COI Report: HOA grant distribution scheme legally arbitrary, unlawful

Sir Gary Hickinbottom has concluded in the Commission of Inquiry (COI) report that assistance grants distributed by members of the House of Assembly are done so in a legally arbitrary and unlawful manner.

According to the Commissioner , there are almost none of the basic rudiments in place required for it to be considered a lawful scheme.

For example, Sir Gary said there is no adequate policy guidance for the exercise of discretion by members of the House in respect of the distribution of grants.

The Commissioner further noted that as the Internal Audit Department (IAD) Report concluded, the guidelines that do exist are not published and are clearly inadequate.

Grants unauditable in absence of records

He further indicated that not all House members were aware of the guidelines and said, for those who were aware of them (the vast majority of members), the guidelines are not always complied with, and, where they are, they are applied in different (subjective) ways.

Sir Gary was also critical of the records keeping function associated with the distribution of the grants illustrating that no sensible records are kept of the grounds on which an application is made. 

“Many applications are made without adequate supporting documentation,” the Commissioner highlighted.

“The lack of records makes the grants largely unauditable, in the sense of checks being made as to how public money has been used. Information is not shared with government departments, which are responsible for other assistance programmes,” the Commissioner found.

Unfettered discretion given to Ministers in distribution

Meanwhile, according to Sir Gary, there are no reasons given for granting or refusing an application and there is no mechanism in place for reviewing or otherwise challenging the refusal of an application.

Reflecting on the evidence he received, Sir Gary determined that “the discretion in members as to whom the recipients are, and how much they should receive, appears to be effectively unfettered.”

The Commissioner also concluded that these apparent deficiencies in the scheme are systemic in the sense that they have been maintained by various administrations over the years.

He further noted that although the Clerk to the House of Assembly has apparently failed to comply with her Public Finance Management Act (PFMA) obligations, the deficiencies cannot be said to lie at the door of any specific elected public official.

The Commissioner shared: “Members of successive Houses of Assembly, and of successive elected governments, knowing of these deficiencies and the risk that they posed, have singularly and quite deliberately failed to address them (and have failed even to seek to do so)”.

No limits to grants distributed

According to Sir Gary, although each Member is granted a fixed amount to distribute for the year (allocated in quarterly tranches), if there is an overspend, the Cabinet can (and does) put forward a supplementary allocation, which can be (and invariably is) voted through by the House of Assembly.

He found that in practice, there is absolutely no limit to the grants that may be made.

“Whilst, no doubt, most of the millions of dollars that are distributed in this way go to those whom the responsible member believes are worthy, the lack of governance – including the lack of checks, balances and even records – is very troubling indeed,” the Commissioner shared.

On the evidence, Sir Gary concluded, the system appears to be clearly unlawful; and successive Houses of Assembly and elected governments have willingly and knowingly allowed it to continue as such.

“They are aware that, in so doing, the risk of dishonesty by applicants and/or elected members themselves is vastly increased; and it is highly unlikely that any dishonesty would be detected,” he added.

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