limited repeat and sectoral pefa 2013 trinidad and tobago...
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Limited Repeat and Sectoral PEFA
2013
Trinidad and Tobago
Final Report
Volume 1 - Central Government
January 2014
The contents of this publication are the sole responsibility of ACE International Consultants and can in
no way be taken to reflect the views of the European Union
Final Report
Project No. 2013/322918/1
By
Mr Ronald Quist and Mr Charles Hegbor
Presented by
ACE, International Consultants (Spain)
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Trinidad and Tobago Limited Repeat & Sectoral PEFA 2013
CURRENCY AND EXCHANGE RATES
Currency unit = Trinidad and Tobago Dollar (TT$)
US$ 1 = TT$6.29
Euro 1 = TT$8.85
GOVERNMENT FISCAL YEAR (FY)
1 October – 30th September
PEFA ASSSESSMENT PERIOD
FY 2009/2010, FY 2010/2011, FY 2011/2012
TIME OF ASSESSMENT
December 2013
Table of contents
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Trinidad and Tobago Limited Repeat & Sectoral PEFA 2013
Table of Contents
Acronyms and Abbreviations 7
Integrated Summary Assessment 9
I. Integrated Assessment of PFM Performance 10
A. Credibility of the budget 10
B. Comprehensiveness and transparency 11
C(i). Policy-based budgeting 13
C(ii). Predictability and control in budget execution 14
C(iii). Accounting, recording and reporting 15
C(iv). External scrutiny and audit 16
II. Assessment of the impact of PFM weaknesses 19
1. Aggregate Fiscal Discipline 20
2. Strategic Allocation of Resources 20
3. Efficient Service Delivery 21
III. Change in performance since the previous assessment 21
IV. Prospects for PFM Reforms 23
1 Introduction 25
1.1 Objective of the PFM-PR 25
1.2 Process of preparing the PFM-PR 25
1.3 Methodology 26
1.4 Scope of the assessment 27
2 Country Background Information 29
2.1 Description of country economic situation 29
2.1.1 Country context 29
2.1.2 Overall government reform programme 30
2.1.3 Rationale for PFM reforms 31
2.2 Description of budgetary outcomes 31
2.2.1 Fiscal performance 31
2.2.2 Allocation of resources 31
2.3 Legal and institutional framework for PFM 32
2.3.1 The legal framework for PFM 32
2.3.2 The institutional framework for PFM 34
2.3.3 Key features of the PFM system 37
3 Assessment of PFM Systems, processes and institutions 39
3.1 Budget credibility 39
3.1.1 PI-1 Aggregate expenditure out-turn compared to original approved budget 39
3.1.2 PI-2 Composition of expenditure out-turn compared to original approved budget 40
3.2 Comprehensiveness and transparency 41
3.2.1 PI-5 Classification of the budget 41
3.3 Policy-based budgeting 42
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3.3.1 PI-11 Orderliness and participation in the annual budget process 42
3.3.2 PI-12 Multi-year perspective in fiscal planning, expenditure policy and budgeting 44
3.4 Predictability and control in budget execution 46
3.4.1 PI-15 Effectiveness in collection of tax payments 46
3.4.2 PI-19 Competition, value for money and controls in procurement 48
3.4.3 PI-20 Effectiveness of internal controls for non-salary expenditure 51
3.4.4 PI-21 Effectiveness of internal audit 53
3.5 Accounting, recording and reporting 55
3.5.1 PI-23 Availability of information on resources received by service delivery units 55
3.5.2 PI-25 Quality and timeliness of annual financial statements 55
3.6 External scrutiny and audit 57
3.6.1 PI-27 Legislative scrutiny of the annual budget law 57
3.6.2 PI-28 Legislative scrutiny of external audit reports 59
3.7 Donor practices 61
3.7.1 D-1 Predictability of Direct Budget Support 61
3.7.2 D-2 Financial information provided by donors for budgeting and reporting on project
and program aid 63
3.7.3 D-3 Proportion of aid that is managed by use of national procedures 64
4 Government Reform Process 66
4.1 Recent and ongoing reforms 66
4.2 Institutional factors supporting PFM reforms 66
Annexes 69
Annex 1: PFM Performance Measurement Framework Indicators Summary 71
5 No data to score dimension (i) 73
Annex 3: List of Stakeholders Interviewed 79
Annex 4: List of Documents Consulted 83
Annex 5a: Data used for scoring PI-2 - FY2009/2010 85
Annex 5b: Data used for scoring PI-2 - FY 2010/2011 87
Annex 5c: Data used for scoring PI-2 - FY 2011/2012 88
Annex 6: Comments to the Draft Report 90
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Acronyms and Abbreviations
AG Auditor General AGA Autonomous Government Agencies AO Accounting Officer BIR Board of Inland Revenue CBTT Central Bank of Trinidad and Tobago CF CF Consolidated Fund CoA Chart of Account CoAs Comptroller of Accounts COFOG Classifications of Functions of Government CPI Consumer Price Index CTB Centrals Tenders Board DMFAS Debt Management and Financial Accountability System EAA Exchequer and Audit Act EU European Union FDI Foreign Direct Investment FY Fiscal Year GDP Gross Domestic Product GFS Government Financial Statistics GNI Gross National Income GRAP Generally Recognised Accounting Practice HDI Human Development Index IA Internal Audit IADB Inter-American Development Bank ICT Information & Communication Technology IFMIS Integrated Financial Management Information System IHRIS Integrated Human Resource Information System IIA Institute of Internal Auditors IMF International Monetary Fund INTOSAI International Organisation of Supreme Audit Institutions LGA Local Government Authority MDA Ministries, Departments and Agencies MoFE Ministry of Finance and the Economy MTEF Medium Term Expenditure Framework NA National Assembly N/A Not Applicable NT National Treasury ODA Official Development Assistance PAC Public Accounts Committee PAEC Public Accounts Enterprises Committee PE Public Enterprise PEFA Public Expenditure and Financial Accountability PER Public Expenditure Review PETS Public Expenditure Tracking Survey PFC Policy Formulation Committee PFM Public Finance Management PFM PMF Public Finance Management Performance Management Framework PI Performance Indicator PPP Public Private Partnership PS Permanent Secretary PSIP Public Sector Investment Program PU Procurement Unit SBS Sector Budget Support SCM Supply Chain Management SNG Sub National Government SoE State Owned Enterprise T&T Trinidad and Tobago
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Trinidad and Tobago Limited Repeat & Sectoral PEFA 2013
ToR Terms of Reference TSA Treasury Single Account TTEITI Trinidad and Tobago Extractive Industry Transparency Initiative TTTI Trinidad and Tobago Transparency Initiative VAT Value Added Tax WASA Water and Sewerage Authority
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Trinidad and Tobago Limited Repeat & Sectoral PEFA 2013
Integrated Summary Assessment
This Public Expenditure and Financial Accountability (PEFA) assessment was sponsored by the
European Commission. It has been undertaken with the formal agreement and active support of the
Government of Trinidad and Tobago. As a consequence of the government not foreseeing any
broad based improvements, given the absence of any significant Public Finance Management
(PFM) reform implementation in the period since the last PEFA assessment in 2008, only those
indicators that scored lower than a B were reassessed. The assumption was that there would
have been no measurable deterioration in the scores of B and above. While of course this is a
reasonable assumption, it may in fact not be accurate1. However, in order to provide narrative
coherence, given the linkages between the different areas of PFM performance, this summary
assessment based some of its performance distillation analysis on performance levels measured in
2008.
The “Limited PEFA” assessment takes guidance from the widely accepted methodology of the
Public Financial Management Performance Measurement Framework (PFM-PMF) issued by the
PEFA multi-donor programme in March 2011and the Field Guide for Undertaking an Assessment
using the PEFA Performance Measurement Framework May, 2012. However, given that sixteen
indicators or less than eighteen PEFA performance indicators were assessed, according to the
current rules and practices issued by the PEFA Secretariat this “Limited PEFA” may not be termed
a PEFA Assessment.
Nevertheless, the approach taken was based upon a careful consideration of the demonstrated
observable public financial management (PFM) systems, procedures and practices in Trinidad and
Tobago at the time of the assessment as determined through direct interviews with Government
officials and the reviews of official documents and reports. It was also based upon the use of
corroborating evidence sought from a variety of independent sources where ever possible including
civil society organizations, development partners and consultants.
This PFM Performance Report presents the current status of the public financial management
system of the central government based upon sixteen indicators measured in 2013 coupled with
considerations of the status of fifteen other indicators that were measured in 2008 and scored an A,
B+ or B. It should serve to identify current areas of strength and weakness. It intentionally does not
comment upon any aspects of specific fiscal or expenditure policy, and does not comment upon
any offices or officers of PFM in Trinidad and Tobago. It has not taken into account considerations
of capacity, except to the degree implicit in the capacity to successfully carry out the assessed PFM
procedures. The objective of the assessment has not been to evaluate and score the performance
of institutions or any PFM offices or officials, but rather to assess the capacity of the PFM systems
themselves to support sound fiscal policy and financial management2.
1 The PI-1 indicator, though having been scored a B in 2008 was reassessed in 2013 and found to score an A. Further,
discussions with the Office of the Auditor General indicated that if the indicator PI-26 were to have been reassessed the
scores would indeed remain the same with indications in the narrative of areas of improvement. These two examples
provide empirical evidence in support of the assumption. 2 In essence this assessment provides a measure of whether the main necessary conditions for delivering upon sound PFM
practice have been met, rather than providing an insight into all of the sufficient conditions necessary to conclude that
sound PFM is being carried out. For example while it assesses whether the PFM systems provide a sound framework for
assessing fiscal risk arising from Public Enterprise activity, it makes no comment as to what authorities do or should do in
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Trinidad and Tobago Limited Repeat & Sectoral PEFA 2013
This Limited PEFA performance review for Trinidad and Tobago presents a third assessment. The
first PEFA Assessment for Trinidad and Tobago was carried out in 2006; the second assessment
was carried out in 2008. It is anticipated that such PEFA assessments shall continue to be carried
out periodically and in doing so will provide a clear and accessible basis for monitoring PFM reform
progress over the long term.
It is anticipated that this Limited PEFA assessment shall support the on-going dialogue between the
government and its development partners on aid delivery modalities and arrangements for support
to PFM reform in Trinidad and Tobago. While this report, by design, neither articulates specific
recommendations for PFM improvements nor details an action plan, it is anticipated that the results,
which establish areas of both strength and weakness, shall assist the government in further
defining its PFM reform priorities and subsequent reform activity sequencing and pacing schedule.
I. Integrated Assessment of PFM Performance
In the following sections of the summary the performance of PFM systems, procedures and
practices as measured through the Limited PEFA assessment along with considerations of
indicators measured under the 2008 PEFA Assessment, are described. The description is
presented in terms of six critical dimensions of PFM as defined within the PEFA methodology.
These are credibility of the budget; comprehensiveness and transparency; policy based budgeting;
predictability and control in budget execution; accounting, recording and reporting; and external
scrutiny and oversight.
A. Credibility of the budget
When considered at the aggregate level, and restricted to an assessment of primary expenditure,
Trinidad generally performs well with respect to the credibility of the budget measured at an
aggregate level with strong performance with regards to aggregate comparison of aggregate
expenditure estimates versus outturns, revenue estimates versus outturns and expenditure arrears
management. However, weaknesses are exposed when the credibility of the budget is considered
at the level of specific line ministries. It should also be noted that while the assessment scores the
management and tracking of expenditure arrears well, there is some indication that informal
procedures are used to procure goods and services that address commitment retroactively. Such
arrears would be excluded from the expenditure arrears monitoring systems and so it is impossible
to quantify the amount. The Trinidad and Tobago Manufacturers’ Association (TTMA) membership
reports long delays in receiving payments when supplies are made to MDAs. That perspective
would include the administrative period required to verify invoices and so may not necessarily
indicate the accrual of arrears, but could well do so.
No direct measures of revenue outturns against revenue estimates were made, however
considerations of comparisons of budget estimates to budget outturn, and supplementary budgets
suggest that Trinidad and Tobago continue to achieve close matches of revenue outturns and
revenue estimates. A significant part of Trinidad and Tobago’s revenue is derived from oil and gas
proceeds. Due to the high price volatility the Budget Division adopts a “budget price” for oil and
response to the information provided by the fiscal risk assessment. Such responses may be purely political and a
comment on such would be beyond the remit or competence of a PEFA assessment.
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Trinidad and Tobago Limited Repeat & Sectoral PEFA 2013
gas, set at conservative levels when compared to current market prices to ensure revenue (and
consequently budget) predictability.
A combination of credible revenue forecasting coupled with effective and realistic top-down
budgetary discipline along with a successful debt management strategy and effective budget
release and expenditure control has provided credibility of the budget at the most aggregate levels.
In contrast (see PI-2) the comparison of outturns to budget estimates for specific line ministries
shows very large variance. These large variances are the result of a budget preparation process
that does not include the issuance of politically backed ceilings as part of the budget call circular.
This in turn has given rise in the case of line ministry development budget requests reduced to a
bidding process based upon anticipated cuts by the Ministry of Finance and Economy. Bids over
final budgets for some ministries are as high as 300%. There are also large variances between
recurrent budget submissions and final approved budgets. This may appear paradoxical given that
payroll is predictable and is managed well in Trinidad and Tobago. Since it makes up the greater
proportion of the recurrent budget it would seem that there should be limited variance in the
recurrent budget estimates when compared to recurrent budget outturns at the line ministry level.
Yet this is not the case. As it turns out budget preparation is based upon the line ministry total
establishment rather than some estimate of the funded establishment and the difference in the two
gives rise to very significant variances.
There is another factor that can impact upon variances between budget estimates and outturns at
the line ministry level. This may arise from poorly managed budget contingencies. As it turns out
Trinidad and Tobago operate a revolving fund of 100 Million T&T$ that is only applied in the case of
emergencies. In the period assessed the size of contingency expenditure never exceed 0.23% of
total expenditure in a given year.
The aggregate expenditure out-turns matches the budget estimates quite closely. It clearly reflects
a measure of fiscal discipline exercised through a macro fiscal framework that is effectively applied
as an instrument of top-down discipline to the budgetary process (see PI-12), coupled with effective
cash and debt management (PI-17), and budget release predictability (see PI-16), as well as sound
salary management (see PI-18). The story is more mixed with respect to the effectiveness of non-
salary expenditure controls (PI-19, PI-20).
The PFM systems deliver predictable and well controlled virement procedures with well
documented and suitably controlled procedures. The low variances up and above the expenditure
deviation at the aggregate level would seem to suggest a strong coupling between the budget
formulation and preparation process, and in turn between budget estimate and implementation.
However, the absence of cabinet approved ceilings being included in the budget call circulars, have
led to budget holders submitting budget estimates that are several times the ceilings adopted by the
Budget Division and approved by the Minister of Finance. While the Exchequer and Audit Act
accommodates for a supplementary budget process, this does not appear to introduce significant
adjustments to the original budget estimates
B. Comprehensiveness and transparency
On the basis of the results of the 2008 PEFA Assessment it was found that Trinidad and Tobago
does well on all areas of comprehensiveness and transparency except with regards with the
classification of the budget.
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The government has adopted standards for the budget formulation and execution, based solely on
economic and administrative budget classifications. The Budget Division can produce consistent
documentation according to GFS/COFOG standards and does so to provide reporting to the IMF.
The budget documentation includes a table that segregates expenditure in accordance with
functional classifications. However, at this time budget execution and financial reporting remains
on an economic and administrative classification. The chart of accounts incorporates and is
consistent with the administrative and economic budget classifications.
Its performance in other areas of comprehensiveness and transparency as reported in the 2008
PEFA Assessment include:
The budget documentation is complete, comprehensible and comprehensive including the
macroeconomic assumptions, the fiscal balance along with the makeup of any deficit
financing, the debt profile and status, the financial assets, the historical budget outturns
and clear explanations on the impacts of new major revenue and expenditure policy
initiatives.
