Editorial
Fraud case: Who will take political blame?
It is difficult, if not impossible, to eliminate abuse and fraud altogether in an administrative system, particularly if it is big, such as the public service, but surely precautions can well be put into place to deter wrongdoers. One problem is that, over time, precautions meant to check abuse and fraud may lose much of their effectiveness unless they are rigorously enforced, as they are supposed to, all the time.
Auditor reports often highlight lack of internal controls in government departments but the observations made often fall by the wayside and sometimes flagrantly repeated. It is only when fraud or abuse is brought to light, as has happened at the VAT department, that issues of internal control and accountability are raised again at national level. This is unacceptable as it shows carelessness and irresponsibility in administration.
The magnitude of the fraud being investigated at the VAT department is such that raises a number of pertinent questions. How is it possible that fraud at such scale could go undetected for so long? Finance Minister Tonio Fenech tried to explain this away by saying that when fraud involved collusion by a number of members of the same department it is very difficult to detect. This is not a very convincing argument as effective controls ought to have been in place to prevent the occurrence of such fraud. In a department so vitally important in the collection of revenue as the VAT department, one would have thought that its operations were closely monitored day by day and that internal controls were really up to scratch all the time to ensure that no avenues were left open to any possible abuse.
Seen in this context, as it should, the minister's reaction to what happened at the VAT department may give the impression that the department was allowed to operate completely on its own, unsupervised. This is certainly not a question of being wise after the event. The minister is suddenly very clear about what needs to be done but should not the running of the department been kept under constant review from the moment it was set up? The fact that it was not does not reflect well on whoever is directly in charge of the running of the administrative set-up and, also, on the government that prides itself on its commitment to seriousness and accountability. Who is going to take political responsibility for what has happened? Somebody must. The buck must stop somewhere.
The minister said they now intended carrying out "a detailed review of the operations within the department to identify the weaknesses of the system and present procedures, particularly those relating to the controls that are in place to detect wrongdoing, and ensure that these are not only strengthened but regularly checked". He also said that his ministry would "implement swiftly any recommendations that would come out from the review ..." This is the very least the public expects today. It is a shame that there had to be such a clamorous case of fraud before the ministry is taking action to ensure the proper collection of revenue.
Details of how internal controls at the department simply failed to be adhered to will no doubt emerge when the case comes up for hearing in court. Hopefully, the fraud case at the VAT department will now lead to greater foresight, responsibility and accountability in the running of government departments. Or is this too much to hope for?
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P. Dimech
May 29th 2009, 05:40
Yes a very good editorial indeed.. It's about time that we read something like that. Prosit for your courage. May we hope that you and your paper will continue to do its utmost to eradicate corruption and such scandals. Some of the comments refer to a PL Mayor who is undergoing investigations in relation to evasion of VAT regarding several issues of the Council Magazine. I followed this on local newspapers and from strong rumours being carried out in Marsaskala on the subject. It-tajba hi, that this PL Mayor is holding 'a grand reception’ for Marsaskala residents. And do you know where? At Caqnu's Wine Halls at Hal-Farrug. And everything is for free. U dan ghal semplici kariga ta’ kunsillier!!! It-tajba hi, that the PL, the party for progressives and moderates approved his candidature despite allegations to contest the election on their behalf. No Sir!! I do not want to be represented by such individuals. It is up to the residents now, to show that votes are not purchased by 'free grand receptions' and 'free coffee mornings'. We are not naive. On the 6th of June I will remain home. U kulhadd Jghid li jrid!!
Charles Grech
May 29th 2009, 00:55
Can someone enlighten me what happened to the LM150,000 allocated in the 2008 budget for animal welfare. Who were the beneficiaries? Certainly NOT THE ANIMALS.
I urge the Public Accounts Committee to investigate and give a detailed account to the nearest Euro Cent.
R.Gauci
May 28th 2009, 23:34
I bet that this case will have a similar end like the one in the ADT!
Did anyone from the administration resign on that case??!!
No instead they tried to help the culprits!!
