As far back as 2007, there was a failure to provide lease agreements for the rental of properties by the State. Ten years later, with a proliferation of rentals throughout the country and exorbitant costs, accounting officers are still not fulfilling their obligations to the Auditor General’s office.
According to the Auditor General on the Public Accounts Report for the Financial Year 2016, the public interest is not best protected where lease agreements remain informal and unexecuted. The cost to rent buildings and offices for several ministries and departments for 2016 was in excess of $480 million and in some cases, the spaces remained either unoccupied or Cabinet approvals were not produced.
The report for the financial year 2007 stated that signed lease agreements were not seen for three properties leased by the Service Commissions Department at a total monthly rental of $589,334.75. Similarly, signed agreements were not seen for three properties for the Ministry of Local Government of which rent totalling $125,155 was paid.
The 2009 report showed that 12 out of 13 signed agreements were not produced for properties rented by the Ministry of Legal Affairs.
For the financial year 2015, rent totalling $525,718.33 was paid for the period June 8, 2014 to September 20, 2015, for unoccupied premises on High Street, Siparia. The rental continued until December 31, 2015, after which the arrangement was discontinued, reportedly due to the absence of an elevator.
The report stated, “In the absence of written, executed lease agreements, it could prove more difficult to enforce the State’s rights under the agreement, leaving the State in a potentially more vulnerable legal position.”
Last week, Communications Minister Maxie Cuffie defended his Government’s position in a press release on the rental of properties following remarks made by Auditor General Majeed Ali in the Parliament. The Sunday Guardian examined Chapter Two—Expenditure: Accounts of Accounts Officers of the report.
It was found that signed lease agreements were not produced for some properties although payments were made and while this matter had been raised in previous years, fingers continue to be pointed in the direction of the Property and Real Estate Division under the Ministry of Public Administration and Communications. That division is responsible for having leases executed. Cuffie said last week that he had mandated the division to closely monitor the use of buildings once rented to ensure that they were occupied at the shortest possible time, including outfitting work.
Personnel Department:
Total rent of $53,585,608.51 was paid during the period December 10, 2012 to July 31, 2016 for unoccupied premises on 12th Street, Barataria, which were reportedly waiting to be outfitted. This contravenes Financial Regulation 34 which places the responsibility on the accounting officer to eliminate non-essential services and to ensure that public funds are utilised to the best advantage.
Ministry of the Attorney General and Legal Affairs
Cabinet approvals for the rental of eight of the 14 properties sampled, with monthly payments totalling $626,637, were not produced. As a result, it was not determined whether there was proper authority for the rental of these properties.
The ministry leased a building on Pembroke Street, Port-of-Spain, on June 6, 2012, at a monthly rental of $100,000 VAT exclusive. Total rent of approximately $5,200,000 was paid from inception to September 30, 2016, for the building together with 20 car park spaces. It was observed that the building remained unoccupied while the parking lot is being utilised. An amount of $4,348,528.60 was spent on the outfitting of the building. Total expenditure to date amounted to $9,548,528.60.
Ministry of Labour and Small and Enterprises Development
Cabinet approvals were not produced for five properties with an annual rental value of $7,851,851.48.
During the period September 1, 2015 to August 31, 2016, a total of approximately $1,084,790.40 was paid for the rental of office space at Gulf City Lowlands Mall, Tobago. This property remained unoccupied until it was relinquished on August 31, 2016.
Cabinet approval was not produced for rental of storage space at Trade Zone Complex No 1, El Socorro Road Extension, San Juan, for the period October 1, 2015 to May 31, 2016, for which expenditure totalling $141,048 was incurred.
Ministry of Rural Development and Local Government
Cabinet approvals were not produced for two rented properties with rental payments totalling $830,675 as at July, 2016.
Ministry of Housing and Urban Development
A Service Agreement between the ministry and an employee of the New City Mall was not produced. Total amount paid was $45,900. As a result, the terms and conditions could not be determined.
Ministry of Community Development, Culture and the Arts
Cabinet approvals for the rental of office space at ten locations with monthly rents totalling $658,207.23 were not produced in contravention of Financial Regulation 8 (l) and Financial Instruction 43.
Ministry of Foreign and
Caricom Affairs
A total of $2,520,540 South African Rand ($US196,884.07) was expended on an unoccupied property at 580 Berea Street, South Africa, for taxes, utilities, maintenance and security costs for the period March 2009 to September 2016.
Ministry of Social Development and Family Services
The ministry leased a building on 95-97 Frederick Street, Port-of-Spain, effective October, 2015. Total rent of $899,135.60 was paid from inception to January, 2017. It was observed that the building was occupied with effect from March 3, 2017.
