Govt raises serious concerns over ‘flawed, fundamentally biased’ Principal Auditor’s report

The Government of Gibraltar has expressed deep concern over the “content, tone and methodology” of the Principal Auditor’s report for 2018/19, which was published this week.

While affirming its respect for the role of independent public auditing and its value in promoting transparency and good governance, the Government said that the report “strays” from the expected standards of accuracy, balance and impartiality.

“In doing so, it reaches for a tabloid style which unfairly picks out untested claims in respect of officers in the public service without allowing time for, or giving due or any weight to, reasonable explanations as to actions, payments or resolutions of matters,” No.6 Convent Place said in a statement.

According to the Government, the 500-page report contains multiple factual inaccuracies, selective disclosures and conclusions described as “unjustified and politically loaded”.

It said the document includes claims against public officers without allowing time for responses or due consideration of explanations, and that detailed analysis of its contents revealed not only serious errors which, when analysed, “will gut the report of credibility”, but also a repeated failure to adhere to accepted international auditing and ethical standards.

The Government has compiled a full record of its correspondence with the former Principal Auditor’s office and said this demonstrated a “fluid, transparent and constructive” relationship with timely responses.

“Yet, the report disregards this cooperative exchange and accuses the Government of obstruction and concealment,” No.6 said.

“These accusations are simply not supported by the facts.”

“They are misleading, unfair, and damaging to the integrity of the civil service and the public service as a whole.”

No.6 also highlighted specific examples of concern, including letters sent by the former Principal Auditor on May 30 and 31, the final day of the reporting period, which the report later cites as unanswered despite the short time frame.

“This calls into question the sincerity of those queries and suggests they may have been included purely to imply a lack of cooperation where none existed,” No.6 said.

In one case, the Government said the report inaccurately claimed audited accounts for the Gibraltar Health Authority for 2013/14 and 2014/15 had not been laid in Parliament by May 31. According to the Government, those accounts were tabled on May 21.

“This is not a minor oversight,” No.6 said.

“It is a demonstrable factual error that casts serious doubt on the reliability of the rest of the report.”

The Government also noted that the former Principal Auditor referred to the political affiliation of a senior official at the Gibraltar Development Corporation, but did not disclose that one of the RGP whistleblowers whose claims also feature prominently in the report is the spouse of a sitting GSD Member of Parliament.

It said such “selective disclosures” reflected an “obvious and worrying lack of even-handedness, a clear partisan approach”, with the former Principal Auditor “appearing to favour the GSD Opposition”, further undermining confidence in the neutrality of the audit exercise.

In the statement, the Government claimed the report did not comply with a number of internationally recognised standards of auditing, including the requirement of an auditor to communicate significant findings with management - in this case, the Government - and allow an opportunity to respond before conclusions are drawn.

No.6 said this step had been “skipped entirely”, adding that the report compromised basic audit principles by failing to allow the Government a chance to respond to its findings and “political insinuations and legally unsubstantiated claims”.

It noted too that parts of the report were “reportedly” drafted in the final week of the former Principal Auditor’s term in office.

“The lack of rigour and objectivity evident in many of the conclusions likely reflects the rushed nature of this work and raises questions about the seriousness of the process which has taken so long as a result of no failings on the part of the Government,” No.6 said.

“All of these concerns, taken together, point toward a report that is not only flawed, but fundamentally biased and therefore fatally compromised.”

"The Government said the former Principal Auditor has showed “a clear pattern of conduct” over several years where “subjective conclusions and political undercurrents appear to be shaping the tabloid style of what should be a neutral, facts-based process.”

It cited concerns too about the political affiliation of close family members to the Opposition party and said that, while this was not disqualifying in itself, it should have prompted greater care to maintain “at least” the appearance of neutrality.

“The combination of public protest, last-minute drafting, selective inclusion and exclusion of politically charged information, and the failure to engage with the Government in accordance with international audit norms paints a clear picture of a report that cannot be viewed as a neutral exercise in public accountability and therefore cannot be relied upon to reach any conclusion that cast aspersions on the political Government, the civil or public service or any individuals within it,” No.6 said.

“The Government will continue to review the document in its entirety and will not hesitate to pursue all necessary steps to protect the integrity of Gibraltar’s public institutions.”

“The people of Gibraltar deserve a public audit process that is robust, impartial, and rooted in truth.”

“The Government will continue to defend those principles and will not allow this important institution to be diminished or politicised and will stand up in defence of the civil and public servants on whom Gibraltar relies.”