GSD says Govt should ‘take ownership’ of financial decisions and end ‘tiresome blame game’

The GSD has accused the Gibraltar Government of a “tiresome blame game” in a row over concerns about early exit schemes identified by the Principal Auditor in his latest report.

The Principal Auditor found there was “no real ownership” of the various schemes on offer, and raised questions as to how carefully they had been planned and how effective they were in achieving efficiencies.

Last week the Gibraltar Government highlighted that the first scheme had been introduced by the GSD in early 2011, and that later schemes following a similar model had been introduced “at the behest” of Unite the Union.

It defended the use of the schemes as “a vital component” of its human resources strategy.

But the GSD said the Government must take ownership of decisions made during 12 years in office and that to blame the GSD was “palpable and utter nonsense” and “a massive red herring”.

“The obvious truth which comes out of an objective reading of the Principal Auditor’s report is that we have a Government which is out of control and unable to properly manage public finances,” the Opposition said in a statement.

“It demonstrates everything the GSD has been criticising.”

“Sadly, the GSLP/Liberals do not even recognise the issue with Mr Picardo protesting too much that they’ve done a good job and trying to put the blame on the GSD’s door.”

“That just means you will never get proper controls or a stop to these abuses and financial practices under the GSLP/Liberals.”

The GSD acknowledged that the first scheme was established in its last administration in 2011.

But it asked why, if the government “was so unhappy” with the policy, it had introduced new schemes in other departments.

It said the GSD scheme was introduced into the Housing Works Agency as a means to secure value for money and better productivity by downsizing the workforce and enhancing value for money contractorization.

“The manner the scheme has been implemented under the stewardship of the GSLP/Libs has failed to achieve these aims,” it added.

The Leader of the Opposition, Keith Azopardi said the Principal Auditor was criticising not the policy itself but its implementation.

“His concern is that the schemes are not delivering the originally intended results because there is poor value for money supervision; early exit pay-outs are being given to people not entitled under the schemes; or people are being recruited to fill posts left by those who have received an extraordinary cash pay-out to leave,” Mr Azopardi said.

“All that is happening under Mr Picardo’s watch.”

Mr Azopardi highlighted findings from the report including:

• Between 2013-2021 the GSLP/Libs changed the conditions of the Early Exit Scheme in the Housing Works Agency expanding its terms by making it available to more people and “keeping the Scheme open indefinitely”;
• In a side letter dated 1 April 2014 the GSLP/Libs made it clear that posts of staff who left on the Early Exit Scheme would not be replaced by new employees;
• By agreements dated between 2013 to 2019 the GSLP/Libs introduced new Early Exit Schemes to 6 other Government-owned companies, agencies and departments with the Principal Auditor noting that not all schemes are the same;
• The Early Exit Schemes have cost the tax-payer over £13 Million from 2011 to date;
• 49% of the employees offered an Early Exit payment had already reached retirement age raising questions as to why they were offered additional pay-outs on retirement anyway;
• A small number of employees who benefited from payments under an Early Exit Scheme were also paid an extra severance package in confidential agreements signed by the Chief Minister;
• 15 employees were transferred to a Government-owned company from Government departments on their last working day just so that they could claim and receive the payments under the Early Exit Scheme;
• In some cases posts of people who have left following Early Exit payments have been replaced and the Principal Auditor describes this as “nonsensical as it contravenes the Early Exit Scheme agreement and again brings into question the very rationale behind introducing such a scheme in the first place…”;
• The Principal Auditor is critical about the introduction of these schemes because of the lack of “post-scheme reviews/analysis to evaluate the success or otherwise of the Government’s initiative of introducing the Early Exit Schemes”.

The GSD said it was “obvious”, given that the first scheme was introduced in early 2011 and the rest between 2013- 2019, that post-schemes assessments fell to be made by the GSLP/Libs.

“They have not been done,” Mr Azopardi said.

The Leader of the Opposition said the Principal Auditor had concluded that “if employees applying and retiring under an Early Exit Scheme are due to be replaced and staff numbers are not reduced, in my view one of the purported aims of the scheme is lost and the value and purpose of introducing such a scheme is therefore questionable”.

“He also raises issues of value for money of the contractorization of works to GJBSL by the Housing Works Agency,” Mr Azopardi added.

“The Principal Auditor has separately been critical of the lack of supervision of certain works conducted by GJBSL.”

“Beyond the EE Schemes the Principal Auditor uncovers a number of significant ad hoc payments made to various public officers beyond the normal age of retirement that raise questions.”

“So how can Mr Picardo avoid those criticisms which all happened under his watch?”

“If he didn’t like the original scheme he could have scrapped it as Chief Minister.”

“Instead he extended it and introduced new schemes and has badly applied them in a way that raises value for money questions.”