Dionne Rose, Staff Reporter
THE MINISTRY of Finance and Planning was on Tuesday lambasted by members of Parliament's Public Accounts Committee (PAC) for illegally collecting $1.1 billion in administrative fees from the National Health Fund (NHF).
According to Auditor General Adrian Strachan, the Finance Ministry had issued directives to the commissioner of customs and the Inland Revenue Department to collect processing fees of 2.5 per cent on gross amounts payable to the fund for the period 2003/2004.
But Mr. Strachan told the PAC that such a directive contravened the NHF Act.
PAC committee members were outraged by the Finance Ministry's and the Government agencies' actions.
"The commissioner of customs and inland revenue is absolutely wrong to follow a directive by the minister, which contravenes an Act and particularly when the minister has not imposed it as a tax, which has been gazetted and brought to Parliament," said committee member, Abe Dabdoub.
He added: "What worries me chairman is that it seems to me that there is almost a proposal that this debt be repaid over 10 years. That can't be, it seems to me that it is to be repaid forthwith."
BUDGETARY CONSTRAINTS
Grace Allen Young, permanent secretary in the Ministry of Health, had earlier said the Finance Ministry had proposed that, due to its budgetary constraints, the money would be paid back to the Fund over a period of 10 years.
"The National Health Fund was set up by law and if the act is contravened, there is an obligation on the part of the fund to demand back the money immediately and if it is not paid, take it to court!" said Mr. Dabdoub.
Acting PAC Chairman Dr. Horace Chang said it appeared that the Finance Ministry was using an underhanded method to balance its books at the expense of the health services.
However, while acknowledging that the law had been breached, Deputy Financial Secretary Robert Martin said the law would have to be amended to allow the Finance Ministry to legally collect the processing fees.
"We are putting steps in place to have the laws amended to allow for the collection of these processing fees because one must understand that, to collect these fees, the commissioners of customs and inland revenue do incur administrative expenses, which have to be recovered," he said.
