Natural Resource Fund Act remains wholly unacceptable

In his New Year’s address on Friday, President Ali again attempted to defend the provisions of the contentious Natural Resource Fund Bill which was passed in Parliament on Wednesday night and which he swiftly assented to on Thursday afternoon.

Intertwined with an attack on the opposition for their reprehensible behaviour in Parliament at the start of the debate on the bill, President Ali said: “It is worth saying a few words about the real cause of the undignified actions of members of the opposition in the National Assembly.

“They claimed that repealing a bill they unilaterally passed, giving the Minister of Finance excessive power over the National Resource Fund, and placing it instead under the supervision of an independent and nationally accountable body, is somehow wrong.

“Yet, even children would know that if a government wished to steal from the NRF, the best way to do it would be to remain with the APNU+AFC proposal and to leave the Minister of Finance in control with little or no oversight”.

He added: “What your democratically elected Government has now done is to remove the Minister of Finance from having such unlimited and unbridled power.

“Instead, we have created a governance and operational structure that is transparent and accountable and in which non-political, highly reputable persons carry out the responsibilities of supervision and compliance.

“In essence, the powers of oversight and control are with you – the people.

“The opposition and certain media outlets (which the President did not name) have tried to mislead their audiences into believing that I will be appointing the Board of Directors unilaterally and will have control over them.

“Nothing is further from the truth.

“While as President of this country, I am obliged to sign letters of appointment, the Board will include a person selected by the National Assembly – all parties therein – after consultation and debate among themselves. It will also include representation from the private sector, which gives a voice to civil society in the newly established decision-making body responsible for overall management of the Fund – mind you a decision-making body that did not exist under the APNU+AFC bill”.

Given the seminal importance of the Natural Resource Fund Bill, now Act, it is important to reemphasise several points connected to this highly controversial piece of legislation.

How could President Ali’s government bring such crucial legislation on December 16 for first reading in Parliament absent a single public con

sultation and intend its passage on December 29 without countenancing the need for review by a sectoral committee or a special select committee of Parliament? Can that be sensible and just?

Criticisms by this administration and others of the APNU+AFC version of the bill were well-founded on the grounds that the APNU+AFC government had been defeated by a motion of no confidence in the previous month and that ministerial powers enshrined in the bill were excessive. What then prevented the PPP/C government from moving immediately after entering office on August 2, 2020 for a public consultation on the NRF bill and the repeal of the offending Act in early 2021? Absolutely nothing. Instead, the PPP/C government played coy on the numerous occasions that questions were raised by Stabroek News and others over their intentions on the Natural Resource Fund bill. One of the tired refrains from officials was that the government was in no rush to spend the money that was accruing. That has now been exposed by the fact that every dollar of the US$534m in the fund will be extracted in the first year with huge amounts to follow in the ensuing years. En passant has the government, the Ministry of Finance or the Central Bank authored a report on the implications of repatriating US$534m into the economy in one fell swoop and spending it? It would be good to see. So how was it that the government convened consultations on the local government policy and the ensuing Local Content Bill but completely denied this in relation to the Natural Resource Fund Bill? Was it the case that it knew that its model for governing the fund would be immediately found execrable and it had no intentions of deviating from it? Can President Ali now say why there were no public consultations on the NRF bill?

The governance structure for the PPP/C’s version of the Natural Resource Fund Act and the entrenched ministerial powers remain wholly unacceptable. President Ali argued on Friday that even though he will be appointing the members of the board of directors he was not doing this unilaterally. He noted that the board will include a member selected by the National Assembly and all the parties represented there “after consultation and debate among themselves”.

Nothing in the Act describes any such consultation process. Moreover, the President must be acutely aware that there is no way with a majority in Parliament that the PPP/C MPs will agree to any candidate other than a party faithful and one that would be entirely at the disposal of the PPP/C government.

He also pointed out that another director will be drawn from the private sector and this will give a voice to civil society. The private sector is sufficiently peopled with overt supporters of the ruling party to raise concerns as to whether any of its nominees would be considered truly independent and representing the broader concerns of civil society and the interests of the downtrodden and impoverished. We remain convinced that the private sector should have no representation on this board given the influence it can have on directing areas in which oil revenues should be spent. Neither the Act nor the President has said anything about the manner of selection of the third member of the board and possible two more members. This opacity is unacceptable and conflicts with the Santiago Principles.

Considering that the Natural Resource Fund will be the repository of the monies accruing from this non-renewable resource and intended to lay the foundation for future generations, it is folly that the PPP/C government has narrow-mindedly shuttled the bill through Parliament without considering that the nearly half of the population of this country who didn’t vote for it but which segment has an inalienable right to the revenues and their management feels completely ignored in the manner in which this legislation was constructed and passed.

The Act remains wholly unacceptable and should be the subject of immediate amendments pertaining to its governance and the calculation of withdrawals from the Fund.