Ministries top it all
4 June 2010
2009 audit report reveals irregularities and corruption in ministries
Royal Audit Authority reported unresolved irregularities of Nu 348.340 million in 2009, one of the highest so far. Its annual report for 2009, released recently, says irregularities from the ministries alone account for Nu 219.494 million.
Among the ministries, the education ministry tops the list of irregular fund use amounting to Nu 109.669 million followed by the agriculture ministry, whose irregular fund use amounts to Nu 36.747 million.
Health ministry is the cleanest with irregularities amounting to Nu 0.220 million only.
The labour ministry tops the list of the corrupted ministries followed by the agriculture and education ministries. Other ministries are reported corrupt-free (see the table).
According to the report, the sharp increase in the amount of irregularities (Nu151.121 million in 2008) was attributed to overdue advances of Nu 193.215 million in the education ministry and Tourism Council of Bhutan, which accounts for 60 percent of the total advances.
Advances remaining overdue is, in many ways, indicative of lapses in the implementation of various capital investments projected in the 10th plan.
The report contains audit observations on all the ministries, 15 dzongkhags, 53 gewogs, seven autonomous bodies, four corporations, two financial institutions and two NGOs. (see table)
Fraud, corruption and embezzlement
Fraud cases include forgery and tampering of documents, malpractices and abuses, misappropriation and non- or short accountal of funds.
The highest proportion of irregularities amounting to Nu 10.574 million was detected in the labour ministry where rampant cases of fraud, corruption and embezzlement were detected in the management of Basic Skills Development Project. There were serious irregularities, including huge amounts of overpayments in construction works under the project.
The funds mobilised through external sources were grossly mismanaged through manipulation of accounting transactions, false payments and various illegitimate payments.
Inadequate coherent supervision and lack of professional integrity of individuals, to whom the management of the project was entrusted, had impeded economy, efficiency and effectiveness of the use of funds and delivery of services to the society.
Mismanagement
Mismanagement includes mismanagement of funds, properties, and revenue and taxes.
The highest mismanaged amount of Nu 24.013 million was detected in the finance ministry with non-declaration of income, short deposit of auction money, pending decisions on appeal cases, prevalence of high rate of assessment of tax based on estimation, and outstanding taxes. Outstanding taxes of Nu 20.935 million are reported from the Regional Revenue and Customs Office in Thimphu, Mongar, Samtse and Paro.
Violation of laws and rules
This includes violation of budgetary norms, accounting norms and procurement norms.
The highest amount of Nu 48.746 million was detected in the education ministry with non- or short levy or recovery of liquidated damages from the education development project amounting to Nu 43.517 million. Other violations include procurement without tenders, procurement from other than the lowest bidder, selection of inappropriate tender procedures, implementation of the same designs irrespective of regions, non-imposition of penalties in the supply of steel elements for planned school construction, and acceptance of defective goods.
Shortfalls, lapses and deficiencies
The education ministry had the highest number of irregularities amounting to Nu 60.806 million with excess payment, non-production of documents, non-collection of security deposits, defective joining compounds, shortage of materials and outstanding advances.
Irregularities include inadmissible, irregular and double payments; non or short deductions; irregularities in maintenance of documents, property management, construction, recoveries, advances; and shortfalls and uneconomical operation.
Budget utilization
The government, for the fiscal year ending June 30, 2009, had not realised capital budget of Nu 5357.162 million, which is about 35 percent of the revised capital budget. Even with the revision of capital budget from Nu 11571.028 million to Nu 15112.157 million, capital expenditure reported was only Nu 9764.995 million, indicating that many planned programmes were either not implemented or the execution of capital programmes was slow.
The audit report states that shortfall in the receipts of grants as compared to budgeted grants could have caused non-implementation of planned activities. At the same time, inadequate absorption capacity, lack of adequate planning and prioritisation of activities could also have contributed to the short execution of the planned activities, the report read.
Irregularities and amounts involved agency-wise
| Fraud, corruption and embezzlemen | Mismanagement | Violation of laws and rules | Violation of laws and rules | Total | |
| MoE | 0.117 | 48.746 | 60.806 | 109.669 | |
| MoA | 5.295 | 0.786 | 30.666 | 36.747 | |
| MoF | 24.013 | 10.945 | 34.958 | ||
| MoLHR | 10.574 | 0.370 | 2.353 | 3.800 | 17.097 |
| MoEA | 0.664 | 8.940 | 5.006 | 14.610 | |
| MoHCA | 2.036 | 0.797 | 2.860 | ||
| MoWHS | 0.210 | 1.039 | 1.249 | ||
| MoFA | 1.074 | 1.074 | |||
| MoIC | 0.147 | 0.863 | 1.010 | ||
| MoH | 0.170 | 0.050 | 0.220 | ||
| Total | 16.986 | 25.257 | 63.178 | 115.046 | 219.494 |
| Dzongkhags | 1.799 | 2.517 | 1.066 | 32.209 | 37.591 |
| Gewogs | 0.671 | 0.593 | 1.430 | 14.745 | 17.439 |
| Autonomous | 1.021 | 0.897 | 0.560 | 59.86 | 62.34 |
| Others | 1.291 | 6.374 | 0.560 | 3.749 | 11.470 |
| Total | 20.768 | 35.638 | 66.317 | 225.617 | 348.340 |
By Sonam Pelden
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One should not take what has been reported by RAA as the gospel of truth. It is quite often exaggerated. In any case, I believe one can get away even with murder if you have fiends and relatives in the RAA. Many similar reports have been presented in the past but we have yet to see any one being convicted or even penalized. So, it is just a ploy to justify the extra allowance they get. Wait and see, by next year all what has been pointed out in the report would have been settled without any conviction or penalty.
How can there be embezzlement of huge chunk of public coffers when we have fully trusted, qualified and elected people’s lyonpos as the head of the ministries?
the ministries will be in short of fund, after all sealing the salary for m,mps and pm which was as big as the mountain range which can be used for the public developmental activities. but they thought that they will win only once and during that point of time they plans to make huge sum of money so that they can use when they loose in next election. naturally the party should loose in the next election as they are going beyond the article of constitution, since one lyonpo has beaten four driver and even the police on the duty was punished for several times. the party members are all money minded. therefore, the shortage is always possible.