Pricewaterhouse draft findings on PNM scholarship ‘slush fund’: Lack of transparency, accountability

Accounting firm Pricewaterhouse Coopers (PwC), which was commissioned by Government earlier this year to review the award of scholarships under the People’s National Movement (PNM) administration have submitted a draft of their findings. The final report will be submitted later this week.

Sources said among the concerns raised by PwC is the lack of transparency and accountability in the awarding of the scholarships. The forensic firm was commissioned to investigate the controversial Community Development Scholarship Programme (CDSP), now renamed the Financial Assistance Studies Programme (FASP), operated by the Ministry of Community Development and Gender Affairs, under then minister Joan Yuille-Williams.

Last year, during the budget debate, Prime Minister Kamla Persad-Bissessar told the Parliament the procedure used by the PNM regime in awarding the scholarships was “shameless, rampant discrimination.” The programme was also described as a “slush fund” which assisted supporters of the PNM.

The scholarship programme was established in 2003 with an annual $45 million budgetary allocation. The PwC started its review on May 25 and by August 24 field work was completed, leaving only outstanding interviews to be done. On September 7, a draft report was completed.

In addressing the matter last year, Persad-Bissessar had said the issue was referred to the Commissioner of Police and the Director of Public Prosecutions. She took the action following a report by the Equal Opportunity Commission (EOC), that there was discrimination in the award of the scholarships.

The findings
A copy of the draft report obtained by Sunday Guardian revealed that although records indicate $49.9 million was disbursed over the review period (2003-2007) “a portion of these disbursements did not actually reach the beneficiary and was not returned to the programme due to a lack of proper monitoring, communication, timelines of the processing of applications, and overall controls.”
• The report stated that on several occasions funds were disbursed to overseas institutions for tuition payment and the student was not registered. In that case, the funds were returned to the treasury but not to the ministry and was effectively “lost,” as “they remained in the Consolidated Fund as a suspense item.”
• PwC revealed the CDSP was not established or administered as a scholarship programme and there was no change in policy directives initially set up by Cabinet.
“The programme was established (and subsequently managed) as a financial assistance or support programme and not a scholarship programme.”
• Recipients were not required to enter into an agreement for obligatory service upon completion or repayment of funding to the Government, while no unit or division was established within the ministry to administer the programme.
• Over 400 recipients received payments directly via cheque totalling $6.5 million.
• There were instances of recipients/beneficiaries of funding where no application was on file.  
• 26 people benefitted from funding on three occasions, while 172 benefitted twice. Of concern to PwC was one particular applicant (A Hosein), who was already enrolled at an institution and benefitted from funding in 2004 and 2006. The applicant submitted three applications which were dated “the same day in 2007, listing different programmes at different institutions.” This applicant applied each year from 2005 to 2011.
• It was revealed that students benefitted from funding for multiple years for attendance at different institutions, pursuing different programmes.
• Also, cheques made out in students names were collected and signed for by employees on the students’ behalf.

PwC’s scope of work
Based on the terms of reference, the scope of the PwC’s assignment included:
• Investigating the award of scholarships by the Ministry of Community Development, Culture and Gender Affairs during the period  2003-2007;
• Conducting a comparative analysis of the Administration of Varying Scholarship Programmes existing across various ministries. It also included ascertaining the ethnicity and nationality of the scholarship recipients.

Government requested a “breakdown of all applications—merit of application, constituency, ethnicity and nationality, course of study listed by all applicants”; the number of all scholarships awarded during the financial years 2003 to 2007; and the completed course of study embarked upon by recipients and subsequent placement within communities.

PwC was also asked to identify the amount of monies spent by the then government under this programme and to determine whether the ministry acted justifiably in its determination of scholarship recipients. This request included whether breaches occurred and if they had prima facie evidence which “suggests impropriety on the part of any individual which contributed to the award or non-award of a scholarship.”

Prime Minister Kamla Persad-Bissessar, during last year’s budget debate in Parliament, claimed that Adanna Joseph had written directly to former prime minister Patrick Manning in 2004, seeking scholarship assistance and had listed “Brigadier Peter Joseph” as her father on her scholarship application form.

Persad-Bissessar had read out what she claimed to be part of an application which Joseph submitted. She claimed Joseph received $25,600 in 2004 to pursue a BA at Mount Saint Vincent.

Minister Devant Maharaj during his contribution in the Senate said that Joseph (Peter) was closely knitted with the PNM government and such a relationship “again raises the long-held suspicion that Sautt was a political tool of the past PNM administration, since the EOC report indicates it seemed one could have received scholarships due to PNM connections.”

However, though the PwC report listed several people with PNM links as having received scholarships, Adanna was not mentioned. In fact, Mount Saint Vincent was not among the listed educational institutes in the report.

Following the disclosure from Government, Joseph (Peter) had issued a release stating his daughter had applied on her own for scholarship assistance from the PNM government, but was unsuccessful since she did not “qualify based on the criteria for an education grant.”

Joseph had stated: “I wish to state that my daughter did not receive an education grant from the Government through the Ministry of Culture and Community Development. “I state categorically that my daughter Adanna Joseph has never received an award of any kind for any purpose from the Government. In 2004, Adanna Joseph on her own accord applied for a scholarship and was not successful...She was told that she did not qualify based on the criteria for an education grant.”