B Sant
May 28th 2009, 22:09
its strange how certain promienet tv showman find it a scoop that Joe boguht two cars and that such a chaotic situation at the VAT dept at our expense was left untackled. Nintrabtu mal ktajjen pepp?
Jimmy Magro
May 28th 2009, 18:11
Ssshhhhhhhhhhhh
the answer is "NOBODY"
Ssshhhhhhhhhhhh
an election is coming
Ssshhhhhhhhhhhh
let the people decide
J. Cachia
May 28th 2009, 17:29
Birds of a feather stick together. Tonio Fenech be a gentleman and a true scholar, resign. Unfortunately we have learnt nothing by joining the European Union least holding to that parliamentary seat. Guess what? We might have the EU breathing down our necks for defrauding part of their share in this VAT SCANDAL. Tonio Fenech and the Commissioner of VAT should stop hiding behind article 56 and publish the investigation alluding to foul play by a Labour Mayor in evading VAT payments regarding the council’s publications. Two wrongs don’t make a right. NO TRANSPARENCY NO VOTE.
Alfred Galea
May 28th 2009, 17:01
Excellent editorial. This is truly " pajjiz tal-mickey mouse". A fraud case possibly involving millions of euros has come to light and the minister who is politically responsible just says that as there were u number of people involved it was very difficult to detect. Does anyone think that such statements would be beleived? Not even naive persons would believe such statements.
M. Micallef
May 28th 2009, 15:11
And we poor souls pay all the taxes they choose to ram down our throats. To me Tonio Fenech failed miserably as finance Minister. If it wasn’t for an uncorrupt businessman this would not have come to light. So his feeble excuses can be thrown out of the window and the sooner he comes to turns with himself that the only honest way out for him is to resign. He can drag with him the VAT Commissioner. What surprises me most apart from this tsunami in the VAT department, the pending investigations involving one third of the Local Councils and in ten days time they expect us to go and cast our votes. NO THANKS! What irritates me even more to hear both political parties urging people to collect their votes. Sod you all. Politicians are a breed of their own, THEY TELL FIBS…I am prepared to stay home on June 6 and watch the Simpson’s at least they are yellow in colour. Full marks to the Editor.
Mario Attard
May 28th 2009, 15:02
I agree with this editiorial. I think that while the majority of people would like to see justice taking place, they seem to have lost hope. How many times did we hear news of abuses in public funds? How many times did we hear the authorities talk about accountability? Yet nothing really happens and its soon forgotten until the next case.
No wonder many have lost interest in politics.
muscat pat
May 28th 2009, 14:11
I dread to see the New Transperancy Internation Report for 2009! Malta was amongst the most corrupt countries of Europe, that is before this VAT scandal was brought up. Who knows what is in store for us after this scandal? Unfortunately gate-keepers of the present administration are part of the problem and not a part of the solution.
In Britain ministers come and go at the whif of the mere sleaze!
In Malta no, the ministers have super glue under-neath their seat.
What a shame.
No accountabily -when millions of OUR monies are involved- does not make us more European, but the laughing stock of Europeans.
Viva the super -glue!
P.Schembri
May 28th 2009, 13:39
Prosit lill-Editur. Resignation looms in the air but having reached the peak of democracy every body here in Malta stays put. 1,000000 Shame to all those responsible for the biggest daylight robbery in the Maltese history concerning the VAT Department. We were led to believe that VAT taxation was full proof. The Commissioner should pave the way followed by the Finance Minister. Apart from this VAT con there are other investigations still under wraps, though smaller in magnitude are very serious involving a particular Mayor who benefited from making thousands of euros through the council’s publications. According to a Sunday Newspaper not only he evaded paying VAT but when under pressure he and his accomplice issued forged VAT receipts pertaining to a 'Bocci Club'. Guess what both the VAT Department and the Ministry of Finance refuses to publish the investigation. And politicians blame each other who is reponsible.
