Clarke blames MoEY for fizzling of McLean surcharge

Finance Minister Dr Nigel Clarke is blaming the education ministry’s failure to respond to requests for information for the eventual collapse of surcharge action against Dr Grace McLean.

In October 2021, the Auditor General's Department (AuGD) recommended that a surcharge be instituted against Dr Dean-Roy Bernard, the then-in-limbo permanent secretary in the Ministry of Education and Youth (MoEY), and McLean, who was acting in the post, alleging that both officials had failed in their fiduciary duty in causing $124 million to be allocated to the Cecil Cornwall-chaired Joint Committee on Tertiary Education (JTCE).

Last month, the Government withdrew the surcharge notice issued to McLean, who the AuGD said was responsible for the loss of $11.2 million of the funds, which was transferred to the JCTE between April and June 2020.

The law prohibits any surcharge action after the passage of three years from the date of payment.

But in response to questions from The Gleaner after public uproar over the latest turn of events, Clarke said that the Ministry of Finance and the Public Service (MoFPS) tried to act on the recommendations but its hands were tied by the MoEY.

“Upon receipt of the AuGD report, the financial secretary initiated surcharge procedures ... . Correspondence was sent to the acting permanent secretary – MoEY, Mrs Maureen Dwyer – and to Dr Grace McLean informing them of the report and requesting response in accordance with the legislation … ,” the finance minister said.

Dwyer had assumed the acting position in October 2021 after McLean went on leave. McLean was interdicted in January 2022 and Dwyer continued in the post.

The finance ministry sought legal advice in November 2021, which “concluded with recommendations for further investigations into the matter ... and the appointment of a committee to investigate the case ... “.

It then dispatched a letter to Dwyer on December 10, 2021.

“The letter instructed cessation of all payments to JCTE with immediate effect and informed that the MoFPS was performing a review of the recommendations made by the auditor general and required the assistance of the acting permanent secretary for the provision of certain information,” the Clarke said.

COMMITTEE FORMED

Financial Secretary Darlene Morrison established the committee as recommended and it was chaired by a deputy financial secretary, and comprised representatives from the Attorney General’s Chambers, the Office of the Services Commission, the Financial Investigations Division, and the MoFPS.

At a meeting on on May 5, 2022, the committee noted that “no response had been received in relation to previous correspondence to the acting permanent secretary”.

The committee agreed that another letter should be sent to Dwyer. That letter, dated July 4, 2022, was sent to reiterate the queries of the December 2021 missive, and to present additional queries.

“To date, the information requested has not been provided,” Clarke said.

The finance minister said that the committee “again considered the case at the meeting held 22nd June, 2023, and noted that the matter was statute-barred in accordance with Section 20(2) of the Financial Administration and Audit Act.

“It should be noted that the Financial Investigations Division and the Major Organised Crime and Anti-Corruption Agency continue their investigations into the matter,” he noted.

PUBLIC TO PRIVATE

The 2021 AuGD report had blamed McLean specifically for permitting the transfer of $11.2 million to the JCTE after the body became a private entity in 2019.

In July 2020, McLean told the members of Parliament’s Public Accounts Committee that she first became aware that the JCTE had become a private entity when the auditor general requested information, which she did not receive.

McLean claimed she wrote letters to no avail, asking for documents to be submitted to the auditor general.

She also claimed that after discovering that the JCTE became a private entity, she curtailed the arrangement that was in place with the ministry.

Monroe Ellis dismissed the argument, stating that Cornwall did not have the authority to privatise a government entity.

“It should be noted that the acting permanent secretary permitted the transfer of $11 million to JCTE after her failed attempt to obtain the accounting records from the chairman despite knowing that the chairman laid claims that he is the owner of the company and refused to comply with the auditor general’s request for information,” Monroe- Ellis said in her report.

A draft report on the JCTE was submitted to the MoEY on June 22, 2021, and the ministry responded seven days later, on June 29, 2021.

McLean did not provide any additional supporting documentation as part of that response.

However, she submitted additional supporting documents on October 6, 2021, after being provided with a copy of the report that was scheduled to be sent to Parliament.

The supporting documentation did not comply with what was requested, the auditor general said.

Both McLean and Bernard have proclaimed their innocence and have argued that their reputations have been damaged.

“I was never given a letter requesting a response to surcharge. Therefore, there was no need to send me a letter about the statute of limitation. The statements made about me are false,” Bernard told The Gleaner last Friday.

McLean had insisted that the surcharge proceedings instituted against her were unwarranted.

Her attorney, Peter Champagnie, KC, said he wrote the auditor general in October 2021, pointing out that the recommendations arrived at on behalf of McLean were “neither substantiated in law or any relevant facts” and that the surcharge recommendation was not grounded in law.

erica.virtue@gleanerjm.com