Abu Dhabi company’s E13m for ICC&FISH designs
MBABANE – The company that is responsible for the architectural designs of the multibillion Emalangeni worth International Convention Centre and Five Star Hotel (ICC&FISH) being built in Ezulwini is based in Abu Dhabi, United Arab Emirates (UAE).
Atrium Design and Decoration, which describes itself as having designed and commissioned a number of government projects worldwide, was in the financial year ended March 31, 2022 paid an amount of US$1 188 666.20 (E13 367 740.09 based on the exchange rate at that time) in respect of architectural service fees for the ICC&FISH.
This has been disclosed by the Auditor General (AG), Timothy Matsebula, in his Financial Audit Report on the Consolidated Government Accounts of the Kingdom of Eswatini for the financial year ended March 31, 2022.
However, the AG has flagged the E13 million payment as being unappropriated and unauthorised, something he reportedly raised with the Controlling Officer in the Ministry of Economic Planning and Development, who in this case is Principal Secretary Thabsile Mlangeni.
CAPITAL EXPENDITURE
Unappropriated expenditure occurs when expenses or capital expenditure are incurred: Without an appropriation; in excess of the amount of an appropriation; for a purpose outside the scope of an appropriation; or after an appropriation has lapsed.
Unauthorised expenditure, meanwhile, is the overspending of a vote or a main division within a vote, or expenditure that was not made in accordance with the purpose of a vote, or in the case of a main division, not in accordance with the purpose of the main division.
“I reported to the Controlling Officer that the ministry incurred an unappropriated and unauthorised expenditure amounting to E13 367 740.09 on Project G59099 –
Support to UNDP Country Programme, under the Central Planning Office, in the fiscal year ended March 31, 2022. The expenditure was incurred while there was no appropriated budget for this project. The expenditure was in respect of payment of Invoice ADP/151B/2014 for the architectural services fees (US$1 188 666.20) of the International Convention Centre (ICC) and Five Star Hotel under the Millennium Project Unit, to Atrium Design and Decoration,” reads the AG’s report.
According to Matsebula, this was in contravention with Financial and Accounting
Instructions 0202 (ii), which states that controlling officers are responsible for ensuring that no amount is spent in excess of the amounts specified by Treasury Warrants, and number 0202 (iii) which stipulates that ‘Controlling Officer should ensure that public money is spent only for the purpose for which they are authorised’.
He said further, Section 107(3)(j) read with Section 34(7) of the Public Finance Management Act of 2017, also states that “a public office and public officer, or another person with responsibility for government resources commits an offence of financial misconduct if, without lawful authority under this Act or other lawful authority, that person wilfully or negligently incurs unauthorised expenditures or makes unauthorised commitments. Any excess or any amount expended but not appropriated and which is not allowed under this section is treated as a loss of public money.”
Matsebula said he warned the controlling officer that expenditure beyond the budget released as appropriated by Parliament was not only unlawful but also had serious effect on the fiscal budget.
“Also, the non-compliance with the laws, rules and regulations may increase the risk of unlawful, wasteful and fruitless expenditure. I advised the Controlling Officer that the ministry ought to have sought for an authority to spend beyond the appropriated (authorised) budget and take corrective action to address the above anomaly, and further strengthen internal controls, in order to avoid recurrence of excess (over) expenditures in future,” the AG said.
PRIOR AUTHORISATION
He said the ministry was further advised to ensure that no public funds were spent without seeking prior authorisation.
The controlling officer, in response, is said to have stated that the project G59099 was combined with the ICC and the hotel when they started in 2013 and later the project was separated into two projects.
She reportedly also stated that further, a foreign payment was made to Atrium Design and Decoration which was not posted into the project until 2021/22 financial year; therefore, the ministry needed savings to clear the over-expenditure.
To this response, the AG reacted: “The controlling officer’s response reflects that the unappropriated expenditure was indeed incurred without seeking authority to spend beyond the warranted budget provision from Parliament.”
Besides government projects, Atrium states in its website that it has designed and commissioned a number of residential projects worldwide; as well as designed and commissioned a number of commercial projects in the UAE.
The company’s Managing Director (MD), Medhat Alwardi, says large or small projects are treated with the same integrity and dedication leading to high class results that consistently exceed their clients’ expectations.
“High quality design grows out of an understanding of our client’s functional and design needs. We design interiors that are not only inviting for our clients, but work with their needs, not against them. We are not pre-occupied with creating our own ‘signature style’, but rather engaged in listening to our clients so that we can provide design solutions that reflect their taste and personality,” he said.
Ultimately, the MD says they are problem solvers who are committed to developing a final product that meets their clients’budget and timeline while exceeding their expectations.
The ICC, which consists of a multipurpose hall, theatre and exhibition space, is being built alongside FISH, and this has led to the development being named the ICC&FISH.
INTERIOR WORKS
As reported last week by this publication, the ICC has in the coming 2023/2024 financial year been allocated an amount of around E800 million for interior works.
According to the Government Book of Estimates, the money is categorised in two: E624 447 817 is loan funds; and E176 million is local funds.
The latest allocation for the ICC will see the total amount spent on this particular part of the development rise to around E3 billion.
Already, an amount of E2 255 983 000 (E2.25 billion) has been spent and the actual figure that has been allocated towards the construction for the coming financial year is E800 447 817. It is estimated that the complete construction of the ICC will cost E4 785 859 000 (about E4.7 billion).
Meanwhile, the FISH part of the development has been allocated E10 million in local funds to complete buildings and interior works of the hotel structure.
As at March 31, 2022, the money spent on the hotel structure stood at E1 846 439 000 (E1.84 billion).
Estimates indicate that the hotel structure will cost E2 580 086 000 (2.58 billion).
This means that for the entire ICC&FISH, it is estimated that the total cost, once the project is complete, will stand at E7 365 945 000 (E7.36 billion).