No financial systems cause of scandals – in public sector

It is obvious from the revelations of the Public Accounts Committee hearing that, the corruption in the public sector is the cause of the country’s bane. Charles Benoni Okine reports.

A former Minister of State, Mr Albert Kan Dapaah, has described as scandalous, the lack of a proper accounting systems to control the budgets of government ministries, departments and agencies in the country and some African states.

According to him, the situation is the cause of the loss of millions of dollars which are often not accounted for and which also impacts on the governments projects meant to enhance development and improve the lives of the masses.

Mr Kan Dapaah made the revelation at the just-ended 2nd Africa Congress of Accountants (ACOA) in Accra on the theme “Africa’s Economic Growth, Accountability and Democracy”.

The three-day conference, attended by more than 1,000 registered participants from 39 African countries and 34 Pan African Federation of Accountants (PAFA) member bodies was hosted by the Institute of Chartered Accountants Ghana (ICAG) and partly sponsored by Graphic Business, the official financial newspaper of the Graphic Communications Group Limited, publishers of the leading brand of newspapers in the country.

Speaking on the topic “The responsibilities of the Professional Accountant in Public Financial Management” he said the public service (ministries and extra-ministerial departments) remains the tool available to African governments for the implementation of developmental goals and objectives.

“As a pivot for growth of African economies, the public service is responsible for the creation of an appropriate and conducive environment in which all sectors of the economy can perform optimally”, he said.

Mr Kan Dapaah said effective management of public funds is thus critical to improving the quality of public service outcomes adding that “In particular, it affects how funding is used to address national and local priorities, the availability of resources for investment and the cost-effectiveness of public services.”

Drawing a wide applause from the participants, he regretted that Africa had suffered and continues to suffer from poor financial practices.

“Indeed, it is the greatest challenge to the continent in its efforts to promote good governance”, he added.

Mr Kan Dapaah pointed of out that the key accountability mechanisms put in place to protect the integrity of the budgeting process and the public sector financial management systems are disregarded.

“Also flouted with impunity are the internal controls and internal decks which have been built into the accounting and reporting modules of the financial management systems”, he pointed out.

He said in the absence of these essential control mechanisms the supreme audit institutions of most African countries continuously lament about abuse of the accounting systems leading to theft, inflated contract payments, widespread corruption and in general poor financial governance.

“In most of these countries including Ghana, the SAI continues to lament about the inability of the Ministries to account for Receipts and Payments as demanded by the Financial Laws of the country”, he said.

In that regards, he said there is the urgent need for Africa to move to halt what he described as the “systemic poor financial governance” adding that “Indeed, it is today the major drawback in Africa’s quest for good governance”.

“When Ghana, for example, agitated for democratic governance in the late eighties leading to the 1992 constitution, the demand was for Human Rights, Rule of Law and Order, Media Freedom, Freedom of Speech and Parliamentary Democracy”, he said.

Proudly, he said “Today, it is fair to say that like most African countries, Ghana has made significant progress in all these areas and if Good Governance was limited to these areas we would have been justifiably proud”.

Mr Kan Dapaah was however, quick to add that “Good governance however must have good financial governance as an essential component. Indeed, without good financial governance all other key components of the good governance agenda are endangered”.

He said it was, therefore, no wonder that on the airwaves in Ghana and other African countries the concern of the average citizen on the various phone-in programmes of the FM Stations is the poor protection of the public purse.

Against this background he reiterated that “To promote good governance and protect democratic governance on the continent, there is the need for a strong and effective financial control environment so as to improve upon public sector financial management systems and practices as an essential prerequisite for strengthened economic growth and delivery of public services by governments”.