Except for relatively minor deposit accounts operated by the Ministry of Energy that arise
as a consequence of Production Share Agreements signed with oil producers, all
revenues generated directly by Departments are transferred to the Consolidated Fund
which operates as a Single Treasury Account3. Almost all expenditure is made through a
centralised payments system. This arrangement provides effective control over the extent
of extra-budgetary expenditure by the ministries that can be undertaken. The Ministry of
Finance has the capacity to oversee revenue and expenditure transactions through daily
bank reconciliations and to monitor the public entities' plans and financial management.
There are no unreported Public-Private Partnerships, nor unreported unconventional
financing instruments for addressing losses of Public Enterprises. All security agency
funds are reported on in aggregate, even if details of expenditure remain undisclosed. The
financial reports consolidation process includes a reconciliation process between sources
of funds and applications which reasonably assures that there are no significant extra-
budgetary funds outside development partner funds.
A review of the mechanisms for the vertical and horizontal allocation of resources to Sub-
national Government suggests a transparent system which incorporates parliamentary
oversight. The budget allocation process provides reliable information on the allocations to
be made to them but not before the start of their detailed budgeting processes. The budget
releases to sub-national government entities are timely and fully predictable.
Moody’s investor services assigns Baa1 to the government bond rating of Trinidad and
Tobago. There is a fairly careful risk assessment of Public Enterprise operations using a
comprehensive risk analysis framework, however at this time not all major public
enterprises are complying fully with the Investment Division’s financial reporting
requirements to make the system fully effective. There is the timely and regular audited
fiscal reporting of most Public Enterprises operations to permit effective oversight by the
Investment Division but not yet all.
The culture of transparency with regards to budget documentation is active and there is
budgetary, tax revenue and audit information that is made available in a timely fashion on
3 The account is operated as a single account with all line ministries operating directly out of that account rather than as bank
account mechanism that incorporates a master account along with subsidiary bank accounts assigned to the different line
ministries.
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the Internet through the government book shop and public and academic libraries. There
is broad transparency demonstrated with respect to public access to key fiscal information.
However, one area that remains opaque is procurement. Awarded contracts are not
published. There is also no information available on the amounts of resources received
by the front line facilities such as primary schools and primary health care facilities.
C(i). Policy-based budgeting
The budget call circular serves as the basic instrument for communicating policy to budget holders.
There is clear policy direction from the cabinet to the budget holders through the budget call
circular. However the lack of cabinet approved budget ceilings dilutes the effectiveness of the
bottom-up elements of budget preparation. This is even though the budget schedule provides
ample time for budget holders to prepare their budget. Without definite ceilings it is difficult to
systematically prioritise programmes and projects. Further the absence of politically backed ceiling
incorporated into the budget call circular has led to a culture by which line ministries intentionally
bid considerably higher that their requirements in anticipation of massive cuts possibly returning
them to actually required levels. In such a budget formulation environment it becomes difficult to
see how carefully considered strategy can survive massive cuts without huge strategic distortion
and imbalance. Almost definitely even if there were carful considerations of life cycle costing –
investment plus forward linked recurrent costs – it is unlikely that these relationships could survive
such a budgetary process.
The fiscal framework is derived with consideration of three year revenue forecasts and a three-year
pro-forma expenditure profiles developed as part of the IMF Article IV consultations. The fiscal
framework used for budget purposes however is defined within a single year framework and the
budget call circulars reflect a single budget year. Trinidad and Tobago adopts a dual budget
process with the recurrent budget process coordinated by the Budget Division within the Ministry of
Finance, and the development budget process coordinated through Public Sector Investment
Program managed through the Ministry of Planning and Sustainable Development. The fiscal
framework defines economic classifications that are linked to the annual budget ceilings.
The budget process encompasses policy input from the cabinet at the beginning and the end of the
budget process through the Policy Formulation Committee; a subcommittee of Cabinet. There are
strong institutional arrangements in place for ensuring both strong policy as well as technical review
of the budget. The budget process occurs in accordance with a definite budget calendar and is
guided by clear and timely budget call circulars that facilitate an early budget preparation process
by the budget holders. However, the budget preparation process as carried out by the budget
holders is not based upon indicative or hard budgetary ceilings. The Line Ministries have
approximately eight weeks to prepare their budget bids. Finalised ceilings authorised by cabinet
which are provided towards the end of the budget preparation cycle allow about a week for
Ministries to finalise their budgets with approved bids incorporated.
The Medium Term Policy Framework (2011 to 2014) serves as the overarching national
development framework from which sector strategies are prepared. Strategies are not developed
within realistic fiscal aggregate forecasts nor are they fully costed with both recurrent cost
implications taken into account. There are links between the sector development plans and the
budget made through annual public sector investment programmes (PSIPs). Links between
projects and programs that are entered into the PSIP are justified by the strategies but the links
remain qualitative. All projects included in the PSIP are cabinet approved. They are however not
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Trinidad and Tobago Limited Repeat & Sectoral PEFA 2013
developed within realistic fiscal aggregates, which is part of the strategic planning process, and
quite different and separate from the fiscal ceilings for annual budget preparation The inclusion of
PSIP projects into the development budget process is not guided by ceilings. Some Line Ministries
report that their budget submissions do not specifically include forward linked recurrent costs
emanating out of the development projects. However, the Budget Division reports that such costs
are estimated and included in the recurrent budgets as part of the reconciliation process. The
effectiveness of such an arrangement is not clear since Line Ministries report that they are not
made aware of such recurrent budget considerations being made and reflected in the approved
budgets.
Further, the absence of cabinet approved ceilings guiding the budget preparation process has
resulted in budget bids received from MDAs exceeding final approved ceilings by as high as a
factor of three in the last budget cycle. The extremely large budget reconciliation adjustments,
coupled with the very late communication of finalised budgetary allocations to the MDAs leaves no
time for them to realign their priorities with the final approved ceilings. The emphasis on
maintaining top down discipline serves the fiscal discipline objective well. However, the absence of
cabinet approved ceilings from the budget process therefore undermines the bottom up elements of
the budget process and almost certainly impacts negatively the opportunities to achieve both
technical and allocative efficiency.
Debt sustainability analysis is performed on an annual basis by the Central Bank of Trinidad and
Tobago. The debt sustainability assessment has become somewhat routine especially because of
the very low debt stock levels that are currently estimated at only 24% of GDP.
The executive typically completes its budget submissions five to six weeks prior to the start of the
fiscal year. The Parliament approves the appropriations prior to the start of the fiscal year after
review of the budget proposals except for one of the years of the review. In that year it passed the
budget within one month of the start of the fiscal year. The Exchequer and Audit Act allows for
continued spending by the executive for just the first month of the new fiscal year.
While the quantum of development partner contribution is small, its strategic and policy impact can
be substantial especially with regards to the piloting of new initiatives and the transfer of expertise.
C(ii). Predictability and control in budget execution
Predictability in budget execution is premised upon revenue adequacy, which in turn requires sound
revenue administration. Many elements of revenue administration work well and appear to have
been enhanced by the implementation of a new tax administration software system. These include
clarity of taxpayer obligations and liabilities, the legal constraints on officer discretion in the
application of penalty waivers and rates, the sustaining of vigorous tax awareness and educational
programs, the selection basis, planning and implementation of tax audits. Recent difficulties with
respect to collection of tax arrears and the timely and regular complete reconciliation of tax
assessments, tax arrears, tax collections and tax payments into the consolidated fund have been
resolved. Trinidad and Tobago implements the complete reconciliation of tax assessments,
collections, arrears and transfers of the Treasury each month before the close of the following
month.
Cash management and debt management are very well managed and facilitate highly predictable
budget releases. Trinidad and Tobago uses a centralised payments system out of the
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Consolidated Fund which beyond daily bank balance consolidation that informs and guides budget
releases facilitates effective debt management. Debt management is enhanced by having the
authority to incur loans being vested in a single authority - the Minister of Finance. Debt is
monitored using the DMFAS system and regularly reconciled and reported on with respect to stock
as well as debt service.
The government employs a manual system for non-salary expenditure management, accounting
and financial reporting4. Budget allocation and budget release discipline is strong. Commitment
control is effected through the implementation of a Vote Book expenditure control system. It is
generally effective even though there are some informal procurement arrangements that bypass the
arrangement with respect to commitments (issuance of purchase orders, referred to as invoice
orders) though not payments. There remain some issues pertaining to procurement planning and
reporting on commitments which may contribute to the end of year rush to spend unutilised funds at
the close of the year. This in turn may be part of the reason for working around procurement
procedures. Civil society elements report that there are substantial payment delays especially
towards the end of the fiscal year.
Payroll management is facilitated using a transverse computerised human resource management
and payroll system, the Integrated Human Resource Information System (IHRIS). This system
directly links three databases: the establishment of posts, the personnel database which serve as
control files, and the payroll database. Changes to these databases leave an audit trail and permit
only selected access dependent upon function. The databases are encrypted. All civil servants are
registered through IHRIS that include appropriate fields to protect against duplication. There are
effective controls with respect to the creation of new posts, that include budgetary controls, the
hiring of new employees (controlled by the posts database), and the assignment of promotions,
transfers, allowances and terminations. Further, through the use of verification procedures,
exception reports and staff surveys there is fair assurance of the integrity of the payroll
management system.
While effective controls exist for each of the main steps of the expenditure cycle (see PI-20),
procurement controls remain less than fully effective for all classes of budget expenditure. The legal
regulatory requirements do not clearly establish the Centrals Tenders Board Ordinance to extend to
special purpose companies (all of which are state owned enterprises) which operate on their own
procurement rules. Expenditure under the Infrastructure Development Fund is implemented
through these special purpose companies and this means that a substantial proportion of
development expenditure is not subject to the public procurement regulations, even though there
exists a Comptroller of Accounts Circular No.12 dated 9th November 2005. Civil society elements
state their concern for the lack of transparency and competition they experience with procurement
carried out by the special purpose companies.
Internal audit in Trinidad and Tobago remains rudimentary and does not focus on systemic issues.
The Internal Audit Units elaborate annual audit plans which when reported on are not disseminated
to the office of the Auditor General or to the Comptroller of Accounts who serves as overall
coordinator of the internal audit function. Upon specific requests made by the Auditor General they
are provided though.
C(iii). Accounting, recording and reporting
4 Such manual systems includes the application of excel worksheets for analysis, reconciliation and reporting.
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Trinidad and Tobago Limited Repeat & Sectoral PEFA 2013
Bank account balances are determined daily. Full bank accounts reconciliations take place
monthly, but given that it is all done manually it takes eight weeks after the close of a given month
to complete the reconciliation process. The accounting system does not facilitate advances.
Reconciliation and clearance of suspense accounts take place monthly within a month of the close
of the month (except for a few identified accounts) and are force closed as part of the end of year
procedures.
Government accounting standards that promote some disclosure are applied across all Line
Ministries consistently and are included in the annual reports that present the audited annual
financial statements. The monthly expenditure returns are comprehensive, consistent with the
budget classification and structure, and allow direct comparison of budget implementation to the
original budget. The reporting format distinguishes commitments and expenditure. The fact that
they are issued within 30 days of the close of the month has ensured their timeliness and hence
their effectiveness as a management tool. The report also includes a reconciliation of revenues, net
changes in debt position, expenditures and consolidated bank balances. This aggregate
reconciliation provides assurance as to the accuracy of the reports.
No reporting on the resources (in cash or in kind) disbursed to the front-line service delivery units
are carried out on a routine basis. There have been no Public Expenditure Tracking Surveys
(PETS) nor any other special surveys carried out in Trinidad and Tobago; nor are there any
planned to be carried out in the near future. The administrative structure of the chart of accounts
reflects entities specified to the level of primary schools and health clinics. Therefore, in principle, it
should be possible to track and report upon cash and kind resources received by such entities.
However, the accounting system being manual would make the reporting on cash and in kind
resources a considerable administrative burden.
Consolidated government accounts are prepared annually with revenue and expenditure
information as well as a statement of financial assets and liabilities. There is however no specific
reporting on non-salary expenditure returns. The annual appropriation accounts are completed
within four months after the close of the fiscal year and audited within seven months of the close of
the fiscal year.
C(iv). External scrutiny and audit
Both the position and the office of the Auditor-General (AG) meet most of the standards of
independence set by INTOSAI for supreme audit institutions. These include the legal requirements
with respect to the appointment and termination of the Auditor-General, the financing of the budget,
the hiring of staff, the auditor’s jurisdiction and the timing and extent of dissemination of audit
reports. In practice not all central government entities are audited every year. It is estimated that
three quarters of total expenditure is audited each year. A range of audits are performed, including
systems audits, financial and compliance, procurement and systems audits. Public Enterprises are
audited by private audit firms. At this time these audit reports are not disseminated to the Auditor-
General. The standards applied are those of the International Organisation of Supreme Audit
Institutions (INTOSAI).
In recent years the Office of the Auditor General has strengthened its capacity to undertake value
for money audits and increased its focus on systems audits. It is incorporating a considerably
stronger risk basis for its audit focus.
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Trinidad and Tobago Limited Repeat & Sectoral PEFA 2013
Audit reports along with audited financial statements are submitted to the legislature within seven
months from the end of the fiscal year which is equivalent to three months from submission to the
AG. The Comptroller of Accounts prepares an aggregated financial statement based on ministry
financial statements.
The accounting officers are responsible for implementing corrective measures emanating out of the
Auditor General's findings. There is little evidence of systematic and timely follow up on external
Audit findings and it is often left to the field auditors to ensure that recommendations are followed
through as part of subsequent audits. It appears that there may be opportunities missed to
strengthen further the PFM system as the recommendations made by the Auditor-General are not
enforced through the full implementation of corrective measures.
Trinidad and Tobago is characterised by a strong democratic tradition and the parliamentary
oversight of the government’s budget processes also includes actual expenditure achievements
and the quality of expenditure management. The parliamentary debates cover fiscal policies as well
as the details of revenue and expenditure estimates. The status of parliamentarians is essentially
part-time with members reporting one day a week except for the budget period where attendance
may cover a full two-week period. Consequently there is a very limited time allocated to budget
oversight both ex-ante and especially ex-post.
The appropriations act is typically passed before the start of the financial year. The Supplementary
Budget Estimates presented by the Minister of Finance and voted by the parliament, is reviewed
once a year. This stance is consistent with the Government’s emphasis on a strong fiscal discipline
objective to its public finance management. Clear rules exist with respect to in-year budget
amendments by the executive.
A review of expenditure anomalies as identified through external audit is done through a public
accounts committee (PAC). The PAC is able to review less than 10% of audit reports, even though
reviews involve in-depth hearings when they occur. This has led to a substantial backlog of audit
reports that remain to be reviewed. At the present time PAC relies on the Auditor General to
ensure that Accounting Officers fully implement its recommendations. However there have not been
systematic or timely follow up on PAC recommendations across all Line Ministries.
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Trinidad and Tobago Limited Repeat & Sectoral PEFA 2013
Table 1.1 Overall summary of PFM Performance Scores
PFM Performance Indicator (PI) Scoring
Method
Dimension Ratings Overall
Rating i. ii. iii. iv.
