DRA audited accounts not submitted as per legislated timeline

The Disaster Reconstruction Authority (DRA), established in 2019, has been engaged in multimillion-dollar cleanup and small home repair work on storm-ravaged Grand Bahama and Abaco.

As its work progresses, complaints about delayed vendor payments, and indications that the DRA will require twice its promised $10 million home repair subvention even as audited accounts of the authority have yet to be tabled in Parliament, raise accountability and transparency concerns.

Section 11(3) of the Disaster Reconstruction Authority Act states that three months after the end of each financial year, the authority shall submit to the minister a copy of its audited accounts together with a copy of any report made by the auditor.

The DRA was established during the previous financial year ending June 30, 2020.

Section 11(2) and (4) state that the auditor for the DRA is to be appointed by the minister after consultation with the authority, and that the minister shall lay before both Houses of Parliament, a copy of the audited accounts together with any report made by the auditor.

And Section 11(5) states: “All contracts awarded by the authority within a fiscal year shall be publicly disclosed at the end of the fiscal year.”

When questioned by Perspective last Friday on when he will table the authority’s audited accounts, State Minister for Disaster Preparedness, Management and Reconstruction Iram Lewis said, “I have no timeline on the matter. Once completed, it will be tabled.”

But the timeline in law for the submission of the audited accounts to the minister is three months from June 30, which at this point puts the authority in breach of that timeline.

Lewis did not respond to our follow-up questions on whether the audit is underway and on which auditor has been appointed, and all contracts awarded by the authority within FY2019/2020 were not publicly disclosed by June 30 of this year.

The substantive minister for both the DRA and the National Emergency Management Agency (NEMA), is the prime minister.

The DRA says $30 million has been spent on the management of storm debris sites on Grand Bahama and the Abacos, and $5 million has been spent on its small homes repair program.

Section 11 of the DRA act has been criticized as thwarting accountability because the authority selects its own auditor, as opposed to the DRA being placed within the ambit of the auditor general of The Bahamas.

Though the DRA has held numerous press conferences giving progress reports since its establishment, the press events are no substitution for the accountability and transparency measures of audits and report submissions to Parliament, which are required by law.

The mandate of the authority is critical for reconstruction efforts on Abaco and Grand Bahama, and so too is accountability for how millions in public and donated funds are being spent.

Before the DRA is given millions over and above that which has already been disbursed, key expenditure questions should be satisfactorily answered for the Parliament and for the general public the authority serves.

Millions for domes that never materialized

Last October, DRA Chairman John Michael Clarke announced that a temporary 250-dome family life center in Spring City, Abaco, would be erected to accommodate approximately 1,000 people displaced due to Hurricane Dorian.

Heralding the family life center as a key step in the rebuilding process for Abaco and in reuniting families displaced by Dorian last September, Prime Minister Dr. Hubert Minnis called on Abaconian storm evacuees to return home so as to take up residence at the temporary facility featuring dome homes manufactured by United States-based firm InterShelter.

In January of this year, the DRA in a statement seeking to discredit social media claims about the purchase price of the domes said, “The authority has budgeted $6.4 million for the domes. An estimated $4 million has been committed to cost.

“This $4 million cost includes the purchase of 250 domes; the preparation of the land for the domes; the purchase of equipment related to the installation; the installation of infrastructure for the domes; and operation of the family relief centre.”

As is well known, the 250-dome family life center never materialized, and neither has a detailed explanation of how the approximately $4 million already committed to cost was spent.

On March 8, DRA Managing Director Kay Forbes-Smith said just 32 domes in Spring City, Abaco, were turned over to the authority.

Both Forbes-Smith and Clarke have indicated that individuals could request a dome for erection on their personal properties, and Clarke said 37 domes were earmarked for east Grand Bahama residents who lost their homes.

In our multiple visits to all settlements of hard-hit East Grand Bahama over the past year, no InterShelter domes could be found, and it is unknown how many individuals on Abaco have received domes for their properties to-date.

Residents of Sweetings Cay, Grand Bahama, have long hoped their protracted wait for the promised dome homes would end as they worked to rebuild their homes and their lives, and in June the DRA advised that container homes donated by the Mediterranean Shipping Company (MSC) would be constructed on the cay.

Residents we spoke to yesterday said just one dome has been erected on a property thus far, and that cleanup of the island is still needed.

‘Major shortfall’ in home repair funds

After reports reached the media of small home repair vendors on Abaco and Grand Bahama who stopped honoring DRA purchase orders due to non-payment, DRA officials confirmed the delay of payments to vendors on both islands.

Several approved DRA applicants we spoke to also confirmed that the purchase order process had been placed on hold.

Successful applicants can be awarded up to $10,000 in assistance to purchase building materials from the DRA’s list of approved vendors on Grand Bahama and Abaco.

Clarke assured that the authority would settle all outstanding payments to vendors and that homes would be repaired, “when revenue is available to attend to it”.

Forbes-Smith told The Nassau Guardian, “The government had indicated that we were putting $10 million into the program. But once we had cleaned out the system and cleared the system, the amount of money that will be needed – that at the end of the day when we would have helped the 4,024 – we estimate that…we probably will have spent closer to $20 million.”

The government pledged $10 million in initial seed funding toward the small homes repair program, which Acting Financial Secretary Marlon Johnson told us was to come from the Dormant Fund Account.

In August, Forbes-Smith said $5 million had been spent on the program, but it is unclear whether $5 million represented the full amount of money seeded to the DRA at that stage.

The DRA, according to Forbes-Smith back in March, is also receiving financial assistance in kind from various NGO groups via a partnership wherein the government pays for construction labor, while the NGOs provide materials as well as “technical and logistical support”.

With some vendors claiming that they have not been paid since the start of the program back in February, a detailed accounting of which vendors have been paid thus far and the amounts paid to them, should be provided to Parliament and the public.

Last week, during his minister’s report, Lewis said in response to a question on when the vendor payments will be settled, “We are currently reconciling all of our accounts. We know that there is a major shortfall.

“The overall program is going to run well over $20 million, but as it stands right now we have accounts to reconcile and once we would have reconciled those accounts and run our numbers, then we will be able to better answer that question and make a determination about the way forward.”

Section 11(1) of the DRA act states: “The authority shall keep proper accounts and other records and shall prepare in respect of each financial year, a statement of accounts.”

But based on Lewis’ statement, it appears that the DRA is still working to get its accounts in some semblance of order such that it can at least resolve its outstanding payments, and definitively know its financial position.

A call for accountability is often equated with an accusation of wrongdoing by those who do not have an appreciation for the level of financial administration that ought to be assured in the management of public finances.

Regardless of how much or how little trust we repose in public officials, external audits are a key accountability tool and ought to be both conducted and the findings submitted, in accordance with the law, so that Parliament and the public can hold elected and appointed officials accountable for public expenditure.

It is in the interest of the DRA and the Bahamian people that the authority satisfy without further delay the audit requirements of the DRA act.

And it is the duty of the executive to ensure that the law in this regard is adhered to.

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