Tag: illegal expenditure

Over 100 police bicycles unassembled in warehouse: audit

Over 100 bicycles purchased for police use in 2009 were left unassembled in a warehouse, according to the audit report of the Ministry of Home Affairs for 2010 made public last week. The report flagged several cases of illegal and wasteful expenditure by the Maldives Police Service (MPS).

The audit found that 500 bicycles were procured in 2009 for MVR1.4 million (US$90,791) and paid for in 2010, while the required funds were not allocated for the vehicles in either the 2009 or 2010 police budgets approved by parliament.

“Of the purchased bicycles, 300 were sent to police stations in the atolls,” the report stated. “When [the Auditor General’s Office] checked on 5 September, 2011 to see if the 200 bicycles that should be in Male’ were there, it was discovered that 111 bicycles were kept in boxes in various warehouses while 89 assembled bicycles were left unused in warehouses.”

It added that six of 10 bicycles sent to Haa Dhaal Kulhudhufushi were also left unassembled.

Since the bicycles were left unused in warehouses, the audit concluded that “it could not be considered that these 500 bicycles were bought for police use,” adding that the expenditure was “wasteful” as the funds could have been used for other purposes.

The Auditor General therefore recommended putting the bicycles to use and holding those responsible for the procurement accountable under articles 47 and 48 of the Public Finance Act for violation of the law.

On March 30, 2010, police unveiled a new fleet of bicycles to be used for patrols as part of the previous administration’s plans to achieve carbon neutrality.

Following the publication of the audit report last week, a police spokesperson told local media that the bicycles would be used in the future.

The police media official noted that bicycles were used for patrols during November’s SAARC summit in Addu City.

Violations of public finance law

Among other cases highlighted in the report, the audit found that a private company was hired to construct a nine-storey building at the police Iskandharu Koshi compound for MVR67.2 million (US$4.4 million) on July 19, 2006 – without a publicly announced bidding process through the tender board.

The contract was awarded under the administration of former President Maumoon Abdul Gayoom.

The audit found that the company was paid MVR92.7 million (US$6 million) for the work, 37.87 percent in excess of the agreed upon sum.

The report noted that that the payment was in violation of public finance regulations, which stipulates that additional payments should not exceed 10 percent of the contracted amount.

Moreover, while the contracted period for the construction work was 18 months, the audit found that the Maldives Police Service approved an extension of a further 35 months.

The audit concluded that the extension was dubious and that police were culpable for the long delay.

The Auditor General therefore recommended that the responsible officials be held accountable and that the case should be further investigated by the Anti-Corruption Commission (ACC).

Moreover, also in 2008, a private company was contracted to build the police tow yard for MVR995,103 (US$64,533) without a public bidding process, which is required for government contracts exceeding MVR25,000 (US$1,621).

The audit also discovered that MVR1.6 million (US$103,761) was paid to contractors in violation of public finance regulations requiring approval from the President’s Office.

In August 2010, the audit found, police paid MVR80,000 (US$5,188) to a chief inspector as compensation for his damaged motorcycle, which was set on fire on August 2. The police executive board approved the payment as the price of the damaged motorcycle.

However, auditors found that the documents submitted by the chief inspector in seeking compensation were fraudulent, as the police report of the incident and photos showed that the damage was not extensive.

Moreover, auditors discovered that annual fees for the damaged cycle continued to be paid after the arson incident.

The Auditor General therefore recommended that the case should be investigated by the ACC.

The report further noted that MVR180,400 (US$11,699) was spent out of the budget in 2009 and 2010 for the police sports club while such expenses are explicitly prohibited by section 4.03(b) of the public finance regulations.

Scrutinising expenses out of the police welfare budget, the audit found that cash and tickets were provided for police officers to seek medical treatment overseas without the requisite doctor’s letter and recommendation form by the police medical service.

A senior police official was given US$1,200 out of the welfare budget for accommodation and food for medical treatment overseas, the report noted.

The report criticised the police regulations that allows senior officials to claim over US$1,000 for treatment overseas while lower-ranking officers were provided smaller amounts.

Meanwhile, as a result of delayed payment of utility bills, the audit found that police incurred MVR43,803 (US$2,840) as fines in 2010.

Lastly, the report noted that according to the Finance Ministry’s ledger, the Maldives Police Service spent MVR73 million (US$4.7 million) in excess of the approved budget of MVR627.7 million (US$40.7 million) for 2010.

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Illegal, wasteful expenditure flagged in Home Ministry’s audit report

Several instances of illegal and wasteful expenditure were flagged in the audit report of the Ministry of Home Affairs for 2010, made public on Tuesday, including MVR 800,000 (US$51,880) paid to two political appointees who did not attend the ministry.

The audit discovered that two state ministers were paid salaries and benefits from January to December 2010 while one was working at the Presidential Commission and the other at the Maldives Customs Service.

“Although the two posts were created for the Ministry of Home Affairs, as the ministry did not receive any service from the two appointees, this office believes that the President’s Office’s creation of the two posts cannot be considered for the need of the ministry,” the report (Dhivehi) stated, contending that the appointments were in violation of budgetary rules and procedures.