A. PFM-OUT-TURNS: Credibility of the budget
PI-1 Aggregate expenditure out-turn compared to original approved budget M1 A A
PI-2 Composition of expenditure out-turn compared to original approved budget M1 D A D+
PI-3 Aggregate revenue out-turn compared to original approved budget M1 Not Assessed
PI-4 Stock and monitoring of expenditure payment arrears M1 Not Assessed
B. KEY CROSS-CUTTING ISSUES: Comprehensiveness and Transparency
PI-5 Classification of the budget M1 C C
PI-6 Comprehensiveness of information included in budget documentation M1 Not Assessed
PI-7 Extent of unreported government operations M1 Not Assessed
PI-8 Transparency of inter-governmental fiscal relations M2 Not Assessed
PI-9 Oversight of aggregate fiscal risk from other public sector entities M1 Not Assessed
PI-10 Public access to key fiscal information M1 Not Assessed
C. BUDGET CYCLE
C(i) Policy-Based Budgeting
PI-11 Orderliness and participation in the annual budget process M2 A D B B
PI-12 Multi-year perspective in fiscal planning, expenditure policy and budgeting M2 C A D C C+
C(ii) Predictability and Control in Budget Execution
PI-13 Transparency of taxpayer obligations and liabilities M2 Not Assessed
PI-14 Effectiveness of measures for taxpayer registration and tax assessment M2 Not Assessed
PI-15 Effectiveness in collection of tax payments M1 NR A A NR
PI-16 Predictability in the availability of funds for commitment of expenditures M1 Not Assessed
PI-17 Recording and management of cash balances, debt and guarantees M2 Not Assessed
PI-18 Effectiveness of payroll controls M1 A B A C C+
PI-19 Competition, value for money and controls in procurement M2 C D D D D
PI-20 Effectiveness of internal controls for non-salary expenditure M1 B C B C+
PI-21 Effectiveness of internal audit M1 C C C C
C(iii) Accounting, Recording and Reporting
PI-22 Timeliness and regularity of accounts reconciliation M2 Not Assessed
PI-23 Availability of information on resources received by service delivery units M1 D D
PI-24 Quality and timeliness of in-year budget reports M1 Not Assessed
PI-25 Quality and timeliness of annual financial statements M1 B A C C+
C(iv) External Scrutiny and Audit
PI-26 Scope, nature and follow-up of external audit M1 Not Assessed
PI-27 Legislative scrutiny of the annual budget law M1 B B D C D+
PI-28 Legislative scrutiny of external audit reports M1 D C C D+
D. DONOR PRACTICES
D-1 Predictability of Direct Budget Support M1 A C C+
D-2 Financial info provided by donors on project and program aid M1 D D D
D-3 Proportion of aid that is managed by use of national procedures M1 A A
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II. Assessment of the impact of PFM weaknesses
When viewed from the perspective of the three main objectives of a sound PFM system, namely
aggregate fiscal discipline, strategic allocation of resources and the efficient delivery of services;
Trinidad and Tobago scores well with respect to fiscal discipline at the most aggregate levels. In
contrast at the Line Ministry level there is a poor match of outturns to estimates. The guidance by a
multi-year fiscal framework (derived from the Article IV consultation forecasts) in setting annual
macro-fiscal parameters and the conservative posture in the specification of a budget oil price, with
a definite budget calendar that facilitates the meaningful bottom-up participation by ministries, along
with the sound cash management and debt management, and the achievement of predictable
budget releases and effective payroll management all point to efficient delivery of services.
However these positives are negatively impacted by the absence of cabinet approved ceilings at
the beginning of the budget formulation cycle, weaknesses in procurement management and the
lack of financial feedback at the end of the service delivery cycle – the receipts by the front line
facilities such as primary schools and primary health care facilities.
The main areas of PFM performance improvement since the 2008 PEFA Assessment are:
The timeliness of budgetary approval by the parliament
The reconciliation of assessments, arrears, collections and transfers for the main tax
revenues
The management of budgetary support both by way of volume and disbursement schedule
predictability
The degree of utilization of government PFM systems by Development partners
There are four main factors that colour the PFM of the central government in Trinidad and Tobago:
1. Single Treasury Account: All payments by Line Ministries are made out of a single treasury
account. Line Ministries are responsible for check reconciliations against their cash books but
only the Treasury carries out full bank reconciliations.
2. Centralized tendering procedures: All management of tenders beyond a ministerial threshold
is carried out by the Centrals Tenders Board. The Centrals Tenders Board Ordinance governs
procurement across central government and sub national government but does not cover the
procurement under the State Owned Enterprises including the Special Purpose Companies
that are employed for carrying out projects funded through the Infrastructure Development
Fund.
3. The employment of manual non-salary expenditure control and accounting systems: The
employment of manual non-salary expenditure control and accounting systems, while not
seeming to compromise on quality or basic effectiveness introduces some delay in
reconciliation and reporting.
4. The diluted role of parliament in budgetary oversight: Trinidad and Tobago has a strong
democratic tradition and has clear parliamentary rules encoded in its standing orders.
However, the one day a week attendance of parliamentarians, coupled with many of its
members being in the government constrains the time that it can garner to effectively review
budget documentation as well as audit reports.
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1. Aggregate Fiscal Discipline
With respect to aggregate fiscal discipline, Trinidad and Tobago’s comprehensive management of
debt; effective fiscal risk assessment and oversight of public enterprises; credible fiscal forecasts
that serves as the basis for top-down budgetary discipline; and a comprehensive and effective
establishment and commitment control process all point to the ability to deliver strongly on
aggregate fiscal discipline (see PI-1, PI-2, PI-3, PI-16, PI-17 and PI-18). This is further
strengthened by a strict commitment control system supported by an effective budget release
system. There is effective external audit at the level of financial and compliance audit with some
elements of systems audit executed. The absence of significant extra-budgetary activity also
contributes to the achievement of fiscal discipline (see PI-7). However, there remain some
concerns with respect to the effectiveness of internal audit and the level of competition achieved
through procurement management.
2. Strategic Allocation of Resources
Trinidad and Tobago still needs to take a number of important steps towards achieving a budgetary
process to be fully capable of the strategic allocation of resources (see PI-5, PI-11 and PI-12). In
particular the absence of indicative fiscal aggregates in the process of developing sector strategies
undermines the likelihood of effectively translating strategic goals through the budget formulation
and budget implementation stages. Sustainability, a crucial strategic objective is undermined
because little attention is paid to life cycle costing (investment cost plus forward linked recurrent
expenditure) in the development of sector programs and projects. Even where these occur it is
unlikely that the careful balance between budgeted investments and their related forward linked
recurrent charges can be maintained given the massive cuts experienced by Line Ministries through
the budget preparation process. Without budget ceilings at the start of the budget preparation
process Line Ministries have little opportunity to prioritize their programs taking into account such
factors as life cycle costing in the preparation of their development budgets.
While there is very strong policy dialogue incorporated into the budget process, the absence of
cabinet approved ceilings at the beginning of the budget cycle leaves a vacuum for defining
priorities which has led to persistent large mismatches between budget bids and the availability of
fiscal resources. The budget classification in Trinidad and Tobago remains principally economic
and administrative and so is not directly capable of supporting a policy based budgeting process
and thus the input for achieving the strategic allocation of resources.
Although the development objectives do not rely heavily upon Development Partner inputs, there
are missed strategic opportunities that arise due to the lack of a close alignment of development
partner grants with the budget process and an almost total absence of timely reporting on project
and programme achievements consolidated into the national consolidated financial reporting
framework. Not tracking resources received by front line service delivery units such as primary
schools and primary health care facilities (see PI-23) is a missed opportunity to better manage,
coupled with an effective monitoring and evaluation framework focussed on outputs and outcomes,
the achievement of effectiveness in the strategy plans.
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3. Efficient Service Delivery
There are areas that Trinidad and Tobago has had much success in contributing to efficient service
delivery. These include the improving collection of revenues which provides a sound basis for
achieving the efficient delivery of services; and also there have been considerable efficiency gains
that have a risen as a consequence of Trinidad’s sound cash and debt management both with
respect to efficient liquidity management, as well as with respect to the market response to sound
debt management with the subsequent reduction in the cost of money to government. The
improved performance of the tax administration offers increasing opportunity for improved revenue
collection.
However there remain some difficulties with respect to public procurement. The current legal and
regulatory framework for public procurement does not include a number of opportunities for
improving competition in public procurement. There are no requirements to prepare and publish
procurement plans; there is no requirement for the implementation of an effective, independent
public procurement complaints mechanism and there is no oversight authority to ensure operational
adherence to the public procurement procedures. Public procurement is further complicated by
the creation of special purpose companies set up as public corporations that are used to procure
goods works and services for the Line Ministries. These special purpose companies are not
required to follow the public procurement laws and regulations. However, they have some
guidelines set out by the Investments Division of the Ministry of Finance and the Economy.
Significant contributions to efficient service delivery can be made through effective monitoring of
transfers to frontline service delivery units to guide policy and inform on the efficiency of service
delivery.
III. Change in performance since the previous assessment
PI-1 was not part of the assessment remit but had to be reviewed to place the entire exercise into
context. Compared to the 2008 PEFA assessment, PI-1 improved from a B score to an A score
reflecting an improvement in aggregate fiscal discipline.
Three other Performance Indicators (PIs) improved. PI-11, which is a government indicator, moved
from a C+ to a B due to the early approval of the budget estimates by the legislature. The other two
are donor indicators; D-1 and D-3. Improvement in D-1 was due to availability of data from donors
to score, the low level of deviations from forecast disbursement and actual disbursement as well as
the weighted delays in quarterly disbursements. D-3 improved because of donors' decision to
provide both direct budget support and sector budget support using national standards, of which
more than 90% of donor support adopted country systems.
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Table 1.2 Change in performance since 2008 PEFA assessment
PFM Performance Indicator Scoring
Method 2008 2013 Change
PI-1 Aggregate expenditure out-turn compared to original approved budget M1 B A
PI-2 Composition of expenditure out-turn compared to original approved budget M1 C D+
PI-3 Aggregate revenue out-turn compared to original approved budget M1 A Not assessed
PI-4 Stock and monitoring of expenditure payment arrears M1 B+ Not assessed
PI-5 Classification of the budget M1 C C
PI-6 Comprehensiveness of information included in budget documentation M1 B Not assessed
PI-7 Extent of unreported government operations M1 A Not assessed
PI-8 Transparency of inter-governmental fiscal relations M2 B+ Not assessed
PI-9 Oversight of aggregate fiscal risk from other public sector entities M1 A Not assessed
PI-10 Public access to key fiscal information M1 B Not assessed
PI-11 Orderliness and participation in the annual budget process M2 C+ B
PI-12 Multi-year perspective in fiscal planning, expenditure policy and budgeting M2 C+ C+
PI-13 Transparency of taxpayer obligations and liabilities M2 B+ Not assessed
PI-14 Effectiveness of measures for taxpayer registration and tax assessment M2 B+ Not assessed
PI-15 Effectiveness in collection of tax payments M1 D+ NR
PI-16 Predictability in the availability of funds for commitment of expenditures M1 B+ Not assessed
PI-17 Recording and management of cash balances, debt and guarantees M2 A Not assessed
PI-18 Effectiveness of payroll controls M1 C+ C+
PI-19 Competition, value for money and controls in procurement M2 D+ D+
PI-20 Effectiveness of internal controls for non-salary expenditure M1 C+ C+
PI-21 Effectiveness of internal audit M1 C C
PI-22 Timeliness and regularity of accounts reconciliation M2 B Not assessed
PI-23 Availability of information on resources received by service delivery units M1 D D
PI-24 Quality and timeliness of in-year budget reports M1 A Not assessed
PI-25 Quality and timeliness of annual financial statements M1 C+ C+
PI-26 Scope, nature and follow-up of external audit M1 B Not assessed
PI-27 Legislative scrutiny of the annual budget law M1 D+ D+
PI-28 Legislative scrutiny of external audit reports M1 D+ D+
D-1 Predictability of Direct Budget Support M1 NS C+
D-2 Financial info provided by donors on project/program aid M1 D D
D-3 Proportion of aid that is managed by use of national procedures M1 D A
Key:
Improved Slipped Not Comparable No Change
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IV. Prospects for PFM Reforms
The Government of Trinidad and Tobago has embarked upon a number PFM reforms since 2005.
As is clearly articulated in the 2011 Budget Speech – Moving from Promises to Performance,
Trinidad and Tobago (T&T) has identified performance as an important objective for governance
and government operations. The IADB has provided Trinidad and Tobago funding to support PFM
reforms. Implementation oversight and monitoring is the responsibility of the Economic
Management Division headed by a Deputy PS. While some preliminary work is in progress a PFM
reform strategy to be implemented with appropriate institutional arrangements is yet to be initiated.
There is some indication though that consultants have completed a draft report that is currently
being considered by officials. Specific improvements are carried out by divisional heads.
There have been specific PFM reform initiatives that have been undertaken including the
development of a draft public procurement bill that is yet to be tabled before parliament. Particular
initiatives within the Office of the Auditor General are to strengthen systems audit as well as
introduce risk based audit and improve value for money audits which have been in existence since
the1980's. By way of development partner participation and support of PFM improvements, this
would require a broader dialogue within the budget formulation process of the Economic
Management Division, the Board of Inland Revenue and the Office of the Auditor-General which
serve as the main drivers of PFM improvements at this time.
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1 Introduction
1.1 Objective of the PFM-PR
The overall objective of the PEFA assessment was to assist in improving the Public Finance
Management performance in Trinidad & Tobago for central government and line ministries. The
assessment was in two fold - first, central government and second sector assessment. The PEFA
methodology requires the assessment of 31 high-level performance indicators - 28 for central
government and 3 for donors. The central government assessment was a "limited PEFA
assessment because both donors and government agreed to review the performance of
Performance Indicators (PIs) that scored C or below in the 2008 PEFA assessment. In view of this,
16 PIs were assessed.
Specifically, the central government assessment was to review progress made over time since the
2008 assessment. This required the appraisal of PFM systems, processes and procedures in
central government agencies, first from the Ministry of Finance perspective as the lead PFM
ministry looking at the top-down approach and then to some selected line ministries as
implementing agencies for the bottom-up approach. The Public Finance Management Performance
Review (PFM-PR) uses a score of A to D for rating each indicator - an A meaning a high
performance and a D meaning a low performance. In addition to the ratings, a narrative is
presented describing and supporting each score and the reasons thereon.
The country's macro-economic context, the legal and regulatory framework, and the institutional
framework supporting PFM were outlined. The PFM-PR is intended to serve as a monitoring and
evaluation tool for effective dialogue between government and donors regarding PFM reform.
As the "Strengthened Approach" which required a country/government led assessment, a donor
coordination and the availability of a common data pool for PFM reform, it turns out that there was
common understanding in this regard leading to a successful mission. The PEFA framework was
intentionally designed not to make any recommendations as part of the "strengthened approach" in
order to encourage a total and complete government led approach to PFM reform.
1.2 Process of preparing the PFM-PR
The assessment was in twofold: first to review central government PFM performance to identify
areas of weakness using the 2008 PEFA assessment as the base line; the second part of the
assessment was sector-specific driven by the EU's eligibility criteria for sector budget support.
The EU Delegation to Trinidad and Tobago in consultation with other major donors and the
Government as a key stakeholder prepared the Terms of Reference. Apart from the central
government assessment, the stakeholders agreed to conduct a sector PEFA assessment to review
the current processes supporting PFM in the selected line ministries. In view of this, five MDAs
were part of the assessment; these were the Ministry of Trade, Industry and Investment, the
Ministry of Labour and Small and Micro Enterprise Development, the Ministry of Food Production,
the Ministry of Energy and Energy Affairs and the Ministry of Environment and Water Resources. A
day's workshop on the PEFA methodology was carried out during the field mission for key
personnel of the five line ministries as well as officials from the Ministries of Planning and
Sustainable Development and Finance and the Economy. Some donor and civil society
representatives were also present.
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Trinidad and Tobago Limited Repeat & Sectoral PEFA 2013
As one of the key deliverables, an inception report was presented to the EU Delegation, which
included a work plan with a schedule of meetings and key MDA staff needed. The team of
consultants received an excellent cooperation from Government officials, donor partners and civil
society organisations in spite of time constraints and busy work schedules. Responses to the
consultants request with regards to official documentation as supporting evidence in addition to
additional meeting schedules were timely met. Many of the interviews required the presence of key
heads of divisions under each line ministry, namely planning, budgeting, procurement, internal
audit, accounting and payroll. The presence of Permanent Secretaries of the various line ministries
visited was very much appreciated as they stayed throughout the interview sessions to ensure the
consultants received responses to questions and the data requested. The triangulation process was
fully appreciated by each interviewee, having understood that it serves as check on the right type of
information for quality assurance.
A debriefing workshop was organised at the end of the field mission where preliminary findings
were presented to government officials and donors. The draft report was submitted to all
stakeholders for review and comments after which the final report was submitted, aimed at
improving the dialogue on PFM improvements and reform between government and donors.
