Category: Letters to the editor

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Not a watershed budget for the poorer person

As Guyanese analyse the Budget for 2013 it is useful to compare some of the numbers with how they are presented and received. There is no group which has welcomed the Budget more than the Private Sector Commission, one representative describing it as our (PSC) budget.

Let us take the apparently straightforward example of the reduction in the rate of personal income tax from 33⅓% to 30%. Readers will note that not only do individuals not have the benefit like dependents allowances while companies are allowed to deduct almost all their expenses, but the individual is still paying the same or higher rate of tax than non-commercial companies do, that is 30%.

If we exclude the personal allowance of $50,000 per month an individual’s nominal and actual tax rate is the same: 30%. Compare this with say GBTI whose nominal corporate tax rate is 40% but which enjoys a host of tax shelters. Its effective corporate tax rate for 2011 is 26.82%. Shareholders of GBTI pay no tax on dividends while its employees pay 30%. Even if we say that the company and the shareholder are the same – which it clearly is not – the shareholders’ tax rate is 26.82%. That is inequitable.

But let us get back to the benefits of the reduction in the rate of income tax and the increase in the rate of NIS, both of which impact on take home pay, or as the PSC says, spending power. In dollar terms, for each $10,000 earned by the worker the tax saving is $333. It means this: the worker who was earning $50,000 per month at December 31, 2012 gets nothing out of the budget; one who earned $60,000 per month takes home $333; one who earned $80,000 takes home $680 more, etc. The earliest point at which the increased take home pay exceeds $10,000 per month is for employees earning $380,000.

Note that I have not taken the projected inflation of 3.5% for 2013 into account. If that is done the income level at which there will be a net saving is for employees earning $296,000 per month. All persons earning below that income per month will actually be worse off.

The PSC is right: this is a watershed budget – but not for the poorer person.

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The AG is the principal legal advisor to the government not the state

Even as one who still spends time teaching, I find it hard to engage Mr Anil Nandlall, Attorney General, not only because of his proclivity for misunderstandings and misrepresentations (on the Budget cuts, on the Lotto Funds), but also because his frequent pronouncements show extremely poor acquaintance and at times no acquaintance, with the finer points of the Constitution, and because of his chameleonic quality of rearranging facts to fit his circumstances. There was a convergence or, to use one of Mr Nandalall’s words, a concatenation, of these qualities in the recent news items in which he sought to arrogate for his office, authority over Bills passed by the National Assembly (SN, February 3, 6).

Let me recap the issue of the Bills that exposed Mr Nandlall and caused him to restate/reconfigure his story three days later. He told Stabroek News on February 3, 2013 that “The opposition bills have not reached the Attorney General’s Chambers… for [his] inputs.” Up comes the Clerk of the National Assembly saying not true: the Bill was there ever since. Cornered by facts, Mr Nandlall’s story changes to, “okay, but not on my desk” (February 6).

Meanwhile, by letter of February 4 in the press I noted for the benefit of the public, and hopefully of Mr Nandlall, that a Bill passed by the National Assembly is not an opposition or government Bill but that of the National Assembly. And that contrary to his claim of jurisdiction over Bills passed by the National Assembly, the Constitution and the Standing Orders of the National Assembly vested certain powers and duties only in the Clerk of the National Assembly (custody and despatch to the President), the Speaker (to correct patent errors), and the President (to assent or explain). While it is evident that Mr Nandlall was unaware of these finer points, Guyanese expect their Attorney General, whoever s/he might be, to appreciate the dangers of tampering, or of delaying tactics by a political appointee, thereby frustrating the constitutional requirement for the President to assent or explain within twenty-one days.

But here again Mr Nandlall’s elusive qualities come to the fore. Here are some of his unbelievable responses. He explains his loose nomenclature of opposition Bills as “descriptive labels … widely used in parliamentary Standing Orders the world over.” Mr Nandlall is obviously less informed about Guyana than he is about the world over, since the “descriptive labels” are used in Guyana only when a Bill is “introduced” as a Private Member’s Bill (Standing Order 51); or “presented” on behalf of the government (Standing Order 53). Since Guyana by itself is proving to be so onerous to Mr Nandlall, it is recommended that he leaves “the world over” to those who know a thing or two about it.

Caught as a central violator of the provisions of the Standing Orders and the Constitution, Mr Nandlall scurries for refuge in what he calls conventions “from the colonial days.” A little learning is truly a dangerous and damaging deficiency. In Mr Nandlall’s “colonial days,” there was no 21 days limit and Bills were required to be assented to by the governor, who was not a member of either chamber, called the Senate and the Legislative Assembly. Mr Nandlall might wish to refer to Dr Shahabuddeen’s discussion on the role of the governor under the 1961 Constitution on page 546 of his book Constitutional Development in Guyana 1621-1978. Under the 1980 Constitution there is a 21-day deadline for the President to assent or explain, while Article 51 of the Constitution makes the President an integral part of the Parliament.