The two political appointees referred to in the report were Sheikh Hussein Rasheed Ahmed, a member of the Presidential Commission and former head of the Adhaalath Party, and Mohamed Aswan, former principal collector of customs.

Among other cases ostensibly in violation of the Public Finance Act and regulations under the law, the Auditor General’s Office noted that none of the construction projects for island and atoll offices as well as regional fire service buildings begun in 2008 were completed on schedule.

According to a status report on the projects prepared in June 2010, while none of the 14 projects were completed on time, the ministry did not seek over MVR6.5 million (US$421,540) in damages for the delays as stipulated in the contracts for 13 of the projects.

The report also found that the Home Ministry failed to include a clause for damages for delays as required by financial regulations in contracts worth MVR1.1 million (US$71,335) and MVR68,500 (US$4,442) respectively to set up partitions and a reception counter in the office.

Consequently, the ministry incurred a loss of MVR189,225 (US$12,271) that it was unable to claim as damages for delays of 51 days and 19 days respectively.

Moreover, as a result of hiring an engineering firm for a monthly pay of MVR4,500 (US$291) for inspection and management of office buildings begun in 2008 by the now-defunct Ministry of Atolls Development, the ministry had to pay over MVR1 million (US$64,850) as a consultancy fee due to delays in completing the inspection work.

The audit also found that four employees of the Parole Unit at the ministry transferred to the Department of Penitentiary and Rehabilitation Services (DPRS) in September 2010 by the Civil Service Commission (CSC) were paid salaries out of the ministry’s budget from September to December 2010 as the DPRS did not have space for the four transferred staff.

In another case highlighted in the report, the ministry paid an owner of an uninhabited island (Haa Alif Dhapparu) MVR5,310 (US$344) in excess of the compensation stipulated in the agreement when the island’s ownership was transferred to the Ministry of Housing and Environment. The island had been under the care of the Home Ministry before it was designated an uninhabited island on August 9, 2010.

The audit report noted that the ministry’s registry of property and assets were not properly maintained in accordance with section 7 of the financial regulations. While some purchases were not entered into the registry, assets transferred from other ministries were similarly unregistered.

As a result of not requiring employees to sign for use of ministry’s mobile phones and laptops, the report noted, six laptops were lost in 2010 while “no employee was held responsible for the losses”.

Lastly, the report found that financial records of monies collected by the ministry were not properly kept. A registry of cash collected was not maintained and receipts were not entered into the daily ledger, leading to discrepancies in the accounts.

Province Offices

The audit of the former Upper North Province Office meanwhile discovered that political appointees paid a living allowances were using government accommodation in Haa Dhaal Kulhudhufushi free of charge. Consequently, the electricity bill for the province office’s accommodation block amounted to MVR105,812 (US$6,861) in 2010.

Moreover, as of July 2011, the electricity bill for the block reached MVR126,022 (US$8,172).

The audit also found that the province office paid MVR156,133 (US$10,125) as docking fees to the Kulhudhufushi Regional Port for an accommodation barge used by Boskalis International, which was contracted by the government to reclaim land in the island.

As the funds were not included in the province office budget and the land reclamation project not carried out through the office, the audit concluded that the expense was in violation of financial regulations.

The report also flagged the hiring of a project consultant for a monthly pay of MVR10,000 (US$648) who had not submitted education certificates. While the province office had claimed that the other candidates did not show up for the interview, the Auditor General’s Office learned that interviews were conducted.

The consultant was appointed a state minister before the contract period expired, the report noted, suggesting that “the announcement for the post was made directly to hire that person.”

Moreover, the audit found that political appointees at the province office did not submit reports of trips out of the island as required by regulations. However, attendance records showed that the staff in question were said to be out of the island on office business.

Meanwhile, the audit of the South Province Office discovered that an individual hired in January 2010 to draw up a strategic development paper in three months was paid a total of MVR154,000 (US$9,987) after illegally extending the contract period beyond the agreed upon three months.

As of July 2010, the audit found, there was no record that the report was ever submitted.

The audit also found that the province office paid for the expenses of a state minister in Male’ for 49 days while there was no record to show any official business conducted during the stay.

Moreover, the expenses for food and accommodation of the south province state minister were significantly higher than the approved rate for government employees.

On July 15, 2010, the audit found, a state minister arranged a dinner worth MVR10,788 (US$699) for 24 people at the Villigilli Resort and Spa while there was no documentation sent from province office to the resort.

“Moreover, while the expenses form was not properly filled, both the form and the approval for the payment voucher were signed by the state minister,” the report stated.

The province office also spent MVR5,088 (US$329) a day for a Defence Minister’s stay at the Villigilli Resort from July 25 to 27, 2010, while there was no documentation at the office explaining the purpose or nature of the trip. Invoiced for the expenses, the Defence Ministry claimed it was not an official visit.

The audit discovered that the province office spent a total of MVR27,580 (US$1,788) to mark the India-Maldives Friendship Week in Addu City while the funds were not included in the office budget and the expenses were not approved by the Finance Ministry.

In the wake of the revelations of the audit, the Anti-Corruption Commission (ACC) Chair Hassan Luthfy told local media today that the commission would discuss the Home Ministry’s audit report at its meeting tomorrow and identify cases to investigate.

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