Assessment team
The EU Delegation contracted ACE International Consultants, Spain for the assignment. Two PFM
experts were hired by ACE for the mission, namely Ronald E. Quist and Charles K. Hegbor.
1.3 Methodology
The field mission was carried out between November 6th 2013 and December 5th 2013. A review
of the legal and regulatory framework that governs Public Finance Management was important for
placing the exercise in the appropriate legal and regulatory framework context.
The PEFA methodology framework was adopted. This involves the use of PFM performance
measurement framework to measure the strength of PFM reforms. An effective and orderly PFM
measurement framework required these three levels of budgetary outcomes, namely:
Effective controls of the budget totals and management of fiscal risks contributing to
maintain aggregate fiscal discipline
Planning and executing the budget in line with government priorities contributing to
implementation of government's objectives, otherwise known as strategic allocation of
resources.
Managing the use of budgeted resources contributing to efficient service delivery and
value for money
Undertaking a PFM reform also requires an assessment of capacity. This is important to ascertain
the pace and extent to which PFM reform activities can be implemented. It also provides a basis for
determining a realistic program of training workshops and capacity development support.
The 2013 repeat PEFA and sectoral assessment involved the following:
Review of legal and regulatory documentation, budget documentation and financial and
audit reports;
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Trinidad and Tobago Limited Repeat & Sectoral PEFA 2013
Assessment of the requirements for further analysis and evaluation of PFM practice in the
central government and the three specific sectors, based upon interviews with
Government Officials in the Ministry of Finance, Central Bank of Trinidad and Tobago, the
Parliament, the Office of the Auditor-General, the Ministries of Labour and Small and
Micro Enterprise Development, Education, Works and Infrastructure, Environment and
Water Resources . Development Partners including the European Union and the Inter-
American Development Bank, among others were interviewed
Quantitative analysis of official financial and budgetary data;
Assessments of PFM procedures and systems; and
The application of professional judgment
An important consideration in developing these indicators is an appreciation of the quality,
comprehensiveness and accuracy of data that is used to determine the indicators. The reliability of
the indicators can only be as good as the accuracy of the financial data upon which they were
calculated. Emphasis was placed on the completeness and quality of financial data in determining
the PEFA indicator measures
It is important to state that due to the fact that the 2013 assessment is a 'limited' PEFA assessment,
it was not possible to compare progress over time except for those 16 indicators which were
assessed, in addition to PI-1 assessed in context of the entire performance measurement
framework:
No. Performance Indicators 2013 Assessment
PI-1 Aggregate expenditure out-turn compared to original approved budget In context)
PI-2 Composition of expenditure out-turn compared to original approved budget
PI-5 Classification of the budget
PI-11 Orderliness and participation in the annual budget process
PI-12 Multi-year perspective in fiscal planning, expenditure policy and budgeting
PI-15 Effectiveness in collection of tax payments
PI-18 Effectiveness of payroll controls
PI-19 Competition, value for money and controls in procurement
PI-20 Effectiveness of internal controls for non-salary expenditure
PI-21 Effectiveness of internal audit
PI-23 Availability of information on resources received by service delivery units
PI-25 Quality and timeliness of annual financial statements
PI-27 Legislative scrutiny of the annual budget law
PI-28 Legislative scrutiny of external audit reports
D-1 Predictability of Direct Budget Support
D-2 Financial info provided by donors on project and program aid
D-3 Proportion of aid that is managed by use of national procedures
1.4 Scope of the assessment
As suggested in the PEFA guidelines, the following main PFM indicators were adopted as a guiding
framework for assessing the current status of PFM practice and performance in Trinidad & Tobago.
The assessment focuses on all public revenues and expenditures of the central government and
the institutions responsible for such. The scope of the PEFA Assessment is limited to the central
government’s public finance management and does not include the Local Governments. Nor does
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it include an assessment of the public enterprises (commercial and non commercial, financial and
non financial). In terms of the scope of public sector expenditure covered in this assessment the
proportion of expenditure was a little in excess of 80%.
The assessment also looked into revenue sources and its expenditure, application of procurement
and contracting procedures at the national level.
As required by the Terms of Reference, three sectors under the support of the EU budget support
operations, namely environmental governance, private sector development support and
diversification from sugar production were screened using the PEFA methodology dimensions in
order to assess relevant PFM issues in those sectors. Five Ministries under the three sectors were
reviewed, namely Ministry of Food Production, Ministry of Trade, Industry and Investment, Ministry
of Energy and Energy Affairs, Ministry of Environment and Water Resources and Ministry of Labour
and Small and Micro Enterprise Development.
Paragraph 6 of the Guidance Note on Repeat PEFA Assessment released in February 2010 by the
PEFA Secretariat recommends the need to assess each of the 31 indicators in a repeat
assessment, using the previous assessment as a baseline for the repeat assessment. To buttress
this point, here is a quote from the Guidance Note on Repeat Assessment:
"It is also important to note that the assessment of each indicator should be linked to the
previous assessment i.e. that the focus is on explaining the performance trajectory by using
the earlier assessment as a starting point, rather than doing an assessment of the indicator
isolated from the previous assessment then subsequently comparing the ratings."
Therefore, it is important to state that going by the ToR, which suggests that the consultants should
assess 11 out of 31 high indicators, which ended up into assessing 14 indicators due to the fact that
three additional indicators scored 'C+' might be short of the requirements outlined in the Guidance
to Repeat Assessments. Therefore, the 2013 assessment can be described as a partial or mini
PEFA.
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2 Country Background Information
2.1 Description of country economic situation
2.1.1 Country context
Table 2.1 below summarises the economic indicators over the last three years. Trinidad and
Tobago is a middle income Caribbean Island with a land area of 5,128 sq km. the GDP per capita
stands at US$17,934 (World Bank Source - 2012). The population is estimated at 1.5 million. The
country has had its fare share of the global economic crisis but has remained resolute to maintain
economic stability. Real GDP growth has been marginal over the last three years, recording a rate
on 0.2% in 2009/2010, a negative growth of 2.6% in 2010/2011 and a marginal increase to 0.2% in
2011/2012. The energy sector recorded positive GDP growth of 3.2% in 2009/2010 but declined to
negative 3.9% and 4.7% in 2010/2011 and 2011/2012 respectively. The non-energy sector
recorded successive negative growth rates of 1.8% and 1.6% in 2009/2010 and 2010/2011
respectively but picked up in 2011/2012 to a GDP growth rate of 3.6% in 2011/2012. Even though
the energy sector recorded negative growth in the last two years, it remains the largest contributor
to the country's economy, accounting for about 40% of GDP and 80% of total export but provides
only 5% of employment. Unemployment, according to the IMF Article IV Consultation report issued
in October 2013 stood at about 5%
The overall fiscal balance witnessed a marginal surplus of 0.1% of GDP in 2009/2010 but recorded
deficit of 0.1% and 1.1% in 2010/2011 and 2011/2012 respectively. The rate of inflation (end of
period) stood at 13.4%, 5.3% and 7.2% in 2009/2010, 2010/2011 and 2011/2012 respectively. The
Heritage and Stabilization Fund (HSF) received transfers of TT$3.03billion in 2009/2010 and
TT$2.89billion in 2010/2011. In 2011/2012 however, no transfers were made to the HSF. The total
HSF amounted to US$4.5bilion in August 2012, 18% of GDP. The gross official reserves stood at
an average of US$9.286billion over the last three years or an average of 12.97 months of import
cover. Macro-economic projections into the future suggest a GDP growth rate of 1.6% in 2012/2013
as well as a stable economic environment with the maintenance of a steady revenue inflow and
expenditure control patterns. There was a rise in foreign direct investment but this trend did not halt
the decline in capital and financial account, which recorded deficits. The current account balance
continued to remain in surplus but with steady declines as a result of higher cost of energy and non-
energy imports in spite of increases in oil and gas exports. The current account recorded a growth
of 20.3% of GDP in 2009/2010 but this declined sharply to 12.3% and 10.1% of GDP in 2010/2011
and 2011/2012 respectively.
The international rating agencies have rated Trinidad and Tobago from an "A" to an AA in
2012/2013 indicating a strong macro-economic environment and efficient debt management
strategy.
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Table 2.1 Economic indicators (in percent of GDP, unless otherwise specified)
2009/2010 2010/2011 2011/2012 2012/2013
(estimate)
Real GDP growth (in percent) 0.2 -2.6 0.2 1.6
Energy 3.2 -3.9 -4.7 0.3
Non-energy 1/ -1.8 -1.6 3.6 2.5
Inflation (end of period) 13.4 5.3 7.2 4.0
Revenue 2/ 34.1 32.3 30.9 31.2
Energy 18.4 19.0 17.3 16.8
Non-energy 1/ 15.7 13.2 13.6 14.4
Expenditure 33.9 32.4 32.0 33.6
Current 29.0 28.0 27.7 29.2
Capital expenditures and net lending 4.9 4.4 4.3 4.5
Overall fiscal balance 0.1 -0.1 -1.1 -2.5
Overall fiscal non-energy balance -18.2 -19.1 -18.5 -19.3
External current account balance 20.3 12.3 10.1 8.8
Public sector debt 3/ 35.5 33.4 39.3 33.9
Net of HSF deposits 4/ 17.6 15.5 21.2 16.0
Gross official reserves (in US$ millions) 9,070 9,823 9,200 9,054
In months of imports 15.8 11.9 12.5 11.7
Source: IMF Article IV Country Report May22, 2013 1/ Includes VAT and Financial Intermediation Services Indirectly Measured (FISIM) 2/ Fiscal data is central government unless otherwise specified and refers to the fiscal year ending in September. 3/ Excluding debt issued for sterilization. 4/ Starting in 2013, assumes no additional contributions to the HSF
2.1.2 Overall government reform programme
The National Medium Term Policy Framework is the Government's strategic development
document that guides its developmental framework agenda. This policy replaces the Vision 2020.
The Medium Term Policy Framework covers the period 2011 to 2014. Five thematic areas form the
basis of the policy document. These are:
Crime and Law and Order
Agriculture and Food Security
Healthcare Services and Hospitals
Economic Growth, Job Creation, Competitiveness and Innovation
Poverty Reduction and Human Capital Development
Line ministries prepare their three-year strategic plan out of the Medium Term Policy Framework.
These strategies are further broken down into annual operational plans from which the budgets are
prepared.
Currently, government is engaging the major development partners on the way forward for a major
PFM reform program, which includes the development of a new chart of account in line with GFS
2001. There are efforts at improving the capacity and capability of some government institutions to
ensure greater transparency and accountability in the public sector.
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2.1.3 Rationale for PFM reforms
As part of efforts to leverage on the successes of the existing PFM processes and procedures, as
well as to improve upon the weaknesses identified as outlined in the 2008 PEFA report,
Government priority has been to work towards attaining sound financial management across the
public sector. Major reform steps include but not limited to the development of a Medium Term
Expenditure Framework and the development of a new chart of account necessary for an integrated
financial management information system (IFMIS). Even though discussions are ongoing, the
actualisation of the major reform programs has rather been slow.
2.2 Description of budgetary outcomes
2.2.1 Fiscal performance
Oil and gas remain the main source of Government's revenue. Total revenue increased steadily
over the last three years, from TT$43.86billion in 2009/2010 to TT$50.06billion in 2011/2012, an
increase of 22.52% over the 2009/2010 figure. Revenue from energy sources contributed an
average of 56% with the remaining 44% from non-energy sources. Apart from the achievement of
budget surplus in FY2009/2010, budget deficits arose in the fiscal years 2010/2011 and 2011/2012,
thereby raising some fiscal concerns; these might be the result of increased recurrent expenditure
of which transfers and subsidies contributed an average of 48.8%. The country's total debt is well
managed due to the effective debt management strategy, which allows a sustainable fiscal
framework. Debt to GDP ratio declined from 35.5% in 2009/2010 to 33.4% in 2010/2011; however,
this increased to 39.3% in 2011/2012. Tables 2.1, 2.2A and 2.2B provide a summary of
government's fiscal performance over the last three years.
Trinidad and Tobago remains focused at attaining set objectives in the Medium Term Policy
Framework, by ensuring a steady growth in revenue generation by diversifying the economy, keep
overall expenditure under control and continue to raise debt from the international bond market in
order to free the domestic economy for competitive private sector development. The country is
further committed to maintaining and reducing debt stock for continuous macro-economic stability.
2.2.2 Allocation of resources
The current Government's development strategy is the National Medium Term Policy Framework
2011 to 2014. The Policy Framework aims, among others, to reduce crime, improve healthcare,
reduce poverty and improve economic activities. The National policy document is translated into
three-year strategic plans by line ministries with weak sector perspective. Further, the strategic
plans are operationalised annually through the budget. Both the strategy and the budget are
developed without a fiscal envelop (please, refer to PI-12).
As shown in Tables 2.2A and 2.2B below, between 85% and 87% of total government expenditure
is on recurrent within the last three completed fiscal years whiles 13% to 15% of total government
expenditure on capital and lending cost. Whiles transfers and subsidies accounted for between
48% and 52% of total expenditure, wages and salaries and expenditure on goods and services
were between 15% and 16%, and 14% and 16% respectively. Interest on government borrowings
accounted for between 6% and 7.5% of total government expenditure.
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Trinidad and Tobago Limited Repeat & Sectoral PEFA 2013
Table 2.2A Summary of Central Government Operations (TT$million)
2009/2010 2010/2011 2011/2012
(Art IV)
2012/2013
(Budget)
Revenue 43,863 46,972 50,057 50,700
- Energy 23,649 27,688 27,638 26,750
- Non-energy 20,214 19,284 22,419 23,950
Expenditure 43,705 47,164 53,919 58,369
Recurrent expenditure 37,347 40,729 46,305 50,906
- wages and salaries 6,711 7,205 8,482 8,636
- goods and services 6,441 6,496 9,092 9,444
- transfers and subsidies 20,904 24,342 25,318 29,015
- Interest payment 3,290 2,685 3,413 3,812
Capital expenditure & net lending 6,358 6,435 7,614 7,464
Non-energy balance -23,491 -27,880 -31,500 -34,419
Overall balance 158 -191 -3,862 -7,669
CLICO financial support 3,400 848 5,100 0
Overall balance including CLICO -3,242 -1,039 -8,962 -7,669
Total financing including CLICO 3,242 1,039 8,962 7,669
Foreign financing -1,056 51 1,854 2,556
Domestic financing 4,297 988 7,108 5,113
Transfers to Heritage and Stabilization Fund -3,027 -2,890 0 0
Source: IMF Article IV Country Report 2013
Table 2.2B: Summary of Central Government Operations (%)
Particulars 2009/2010 2010/2011 2011/2012 (Art IV)
2012/2013 (Budget)
Revenue 100.0% 100.0% 100.0% 100.0%
- Energy 53.9% 58.9% 55.2% 52.8%
- Non-energy 46.1% 41.1% 44.8% 47.2%
Expenditure 100.0% 100.0% 100.0% 100.0%
Recurrent expenditure 85.5% 86.4% 85.9% 87.2%
- wages and salaries 15.4% 15.3% 15.7% 14.8%
- goods and services 14.7% 13.8% 16.9% 16.2%
- transfers and subsidies 47.8% 51.6% 47.0% 49.7%
- Interest payment 7.5% 5.7% 6.3% 6.5%
Capital expenditure & net lending 14.5% 13.6% 14.1% 12.8%
2.3 Legal and institutional framework for PFM
2.3.1 The legal framework for PFM
The 1976 Constitution of the Republic of Trinidad and Tobago provides the underlying foundations
of the Public Finance Management (PFM) out of which the specific laws and regulations emanate.
The Exchequer and Audit Act (1959 plus Amendments up to 2012) is the main PFM law in the
country. Table 2.3 below provides a detail overview of the main PFM laws and regulation.