But more importantly, I hope for Mr Nandlall’s sake that he would not argue, even in a corner shop, that a convention of limited historical validity can trump Standing Orders recognised in Section 9 of the Constitution Act, or the Constitution itself which is the supreme law of Guyana. There are many learned articles, textbooks and treatises (Dicey, Wheare, Jennings, Phillips, Fiadjoe, etc) on the place of conventions in any constitutional environment, whether one having a formal written constitution or one governed by an uncodified constitutional regime. They are easily accessible and comprehensible to the average person.

While asserting a convention violative of the Constitution and the Standing Orders as “having great utility,” Mr Nandlall’s conscience suffered no discomfort in his recent rejection of one of the most ancient parliamentary conventions, that resignation should follow a vote of no-confidence. And let me share with Mr Nandlall another convention which his government has rejected out of hand: that while a head of state can either assent or withhold assent, by convention, assent is always granted and not withheld. I now wait to see whether Mr Nandlall will compare this with the veto. He just might…

Shockingly, Mr Nandlall does not seem to know the basic functions he is appointed to perform. In order to buttress his misconceived assertion of authority over Bills passed by the National Assembly, he claims that he is “the principal legal adviser of the state apparatus.” Mr Nandlall is not. In fact, he is the principal legal adviser to the government (Article 112 of the Constitution). Maybe the Interpretation and General Clauses Act does not provide a definition which could help Mr Nandlall, but surely Article 106 of the Constitution dealing with the resignation of the “Government” should have guided him. In management there is an axiom that if you do not know your job requirements, you cannot do it.

All in all, Mr Nandlall’s positions are so devoid of rationality or consistency that he forgot that only recently he took the Speaker of the National Assembly to court. By his latest definition of his job as Attorney General, the man has taken his own client to court!

As we have come to learn, attorneys general are no longer blessed with the same judgment on the wisdom of silence as those of yesteryear. Hopefully, Mr Nandlall will learn as he goes.

Let me end by saying that I believe that the perpetuation of much of what we as Guyanese receive daily from the government and the Attorney General is a result of a largely ineffective political opposition and its battery of lawyers. Let us hope that they will not remain silent on this issue which involves a Bill they introduced and which involves both substantive and procedural constitutional points. And I hope too that the Speaker of the National Assembly Mr Raphael Trotman will now accept and carry out his duties in relation to Bills, seeking whatever advice and assistance he may require.

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Ramson’s opinion as AG was solicited on a private lottery not a government lottery

Unusually for Guyana, Mr Charles Ramson SC uses the honorific ‘Justice’ to subscribe his letter ‘Solicited opinion that the government share of the Lotto funds does not have to be placed in the Consolidated Fund has now been given the blessing of a High Court judge’ (SN, January 15).

Despite having occupied such an exalted position, Mr Ramson still seems unable to accept certain basic facts as well as the relevant constitutional and statutory provisions in the entire Lotto funds issue, including the case to which he refers. Let me try to clarify some salient points for him.

In 1996, some time around which Mr Ramson had his first stint as Attorney General, the Government of Guyana and Canadian Bank Note Ltd signed an agreement under which the company’s wholly-owned subsidiary, the Guyana Lottery Company Inc, was granted permission to operate a lottery in Guyana. Under the terms of the agreement, the company pays to the Government of Guyana a licence fee of 24% of gross revenues, decreased by the amounts of any additional fees and taxes.

The question which the court was asked by Mr Desmond Trotman to address in the Lotto case is whether the 24% is subject to Article 216 of the Constitution of Guyana. That article requires that:

“All revenues or other moneys raised or received by Guyana (not being revenues or other moneys that are payable, by or under an Act of Parliament, into some other fund established for any specific purpose or that may, by or under such an Act, be retained by the authority that received them for the purpose of defraying the expenses of that authority) shall be paid into and form one Consolidated Fund.”

In what he keeps repeating is a “solicited opinion” given by him on May 19, 2010, Mr Ramson as Attorney General advised that the funds received from the Guyana Lottery Company were not required to be deposited into the Consolidated Fund.

It is more than surprising that Mr Ramson who holds such a high opinion of himself and which he thinks is shared by others would make the elementary mistake of not properly and adequately checking the Government Lotteries Act Cap. 80:07. This Act, which permits and regulates Government lotteries provides the following unambiguous definition of “Government lottery”:

“Government lottery” means a lottery organised and conducted by the Government Lotteries Control Committee under the provisions of section 3 of this Act“ (emphasis added).

But instead of staying faithfully with that definition, Mr Ramson refers in his opinion to the Auditor General the following definition in the agreement:

“A lottery organized and conducted under the provisions of Chapter 80:07 Laws of Guyana.”

No clumsy, procrustean or perverse attempts to circumvent the Guyana Lotteries Act could succeed since only a lottery “organised and conducted by the Government Lotteries Control Committee” comes within the definition of the Act. The lottery on which Mr Ramson’s opinion was solicited is one organised and managed by the Guyana Lottery Company Limited, a private company. It could not therefore be a government lottery, even by Mr Ramson’s strained definition.

But this was not Mr Ramson’s only error. In referring to a Development Fund of Guyana to buttress his flawed opinion, he does the opposite and actually weakens his case. Had he done basic research he would have realised that there is no such fund in Guyana, nor has any been in existence since 1966 when an earlier Development Fund set up for the colony of British Guiana was abolished.