Miriam Webster
May 28th 2009, 13:12
Very impressive editorial, and right on the mark. Ultimate responsibility lies with our elected representatives, but instead we charge front line supervisors, as in the case of a soldier who died because of a poorly organized training session, while ministers flatten fields in environmentally sensitive areas to host a party. How much utter ineptitude must be displayed by a governing party before it admits to itself, and the public that elected it to office, that it is out of control?
Joanne Micallef
May 28th 2009, 13:05
How can we expect Goverment entities to function as they should if no one is ever held accountable for anything.
Mrs. S. Xerri
May 28th 2009, 12:45
Well done Editor. You hit the nail on the head with today’s editorial. Those responsible, Government and Opposition alike should take heed of your comments. The general public are fed up with such maladministration, both where the civil service and other public entities are concerned, not to mention the local councils. The Auditor General had on more than one occasion told off the Authorities of such misdoings. Unfortunately his remarks always fell on deaf ears. So now both political parties must say 'mea culpa' for the state of affairs we are in. Allegations of fraud especially where VAT is concerned had been going on for months. Nobody took any notice. Now they should shoulder their political responsibilities. Those who knew what was going on, or had suspicion on such fraudulent actions, should take full blame. Be open with the general public. Publish the results of such investigations instead of doing your utmost to hide them from the public. We are truly fed up with our politician’s attitude. I will definitely stay home on June 6th and continue to do so, until I will be treated as an intelligent person by our politicians.
Emanuel Farrugia
May 28th 2009, 12:20
Yes, but not in Malta.
C.Gauci
May 28th 2009, 12:06
Somebody has to shoulder both the administrative and the political responsibility of the VAT fraud case. I believe that this is not the only case under investigation whereby VAT is being evaded by people employed in the public sector. Recently, on another Sunday newspaper was revealed that a PL Mayor was involved in VAT evasion concerning the Council's magazine where thousands of euros were at stack. Worst than that, the same paper also revealed that this Mayor together with another person were compelled by circumstances to issue VAT fiscal receipts on behalf of the Marsaskala Bocci Club, where the latter had nothing to do with the issue of the magazines. Nobody had denied the paper's allegations, neither the VAT Department nor the Mayor or his Council. When is the investigation going to be made public, especially when the residents concerned are due to go to the polls to elect their representatives in the local Government? If the allegations as published by the Paper are true, the Authorities are duty bound to publish the contents so that the residents concerned should not be deceived. But even in such cases, somebody should also shoulder the political responsibility.
t.borg
May 28th 2009, 12:04
a very good editorial. it seems that many departments are not working accordingly. why many firms selling tiles, furniture, appliances and more does not show prices on items? why the department of consumers does not take action? the people want to know otherwise they will suspect foul play.
P.Cassar
May 28th 2009, 11:46
For john public it is the minister who is responsible for what happens in his domain so he is responsible and should resign. This is what happens in democreatic countries. What happens here happens in despotic societies!! When somthing positive happens Ministers fall on each other to claim victory so this should apply also to defeats.
David Pace
May 28th 2009, 11:43
Accountability is most important in such cases, especially where collection of funds are involved. Those committing such offences by evading the VAT are committing offences against all Maltese citizens. Evading VAT is therefore a very serious crime and should not be treated lightly. On the contrary, it should be treated with the highest seriousness that such an offence incurs. Especially when involved are public servants and people in the public administration such as the local councils, public corporations etc. Those responsible for such investigations should not continue dragging their feet, but they should conclude the pending investigations as early as possible. Once the investigations are concluded, those responsible should not bring forward excuses to hide from the public its contents. Such investigations should be made public.
paul sciberras
May 28th 2009, 11:13
I have been asking this question I ;lost count now. What happened to the investigation regarding the VAT lottery scam.Are the personnel who where involved in the offence are still at the same location with business as usual.
A. Cassar
May 28th 2009, 10:58
One more case of who is to take the politically responsibility of such a shame. Imagine if this had happened in the UK, it would have been followed on all national newspapers , TV`s news, TV`s talk shows & all, day in day out untill the Minister had to go. But here in Malta we are still too much stuck to that Parlamentary Seat , come what may. Shame politics at its best.
A good editorial indeed.