In 2022, the family of the late Benjamin Handle Kwasi Dzata may have been preparing to mark the 10th anniversary of his death. But in the books of the Controller and Accountant General’s Department (CAGD), the government’s payroll master, Mr Dzata was very much alive and drawing his pension from state coffers.
Mr Dzata worked at the head office of the CAGD until his retirement. After his death on October 13, 2012, his monthly pension payments were supposed to have stopped. But a decade after his passing, his name was still on the government payroll, a “ghost” receiving a monthly paycheck.
At this particular count in 2022, there were 58 other ghost names discovered in the books of the head office of the CAGD. One of these ghost names was that of a man who died in 2009 but was still being paid a pension 13 years after his death.
Until 2022, when the Auditor-General’s review of public accounts discovered the waste, the 59 ghost names had sunk almost GH¢400,000 at the head office of the CAGD alone for 13 years. But these infractions did not only occur in the books of the CAGD head office. They were rampant in some of the CAGD’s regional offices as well.
In the records of the Auditor-General (AG), these ‘ghost’ payments are designated as either cash irregularities or payroll irregularities. Between 2017 and 2023, Ghana lost about GH¢1.1 billion to both irregularities — Cash (GH¢1 billion) and Payroll (GH¢42.9 million).
Yet, these are just two of the various irregularities identified in government finances. There are irregularities in how the State pays or collects rent (rent irregularities), anomalies in tax collections (tax irregularities) and how outstanding debts or loans are recovered (loan irregularities). And there are contract and store or procurement discrepancies (contract irregularities and procurement irregularities).
These seven financial irregularities in public institutions, according to the Auditor-General’s special audit reports (2017-2020 and 2021-2023), have contributed to the loss of GH¢ 43.7 billion in seven years – that is an average of GH¢ 6.2 billion annually.
An insipid story of recoveries
For many, the telltale story of waste and loot captured in the annual AG’s report makes for a grim read. But these reports often leave what appears to be a glimmer of hope at the end of almost every recorded infraction — an order for the concerned public institutions to recover the monies lost. The institutions are advised to pay the recoveries either into the Consolidated Fund, the Auditor General’s recoveries account or a designated Public Fund.
However, the reality is that the Auditor-General’s recommendations are not complied with. And most of the funds are often not returned.
When The Fourth Estate combined the recoveries the AG accounted for in his two special audit reports for the period from 2017 to 2023, it was noted that about 66% of the funds lost to irregularities were not paid back.
For instance, between 2017 and 2020, the Kwame Nkrumah University of Science and Technology (KNUST) under the Ministry of Education recorded contract irregularities amounting to GH¢ 26.7 million. Upon the AG’s instructions and demands, the University could only recover a paltry GH¢ 1.39 million.
This is emblematic of the problem with public institutions cited in the annual AG’s report on public accounts. Most of them fail to retrieve funds lost to what appears to be fraudulent activities, negligence and non-compliance with established financial protocols.
Source: Auditor General’s special audit reports
After the Auditor-General flagged financial irregularities from 2017 to 2023 and ordered the retrieval of funds, the public institutions were only able to recover GH¢ 14.9 billion out of GH¢ 43.7 billion lost. Thus, 66 per cent of the questionable expenditure of state funds has not been recovered – and from all indications, the remaining GH¢ 28.8 billion may be lost for good.
Enforcement gap persists despite Supreme Court’s emphatic ruling
When asked why the majority of the questionable expenses are left unrecovered, the Audit Service said it is not within their purview to compel public institutions to return the money.
“When it comes to the enforcement side of things, it’s outside our mandate,” says Fredrick Lokko, Assistant Director of Audit. “It’s outside the mandate of the Auditor General. So we believe that when you engage those other institutions, they can probably give you more precise reasons why they’ve also not been able to do the needful.”
But Beauty Emefa Narteh, Executive Secretary of the Ghana Anti-Corruption Coalition (GACC), believes the AG has the power to disallow and surcharge, which is not only needed in recovering, but also in stopping or preventing unlawful payments.
“For instance, the Auditor-General can exercise the power by saying I disallow this payment, which means that that person cannot be paid,” she says. “It means it will be unlawful to pay that person. That is also a form of recovery. At the same time, the Auditor-General can also exercise the power of surcharge, which means that they can say you have spent this money unlawfully, so you have to pay for it.”
Mrs Narteh’s statement is consistent with a landmark ruling by Ghana’s Supreme Court in 2017.
In the case Occupy Ghana vrs Attorney-General, the plaintiff argued the Auditor-General must not only issue reports about loot and waste in the public institutions but must also disallow and surcharge institutions and individuals to ensure monies lost are returned. The Court held that the mandate of the Auditor-General is not accomplished by just issuing reports on infractions and irregularities.
“It [is] quite clear that the said constitutional provision on the powers of disallowance and surcharge of the Auditor-General must be enforced,” the Supreme Court ruled.
For Kofi Bentil, a founding member of Occupy Ghana, the civil society group that secured the monumental ruling from the apex court, the problem is with the leadership.
“We have observed that since Domelovo [immediate past Auditor General] was removed from office, that office has become ineffective. In fact, it has even become negative because whoever was put there is even said to clear some people who clearly Domelovo was going to surcharge,” Mr. Bentil told The Fourth Estate.
He emphasised that the AG does not lack any law or facility to ensure enforcement in the recovery of illegal expenditure. He thinks the ongoing constitutional review exercise must re-examine the appointment of the Auditor General and prevent the president from selecting the occupant of the office.
Source: thefourthestategh.com