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Table 2.3 Overview of the main laws and regulations governing PFM in Trinidad and Tobago
Area Description
General - Constitution The 1976 Constitution is the supreme law of the land. All other laws are rooted
in the Constitution
The roles of the three arms of government (executive, parliament and the
judiciary) are clearly articulated in the Constitution
It mandates the establishment of the Consolidated Fund out of which all public
funds are to be deposited and expended. It further established other statutory
funds for specific functions (Section 12 to 17 of the EAA and Chapter 8 Section
112 to 114 of the Constitution)
It provides for the establishment of the Office of the Auditor General and for
adequate staff to be provided. All the salaries and allowances of the Auditor
General are a direct charge to the Consolidated Fund (Section 7 to 11 of EAA
and Chapter 8 Section 117 of the Constitution)
Budget preparation and
execution
The Exchequer and Audit Act (1959 plus Amendments up to 2012) is the main
budget preparation and execution law
It provided for the function of the Minister of Finance. It empowers the Minister
of Finance to plan, budget and utilise, account and report all government
revenue and expenditure. It sets out the roles of various divisions of the Ministry
of Finance such as the Budget Division for providing leadership in macro fiscal
framework, planning and budget formulation, the Treasury Division headed by
the Comptroller of Accounts for ensuring proper accountability and reporting,
among others (Section 3 to 5 of the EAA).
It sets borrowing limits of the government
The roles and responsibilities of all government accounting officers are clearly
laid out in the EAA
A number of laws regulate the functions of the Ministry of Finance. Some of the
laws include the following:
- Heritage and Stabilisation Funds
- Finance Acts (plus amendments)
- Appropriations Acts
- Freedom of Information Act
Tax administration The Finance Act (plus amendments) governs the revenue administration in
Trinidad and Tobago. It provides for levying of Value Added Tax on goods and
services, Income tax on profit from trade and business, Pay-As-You-Earn
(PAYE) for salaried workers and Customs duties on imports and exports
Specific laws for revenue administration include:
- Customs Act 1938 + Amendments to date
- Value Added Tax Act, 1939 + Amendments to date
- Income Tax Act, 1938 + Amendments to 1980
Public sector entities Part IV Sections 31 to 40 of the Exchequer and Audit Act provides clear legal
guidelines for the establishment and management of the finances of statutory
boards. Statutory boards are mandated to maintain proper books of accounts
for public accountability and transparency in order that the Auditor General will
have complete access for external audit.
Expenditure control and
internal audit
The EAA details the role of the Minister of Finance. It provides the
responsibilities of the Treasury - headed by the Comptroller of Accounts. If
further mandates the Comptroller to ensure proper use and accountability of all
government funds by all government accounting officers.
The EAA articulates the prescription of standardised financial regulation
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Trinidad and Tobago Limited Repeat & Sectoral PEFA 2013
Area Description
manuals (accounting and internal audit) for use by all government accounting
officers.
External Audit Chapter 8 Sections 116 and 117 of the Constitution and Section 7 to 11 of EAA
provide the legal basis for the Office of the Auditor General. She has the power
to have complete access to all government financial and administrative records
as part of her mandate to audit the government. She prepares her own audit
plans without the influence of the Executive or any other body. She may act on
the request of the executive to audit specific entities as and when required. She
has the authority to audit statutory boards and submit all her audit reports for
both central government and statutory boards to Parliament. Currently the AG
does not audit any state-owned enterprise. In order for the AG to audit these
SoEs, the Auditor General has to be appointed by the SoE.
Legislative oversight Chapter 4 Section 39 of the Constitution establishes Parliament. Parliament is
made up two chambers, the House of Representatives (Section 40 to 45) and
the Senate (Section 46 to 52).
Section 53 to 63 details the powers of Parliament to enact laws and provide
legislative oversight on the Executive
Banking and financial
laws
Central Bank Act Chapter 79:02 (amendments 1986, 1993 and 1994) governs
the Central Bank of Trinidad and Tobago. It provides the legal framework for the
appointment of a Governor. It stipulates the relationship between the bank and
the government in terms of being the government banker as well as providing
temporary loans/advances to the government as may be agreed between the
Minister of Finance and the Bank.
It further provides the legal guidelines for regulating financial institutions (both
government and private) operating in the country.
Procurement Government procurements are in two folds, one through the Centrals Tenders
Board (CTB) and the other through Special Purpose Companies. The Special
Purpose Companies were set up to reduce the lengthy legal and administrative
procurement procedures in the CTB Ordinance.
The CTB Ordinance No 22 of 1961 regulates public procurement that are been
referred to it by the ministries, departments and agencies. Procurements values
at TT$2million or above are undertaken by the CTB.
2.3.2 The institutional framework for PFM
Legislature
The Constitution is the Supreme Law of the land. It empowers Parliament to pass laws and legal
regulations, provide executive oversight and serves as a public institution for elected people's
representative to deliberate over issues of national interest. Parliament is made of two chambers - a
41-seat House of Representatives excluding the Speaker and a 31-seat Senate including the
President of the Senate. Parliamentarians are part-time officials who attend to the business of the
House once a week. Even though the Constitution mandates Parliament to amend budget
proposals submitted by the executive, in practice, it does not occur due to the high number of
Parliamentarians supporting the government of the day. Each House has a separate set of
Standing Orders. It regulates the proceedings in the two chambers. It further empowers the setting
of various committees to oversee the business of the day. Currently, there are 5 Joint Select
Committees with oversight mandates. These are:
Public Accounts Committee - responsible for reviewing public accounts and audit reports
of the Auditor General of all government ministries, departments and agencies
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Public Account (Enterprises) Committee - responsible for reviewing the financial
statements and audit reports of all state-owned enterprises
Joint Select Committee, Municipal Corporations and Service Commission - oversees the
activities of municipalities and operations of commissions
Joint Select Committee, Government Ministries, Statutory Authorities and State
Enterprises Group 1
Joint Select Committee, Government Ministries, Statutory Authorities and State
Enterprises Group 2
It should be noted that the Finance Committee (Committee of the Whole) of the House of
Representatives is responsible for reviewing budget estimates and macro fiscal data
Executive
There are 32 central government ministries including the office of the Prime Minister. The country is
divided into 14 municipal corporations, made up of the 2 city corporations, 3 borough corporations
and 9 regional corporations. The President is the Chief Executive Officer of the country. The Prime
Minister is the head of cabinet and the appointing authority for ministers of the various ministries.
Judiciary
The Judiciary is the third arm of government. It derives it powers from the Constitution. The
Supreme Court of Appeals is the apex of the judicial arm, followed by the High Courts and the
Magistrate Courts. Other specialised courts such as the Tax Appeals Board are setup to adjudicate
on tax disputes
Auditor-General
The Constitution and the Exchequer and Audit Act set up the Office of the Auditor General. for
auditing all government institutions and agencies. The staff of the Office of the Auditor General are
appointed by the Public Services Commission. The Office is accountable to Parliament at least
every year or as and when required. The Executive President in consultation with the Prime
Minister appoints the Auditor General. The Auditor General's salary and allowances are funded
directly from the Consolidated Fund. Her removal from office can only be done after
recommendation from a tribunal set up by the President to investigate the call for removal.
The Ministry of Finance
The Ministry of Finance and the Economy is the lead ministry for implementation of approved fiscal
policy of the government of the day. It derives its powers from the Exchequer and Audit Act. The
Finance Minister is accountable to Cabinet and Parliament referencing the day-to-day financial
management of the economy by leading and coordinating the development of the macro fiscal
framework, annual budget estimates, the activities of the line ministries, and ensuring the efficient
use, accounting and reporting of government funds in all government institutions.
The Budget Division
It is the responsibility of the Budget Division of the Ministry of Finance and the Economy to plan
government's fiscal policy. It further plans and guides the entire budget formulation and preparation
process. In conjunction with the Ministry of Planning and Sustainable Development, it ensures the
effective planning and implementation of the Public Sector Investment Program (PSIP) and other
Public Private Partnerships (PPPs) ventures.
Comptroller of Accounts
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The Comptroller of Accounts is the head of the Treasury Division of the Ministry of Finance and the
Economy. She is responsible for proper accountability of all government funds including the
Consolidated Fund and the Infrastructure Development Fund. She is also responsible for
authorising any banking arrangement, developing and managing the chart of account, development
of international accepted accounting and internal audit standards and policies and ensures their
compliance thereon.
The Economic Management Division
It is a division of the Ministry of Finance and the Economy, responsible for debt management,
macro fiscal forecasting and policy development.
The Centrals Tenders Board
This is a unit under the Finance Ministry for carrying out government procurement above
TT$2million. It provides technical assistance to procurement officers in the various ministries,
departments and agencies on procurement procedures. It is the “sole and exclusive authority in
inviting, considering and accepting or rejecting offers for the supply of articles or for the undertaking
of works or any services necessary for carrying out the functions of Government or any statutory
bodies, and to dispose of surplus or unserviceable articles belonging to the Government or any
statutory bodies.”
Financial Systems
IHRIS (Integrated Human Resource Information System) -Payroll and Human Resource
Management at national and provincial levels
Revenue administration and tax collection (using GENTEX software); and
Customs administration using ASYCUDA World)
IFMIS - ongoing discussions for the development of a new chart of accounts and a rollout
of the integrated financial management and information system (IFMIS)
Ministries, Departments and Agencies
Line ministries are the implementing agencies of government policies. A Minister of State is the
political head of the line ministry, followed by the accounting officer or administrative head -
Permanent Secretary who is a public servant. . The Minister is responsible for setting policy
initiatives and ensuring their achievements. The Permanent Secretary is responsible for the
management and implementation of the budget and accountable to the Comptroller of Accounts
and Parliament.
Public Enterprises
A number of public enterprises exist in Trinidad and Tobago for the provision of public services in
the area of transport, communication, construction, energy, and agriculture and food production,
among others. Some of the public enterprises are non-profit entities. The Public Investment Division
of the Ministry of Finance is responsible for supervising the State-Owned Enterprises (SoEs) and
ensures the risk portfolios are within limits. SoEs are required to submit their annual corporate
operational and financial plans to the National Treasury. The audit reports are sent to Parliament.
There are also Special Purpose Companies (autonomous public entities) who principally provide
services for the line ministries.
The Central Bank of Trinidad and Tobago
The Constitution establishes the Central Bank of Trinidad and Tobago (CBTT). It is the government
banker. It facilitates international banking transactions for the government as well as providing
domestic financial market services such as Treasury Bills on behalf of the government. It monitors
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Trinidad and Tobago Limited Repeat & Sectoral PEFA 2013
all government borrowings, both domestic and foreign. It publishes quarterly fiscal statistics and
annual economic reports.
Table 2.4 below provides an overview and responsibilities of the main actors in Public Finance
Management
Table 2.4 Overview of the role and responsibility of the main PFM players
Institution Main role and responsibility in PFM
Parliament Parliament is Constitutionally mandated to review government budget estimates as well as
the macro fiscal framework supporting the estimates. It is also mandated to perform an
oversight role by reviewing all audit reports submitted to the legislature by the Auditor
General
Auditor
General's
Department
It is a government agency with the legal mandate to perform annual statutory financial audit
of all government agencies and statutory boards. The audit reports thereof must be
submitted to Parliament
Internal Audit Currently, there is no independent government agency superintending over internal audit
functions. The Comptroller of Accounts is the administrative head of internal audit
MOFE It is the lead government ministry in providing financial, economic, fiscal and debt
management services for the government. It oversees the implementation of government
fiscal policy
Comptroller of
Accounts
The Comptroller of Accounts heads the Treasury Division of the Ministry of Finance and the
Economy. Her main role is to coordinate the implementation of government fiscal policies by
ensuring strict compliance of all financial regulations in the relevant public finance
management laws and regulations
Board of Inland
Revenue,
Customs and
VAT
The BIR is the main revenue collection agency of the government. It is a division of the
Ministry of Finance and the Economy. Both tax and non-tax revenue are collected and
deposited into the Central Bank of Trinidad and Tobago. The Board is headed by a
Chairman. The day-to-day administration of the Board is headed by two Comptrollers -
Comptroller of Customs and Comptroller of Inland Revenue (Income Tax and VAT)
Main central
government
agencies
Line ministries are the implementing agencies of government fiscal policies. There are about
69 main expenditure heads captured by the 2011/2012 budget. The core role of these
ministries departments and agencies are centred on the five medium term policy priorities;
these are crime and law and order, agriculture and food security, health care services and
hospitals, economic growth, job creation, competitiveness and innovation and poverty
reduction and human capital development
Central Bank of
Trinidad and
Tobago
The Central Bank of Trinidad and Tobago is the government banker. It serves as depository
of government funds from all sources, be it tax revenue, non-tax revenue, domestic or
foreign loans, grants from donors, proceeds from securities and bonds, among others.
2.3.3 Key features of the PFM system
Both central government and local governments have the same financial year, that is, 1st October
to 30th September. The annual budget process begins with the issuance of a budget circular
between late February and early March with a two-month window for MDAs to complete and submit
their estimates to the Ministry of Finance. Officials of various ministries claim their internal
processes begin a month earlier prior to receiving the circulars from the Ministry of Finance and the
Economy. The executive, over the last three completed fiscal years, submitted the budget by the
first week of September except for the FY 2011/2012 where budget submissions were made in the
first week of October. Consequently, the Appropriations Acts for 2011/2012 were passed 21 days
after the end of the fiscal year 2010/2011. The Exchequer and Audit Act allows a 30-day funds
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Trinidad and Tobago Limited Repeat & Sectoral PEFA 2013
withdrawal period to run government operations in the event Parliament delays in passing the
Appropriations Act.
The country operates a Treasury Single Accounts held at the Central Bank. Revenues are
deposited into the Treasury bank account and payments are made out of the Exchequer account.
Payroll is managed centrally through the Integrated Human Resource Information System (IHRIS).
The system links the establishment database to the personnel database and the payroll database.
Controls and audit trails are inbuilt to give access and monitor entry into the IHRIS. Each ministry
has access to the IHRIS for changes of establishment or personnel database. The accounting
standard is cash accounting operated using the manual system chart of accounts. Each ministry
churns out monthly expenditure returns following the monthly cheque return reconciliation process
between each MDA and the Treasury and the use of manual vote books.
External audit and oversight of the executive is provided for by the Office of the Auditor General
and Parliament. The Office of the Auditor General is a government agency with legal foundation set
out in the Exchequer and Audit Act; the remuneration of the Auditor General is a direct charge to
the Consolidated Fund. The Auditor General and/or her representative are given full access to
public records. Her audit reports are submitted to the Parliament. Only audit reports on public
accounts are currently on the website The EAA places the financial responsibilities on each
accounting officer within the various MDAs and is required to implement PAC recommendations
and actions out of the Auditor General's reports.
The standings orders of both chambers of Parliament provide detail and clear guideline on
legislative procedures. The practice in the budget review process by the legislature has been
overtaken by tradition where limited time is used in the actual review process. The entire budget
review process from executive submissions to legislative approval takes three weeks. While the
legislative review processes are allowed 7 days, the legislative process usually takes 3 to 4 days in
each House to debate the Appropriation Bill for the budget. However, for the debate on
Supplementary and/or Variation of Appropriation Bills the time could be as short as 1 day in each
House which is clearly inadequate.
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3 Assessment of PFM Systems, processes and institutions
3.1 Budget credibility
3.1.1 PI-1 Aggregate expenditure out-turn compared to original approved budget
It is important to state that, PI-1 does not qualify under this assessment remit (based on the Terms
of Reference) for the fact that it scored a 'B' in 2008. However, in order to place specific PFM
performance indicators within the context of current overall aggregate measure, it was deemed
appropriate to measure this indicator. Further, it was useful for performance of internal PI
measurement consistency checks.
The Government fiscal year remains the same, still operating a fiscal calendar beginning 1st
October and ending 30th September each year. At the aggregate level, Trinidad and Tobago has
achieved budget discipline coupled with an effective bottom-up expenditure commitment control.
There is however deficiency with the top-down perspective, which involves political engagement
with respect to providing firm ceilings for budget preparations at all levels.
Table 3.1 below details the performance of primary expenditure outturn compared with primary
original expenditure estimates. In two of the three completed fiscal years 2009/2010 and
2011/2012, aggregate expenditure deviations were below 5% of original approved primary
estimates (2.1% and 0.03% respectively). In 2010/2011 the deviation was 7.7%.
