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Auditor General makes bitter findings in cane loan fund management

Published:Wednesday | June 29, 2016 | 6:39 AM
In a Special Audit Report into the the Cane Expansion Fund, Auditor General Pamela Monroe Ellis found that of the $206.8 million it disbursed, $82.7 million or 40 per cent went to members of the Fund's Loans Committee and senior employees of the Agriculture Ministry.

The Auditor General has found that the Sugar Industry Authority (SIA) has disbursed almost half of a multimillion-dollar loan fund to members of a committee set up to administer the loan programme as well as senior employees of the Agriculture Ministry. 

In a Special Audit Report into the the Cane Expansion Fund (CEF), Auditor General Pamela Monroe Ellis found that of the $206.8 million it disbursed, $82.7 million or 40 per cent went to members of the Fund's Loans Committee and senior employees of the Agriculture Ministry.

The Auditor General says the SIA appears to have breached the loan policy of the Cane Expansion Fund as there was no evidence that the loans were approved.

The Auditor General raised questions about the loan application process, noting that it appears that farmers did not submit a loan application as a prerequisite for loans.

The Auditor General chided the SIA for not being strident in its effort to recover sums overdue from delinquent borrowers.

This, she said, was exacerbated by additional loans being granted by the SIA to some delinquent borrowers.

The objective of the Cane Expansion Fund is to support the improvement in production, productivity and efficiency in the sugar industry through the provision of concessionary loans and grants to cane farmers.

Loans are provided to cane farmers at a rate of five per cent for land preparation, harvesting, replanting and to purchase equipment.

The report points out that the SIA has failed to implement six of 12 recommendations made by a firm contracted by the agriculture ministry in 2012 to review the administration of the Fund.

The six proposals focus on improvement in the use of funds and performance monitoring, structure and staffing as well as technology.

The SIA cited funding as the inhibiting factor to the prompt implementation of the recommendations.

However, the Auditor General says tardiness in introducing the recommendations has led to continued inefficiencies and deficiencies in the administration of the Fund.

Last year, permanent secretary in the Ministry of Agriculture Donovan Stanberry admitted that he and other senior members of the ministry had received loans under the European Union-funded CEF.

He, however, argued that the process was transparent and the question of a conflict of interest did not arise.