Auditor: Govt must end financial abuses

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  • Auditor General Heather Matthews

    Auditor General Heather Matthews


The reputation of the civil service is at stake BPSU president

Union leader Kevin Grant warned the hard-fought reputation of many civil servants is at risk from those that break the rules.
Reflecting on a failure to follow Financial Instructions highlighted in the Kyril Burrows and Delcina Bean-Burrows fraud trial, Mr Grant urged public service workers to shed a “cloak of negativity” hanging over the civil service.
The Bermuda Public Services Union president told The Royal Gazette: “I have always emphasised the importance for civil servants to follow protocol, whether members or not members of the BPSU.
“Whether I make these comments as the president of the BPSU, or a fellow co-worker, it is important that we as civil servants uphold set protocols and practices and do not take the position and job that we hold for granted.
“There are a lot of our families and friends who are out there struggling now and would love the opportunity to just be employed.
“It is unfortunate but there is a negative stereotype that is placed on civil servants and critics are able to highlight inefficiencies and lack of quality public services throughout the civil service.
“However we, the civil service, must look to shed this cloak of negativity that shrouds the hard work of many civil servants.”
Mr Grant said there was a time when Government was the employer of choice, and holding a Government position came with a sense of pride and integrity.
He continued: “It is important that the conduct of civil servants is consistent both externally and internally. Externally civil servants must realise that we are service oriented.
“The responsibility of quality public services is two-fold, meaning that Government must play their role in providing appropriate resources for quality public services; however how we carry out our duties and responsibilities to the public is significant.
“Especially when people have to deal with so many other issues in this economic climate, the least that we can do is provide quality public services.
“Internally as civil servants we should be just as vigilant, keeping in mind the code of conduct and conditions of employment, civil servants have a responsibility to govern themselves accordingly.”
Auditor General Heather Matthews has criticised civil servants for turning a blind eye when their colleagues break the rules; whistle-blowers will be protected as part of Premier Paula Cox's good governance legislation.
Mr Grant said: “I believe that civil servants would feel more comfortable with whistle-blowing legislation if they were assured that there was a clearly understood procedure and process that was confidential and guaranteed the protection from any retaliation or discrimination that could jeopardise their future within the civil service.”

Auditor General Heather Matthews believes civil servants will continue abusing public funds until Government officials finally start holding them accountable.

Mrs Matthews questioned why public officials have once again been allowed to get away with breaking Financial Instructions, paving the way for Kyril Burrows and Delcina Bean-Burrows to steal more than $500,000 over a period of five years.

The auditor noted how, despite repeated pledges from Premier and Finance Minister Paula Cox that she's committed to good governance, those who turned a blind eye to the couple's thefts continue to hold senior positions in Government.

And she said Works and Engineering manager Burrows should have been fired seven years ago, when it emerged he'd used his Government credit card to spend more than $30,000 on personal items including clothing, luggage and golf.

He did not face any criminal charges over that incident when it was discovered, and escaped with a warning from the Accountant General, who withdrew his credit card privileges.

“Nothing less than a repayment of all funds and dismissal would have sufficed,” Mrs Matthews told The Royal Gazette.

The Auditor General has been a frequent critic of Government's attitude towards financial controls in recent months, claiming nobody has the fortitude to punish officials who break the rules.

Ms Cox has introduced the Good Governance Act to try to stamp out any unethical behaviour within Government.

However, Mrs Matthews argues Ms Cox, as Finance Minister, already has the power to bring charges against any Government officer responsible for improper payment of public money.

In the Burrows and Bean-Burrows trial, two Works superintendents, Greatfield Carmichael and Calvin Waldron, told the jury they authorised payments for Burrows, their superior, without knowing what they were for.

Former Works Permanent Secretary Robert Horton said he was the accounting officer responsible for the Ministry's money.

The Auditor General told this newspaper: “This case speaks to a blatant disregard for Financial Instructions and the reluctance to hold civil servants accountable which I have spoken about in my prior reports.

“Such instances of abuse will continue to occur until such time that persons are held accountable, and are seen to be held accountable, as required by Financial Instructions.

“It is also clear that no one person could have perpetrated this long standing abuse of public funds without the assistance of other civil servants at various levels who were also in breach of Financial Instructions.

“As far as I am aware, there has been no action taken against those civil servants who have admittedly signed-off on payment documentation without knowledge of the work being carried out.

“Turning a blind eye or hiding behind the veil of 'that's the way it has always been done' is unacceptable. Unfortunately, there is no consideration of personal or professional ethics or simply doing the right thing.”

Mrs Matthews recalled how her office had investigated the case with the assistance of a whistle-blower who came forward voluntarily to provide key information.

Earlier this month, following a three-month trial, a Supreme Court jury unanimously found Burrows, 48, and Bean-Burrows, 49, guilty of misappropriating $542,000 taxpayers' money between January 2005 and December 2009. Prosecutors say more than $1 million was actually taken from the public purse in that time.

Burrows dishonestly submitted invoices so Government paid for renovations at their private property in Turkey Hill, St George's, with a plan of turning it into a luxurious home the pair nicknamed 'Teddy Bear Castle'.

He also used his Government credit card to buy three television sets for the couple's home, while the couple directed taxpayers' money to Bean-Burrows' companies for work which was never done.

During the trial, Mr Carmichael admitted signing a payment certificate to give $3,850 to Bean-Burrows' company Ren Tech for hurricane preparation work at Harrington Sound School.

He said he did not know whether any work was done; the jury was told Harrington Sound was just one of many cases in which cash was handed over when no work was done.

Mr Waldron said he regularly signed off blank payment certificates to Burrows without asking any questions, telling the court: “I just took it on good faith that they were running the project.”

Mr Carmichael and Mr Waldron were initially charged with three counts of obtaining money by deception, which they pleaded not guilty to.

The Crown dropped those charges in February, and the pair continue to work as superintendents in Public Works.

According to Financial Instructions, the Finance Minister appoints the accounting officer to be responsible for the custody and control of funds within a Ministry.

The rules state: “Accounting officers may delegate departmental financial accounting functions, but they will not be relieved of accountability and responsibility by such delegation.

“As such, if there is a loss in the department, the accounting officer is responsible for ensuring Government's funds are repaid; in some cases this may be from the accounting officer's personal funds.

“Infractions of Financial Instructions in an area under their purview can be noted in the accounting officer's personnel file and/or disciplinary action may be taken.”

The action to be taken against accounting officers is based on the seriousness of the case, the extent to which Financial Instructions were followed and checked on a routine basis and whether the loss is due to habitual non-compliance with sound internal controls.

Action taken to mitigate the loss can weigh in the accounting officer's favour.

Financial Instructions also state all Government employees are personally responsible for the performance of financial duties entrusted to them and for inaccuracies in the accounts prepared under their authority.

The Finance Minister has the power to direct they are surcharged if they are responsible for any improper payment of public monies or for any payment of monies which is not duly vouched for.

The penalties for non-compliance with Financial Instructions include disciplinary proceedings against the employee and accounting officer, and the withdrawal of financial signing authority.

When asked whether civil servants have been sanctioned in the past, Cabinet Secretary Donald Scott has pointed to a “protocol of confidentiality in the disciplinary process”.

Mr Horton was reassigned as Permanent Secretary of the Ministry of Government Estates and Information Services in April 2011.

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