Public finance oversight shortcomings

By Robert Vasquez

The lack of a Public Accounts Committee of Parliament, to have oversight of public finances and any mismanagement of those, has been highlighted by the GSD opposition again.

All territories with British connection - Anguilla, Bermuda, British Virgin Islands, Cayman Islands, Falkland Islands, Montserrat, Saint Helena and the Turks and Caicos Islands - have Public Accounts Committees. Gibraltar is very noticeably the only exception.

It is a purposeful deficiency as it allows any possible misbehaviour and failings involving public (our) money to go by unseen and uncovered to the detriment of democracy and good governance. It opens the doors also to purposeful misuse (if any) of public (our) money.

The non-existence of a Public Accounts Committee, added to the huge delays in the finalisation and publication of the Principal Auditor’s Reports, through no fault of the Principal Auditor, is an institutional disgrace.

The lack of a Public Accounts Committee adds to Gibraltar’s wider democratic deficits. For example, the constitutional lack of separation of powers between the legislature (Parliament) and the executive (ministers collectively and individually).

They smack of Gibraltar having an authoritarian regime, without adequate continuous oversight. Government is accountable to the electorate every four years only. It is just those elections which are a slight separation of our governmental system from countries lacking democracy, and even then, one must overlook UK ultimate constitutional control.

The GSLP-Liberal Government endorses and supports the undemocratic deficit of not having a Public Accounts Committee. Why is it hiding its financial management from public scrutiny?
The Principal Auditor’s Report, covering the periods 2016/2017 and 2017/2018, which was published very delayed in January 2024, included wide criticisms of dealings with public moneys.

The position of Principal Auditor is an independent constitutional appointment. He/she is charged with overseeing how all public (our) monies are handled by governments for the benefit of all contributors to the public purse in Gibraltar.

The GSLP-Liberal Government caused the huge delay in its publication. The tardiness undermines the required democratic scrutiny.

All financial years since 2017/2018 remain unaudited, all in all five years of delay. It is hugely detrimental to public accountability and of the use of public (our) money.

The GSD points to the GSLP-Liberal Government for causing the delay in publishing Principal Auditor’s Reports. The GSD shadow Minister for Public Finance, Roy Clinton in January highlighted that. He campaigns now for a Public Accounts Committee to be set up.

A Public Accounts Committee could and would likely be hugely critical of such an unconscionable failing. The creation of such a parliamentary committee is something that, Mr Clinton has pursued recently.

It had been advocated by me for years before the GSD by Mr Clinton adopted the policy, as has the need for greater transparency. The GSD, when in government under the leadership of Sir Peter Caruana, ignored my calls and refused to set one up a Public Accounts Committee when it agreed the 2006 Constitution. It failed also to deliver greater transparency.

The Principal Auditor in his Report called also for a Public Accounts Committee to be set up. He said it was “critical”. Additionally, he called for a new Public Audit Act, and the proper resourcing of the audit department.

The GSLP-Liberal manifesto promised that “… if elected we will bring legislation to Parliament to enhance the powers of the Principal Auditor…”. It has not been done. The opposite is true, the Principal Auditor’s Reports have been delayed by GSLP-Liberal Government inaction.

The GSD opposition, having failed to deliver whilst in government, now pleads for increased transparency generally and for greater and better parliamentary scrutiny of dealings with public (our) money. The call falls on the deaf ears of the GSLP-Liberal Government.

A Public Accounts Committee would delve into how public (our) money is spent and would take an in-depth look into public finances generally and the findings of audit reports.

Having a Public Accounts Committee should be a constitutional requirement. It highlights a further failing of the 2006 Constitution as negotiated then by the GSD.

Mr Clinton highlighted recently that Gibraltar was the only territory attending the Commonwealth Parliamentary Association’s Overseas Territories Forum meeting that did not have a Public Accounts Committee.

Its agenda was to discuss Oversight of Public Finances and Governance. It was organised in combination with the UK national audit Office and the UK Government Audit Agency.

Mr Clinton was emphatic that the issue is not party political one, but one of good governance. The GSLP-Liberals obviously disagree. The establishment of a Public Accounts Committee is totally opposed by the GSLP-Liberal, despite that it would benefit all taxpayers.

He reminded all that he has brought the subject to Parliament. He has proposed two motions for a Public Accounts Committee to be set up. The GSLP-Liberals defeated them both, as, according to Mr Clinton, they “… remain entrenched in avoiding proper scrutiny.”

A Public Accounts Committee would be chaired by an opposition MP. It would meet as frequently as necessary at the behest of that Chairman.

In the GSLP-Liberal 2023 manifesto, however, they promised to “… remain committed … to real and absolute transparency.”

Well, where is the transparency that a Public Accounts Committee would deliver on public (our) finances?

They also promised to “… enhance and reform the political, parliamentary and constitutional processes in Gibraltar. The objective remains to open up the system further to citizens so that they are closer to the actual decision-making in areas that affect them.”

Where is that? Certainly not in the field of public (our) finances.

The GSLP-Liberals argued in their manifesto that Parliament can undertake the oversight of public (our) money. That is not so! Parliament does not meet sufficiently frequently, or for long enough, to oversee in detail where and how public (our) money goes or is misused.

What are GSLP-Liberal government trying to keep away from public gaze in their dealings with public (our) money?

What control over public (our) money are the GSLP-Liberal government avoiding so assiduously?

A Public Accounts Committee would help belief and confidence in how public (our) money is spent and improve our lacking democracy to an important extent.

Robert Vasquez, KC, is a retired barrister and political commentator. He stood as an independent candidate at the last general election on a platform of democratic reform.