06 June 2010

Parliamentary committee asks, 'Where has the money gone?'

FRETILIN MEDIA RELEASE Dili, 6 June 2010 Parliamentary committee asks, 'Where has the money gone?'

Members of a cross-party parliamentary committee are asking, 'Where has the money gone?' following their visit to the construction site of the government's US$260 million heavy fuel power station.

The government has so far paid the contractor China Nuclear Industry 22nd  US$22 million. Yet, members of parliament's Committee C - Economics, Finance and Anti-Corruption Committee - who inspected the site at Hera on 3 June 2010, came away concerned with the lack of physical progress of the project and questioning the amount paid thus far.

The Vice President of Committee C, Cecilio Caminha MP, a member of the de facto government's CNRT parliamentary bloc, said after the visit: "The calculated US$22million paid out is not equivalent with the physical works the committee has just seen here." (Timor Post date 5 June 2010)

Speaking to journalists in Dili today, FRETILIN MP and parliamentary spokesperson Jose Teixeira said Mr. Caminha's remarks showed that even  government MPs are concerned about the financial transparency of this huge and controversial project, which has undergone tumultuous reviews and redesigns, none of which have ever been transparent.

"The company contracted to supervise the contract, Bonifica Consultants, has told the committee that US$22million has been paid so far, yet the committee agreed after visiting the site that the work done to date does not reflect that expenditure.  So where has the money paid by the government gone, and for what has the government paid this amount?" asked Teixeira.

Teixeira said the de facto government had ignored FRETILIN MPs requests for copies of the contract documentation to allow MPs to scrutinize the deal, in line with their constitutional mandate. "I and other colleagues in parliament formally tabled requests for copies of the contract and design documents addressed to the de facto Minister of Finance, in April 2009, but to date we have had no response.  Our requests about the same time to the Ministry of Infrastructure for copies of the contract and design documents, and to the Minister for Economy and Development for documents relating to environmental approvals have met the same fate.

"When de facto Prime Minister Gusmao wrote to parliament on 4 November 2009 announcing that the second hand heavy fuel station project had been abandoned and replaced with a ‘new generators’ project, FRETILIN expressed concerns about the financial cost to Timor-Leste's coffers.  You cannot cancel a contract to buy generators and then opt to purchase new ones, without some indemnity costs for loss of opportunity by the contractor.  By ignoring our request for information about this the government is attempting to unconstitutionally withhold information to prevent parliament from scrutinizing public finances.

"The Gusmao de facto government claims to have implemented unprecedented best practice in public finance management, but everyone from civil society to international development partners, except the World Bank who are complicit to it all, knows the opposite is the truth.

"The government has kept secret copies of contracts for the heavy fuel station, patrol boats from China, and other large government contracts, which never underwent a public tender process.

"Even details of payments made to retired former presidents, prime ministers etc, all have been kept secret. You cannot even access information to tell who are the shareholders of a company that has won a tender.

"This government is totally lacking in transparency and has done its utmost to avoid parliamentary and public scrutiny of its management of public finances, especially on procurement.  This is evidenced by what has gone on with this project, which is now being questioned even by their own senior people in parliament."

For further information please call Jose Teixeira M.P. on +670 728 7080

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