The National Audit Office in its report on the 2009 Public Accounts, said today that claims for the travel allowance conceded to Gozitan government employees working in Malta were not always supported by adequate evidence.
"Most of the declarations were overstated, some of which substantially. Eligibility criteria to qualify for such allowance were also not properly defined."
The office said that due to lack of evidence substantiating the residency claimed by Gozitan students in receipt of the accommodation and travel allowances, coupled with the insufficient internal controls in the administration of the system, it could also not be ensured that only eligible students were receiving this subsidy.
In observations on other departments, NAO said that the vast majority of payments charged to the Housing Schemes Subsidy account under the Ministry for Gozo covered unrelated expenses in connection with the finishing works of a new Adult Training Centre (ATC) in Victoria, when this property was not even owned by the Central Government but belonged to the Housing Authority.
PAYMENTS TO HEARSES ASSOCIATION
It noted that the Motor Hearses Association had signed an agreement with the government and the (then) Malta Transport Authority wherein the government obliged itself to pay €230,000 as support to the Association to face the challenges brought by the liberalisation of the hearses sector.
"When the grants were issued, the association was required to submit quarterly accounts to the Authority detailing how these funds were utilised.
"NAO, through Transport Malta, requested a copy of the accounts to perform a financial and compliance audit. However, the Association did not abide by these instructions and so an audit could not be performed."
NAO said that a substantial portion of the budget of the Tourism Department for 2009 was used to pay long outstanding invoices spilling over from one year to the next. The expenditure audit also revealed weaknesses related to the procurement process for services rendered.
Standing regulations and instructions were not always adhered to by the Ministry of Foreign Affairs when procuring goods and services. Travel advances were granted unnecessarily, while subsistence allowances were at times incorrectly calculated. Other shortcomings were noted in the approval of hospitality expenditure, and the use of chauffeur-driven services. Internal controls at the Head Office of the Ministry of Foreign Affairs, over expenditure incurred by Maltese Embassies abroad need to be considerably enhanced. Desk Officers processing the accounts at the Head Office were often relying on what the respective Missions reported, without any scrutiny or checking of supporting documents or backing information.
NAO said that a financial audit was performed on the Co-Operatives Board 2006 – 2008 Financial Statements. Various accounting inaccuracies were observed, including non-disclosure of a bank account in the Financial Statements.
An IT audit at the Social Security Department within the then Ministry for Social Policy identified shortcomings relating to IT Security, including the lack of a risk assessment and Disaster Recovery Policy.
At the VAT Department, following a review of amounts reported under ‘Past Arrears Written-Off’ and ‘Amounts Not/Due’ as reported in the Arrears of Revenue Return for 2009, it resulted that a number of inter-departmental adjustments were erroneously classified as written-off in the Return.
An expenditure audit carried out on the Consumer and Competition Division revealed shortcomings relating to an unauthorised extension of a contract, and mobile calls being made from barred fixed telephone lines.
ACQUISITION OF CARS
An audit survey on the acquisition and use of Fully-Expensed Cars within the Public Service revealed a number of shortcomings, namely (i) failure by respondents to provide information concerning the retail price, purchase price and engine capacity of fully-expensed cars; (ii) fuel consumption limit being exceeded; (iii) lack of use of the computerised Fleet Management System; (iv) respondents failing to submit sufficient information on the majority of fully-expensed cars that were sold to retiring officers, thereby hindering NAO from verifying the selling price calculation; (v) the necessary approvals for thirteen leased cars not being provided by respondents; and (vi) deficiencies being noted in the manner Ministries and Departments calculate the taxable fringe benefit.
The audit on Personal Emoluments at the Correctional Services Department revealed (i) limitations regarding use of punch clock; (ii) inconsistencies in overtime hours recorded and paid to Correctional Officers; (iii) lack of control over Civilian Officers’ working hours and overtime; and (iv) lack of adequate segregation of duties due to staff shortage.