02 April 2009

FRETILIN welcomes government MP's call for inquiry into East Timor Ministry of Finance malpractice

MEDIA RELEASE Dili, Thursday 2 April 2009 FRETILIN welcomes government MP’s call for inquiry into Ministry of Finance malpractice - FRETILIN today welcomed a call by the two biggest parties in Timor Leste’s ‘Parliamentary Majority Alliance’ (AMP) government for an inquiry into apparent corruption and nepotism in the Ministry of Finance.

Two AMP chiefs – the Democratic Party’s (PD) deputy leader, Rui Menezes and the Social Democratic Party’s (PSD) leader, Fernando Gusmão – on Tuesday (30 March) called for a parliamentary committee to inquire into the controversial recruitment of national directors for the ministry, including the involvement of politically-appointed Australian advisors.

“Mismanagement of the Finance Ministry is so serious that even the AMP’s own parliamentarians will tolerate it no longer,” said FRETILIN MP and Party Vice President, Arsenio Bano, today.

“FRETILIN as the largest party in parliament has been calling on the de facto Minister of Finance, Ms Emilia Pires, to answer allegations of corruption and nepotism for almost a year now, including allegations of jobs for ‘mates’ from Australia employed on hugely inflated salaries,” Bano said.

He said that on Tuesday PD deputy leader Rui Menezes expressed particular concern that a selection panel composed almost entirely of foreign advisors and non-public service political appointees decided the futures of senior civil servants who had served the ministry since

Mr Menezes added that following the panel’s interviews with the applicants, a list of successful candidates was published on 26 March. However a conflicting list was published the following day, which omitted previously successful candidates and added new ones.

Some of the people named on the second published list of successful candidates had not even applied for the positions, Mr Menezes said.

He said Minister Pires should be called before parliament to explain, and called on her to cancel the recruitment process and start afresh.

Mr. Menezes has previously raised complaints in parliament of the minister’s political appointment of an Australian taxation official, Mr. Graham Daniels as Director General of the ministry’s Customs Division. He has questioned the Minister’s motives for the appointment, as well as Mr. Daniels’ alleged mistreatment and verbal abuse of Timorese national directors and staff.

Also on Tuesday PSD leader Mr. Fernando Gusmão called on Ms Pires to explain to parliament what he criticised as “a practice of growing collusion, corruption and nepotism in the Ministry of Finance.” Mr. Gusmão used the Indonesian acronym “KKN” to describe evidence of increasing corruption in the ministry.

Both Mr. Menezes and Mr. Gusmão also criticised the large number of politically-appointed advisors and other bilateral and multilateral–funded consultants, mostly Australian citizens, including an Australian pathology nurse who is an advisor in the ministry.

Mr Bano said Minister Pires had repeatedly failed to respond FRETILIN’s requests to provide parliament with details and copies of contracts with these consultants and advisors.

“We don’t have anything against Australians, but we do object to ministry appointments on the basis of who you know and not what you know,” Bano said.

He said FRETILIN would ask parliament to formally investigate the ministry’s recruitment processes and would expect support from members of the AMP.

The Australian newspaper on January 16 2009 in a report headed “Timor officials 'took' $13.3 million” said: “An urgent search is underway in East Timor for $13.3million that was allocated to various government ministries but is unaccounted for, amid growing corruption concerns.”

Mr Bano said minister Pires had failed to explain what happened to these missing millions, despite having promised to do so by the end of March 2009.

Note: FRETILIN Media Release of 16 December 2008 is reprinted below. For further Information contact José Teixeira on +670 728 7080 or Arsenio Bano on +670 741 9505

FRETILIN Media Release

Dili, Tuesday, December 16, 2008

Finance Minster's 'mates rates' for well-connected Australians

FRETILIN condemns secrecy on consultants' fees

Money from Timor Leste’s National Petroleum Fund, as well as scarce donor funding is being squandered on exorbitant salaries and fees to under-qualified foreign and local consultants with political and/or personal connections to government ministers, FRETILIN MP and Party
Vice President, Arsenio Bano, said today.

Bano, who was also a former Minister in the FRETILIN government said that de facto Prime Minister Xanana Gusmao had refused to release details of the number of consultants as well as copies of their contracts, despite repeated requests by FRETILIN and other MPs in
Parliament to his Finance Minister, Emilia Pires.

“The government is providing jobs for ‘mates’, both Timorese nationals and Australian citizens born in Timor-Leste. They are receiving exorbitant salaries and consultancy fees, and many are woefully under-qualified, especially in the Ministry of Finance,” Bano said.

“We understand more than 70 advisors have been hired for the Ministry of Finance alone this year.”

They included a Sydney-based Australian lawyer paid more than US$80,000 for just over one month’s work in the first months of the AMP de facto government as an advisor on Timor-Leste’s petroleum law – despite having no specific legal experience in the petroleum sector.

“His only skill as far as we can gauge is knowing the right people in the government and having connections with diplomats and Timorese businessmen,” Bano said.

“We also know of a laboratory technician with no experience or qualifications in public finance or related fields being paid over US$10,000 per month to advise the Minister for Finance.

Bano added: “The new fashion is ‘jobs for the boys’, and in some cases ‘the girlfriends’.

“Many of these shysters are being paid from the state budget which is almost totally funded from the Timorese people’s Petroleum Fund. Perhaps this is the Minister of Finance’s latest poverty eradication program for the politically connected and already economically

Bano said FRETILIN first argued against payment of exorbitant consultants’ fees during the budget debate last December. He said that this is being repeated with the AMP’s 2009 proposed budget that is currently being discussed in the parliamentary committees.

“Repeated attempts to get basic details of the numbers of consultants, their skills and experience have been refused, as if the information was a state secret rather than a matter of public interest.

“These are basic public accounts details the government is constitutionally and legally bound to provide to parliament to enable it to perform its budget oversight role effectively.”

Bano said that thanks to revenue from the FRETILIN government–initiated Petroleum Fund, the Gusmao government had an annual budget equivalent to the seven annual budgets available to previous governments.

“This bounty should be spent on health, education and agriculture, the prime movers of real human development, which receive less than 15 per cent of the current budget. Neither should our donors be giving funds to pay people without suitable or adequate qualifications. Those funds
can be better spent on our people’s development,” he said. ENDS

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