Palmer moves to fix disconnect between PCJ and Petrojam

Palmer moves to fix disconnect between PCJ and Petrojam

Senior staff reporter

Thursday, April 04, 2019

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PERMANENT Secretary in the Ministry of Science, Energy and Technology (MSET) Carol Palmer on Tuesday told the Public Accounts Committee (PAC) that since she took up the post it has become clear that the ministry does not have direct access to information out of Petrojam or its parent company, the Petroleum Corporation of Jamaica (PCJ).

She said that a full assessment of the ministry’s 14 agencies with boards showed that MSET only has representation on eight, with Petrojam and the PCJ among those not included.

“… Efforts are now being made, as we seek to establish new boards, that the situation is regularised because the ministry will have to have capacity to be at board meetings so that we can know what is happening and provide the required reporting to the permanent secretary and the minister to ensure that corporate governance is being adhered to,” Palmer said.

The PAC was reviewing the Auditor General’s report into the operations of the entities, including updates and responses from the PCJ since the publication of the audit last December.

Palmer informed the committee that she intends to make representation to the Ministry of Finance on the structure of MSET as it does not now have the capacity to properly provide oversight of the entities under its purview.

“It’s one thing to have a responsibility, it’s another thing to be enabled to carry it out,” she remarked.

The ministry, she said, has begun to receive minutes of board meetings and operational plans of both entities (Petrojam and the PCJ), one of the areas of reporting deficiency highlighted in the Auditor General’s report.

The PCJ’s group internal auditor had informed the PAC that it had not been receiving Petrojam’s internal audits.

Meanwhile, the PCJ’s group internal auditor and group chief financial officer have been appointed to sit on Petrojam’s audit, technical and finance committees, respectively. Also, directives have been given that the minutes of board meetings, operational and strategic plans, must be submitted to the ministry.

Palmer noted that the issue of agencies of the ministry not submitting board minutes and other documentation was not unique to MSET, as she explained that she has been asking for board minutes since taking up office.

“It is a fact that we haven’t got the information [but] where the ministry had representation, then the information comes in. So what happens is that it’s left to the disposition of the board whether it chooses to inform the PS or not. Perhaps the other issue is there is a role for the PS when you’re a body corporate when you’re operating on your own…so things that you may expect or things that you think ought to happen or things that with normal governance arrangements managing public affairs you should do, is not necessarily what occurs,” she stated.

The permanent secretary pointed out that there are several legal measures which exist in the public service for proper governance arrangements, but that there is a shortcoming with compliance, and the application of sanctions for failure to comply.

PAC Chairman Mark Golding voiced strong concerns over a lack of accountability on the part of the PCJ board for operations at Petrojam, now linked to a major corruption scandal.

“There is the question of that ‘one individual’ who was on the Petrojam board throughout many of these events, but there is also the fact that the PCJ itself, as the parent body, was wholly lacking in its oversight of Petrojam itself, which committed various breaches. There has been no accountability whatsoever at the level of the PCJ for what has happened,“ Golding stressed, after the committee was informed that the PCJ board remained in place, including the individual who was also a Petrojam board member.

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