Premier Ewart Brown yesterday called on the Governor to request the resignation of Auditor General Larry Dennis, claiming he had politicised the job.

His comments came after the release of a special report by Mr. Dennis which gave a qualified audit on Government's Consolidated Fund the first in eight years.

The Auditor General said worries about spending were too great to give a clean audit.

And he complained controls were eroded by Ministerial interference, and civil servants not standing up to perceived pressure from politicians.

Dr. Brown, who is off-Island for tourism talks and a meeting with Bermuda's Capitol Hill representative, told ZBM news last night: "For more than two years, our Government has been calling for the Governor to request the resignation of Mr. Dennis. We think that he has politicised his post and he is decidedly anti-Government."

Acknowledging the Auditor General's August retirement, the Premier added: "He is determined to do damage to our Government on the way out. We do not mind being audited, but Mr. Dennis long ago diverted from the norm and really it does not deserve the respect of the Government."

The Consolidated Fund is Government's main operating fund, through which it conducts the majority of its transactions.

A qualified audit opinion is given if the auditor disagrees with the treatment or disclosure of information in its financial statements.

The report was tabled in Parliament yesterday.

Finance Minister Paula Cox told the House of Assembly: "I am disappointed to report that the annual accounts of the Consolidated Fund of the Government of Bermuda were given a qualified audit opinion for the first time in eight years.

"The rationale for this qualification is included in the Auditor's Report.

"As I indicated to the Auditor General, given that some of the deficiencies he identified were related to subsequent events occurring after the Government's financial year-end of March 31, 2008, I did not fully agree with the qualification on the accounts, but this was an issue in his remit, not mine."

The United Bermuda Party issued a statement describing the report as "damning", saying it painted "an ugly picture that says taxpayers are getting ripped of".

Said Shadow Works and Engineering Minister Patricia Gordon-Pamplin: "The report stands as an indictment of the Government's adherence to the practices of good governance. Instead of ensuring Government work is accountable and transparent to the public, the report paints a disturbing picture of an officially abetted breakdown in the system of checks and balances designed to protect the public purse.

"What we see is a Government operating with no real regard for rules and regulations; where contract terms are ignored or bypassed, where the concerns and advice of technical officers and senior civil servants are rejected or overridden, where the outflow of millions of dollars to consultants and contractors goes unaccounted for, and where ministers intervene to ensure questionable payments are pushed through."

In his report, which looked at the Police/court building and the advertising spending of Tourism, Mr. Dennis said that during the audit of the financial statements of the Consolidated Fund he became aware of material expenditures made by two ministries he was unable to audit satisfactorily.

"The problem was that there was insufficient appropriate documentation or approvals to support the payments," he said in the report.

So Mr. Dennis alerted the Finance Ministry and extended his audit.

He wrote: "My extended audit procedures revealed persuasive evidence of inappropriate behaviour and seriously compromised internal control systems.

"The internal controls that should have prevented such behaviour were rendered ineffective by ministerial intervention and failure by senior civil servants to carry out their responsibilities and in some cases to resist actual or perceived ministerial pressure."

Prior to his comments on ZBM news, Dr. Brown hit back via a statement read out in the House by Education Minister Elvin James.

Dr. Brown said the Auditor's special report was "a distressing example of an abuse of power, a manifestation of the politicisation of the high office in question and evidence of a clear intention on the part of the Auditor to inflict harm to the reputation of two ministers of this Government."

He said under the cloak of words like "misgivings" and "considerable doubt" the Auditor General has sought to damage the reputations of respected international companies, committed civil servants and ministers of the Government.

The statement added that the Auditor General's report zeroed in on Works and Engineering and Tourism and Transport.

"It is also a coincidence that the Ministers of those two ministries which are the subject of the special report submitted on the same day the ministries are to be debated are the same ministers who are the subject of bogus cheques prepared in an effort to frame them," the statement said.

Ms Gordon-Pamplin took a different view.

"We see efforts at the highest level of government to obstruct audits, including one directive stopping civil servants cooperating with the Auditor General a directive that opened them to criminal prosecution and the possibility of jail. The Premier's statement this morning attacking the motives of the Auditor General indicates these highly disturbing arrangements and conduct will continue...What we have been presented with this morning is an ugly picture that says taxpayers are getting ripped off."

Mr. Dennis' report makes no mention of the cheque scandal which saw Government claim that copies of cheques had been placed in ministries' files to imply that Dr. Brown and Works and Engineering Minister Derrick Burgess had been paid by the Police/Court building contractors.