor General’s Office is seeking independence after failed bids in 1989, 1993 and 2005.

Auditor General (AG) Junias Kandjeke this week confirmed that the draft bill is already out of Government’s hands, “and is being finalised by our legal drafters before going to Parliament”.

A State Finance Amendment Bill is expected to bring about the removal of the audit – the powers, duties and function—of the Auditor General from the State Finance Act through the proposed Audit Bill.

According to Kandjeke, the Audit Bill deals with the appointment and conditions of services for staff of the AG’s Office, as well as other administrative matters involving his office.

Namibia has a relatively comprehensive legal framework for transparency and accountability in the budget process and key provisions relating to the management of public resources derive from the Constitution and the State Finance Act of 1991.

Over the years, the relationship between Government and the Auditor General has been like external auditors vs. clients. But the Auditor General does not have financial independence.

The AG is invited to a budget hearing in which it may motivate its budget. Should the hearing not bring about a satisfactory selection, the Minister of Finance the right of final decision.

“Functionally, we are independent, but financially we are not.  Independence moves with the environment changes. As long as we are able to independently express out views, we will remain independent.  

“However, we are not independent when Government gives directives saying all positions in Government must be frozen yet we want positions to be filled to be able to do our job.  The fact that our recruitment is sanctioned by the Public Service Commission is crippling us, because according to international standards, it’s not enough. 

“Right now, we have a building which we got in the year 2000 for N$10m. No construction has ever taken place at that building because we have to wait for money from Government. Today, N$80million is wanted for that property to be developed. If we were having financial independence, we could have done so already,” said Kandjeke.

The Auditor General is appointed by Parliament on recommendation of the Head of State.

Retired deputy AG, Walter Barth said the move to make the office financially independent is long overdue; “There were several attempts to change the operations of the AG and on the international platform Namibia is considered fairly independent when it comes to the AG’s operations,” Barth said.

He further added that if the AG’s Office gets the opportunity to operate independently that would also improve their operations and give them the financial muscle to seek the services of qualified
chattered accountants.

In some instances, the AG’s office outsources independent auditing expertise to deal with the overwhelming amount of work. The first time the AG sought independence was in 1989 on the eve of independence, “but the South African Administrator General chose not to sign it into law but leave it to the new Government,” said Barth.
After independence in 1993, a committee made up of officials from the ministries of Justice, Finance and the Prime Minister’s office failed to agree on the move. Another attempt in 2005 failed to make the AG’s office independent.

The Deputy AG, Gomes Menette was buoyant that financial independence will improve their operations in the future.
“The bill will seek to give the Auditor General’s Office budgeting and recruiting powers,” he said.

At the moment, the Auditor General’s Office has no adequate skilled staff and this impedes on its performance such that audit reports are completed years after the financial year would have passed.
The AG’s office has no enforcement powers to push for the implementation of its recommendations.
 Currently, the AG’s role does not go beyond communicating and addressing findings and implementation is left to the management of the clients or the people running audited organisations. 

But this move will not make the AG’s office a parastatal, Kandjeke says, and neither will it give the office powers to enforce.

“The bill gives us a guarantee that the AG will not be influenced by Cabinet or Parliament. It will strengthen the independence of our operations from the Executive and the media. We cannot be outside the State because we have to be part of it. It will give us more value, integrity as an institution and avoid the system relying on an individual,” he said.

The various conditions of service of the Auditor General to secure independence include, special procedure for appointment, special procedure for removal, immunity from actions by others in its performance of duties, independence to frame work plans and the fact that the Auditor General is not a public servant. 

Further, it has powers to enforce or initiate enforcement action to secure access to needed records, which are not produced but it does not have power to seal documents and other related items considered necessary for audit and inspection; once fraud is established, matter is reported to police who confiscate the records.

NamPort is currently the only organisation where the Act stipulates that audits must be carried out to the satisfaction of the Auditor General.

The powers to perform these audits are mandated by the Section 25 of State Finance Act no. 31 of 1991.  The Auditor General does not discharge judicial functions. 

The AG can engage consultants and obtain professional services in conducting audit. The AG can report on acts that infringe upon State economic interests like mass embezzlement of state assets, serious losses and wastes. The reports on the findings are sent through Minister of Finance to Parliament. 

But it does not have any role on the disposal or the action taken on the audit findings. It does not present an interim report before rendering an annual report on the examination of the closing of accounts of the Federal, Provincial and local governments. 

In case of Financial Statements audit, the AG does not have the powers to amend accounts.