With a modicum of diligence, Mr Ramson would have discovered that there is no Development Fund of Guyana whether under the Constitution, the Financial Administration and Audit Act Cap. 73:04 or the successor provisions in the Fiscal Management and Accountability Act No 20 of 2003. The latter makes it pellucid and mandatory that all public moneys raised or received by the government must be credited fully and promptly to the Consolidated Fund. The only exceptions, none of which applies to the 24% received from a private company, are:

(a) moneys credited to an extra-budgetary fund set up under enabling legislation establishing such a fund;

(b) moneys credited to a deposit fund established by the Minister into which public moneys are paid pending repayment or payment for the purpose for which the moneys were deposited; and

(c) any fund established for any specific purpose by or under an Act to be retained by the authority receiving the money to be used for the purpose of defraying the expenses of that authority.

But Mr Ramson’s most egregious error was his failure to recognise that the Constitution is the supreme law of Guyana and its provisions, including Article 216, cannot be swept aside by the terms of any agreement however clearly or ineptly drafted.

Unfortunately for Mr Ramson, he did not stay silent even with the embarrassment of such elementary errors. Without the benefit of a written decision of the judge or his presence in the court when Justice Diane Insanally gave her ruling on a preliminary point, Mr Ramson claims that his opinion “has been given the blessing of a High Court judge.”

If Mr Ramson would exit the fantasy land in which he “sedulously sought refuge” he would realise that the learned judge did no such thing: she simply ruled on a procedural point only; and he would also learn that that ruling has been challenged. Incidentally one of the grounds of appeal is the judge’s reliance on what is considered a flawed point handed down by Mr Ramson himself while he sat on the Court of Appeal.

Unhelpfully for his legacy that was the closing case Mr Ramson included in his book In Pursuit of Justice – A Collectanea which he thinks secured his expertise as a legal mind.

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Teixeira was very wrong

In his presentation at the awards dinner of the Georgetown Chamber of Commerce and Industry last Thursday Mr Clinton Urling, the Chamber’s President included in his wish list for Guyana a stronger civil society. In the course of his presentation Mr Urling not only referred to the work of the Transparency Institute of Guyana Inc but also echoed a recent call by that young organisation – made on the day Transparency International released its 2012 world Corruption Perceptions Index – for measures to enhance accountability, combat corruption and strengthen governance.

Mr Urling would most likely have been aware that only a few hours before he spoke the youth arm of the ruling party had attacked Transparency Institute, singling out its highly respected Vice-president Dr Anand Goolsarran for its vituperation, and severely chastising Transparency International for daring to include Guyana in its 2012 survey. Significantly, even if Mr Urling was aware of the attack, he offered no comment or defence of a civil society organisation in the presence of two Ministers of Government, Messrs Irfaan Ally and Robert Persaud.

One day later, PPP/C governance czarina Ms Gail Teixeira took the PYO vulgarity one notch down when she dismissed the 2012 CPI by stating that “only four persons were surveyed [by TI] as it related to Guyana.“ She even suggested that they must all be male! Surely anyone who knows anything about surveys would know that no sane person would regard a sample of four as reliable or representative of any population and that such a statement simply could not be right. Indeed, Ms Teixeira was wrong, very wrong.

The Transparency International website discloses that for its 2012 CPI with respect to Guyana, TI used four surveys, which in total, and even allowing for overlap, would have covered hundreds of individuals and organisations. The four surveys were Global Insight, World Bank’s Control of Corruption Index (WB), World Economic Forum and the International Country Risk Guide.

If this better information does not have any impact on Ms Teixeira and her “youths”, it is inevitable that any discourse in Guyana would continue to be backward-looking, uncivil and profoundly infected by manipulation and distortions. The leadership of the PPP/C must be in dreamland if it does not realise that for many Guyanese, the ‘C’ in PPP/C has long since ceased to represent any evaporated Civic and now, on empirical evidence as well as well-founded perception, unmistakably stands for Corruption.

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An abomination for an Auditor General report

The report of the Auditor General on the public accounts of Guyana was tabled in the National Assembly on Monday. In a country with weak accounting and accountability, an Access to Freedom Act that has not been brought into force, an Integrity Commission without Commissioners, no Public Procurement Commission, no anti-corruption or whistleblowers legislation, the report by the Auditor General – if its Executive Summary is an indication of its contents – is striking for its sterility.

A comparison of the 2011 Executive Summary is an almost identical reproduction of the 2010 report.

Note that 2011 was a less effective audit than 2010 which in any case was itself not a good audit: it ignored the armies of contract employees, the off-constitution spending by that abomination called NICIL, slush funds across ministries and including the dormant accounts, the loan recovery unit, the National Frequency Management Unit.

The problem we face is an unqualified acting Auditor General who plays to his master’s voice in order to retain one of the most lucrative employment contracts in Guyana. If we need any proof of this we need go no further than the clandestine attempt to lay a path for confirmation.

If that happens, if we think the 2011 audit is poor, we have not seen anything yet.