BRIDGETOWN, Barbados (CMC) — The London-based Commonwealth Secretariat says it is confident that “discretionary funding” being withheld by some Commonwealth member states to highlight the way the organisation is being administered would be reinstated as early as April this year.

The British Government has suspended its funding of £4.7-million voluntary contribution to the Commonwealth Secretariat after Commonwealth Secretary General Baroness Patricia Scotland was criticised by auditors for “circumventing” usual competitive tendering rules when she awarded a lucrative consultancy contract to a company run by a friend.

The auditors also discovered that procurement rules had been waived by the secretariat on no fewer than 50 occasions over three years.

Both New Zealand and Australia have also suspended their discretionary funding to the Commonwealth Secretariat until its financial systems are tightened up and tested by external auditors.

“We fully accept the recommendations of the recent KPMG internal audit report on procurement across the 2015 – 2018 financial years. All six of the recommendations were accepted and all but one have been implemented.

The remaining recommendation will be implemented by the end of February 2020,” a Commonwealth spokesperson told the Caribbean Media Corporation (CMC) in response to a number of questions CMC had e-mailed to the secretary general on Wednesday.

The Commonwealth Secretariat said that Lady Scotland was “unavailable” but the spokesperson added “the follow-up audit in April will test and verify this position.

We hope that the withheld discretionary funding, which is for the Commonwealth Fund for Technical Co-operation, will then be reinstated, allowing the Commonwealth to continue delivering vital work on behalf of member countries.”

Lady Scotland is due to visit Barbados next week where Caribbean Community (Caricom) leaders will hold the two-day inter-sessional summit from Monday.

The Commonwealth Secretariat is the central administrative hub for the intergovernmental organisation that comprises 54 countries – many of them former British colonies – and encompasses almost a third of the world’s population.

According to official figures, about two-thirds of the Commonwealth Secretariat’s funding, estimated at £18.4 million in 2018, comes from automatic subscriptions from member states, while the budget for the Commonwealth Fund for Technical Cooperation (CFTC), which is discretionary and estimated at £12 million.

The UK is the largest contributor to this fund. Commonwealth heads of Government have already rejected calls to give Lady Scotland an automatic second term of office when it comes up for renewal this year.

New Zealand has also put its £1.5-million contribution on hold while Australia has cut its funding to the Commonwealth Secretariat by £414,000 and has made its remaining contribution of £260,000 contingent on the reforms being implemented.

The audit committee report claimed that the consultancy firm, owned by Lord Patel of Bradford, a friend of Lady Scotland and a fellow Labour peer, was “apparently insolvent” at the time with debts worth more than £40,000.

The report also stated that the Commonwealth Secretariat was unable to provide the auditors with KYA Global’s final report setting out its recommendations.

But attorneys for Lady Scotland said the decision to award the contract to Lord Patel’s firm was fully justified and complied with procurement procedures at the time.

In a statement last month, Lady Scotland’s solicitors, Carter-Ruck, said KYA Global Ltd was awarded the two contracts “on the basis of its proven track record in change management consultancy” and its services were “dearly needed” at the beginning of Lady Scotland’s term of office.

“This decision was wholly justifiable and SG Scotland was advised that this complied with the procurement procedures that were in force at the time,” he added.