Table 3.1 Comparison of Budget estimates against Actuals (primary expenditure, TT$)
2009/2010 2010/2011 2011/2012
Primary original expenditure estimates 43,796,407,028 48,446,684,382 54,723,399,192
Primary expenditure outturn 44,701,924,505 52,154,204,269 54,738,504,571
Aggregate expenditure deviation 905,517,477 3,707,519,887 15,105,379
Aggregate expenditure deviation,% 2.1% 7.7% 0.03%
Source: MOFE
PI Dimension Score
2008
Score
2013
Justification for 2013 score
PI-1 Aggregate expenditure out-
turn compared to original
approved budget
B A In one of the three completed fiscal years, the
aggregate expenditure deviation was 7.7%; this
was an improvement from the 2008 PEFA
assessment of 10% in one of the three years -
2004/2005. Actual deviations for the last
completed fiscal year were 2.1%, 7.7% and
0.03% for 2009/2010, 2010/2011 and
2011/2012 respectively
Change in performance:
Score is comparable. There was an improvement when compared to the 2008 PEFA where in one of the three
years - 2004/2005, the expenditure deviation was 10% as compared to 7.7% in 2010/2011
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3.1.2 PI-2 Composition of expenditure out-turn compared to original approved budget
This indicator compares primary expenditure, budgeted and actual, at a sub-aggregate level across
the main administrative headings. The first dimension measures the extent to which reallocations
between budget heads during execution have contributed to variance in expenditure composition
without the contingency vote. The second dimension assesses the share of the actual expenditure
made of contingency vote. The assessment is made for the central government and is based on the
last three completed fiscal years FY (2009/2010, 2010/2011, 2011/2012).
(i) Extent of variance in expenditure composition
Table 3.2 below provides a measure of the extent of variance in expenditure composition of
government ministries, departments and agencies. The practice where budget estimates are
prepared without any firm fiscal ceilings, results in budget cuts by the Ministry of Finance and the
Economy. Further, it encourages ministries, departments and agencies to budget for as many
projects and programs as possible having in mind the degree of cutbacks by the Finance Ministry.
As depicted in Table 3.2, budget reallocations across ministries, departments and agencies ranged
between 17.4% and 19.5% within the last three completed fiscal years. The explanations are that
these reallocations occur either due to underutilisation of budgetary allocations of some ministries
as well as the additional allocations during the supplementary budget process mid-year. Further,
the expenditure deviations, which are mainly from the recurrent budget, arose as a result of payroll
estimates prepared on the basis of the establishment database which might not be necessarily
occupied by new staff recruitments. It is obvious that these reallocations can affect project
implementations in line ministries
(ii) The average amount of expenditure actually charged to the contingency vote
Article 115 of the Constitution and Section 16 of the Exchequer and Audit Act provide for the
establishment of a contingency fund to be approved by parliament. Currently, Trinidad and Tobago
has a statutory contingency fund of TT$100miilion; this can be increased by a Parliamentary
resolution. This fund is reserved for purposes of unforeseen events both natural and manmade.
The Exchequer and Audit Act further prohibits MDAs from budgeting for any contingencies. The
Minister of Finance and the Economy has the sole authority, with the approval of cabinet to utilise
the contingency fund as and when required. Comparatively, the entire statutory contingency fund
represents only between 0.18% and 0.23% of the total primary expenditure estimates between
2009/2010 and 2011/2012 fiscal years. Available evidence suggests the efficient and prudent
usage of the contingency fund. The average contingency share of total primary expenditure was
0.07% over the last three completed fiscal years.
Table 3.2 Primary expenditure composition variance of (%)
2009/2010 2010/2011 2011/2012
Total expenditure variation i.e. PI-1 1.9% 7.4% 0.04%
Composition variance i.e. PI-2(ii) 17.5% 17.4% 19.5%
Contingency share of budget i.e. PI-2(ii) 0.11% 0.0% 0.11%
Average contingency share 0.07%
Source: Author’s calculations derived from the Appropriations Acts and Auditor general Reports on Public Accounts for
2009/2010, 2010/2011, 2011/2012. Data used for the calculations is presented in Annexes 5a to 5c
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PI Dimension Score
2008
Score
2013
Justification for 2013 score
PI-2 Composition of expenditure
out-turn compared to
original approved budget
C D+ Scoring method M1
(i) Variance in expenditure
composition excluding
contingency items
NA D The reallocation of ministerial votes over the
last three completed fiscal years were 17.8%
each for 2009/2010 and 2010/2011 and 20.4%
for 2011/2012.
(ii) Average amount of
expenditure actually
charged to the contingency
vote
NA A The average percentage of actual expenditure
charged to the contingency vote over the last
three completed fiscal years was 0.07%. The
charge for each of the years was 0.11%, 0%
and 0.11% for 2009/2010, 2010/2011 and
2011/2012 respectively
Comparability of scores and performance change:
(i) The scores are not comparable due to the change in the PEFA methodology.
(ii) The scores are not comparable due to the change in the PEFA methodology.
3.2 Comprehensiveness and transparency
3.2.1 PI-5 Classification of the budget
Trinidad and Tobago's national budget is based on administrative and economic classification. The
revenue budget is segregated into tax type, revenue source, i.e. tax and non-tax and then into
recurrent and capital revenues. The expenditure budget is in two volumes, one for recurrent funded
from the consolidated fund and the second for development program which has two sources of
funding - consolidated fund and infrastructure development fund. Budget circulars over the last
three completed fiscal years have continued to instruct ministries, departments and agencies to
prepare their budget in the normal line item format with the inclusion of corporate and business
plans as a preparatory phase towards moving to output-based budgeting. It should be noted that
even though the current budget classification is not fully GFS/COFOG 2001 compliant, the use of
mapping tables allows for such classification into functional and sub-functional classification for
reporting to the International Monetary Fund (IMF).
Further, in-year budget reports are consistent with the administrative and economic classification of
the annual budget estimates and institutional practices and arrangements. This allows for fairly
easy statistical and variance analysis.
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Table 3.3 Synthesis of the classification of the 2011/2012 Budget
Categories FY 2011/2012 Remarks
Budget
preparation
Budget
execution
Central
Govt
budget
reporting
Administrative yes yes yes 69 Votes/Head for Ministries Departments &
Agencies
Economic yes yes yes Revenue:
Tax;
Non-tax;
Other;
Grants.
Expenditure:
Item 1 – Personnel emoluments;
Item 2 – Goods & Services
Item 3 – Minor equipment purchases
Item 4 – Current transfers and subsidies
Item 5 - Acquisition of physical assets
Item 6 - Current transfers to statutory boards
Functional
(COFOG)
No No no The use of mapping tables allows for sub-functional
classification and reporting to IMF
PI Dimension Score
2008
Score
2013
Justification for 2013 score
PI-5 Classification of the budget C C Over the last three years, Trinidad and
Tobago's national budget is classified into
administrative and economic headings; further
the classification allows for consistent budget
execution and reporting even though this is not
fully GFS 2001 compliant
Comparability of scores and performance change:
Scores are comparable; there is no change since 2008 PEFA
Ongoing reforms
Work is ongoing with IADB referencing revision of chart of account to fully comply with
GFS 2001
Discussions on implementation of IFMIS but very slow as budget division and treasury
have not agreed on structure of chart of account
3.3 Policy-based budgeting
3.3.1 PI-11 Orderliness and participation in the annual budget process
(i) Existence of and adherence to a fixed budget calendar
The Ministry of Finance around February each year normally issues a budget call circular. The
circulars are clear. Available evidence attests to the fact that the Ministry of Finance and the
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Trinidad and Tobago Limited Repeat & Sectoral PEFA 2013
Economy provided budget circulars to government ministries and department for the preparation of
annual budget estimates between February and March each year as shown in Table 3.4 below. The
circular clearly indicates the budget calendar referencing the submission of estimates from
ministries, followed by an indication for justification of these estimates. Officials from government
ministries and departments confirmed that budget estimates were submitted on or before the
deadline indicated in the circulars, that is by the 30th April.
Ministries, Departments and Agencies prepare their budget estimates, derived from the annual
operational plans out of their three to five-year strategic plans, linked to the national policy
framework, without any knowledge of their fiscal envelop or ceilings during the review period.
Available evidence suggests that estimates emanating from these central government agencies are
as much as between five and seven fold higher than the approved allocations from the Finance
Ministry.
The current practice of preparing budget estimates without considering any fiscal space has often
led to budget cuts by the Ministry of Finance and the Economy. In order to obtain a reasonable
level of guarantee for resource allocations, Ministries Departments and Agencies (MDAs) seek
cabinet approval particularly for projects under the Public Sector Investment Program (PSIP) for
such projects valued at TT$2million and above. Interestingly, the Ministry of Finance and the
Economy may not fully fund those projects budgeted for by MDAs even with cabinet approval.
Consequently, this has led to the stage where everyone scrambles for resources beforehand.
Table 3.4 Budget Preparation and Approval Calendar
FY2009/2010 FY2010/2011 FY2011/2012
Budget Circular issued by MOFE 20th February 2009 5th March 2010 3rd March 2011
Budget proposals from MDAs due 30th April 2009 30th April 2010 30th April 2011
Budget estimates submitted to Parliament 7th Sept 2009 8th Sept 2010 10th Oct 2011
(ii) Clarity/comprehensiveness of and political involvement in the guidance on the preparation of
budget submissions
There is an absence of direct political involvement at the beginning of the budget preparation
process. No cabinet approved ceilings are provided in the call circulars. The bottom-up perspective
which involves ministries, departments and agencies preparation and submissions of budget
estimates is not guided by a top-down approach which involves the setting up of firm fiscal ceilings
indicating the resource envelop available to each ministry. Ministries, in desperation to accomplish
their projects and plans, tend to seek cabinet approval individually particularly for PSIP projects
prior to budget submissions. Cabinet approval however does not prevent the Ministry of Finance
from undertaking its 'cutback' policy. In addition, ministries are forced to provide an over-bloated
budget estimate in order that any cutbacks will have minimal effect on their approved resource
envelop; nonetheless, MDAs have indicated that their annual budget allocations are about a third of
their submissions. Further, the current practice has necessitated the preparation and submission of
supplementary budget estimates mid-year, thereby becoming an annual ritual, availing ministries
the opportunity to make justification for additional resources.
(iii) Timely budget approval by the legislature or similarly mandated body
Tabling the national budget estimates by the Minister of Finance and the Economy and the
Parliamentary approval of those estimates occur with three weeks between September and
October each year. Table 3.5 provides the exact dates the legislature received the budget
estimates and the date of approval. In two of the last three completed fiscal years, 2009/2010 and
2010/2011, the legislature approved the budget prior to the start of the new fiscal year. In
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Trinidad and Tobago Limited Repeat & Sectoral PEFA 2013
2011/2012 however, the estimates were approved three weeks after the end of the fiscal year. It
should be noted that Article 114 of the Constitution permits the withdrawal of funds from the
Consolidated fund for government business by the Minister of Finance thirty days following the
expiration of the fiscal year in the event that Parliament is unable to pass the Appropriation Act of
the ensuing year.
Table 3.5 Timeliness of Parliamentary approval of Budget Appropriations
Fiscal Year Date Parliament Received
Budget
Date Parliament Approved
Budget
2009/2010 7th Sept 2009 25th Sept 2009
2010/2011 8th Sept 2010 23rd Sept 2010
2011/2012 10th Oct 2011 21st Oct 2011
Source: Clerk to the Senate
PI Dimension Score
2008
Score
2013
Justification for 2013 score
PI-11 Orderliness and
participation in the annual
budget process
C+ B Scoring method (M2)
(i) Existence of and adherence
to a fixed budget calendar
A A Clear and fixed budget calendar exist. These
are contained in the budget circular issued by
the Finance Ministry between February and
March each year; these dates are followed.
(ii) Clarity/comprehensiveness
of and political involvement
in the guidance on the
preparation of budget
submissions
D D There is very little political involvement in the
budget preparation process. There are no
budget ceilings in the budget circulars issued
by the Finance Ministry to serve as a top-down
fiscal discipline.
(iii) Timely budget approval by
the legislature
C B In the last three completed fiscal years, the
legislature has approved the annual budget
before the start of the next fiscal year in two of
the three years under this assessment
Comparability of scores and performance change:
Scores are comparable; there has been an improvement since 2008. The improvement was as a result of
dimension (iii)
Ongoing reforms
No planned reforms
3.3.2 PI-12 Multi-year perspective in fiscal planning, expenditure policy and budgeting
(i) Preparation of multi -year fiscal forecasts and functional allocation
At present, the budget does not consider multi-year fiscal forecast. The budget document only
presents actual outturns for the second year before the current fiscal year, original, revised and
adjusted estimates for the first year before the current year, and the approved estimates for the
current fiscal year. The budget document does not make projections for the two outer years.
Discussions are far advanced for the government to consider adopting a multi-year perspective
towards budget preparation. The budget estimates are based on administrative and economic
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classifications. The government with respect to forecast figures following discussions and
consultations with Article IV IMF team adopts a conservative posture. The annual budget estimates
are derived from annual operation plans emanating from the three to five-year strategic plan from
each ministry. The estimates are prepared without any fiscal frame or ceilings, leaving these
ministries to prepare virtually a 'wish list' and then be faced with arbitrary cutbacks from the Ministry
of Finance.
(ii) Scope and frequency of debt sustainability analysis
Officials say no substantial change has occurred to the DSA analysis since the last PEFA
assessment in 2008. Government's continued efforts at diversifying funding instruments through the
issue of bonds on the international market has seen positive strides in the management of
government debt. The instruments have been largely long term with good interest cost which do not
have significant risk on government macro fiscal stability. The debt management strategy continues
to yield the required result in terms of government debt ratio to GDP even though there are
concerns referencing the rising debt portfolio, which averages 36% of GDP within the last three
completed fiscal years. The Central Bank still carries out the Debt Sustainability Analysis each year
for both foreign and domestic debt and reviewed by the IMF Article IV team. It does so with officials
of the Debt Management Unit within the Ministry of Finance in order to build the capacity of the
newly created and functional Debt Management Unit of the Finance Ministry.
(iii) Existence of sector strategies with multi-year costing of recurrent and investment expenditure
It should be noted that Trinidad and Tobago has no sector strategies, let alone costed sector
strategies. Individual ministries, departments and agencies do prepare strategies that are linked to
the national development policy. Interactions with officials from ministries, departments and
agencies suggest that even though there are no sector strategies, there is fairly some level of
interactions among ministries that have commonalities and inter-linkages, during the budget
preparation stage in order to reduce overlapping and/or repetitive projects. In spite of these, some
MDAs had reservations regarding the effective collaborations with some government agencies.
These strategies are rolling strategies between 3 to 5 years but these are not fully costed. The
investment part of the strategies, which dovetails into the PSIP, do have cost projections; however,
there are no forward linked recurrent expenditure neither for the current year nor on a multi-year
perspective.
(iv) Linkages between investment budgets and forward expenditure estimates
The Vision 2020 which was formally launched in 2006 and operationalised between 2007 to 2010,
has been replaced with a Medium Term Policy Framework spanning 2011 to 2014. The overall
goals of the Medium Term Policy Framework is to ensure lasting and sustainable leaving conditions
of all nationals of Trinidad and Tobago, reduce crime, attain food security, improve healthcare and
generate economic activities through the diversification from oil and gas, which is currently the main
backbone of the economy.
The Policy Framework envisages the development and growth of the entire Republic segmented
into the North Coast, Southern, Eastern, Central and the North East. It is a requirement for all
ministries' strategies to be aligned to the National Medium Term Policy Framework; as the lead
ministry involved in monitoring and evaluation, the Ministry of Planning and Sustainable
Development ensures all project strategic plans submitted by each ministry conform to national
priorities in order to qualify for inclusion into the PSIP. Further, for inclusion of ministries' projects
into the PSIP, the Planning Ministry ensures that these projects have cabinet approval. The projects
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Trinidad and Tobago Limited Repeat & Sectoral PEFA 2013
are not fully costed in term of investment cost and forward linked recurrent expenditure. Officials
from the Planning Ministry intimated that even though there are linkages between the Medium Term
Policy Framework and the ministries strategies, one cannot see a direct one-to-one mapping of the
projects to the national policy.
