Commission immediate review of key functional areas of PCJ and Petrojam, Auditor General recommends
Auditor General Pamela Monroe Ellis has made several recommendations to the Government in the wake of her department's findings from a probe into the operations of Petrojam and the Petroleum Corporation of Jamaica (PCJ).
The 113-page report was tabled in the House of Representatives on Tuesday.
MONITORING AND OVERSIGHT RESPONSIBILITIES
In terms of monitoring and oversight responsibilities, the auditor general has made the following suggestions:
• In keeping with the accountability framework, the permanent secretary should ensure that an appropriate arrangement is established to effectively monitor the respective public bodies. This arrangement should include a system that ensures that board minutes and other specified reports are faithfully received by the permanent secretary.
• Permanent secretaries should ensure that such board minutes are reviewed and the portfolio minister is formally apprised of significant issues that may affect the performance of the entity; so as to allow the portfolio minister to take appropriate actions regarding the performance of the board.
• Where the permanent secretary has designated a representative to the board, the designate must make a formal written report to the permanent secretary after each meeting, who should then report these matters to the portfolio minister.
• The boards of PCJ, Petrojam and all public bodies should develop a framework document in keeping with the Corporate Governance Framework, to strengthen the governance and management arrangements in their respective entities, over which they have been charged with governance responsibilities.
• The Ministry of Finance and the Public Service should make it a prerequisite that the boards of all public bodies establish a Governance sub-Committee to monitor and review governance arrangements.
• Government of Jamaica should commission an immediate review of key functional areas of PCJ and Petrojam.
• The stewardship of those charged with governance should be assessed in the context of significant project cost overruns, as well as nugatory expenditure, which could be deemed a consequence of mismanagement.
• The Government must act intentionally to hold those responsible for failure in their fiduciary responsibility. Case in point, in relation to the contract for the Perimeter Fence (at Petrojam), no public officer should financially expose any public body without the requisite consequences.
PROMOTE GOOD GOVERNANCE PRACTICES
In order to promote good governance practices and the receipt of value for money, Petrojam's board of directors should initiate a review of its procurement practices, with a view to ensure that:
• The appropriate method of procurement is utilised that meets the criteria stipulated in the Procurement Guidelines;
• Procurement opportunities are open to all eligible suppliers by the submission of the requisite competitive quotes or advertisement in keeping with the Procurement Guidelines;
• Its Project management system is strengthened to ensure that proper due diligence is conducted, prior to the execution of projects, along with stringent project design to minimise unplanned variations and resulting cost overruns, and ongoing monitoring to ensure that agreed upon deliverables are received;
• Requisite approval and reporting of the contract variations is done and future adherence is observed at all times.