Scholarship programme hit by high delinquency

Millions owed by persons who fail to honour bond agreement

BY ALICIA DUNKLEY Observer senior reporter dunkleya@jamaicaobserver.com

Thursday, January 26, 2012

AUDITOR General Pamela Monroe Ellis has raised concern about the high delinquency rate for the scholarship and assistance programmes of the Ministry of Finance and its agencies where some beneficiaries are owing millions to the Government.

In her report for the financial year ending March 31, 2011, which was tabled in Parliament on Tuesday, Monroe Ellis said despite previous reports "a high delinquency rate still exists for the programme".

"At March 31, 2011 beneficiaries who failed to honour their bond agreement owed the Government J$36.8 million, Cdn$198,557, US$176,340 and £36,371," the Auditor General said in her report.

She said despite this, the programme's management was tardy in referring delinquent cases to the Attorney General's Department.

"For example a list, dated August 2011, of beneficiaries who forfeited their bond agreement between 2001 to 2006 revealed that the Ministry had not reported the cases to the Attorney General's Department," Monroe Ellis said.

She advised the finance ministry and its agencies to "implement a proper system to adequately capture delinquent cases so that they can be dealt with properly to reduce or prevent future loss to the government".

In the meantime, the auditor general said the ministry was still to produce evidence that 23 beneficiaries of awards, totalling US$906,963 and one who in 2004 received assistance in the form of a US$18,500 tuition waiver, were currently serving bond or repaid the Government.

"Management was advised to provide evidence of employment for these individuals or recover the amounts as per the loan agreements and government bonding policy," Monroe Ellis said.

She also had an issue with shoddy paperwork regarding the programme. "Management was unable to take action to recover outstanding liability from a delinquent who received assistance of J$913,000 as the relevant loan and bonding agreements were not signed. Additionally, 31 loan agreements and 28 guarantors' affidavits for awardees who benefited from US$972,502 in tuition and J$221,932 in stipend allowances were not presented for audit inspection," Monroe Ellis said.

"Consequently we could not determine if the Government's interest was protected. Management was advised to ensure that loan agreements and guarantor's affidavit are signed in order to protect the government's interest," the auditor general said.

At the same time, she said the absence of adequate monitoring made it easy for 21 beneficiaries who received tuition of US$406,112 and stipend of J$191,771 for studies between 2000 and 2006 to not submit the required annual progress reports.

"In addition, we were unable to determine whether 31 beneficiaries who received tuition and stipend of US$ 954,872 and J$163,880 respectively, successfully completed their studies as their final awards were not submitted," the report stated.

Failure to submit annual progress reports and final awards are a breach of the Government's standard operating procedure.

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Scholarship programme hit by high delinquency