PI Dimension Score
2008
Score
2013
Justification for 2013 score
PI-12 Multi-year perspective in
fiscal planning, expenditure
policy and budgeting
C+ C+ Scoring Method M2
(i) Multi-year fiscal forecast
and functional allocations
C C The budget estimates have no forecast figures
for the two outer years. The estimates are by
economic and administrative classifications.
(ii) Scope and frequency of
debt sustainability Analysis
A A A debt sustainability has been carried out in
each of the last three completed fiscal year
2009/2010, 2010/2011 and 2011/2012
(iii) Existence of costed sector
strategies
D D There are no sector strategies, let alone costed
sector strategies. Nonetheless, there is some
level of collaboration during the preparation
stage of the annual budget
(iv) Linkages between
investment budgets
B C Major government projects have weak
sectorlinkages with some level of recurrent cost
estimates
Comparability of scores and performance change:
Scores are comparable; there are no changes.
Ongoing reforms:
No reforms
3.4 Predictability and control in budget execution
3.4.1 PI-15 Effectiveness in collection of tax payments
(i) Collection ratio for gross tax arrears
It is important to state that the assessment team were unable to gather data on tax collection in
order to calculate the tax collection ratio needed to score this dimension during the field visit, which
ended on the 5th of December 2013. A draft report was submitted to the Ministry of Finance and
the Economy as a follow-up measure for data collection but to no avail, therefore the inability of the
assessment team to score this dimension.
Interactions with officials of the Board of Inland Revenue suggest a high tax collection ratio or in
other words a low tax debt ratio to total annual tax collection.
Table 3.6 Collection of tax arrears TT$
2009/2010 2010/2011 2011/2012
Customs
Valued Added Tax
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Trinidad and Tobago Limited Repeat & Sectoral PEFA 2013
2009/2010 2010/2011 2011/2012
Income Tax
Total
Source: Revenue Authorities.
(ii) Effectiveness of transfer of tax collections to the Treasury by the revenue administration
The Board of Inland Revenue (BIR) oversees the operations of both Customs and the Inland
Revenue, which is made up Value Added Tax (VAT) and Income Tax. The Comptrollers of
Customs and Inland Revenue head the Customs and the Inland Revenue divisions of the Ministry
of Finance and the Economy respectively.
The duties and taxes collected by the Customs division are paid directly into commercial banks
nearest to the Customs duty stations daily. The commercial banks transfer the funds directly to the
Treasury account designated for Customs deposit account. Similarly, the Inland Revenue has
Treasury deposit account held by the Central Bank of Trinidad and Tobago (CBTT) into which all
income taxes are deposited. Commercial banks are used as collection banks particularly for remote
areas outside Port of Spain. Daily transfers are made to the CBTT for all cleared cheques and
cash. It is important to state that the cheque clearing system could take between 2 to 4 days and
therefore funds from commercial banks are only transferred to the CBTT upon clearance of
cheques. Cash payments and electronic transfers are done within 24 hours of the commercial bank
receiving the taxpayers funds.
iii) Frequency of complete accounts reconciliation between tax assessments, collections, arrears
records and receipts by the Treasury
GENTAX system is the software used by the Board of Inland Revenue (Customs and Inland
Revenue - VAT & Income tax) for tax administration. The software captures tax assessed and tax
collected. The system generates reports on tax arrears arising out of the tax assessments and tax
collected. Transfers to the CBTT are recorded in the software through the centralised electronic
cash book. The integration of GENTAX allows for automatic reconciliation between tax assessed,
tax collected, tax transferred to the Treasury and tax arrears. The full reconciliation is done every
month with 4 weeks following the end of the month.
PI Dimension Score
2008
Score
2013
Justification for 2013 score
PI-15 Effectiveness in collection of
tax payments
D+ NR
(i) Collection ratio for gross tax
arrears, being percentage of
tax arrears at the beginning
of a fiscal year, which was
collected during that fiscal
year
D NR No data to score
(ii) Effectiveness of transfer of A A Transfers from commercial banks for cleared
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PI Dimension Score
2008
Score
2013
Justification for 2013 score
tax collections to the
Treasury by the revenue
administration
cheques and cash are made within 24 hours of
their receipt from taxpayers.
(iii) Frequency of complete
accounts reconciliation
between tax assessments,
collections, arrears records
and receipts by the Treasury
D A The tax software GENTAX generates monthly
reports. Full reconciliation of tax assessed, tax
collected, tax transferred to the Treasury and
tax arrears are done with one month after the
end of the month.
Comparability of scores and performance change:
Ongoing reforms
Introduction of ASSYCUDA for Customs
Use of IT in tax offices across the country as part of integration of all tax offices
Recruitment of more tax field staff for improved collections
Improvements in tax audit
Use of banks to collect tax from taxpayers for a service fee
3.4.2 PI-19 Competition, value for money and controls in procurement
(i) Transparency, comprehensiveness and competition in the legal and regulatory framework
Central Government procurement practices adopt two separate approaches, one through the
Centrals Tenders Board (CTB), the other through the use of Special Purpose Companies - state
owned companies. The Centrals Tenders Board is governed by the Centrals Tenders Board
Ordinance No 22, 1961. Article 20 of the Centrals Tenders Board Ordinance requires the Board to
“invite members of the public in general” for carrying out procurement and in so doing establishes
open competition as the default procurement method. There are specific thresholds for each level
of procurement committee. Permanent Secretaries may decide to adopt internal systems without
the Centrals Tenders Board for projects and consultancy services of up to TT$1miilion and
TT$0.5million respectively. Goods and Services above this threshold and up to TT$2million must
adopt the Ministerial Tender Committee - the ministerial tender committee is supposed to be
chaired by the director of contracts of the Centrals Tenders Board but for the past three years has
been chaired by either of the two Acting Assistant Directors of Contracts. Further, the Centrals
Tenders Board oversees the procurement processes for all procurements above TT$2million
provided MDAs decide to use the Board. MDAs have the choice to use special purpose companies
if they so wish, having their own legislative procurement procedures. Special Purpose Companies
were introduced as resolve to the long legal and bureaucratic procurement rules and procedures
under the CTB Ordinance.
As shown in table 3.7 below, only three of the six standards elements of legal and regulatory
framework were met by the CTB Ordinance No. 22 of 1961.
Table 3.7: Elements of legal and regulatory framework of the CTB Ordinance
Number of
requirements
met
Elements of the legal and regulatory framework for procurement Availability
Three out of six
elements met
Be organised hierarchically and precedence is clearly established. √
Be freely and easily accessible to the public through appropriate means. √
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Trinidad and Tobago Limited Repeat & Sectoral PEFA 2013
Number of
requirements
met
Elements of the legal and regulatory framework for procurement Availability
Apply to all procurement undertaken using government funds. X
Make open competitive procurement the default method of procurement and
define clearly the situations in which other methods can be used and how
this is to be justified.
√
Provide for public access to all of the following procurement information:
government procurement plans bidding opportunities, contract awards, and
data on resolution of procurement complaints.
X
Provide for an independent administrative procurement review process for
handling procurement complaints by participants prior to contract signature.
X
(ii) Use of competitive procurement methods
Section 5 of the Centrals Tenders Board Ordinance No. 22 of 1961 (Amended) provides the
structure and composition of the Board. There are 8 members. The President of the Republic
appoints five public servants in addition to 3 private sector officials with depth of experience in the
area of procurement to be undertaken as follows:
Director of Contracts of CTB – Chairman of the Board
Deputy Director of Contracts of CTB – Deputy Chairman of the Board
Permanent Secretary, Ministry of Trade, Industry and Investment - Member
Comptroller of Accounts - Member
Chief State Solicitor - Member
3 Private Sector Officials
The ex officio members, i.e. those appointed by the President shall hold office as pleased by the
President, in accordance with Section 7(1) of the CTB Ordinance. Section 7(2) of the Ordinance
stipulates a two-year office term of Board Members from the private sector but with a perpetual
number of reappointment as stated by Section 7(3).
The default procurement method is open competition. The use of sole sourcing and restricted
tender needs justification by each MDA and approval from the CTB. Table 3.8 below provides some
data on the type of procurement adopted but fails to provide the value of such contracts. Further,
the CTB Ordinance does not provide clear criteria for justification referencing sole sourcing or
restricted tender.
Civil Society Organisations have lamented on the current procurement legal framework, which tend
to provide unfair competition with the public sector even with the use of CTB procedures on one
hand and more importantly with the involvement of State-owned Special Purpose Companies. This
is further buttressed by the 2012 Transparency International Corruption Perception Index Report
ranking Trinidad and Tobago 80 out of 174 countries, a drop of 8 points from the 2008 report.
(iii) Public access to complete, reliable and timely procurement information
Public access to complete, timely and reliable procurement information is limited to access to the
CTB Ordinance No. 22 of 1961 on the Ministry of Finance website and Government Printer as well
as copies of the Information Booklet published in April 2008. The booklet provides information on
membership of the CTB, the financial limit of tenders to be submitted to CTB, the evaluation
process, procurement method and cycle, among others. Standardised tender documents are used
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Trinidad and Tobago Limited Repeat & Sectoral PEFA 2013
for any form or type of procurement. The instructions to bidders may have some similarities
depending on the nature of the project but technical specifications are different for each project.
There is no formal training programs for procurement officers within the various MDAs even though
a one-on-one mechanism is sometimes used when MDAs submit tender requests.
The CTB Ordinance does not mandate MDAs to publicise their annual procurement plans for the
benefit of the general public and in particular, the suppliers and contractors who may wish to
engage in government business; further, the absence of MDAs full procurement plans has the
tendency of providing unfair competition as it is likely to have leakage of insider information. The
only stage the public is aware of any government tender is through the print and electronic media.
The public is notified when a contract is awarded but this occurs for open competitive procurement
methods and some restrictive tenders only; referencing sole sourcing, there is no public awareness.
Access to complaints resolution is very limited only to the aggrieved bidder; there is no independent
complaints body. Table 3.8 below provides summary of contracts awarded using the CTB
procedures.
Table 3.8: Contract awarded
FY Sole Sourcing
(with justification)
Selective/Restricted
Tenders
Open Tenders Total
2009/2010 2 9 228 239
2010/2011 8 19 347 374
2011/2012 3 4 245 252
Total 13 32 820 865
Source: Centrals Tenders Board
(iv) Existence of an independent administrative procurement complaints system
The CTB Ordinance No. 22 of 1961 does not provide for the establishment of an independent
complaints body or mechanism to superintend over any complaints received from any dissatisfied
bidder in the procurement process. Further, there is no window of opportunity in terms of days or
weeks between the contract award date and the contract signing date for aggrieved bidder(s) to file
a complaint. Table 3.9 below indicates the existence of no independent complaints mechanism.
It should be noted that aggrieved bidders can officially notify CTB on their grievances. CTB does
provide reasons for disqualification of bidders in accordance with the Freedom of Information Act,
which requires that all decisions for rejecting or awarding the contract to a particular bidder be
made available. Even though decisions of these processes are not public, the CTB officially notifies
the Ministry of Public Administration
Table 3.9: Complaints Review Process
Complaints are reviewed by a body which:
(i) is comprised of experienced professionals, familiar with the legal framework for
procurement, and includes members drawn from the private sector and civil society as
well as government.
No
(ii) is not involved in any capacity in procurement transactions or in the process leading to
contract award decisions.
No
(iii) does not charge fees that prohibit access by concerned parties. No
(iv) follows processes for submission and resolution of complaints that are clearly defined
and publicly available.
No
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Trinidad and Tobago Limited Repeat & Sectoral PEFA 2013
Complaints are reviewed by a body which:
(v) exercises the authority to suspend the procurement process. No
(vi) issues decisions within the timeframe specified in the rules/regulations. No
(vii) issues decisions that are binding on all parties (without precluding subsequent access
to an external higher authority).
No
Centrals Tenders Board
PI Dimension Score
2008
Score
2013
Justification for 2013score
PI-19 Competition, value for
money and controls in
procurement
n/a D Scoring Method M2
(i) Transparency,
comprehensiveness and
competition in the legal and
regulatory framework
n/a C The Centrals Tenders Board Ordinance No 22,
1961 meets three of the six legal requirements
stated in Table 3.7 above
(ii) Use of competitive
procurement methods
n/a D Some data is generated by CTB on the type of
procurement method used but fails to include
the value of those contracts as well as the total
value of all government contracts.
(iii) Public access to complete,
reliable and timely
procurement information
n/a D Information available to the public is very
limited. MDAs do not provide information on
procurement plans with bidding opportunities.
Complete data on contracts awarded as well as
complaints resolved is not available
(iv) Existence of an
independent administrative
procurement complaints
system
n/a D There is no independent administrative
procurement complaints mechanism provided
for under the CTB Ordinance No. 22 of 1961
Comparability of scores and performance change:
Scores are not comparable; the PEFA methodology was revised in January 2011
Ongoing reforms
There have been attempts to enact a new procurement law but has been in indeterminate state
since 2006. A legislative proposal has been prepared to guide the executive towards the enactment
of the new procurement law and this has been on the table since 2006. Civil Society Organisations
have made proposals towards this process but is yet to see the light in the tunnel.
3.4.3 PI-20 Effectiveness of internal controls for non-salary expenditure
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Trinidad and Tobago Limited Repeat & Sectoral PEFA 2013
(i) Effectiveness of expenditure commitment controls
After the approval of the national budget through the passing of the Appropriation's Act by
Parliament, the Ministry of Finance requires each ministry to submit an annual implementation or
activity plan together with a pro-forma cash flow. It should be noted that the activity implementation
plan takes into account the project or program implementation cycle that informs the cash flow
projections; however, it fails to indicate the procurement method to be adopted. A manual vote
book records the approved expenditure estimates under each heading for the management and
control of expenditure commitment and payment. The Ministry of Finance issues a quarterly general
release memorandum for recurrent expenditure that allows for commitment of expenditure. Further,
the Ministry of Finance issues a monthly cash release warrant to each ministry for payment of
goods and services. With regards to the Infrastructure Development Fund projects, the Finance
Ministry issues specific warrants only upon receipt of verified and approved supplier or contractor
invoice. Ministries do not commit for expenditure without receiving a general release warrant from
the Finance Ministry even though officials admit there are occasional informal practices particularly
at the district or agency level in anticipation of cash release warrants. Permanent Secretaries of
MDAs are allowed to vire funds from recurrent expenditure votes except for specific recurrent
expenditures that require the approval of the Budget Director or the Minister of Finance and the
Economy such as in the case of "official overseas travel".
(ii) Comprehensiveness, relevance and understanding of other internal control rules/ procedures
The Exchequer and Audit Act provides clear legal framework governing financial administration. It
further provides regulation as to the application of the laws. The Comptroller of Accounts as the
Head of Central Treasury has issued accounting and internal audit manuals for use by public
officials, the latter being a draft yet to be finalised.
Expenditure emanates from the head of the spending unit by issuing the purchase requisition,
followed by a purchase order approved by the Accounting Officer, having ensured that the
expenditure has a budget line and the necessary cash releases. Quotations are sought from at
least three vendors for simplified procurement or the necessary procurement method applied if it
requires the Ministerial Tender Committee or the Centrals Tenders Board. Payment for goods and
services are made only when the appropriate invoices are submitted by the supplier. Officials
intimated that the internal control procedures are clear and fairly simply. There are however
occasional minor compliance issues.
(iii) Degree of compliance with rules for processing and recording transactions
Section 4 of the Exchequer and Audit Act gives powers to the Treasury to ensure that all public
funds are properly receipted and accounted by all manner of person. Each accounting officer must
ensure full compliance with all financial management rules and procedures for the proper use,
recording and reporting of government funds. Interactions with accounting officers suggest the
occasional breaches to procurement rules and procedures, proper supporting documentation for
expenditure commitment and payments, among others. Some of the reasons for these occasional
breaches are due to high staff turnover - requiring constant training and supervision, others being
deliberate to fast-track transaction procession.
