Finance Ministry defends new Natural Resource Fund bill

explication of the Green Paper the Ministry of Finance listed an impressive series of advisors: the Commonwealth Secretariat, the International Monetary Fund, the World Bank and the InterAmerican Development Bank and others unnamed. One can only assume that the Guyana Government soundly rejected the advice of these advisors on who should be in charge of what will be styled the Natural Resource Fund (NRF) or that these institutions cancelled out each other in the advice department”.

That editorial went on to state: “The deep political and ethnic polarisation that Guyana has been steeped for its postIndependence history, the lack of trust in governments, the undermining of independent minds and institutions by the political directorate, the pall of mismanagement and corruption that has characterised government, the risk of party paramountcy and the tendency for pork barrel spending all make the Ministry of Finance of this or any other government unsuited to the task of overall management of the NRF. The model presented in the Green Paper must be banished from the outset”.

Furthermore, following the passage of the bill on January 3rd, 2019, the newspaper editorialized on it on January 14, 2019 and maintained its criticism of ministerial powers. “These sentiments remain and have been heightened in the aftermath of the December 21st motion of no confidence which has deepened divisions around all matters. In this insalubrious environment, the NRF bill has been passed and will not have the confidence of both sides of the political divide. While in other jurisdictions, where institutions and political maturity are well established, it is perfectly reasonable for the Finance Ministry and the Central Bank to have these significant roles, in the Guyana of today, this is not the case. Both the Ministry of Finance and the Central Bank are prone to political interference and machinations”, the editorial had stated.

The Ministry of Finance statement said that the Page One Comment “also insinuates negativity around the withdrawal rule proposed by the PPP/C’s Bill, without taking account of the ironic fact that, at least under the PPP/C withdrawal rule the author of the SN article is able to calculate how much will be transferred, whereas under the APNU+AFC withdrawal rule the world is in the dark as to exactly how much will be withdrawn”.

Persaud said that the only concern raised by the newspaper in the comment was that the fund would be completely emptied in its first year of operation, which he called an unfathomable occurrence.

The ministry further argued that its proposed Board of Directors would remove the excessive powers of the minister and “be responsible for reviewing and approving the policies of the Fund and monitoring its performance, thereby completely separating the management of the Fund from the Minister responsible for Finance.”

The Ministry said that it therefore fails to see how Stabroek News could “presumptuously conclude” that the key policy matters would be exclusively in the purview of the PPP/C administration.

The Ministry of Finance added that it is baffled as to why the newspaper would conclude once more that the government chooses all members of the NRF Board.

Persaud noted that the Ministry’s statement did not address the silence in the bill as to who will choose the directors and the method. He said the directors to be chosen could well end up being ciphers of the government and therefore create artificial separation from the ministry. Persaud said that oversight of this pivotal fund has to be accomplished via independent persons of high repute whether from here or abroad.

The ministry said that another erroneous statement made by the Stabroek News in its report is that “The Board of Directors would replace the 22-member Committee in the APNU+AFC version of the NRF which was assented to by former President David Granger”.

Persaud said that in the APNU+AFC version of the bill it was this 22-person committee that was intended to perform the functions of the Board of Directors in the PPP/C’s version.

The ministry statement further said that the 22-member Public Accountability and Oversight Committee has been replaced by a 9-member Committee which is more “practical, realistic, administratively more efficient, and would provide non-governmental oversight of the fund. In comparison, the APNU+AFC 22 member committee was designed to be cumbersome and non-functional”.

The ministry also contended that the mechanism to withdraw funds outlined in the NRF Bill 2021 removes the complexities and hindrances to achieving the fund’s objectives by providing a simpler, more transparent formula for calculating the ceiling on annual withdrawals.

Persaud said that neither the APNU+AFC’s version nor the PPP/C’s is acceptable and the people of the country could not afford to have stewardship of the fund only in the hands of the current government and its allies.