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PI Dimension Score
2008
Score
2013
Justification for 2013 score
PI-20 Effectiveness of internal
controls for non-salary
expenditure
C+ C+ Scoring Method M1
(i) Effectiveness of expenditure
commitment controls
B B A manual vote book is used to manage and
control expenditure commitment. For most
expenditures, no commitments are made
without the commitment and/or cash release
warrants. There are minor cases of expenditure
commitments without the necessary releases.
(ii) Comprehensiveness,
relevance and
understanding of other
internal control rules/
procedures
C C Internal control procedures in the Treasury
accounting manual are fairly simple and
understood by accounting officers; however,
there are occasional minor breaches
(iii) Degree of compliance with
rules for processing and
recording transactions
B B Generally, the level of compliance with internal
control procedures are high; however, there are
occasional breaches as a way to simplify and
fast-track the processes
Comparability of scores and performance change:
Scores are comparable; there are no changes
3.4.4 PI-21 Effectiveness of internal audit
The Internal Auditor derives his or her powers from the Exchequer and Audit Act 1959 Chapter
69:01, Regulations 13 sub-section 4 and 65 sub-section 3 and Paragraphs 3, 4 and 105 of the
Financial Instructions1965, which specifies that each accounting unit of a ministry, department or
agency shall establish an independent internal audit section occupied by a check staff. Beyond
these clauses in the Financial Regulations, there is no other specific legal framework governing the
internal audit unit.
(i) Coverage and quality of the internal audit function
Overall, the functions of the internal audit unit are weak and do not meet professional international
standards. Much of its functions are limited to compliance audit with limited time allotted to systems
audit of central government activities. Audit work plans are prepared by established internal audit
units and approved by the Permanent Secretaries of the various ministries; this occurs in larger
ministries. The Comptroller of Accounts has an accounting manual that governs financial
management within central government. Paragraph 2.4.1 of the 2011 Accounting Manual details
internal audit procedures prior to approving all payments. There is a draft internal audit manual,
which is still a 'work-in-progress' document aimed at providing internal audit guidelines to all internal
audit staff across government agencies in line with Institute of Internal Auditors standards; it is
foreseen to be completed by the first quarter 2014. In recent times, some effort is been made
towards value-for-money audits across board but this is still rudimentary with limited effect. The
frequency of ministerial realignments, in most cases affect the efficient running of the internal audit
units due to frequent reshuffles as well as the re-creation of entirely new internal audit units.
Available evidence suggests insufficient human resource capacity in the established internal audit
units across central government ministries and departments.
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Trinidad and Tobago Limited Repeat & Sectoral PEFA 2013
(ii) Frequency and distribution of reports
Even though ministries, departments and agencies prepare quarterly and ad-hoc internal audit
reports, such reports are only submitted to the Permanent Secretaries of the various ministries
within a month following the end of the quarter. There are no formal arrangements to periodically
and systematically submit similar reports to the Comptroller of Accounts, the Minister of Finance nor
the Auditor General even though those reports are made available on request to the Comptroller of
Accounts and the Auditor General during their routine visits and external audit work. Consequently,
less reliance is placed on the work of the internal auditor due to the weaknesses in the internal
audit mechanism.
(iii) Extent of management response to internal audit findings
Available evidence suggests limited action taken by management referencing recommendations
emanating from internal audit reports. Most of the issues raised in these audit reports appear to
reoccur in many instances, particularly on compliance of rules and regulations on financial
management. Interactions with the Auditor General revealed significant concerns regarding
management follow-ups on general audit findings and recommendation; as it turns out,
recommendations made by the Auditor General several decades ago have not been actualised and
still remain relevant in these present times.
PI Dimension Score
2008
Score
2013
Justification for 2013 score
PI-21 Effectiveness of internal
audit
C C Scoring Method M1
(i) Coverage and quality of the
internal audit function
C C Many central government ministries and
departments have internal audit units but with
limited human resource capacity. Focus of
internal audit is on compliance with limited time
on systemic audit not meeting international
professional standards.
(ii) Frequency and distribution
of reports
C C Quarterly audit reports are prepared within one
month after the end of the quarter and
submitted only to the Permanent Secretaries of
the various ministries. Copies are only made
available on request to the Auditor General and
the Comptroller of Accounts of the Ministry of
Finance and the Economy.
(iii) Extent of management
response to internal audit
findings
C C Limited management action is seen on follow-
up of internal audit recommendation, the result
of which is the continuous flouting of financial
regulations and procedures
Comparability of scores and performance change:
The scores are comparable; there are no changes.
Ongoing reforms
No major reforms on change from more compliance to systems audit but the internal audit manual
is been updated to improve
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Trinidad and Tobago Limited Repeat & Sectoral PEFA 2013
3.5 Accounting, recording and reporting
3.5.1 PI-23 Availability of information on resources received by service delivery units
Government accounting systems and methodology has seen no change since the last PEFA
assessment conducted in 2008. The chart of account remains unchanged and inconsistent with
Government Financial Statistics (GFS) 2001. Consequently, it is not possible at this present stage
to track amounts received both in cash and in kind by primary service delivery units such as primary
schools and primary health care facilities across the country. An attempt to put together such an
expenditure tracking report will be burdensome to staff, taking into cognisance the manual
accounting system currently in use in Trinidad and Tobago.
It should also be noted that within the last three completed fiscal years 2009/2010, 2010/2011 and
2011/2012, no Public Expenditure Tracking Survey (PETS) nor Public Expenditure Review (PER)
has been conducted, as well as any other specialised surveys to track public expenditure and
resources received by primary health care facilities and primary schools.
PI Dimension Score
2008
Score
2013
Justification for 2013 score
PI-23 Availability of information on
resources received by
service delivery units
D D No PETS nor PER has been conducted with
the last three completed fiscal years
2009/2010, 2010/2011 and 2011/2012. Further,
the chart of account at its current state is
unable to track resources both cash and in kind
received by primary healthcare facilities and
primary schools across the country
Comparability of scores and performance change:
Scores are comparable; there has been no change since the 2008 PEFA
Ongoing reforms
Discussions are ongoing between government and development partners for the development of a
chart of account to conform with GFS 2001 as well as capable of providing additional statistical and
fiscal report and analysis for government use.
3.5.2 PI-25 Quality and timeliness of annual financial statements
(i) Completeness of the financial statements
In Trinidad and Tobago, a centralised payment system uses the Treasury Single Account for the
payment of all central government expenditures. Ministries, Departments and Agencies do not keep
individual bank accounts, with the exception of some MDAs such as the Ministry of Energy and
Energy Affairs which maintains an own revenue collection bank account at the Central Bank for
royalties, for collection of licence fees on oil and gas concessions and other internally generated
revenue sources. The Exchequer and Audit Act - Section 13(c), backs the opening of deposit bank
account with the Central Bank. Each ministry, having been allocated their annual approved budget,
prepares an activity implementation schedule and a pro-forma cash flow forecast to the Ministry of
Finance based on which quarterly general warrant and monthly cash release warrants are issued.
Manual vote books are used to control commitment of expenditure in line with actual cash release
warrants received from the Ministry of Finance. No commitments for expenditures are made without
the cash warrant but with occasional minor breaches leading to informal practices; for instances
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Trinidad and Tobago Limited Repeat & Sectoral PEFA 2013
where commitments are made without cash, a special official request is sought from the Ministry of
Finance prior to making the said commitment. Therefore, there is an effective mechanism for
monitoring and reporting outstanding commitments. Each ministry submits a daily expenditure
return to the Comptroller of Accounts followed by a monthly reconciliation sheet from the Treasury
to the individual spending ministries within two weeks after the end of the month. The Treasury
prepares a consolidated financial statement, which is an aggregation of all central government
transaction and submits same to the Auditor General. An account is said to be consolidated when a
"Financial information in which assets, equity, liabilities and operation accounts of a firm and its
subsidiaries are combined, after eliminating all inter-firm or inter-agency transactions" Table 3.10
below summarises information contained in the Treasury financial statements; it shows that the
financial statements are complete with the exception of few items.
Table 3.10 Information Contained in the Treasury Financial Statements
Financial heading Sub-financial heading Presence in Financial Statements
Revenue Direct tax Yes
Indirect tax Yes
Non-tax revenue (incl. IGF) Yes
Grants Yes
Expenditure & transfers Personnel Emolument Yes
Administration Yes
Service Yes
Investments Yes
Statutory payments Yes
Subsidies Yes
Retained IGF No
DP funded projects Yes
Assets Cash & Bank balances Yes
Advances Yes
Public loans (receivable) Yes
Equity & other investments Yes
Revenue arrears No
Liabilities Public debts (domestic) Yes
Public debts (foreign) Yes
Statutory obligations Yes
Outstanding commitments Yes
Expenditure arrears No
(ii) Timeliness of submission of the financial statements
Section 24 (1) (a) of the Exchequer and Audit Act Chapter 69:01 (Amendment 1998) mandates the
Comptroller of Accounts to prepare and submit consolidated financial statements to the Auditor
General within four months following the expiration of fiscal year. In all the last three completed
fiscal years, the Treasury has complied with the legal requirements as shown in Table 3.11 below.
As part of the compliance check referencing the timely submissions of annual financial statements,
the Auditor General tabulates all the statutory annual financial statements and the corresponding
actual date of their receipt.
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Trinidad and Tobago Limited Repeat & Sectoral PEFA 2013
Table 3.11 Timeliness of Submission of Annual Financial Statements by Comptroller to Auditor General
Financial Year Financial Statements for: Date of Submission to Auditor
General
FY2009/2010 Consolidated Fund 31st January 2011
FY2010/2011 Consolidated Fund 31st January 2012
FY2011/2012 Consolidated Fund 31st January 2013
Source: Audit General Department
(iii) Accounting standards used
Central government financial statements are prepared using the cash accounting standards which
are generally accepted; the standards are disclosed. These standards have been consistently
applied over time. The financial reports are prepared in a consistent format in line with the budget
estimates and allow for fairly easy statistical and financial analysis. Financial assets and liabilities
are disclosed both in the financial statements and in the notes to the account.
PI Dimension Score
2008
Score
2013
Justification for 2013 score
PI-25 Quality and timeliness of
annual financial statements
C+ C+ Scoring method M1
(i) Completeness of the
financial statements
B B The annual financial statements prepared by
the Treasury are an amalgamation of the MDAs
financial positions. The financial statements are
complete except for the exclusion of
expenditure arrears and revenue arrears
(ii) Timeliness of submission of
the financial statements
A A The Treasury prepares annual financial
statements and submits to the Auditor General
four months after the end of the fiscal year in
accordance with Section 24 (1) (a) of the
Exchequer and Audit Act
(iii) Accounting standards used C C The financial statements are prepared on cash
accounting basis and are consistent over time
with some disclosure of the accounting
standards
Comparability of scores and performance change:
Scores are comparable; no change since 2008
Ongoing reforms
Discussions are underway for the development of a new chart of account
3.6 External scrutiny and audit
3.6.1 PI-27 Legislative scrutiny of the annual budget law
The budget estimates submitted to the legislature is scrutinised on the basis of Articles 63 and 64 of
the Constitution.
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Trinidad and Tobago Limited Repeat & Sectoral PEFA 2013
(i) Scope of the legislature’s scrutiny
In Trinidad and Tobago, the budget estimates are considered 'secret documents' until they are laid
before Parliament. Once laid, the revenue and expenditure estimates are reviewed but less
thoroughly. The extent of review is so limited that parliamentarians have very little questioning
space. As it turns out, the ruling government of the day always has the majority in the legislature
and therefore proceedings are rushed through. The legislative review also covers macro fiscal
policies supporting the budget estimates but is generally weak. The legislature has Constitutional
powers to amend the budget estimates presented by the Minister of Finance; however, these
powers have never been exercised since majority of the parliamentarians are from the ruling
government.
(ii) Extent to which the legislature’s procedures are well-established and respected
The House of Representatives and the Senate have separate standing orders that govern the
parliamentary procedures of both Houses. Clear rules and procedures exist in laying 'money bills'
in both houses and are generally respected. However, parliamentarians have raised concerns
regarding the limitations to questions asked during debates. In most cases, proceedings are cut
short and motions put to vote which eventually get passed or approved by the house due to the
numbers of parliamentarians supporting the executive.
(iii) Adequacy of time for the legislature to provide a response to budget proposals
Within three weeks, the entire legislative budget review process is completed, from the date the
budget is first laid in the House of Representatives and then the Senate to the approval of the
estimates by the Senate. In practice, the Finance Committee of the House of Representatives uses
a day to review the budget estimates as opposed to 7 days allotted. The Senate debates the
Appropriation Bill . However, for the debate on Supplementary and/or Variation of Appropriation
Bills the time could be as short as 1 day in each House. In two of the last completed fiscal years
2009/2010 and 2010/2011, the legislature approved the budget prior the beginning of the new fiscal
year; in fiscal year 2011/2012 the estimates were passed 21 days after the start of the new fiscal
year.
(iv) Rules for in-year amendments to the budget without ex-ante approval by the legislature
Around April or May each year, the executive reviews the performance of the economy and the
level of execution of the budget. At this stage, the Minister of Finance presents a supplementary
budget, which goes through the same process as the main budget in terms of rules and procedures
governing 'money bills'. It must however be noted that, over the years, the supplementary budget
process has become an ex-post event as it turns out that the executive might have made
expenditure and payment commitments prior to seeking parliamentary approval, thereby using
parliament as a 'rubber stamp'. Ministries, Departments and Agencies have all relied on the
supplementary budget process to secure additional funding for their projects and programs; in view
of this, there are numerous budgetary reallocations resulting in huge administrative deviations in
budgetary outturns (refer to PI-2).
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PI Dimension Score
2008
Score
2013
Justification for 2013 score
PI-27 Legislative scrutiny of the
annual budget law
D+ D+ Scoring method M1
(i) Scope of the legislature’s
scrutiny
C B Both revenue and expenditure estimates are
reviewed but only when they are laid before the
legislature. Review of macro fiscal policies
takes place but this is weak as proceedings are
rushed.
(ii) Extent to which the
legislature’s procedures are
well-established and
respected
C B Both the House of Representative and the
Senate have standing orders, which provide
clear rules and procedures for budget debates.
Although generally respected, there are
concerns regarding the limit to questions and
the rush for approving bills in general and
budget estimates in particular
(iii) Adequacy of time for the
legislature to provide a
response to budget
proposals (time allowed in
practice for all stages
combined)
D D A maximum of three weeks is used for laying
and approving the budget which is clearly
inadequate
(iv) Rules for in-year
amendments to the budget
without ex-ante approval by
the legislature
A C There are rules for supplementary budget
processes that are followed, however with
extensive administrative reallocations.
Parliament has become a 'rubber stamp' entity
as the executive might have committed
expenditure prior to legislative approval.
Comparability of scores and performance change:
Scores are comparable. There is no change in overall score but there is a decline in dimension (iv) from A to C
due to the fact that parliament has become a 'rubber stamp' entity approving ex-post events
Ongoing reforms
3.6.2 PI-28 Legislative scrutiny of external audit reports
Parliament derives its powers from Chapter 4, Parts 1 to 3 of the Constitution, the current revision
dating 2007 . Powers to summon ministers, scrutinise the budget otherwise known as "money bill"
as well provide oversight of government fiscal and financial management are all derived therein
(i) Timeliness of examination of audit reports by the legislature
A member of the opposition party chairs the Public Accounts Committee. Due to the limited number
of meetings (at most 7 times in a year but on average 4 times in a year), there remain huge backlog
of Auditor General reports yet to be reviewed by PAC. The table below provides details of the
timely examination of audit reports from the Auditor General. These delays in reviewing Auditor
General's report has resulted in weak implementation of recommended action by the executive.
Table 3.12 Timeliness of Examination of Audit Reports by Parliament
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Trinidad and Tobago Limited Repeat & Sectoral PEFA 2013
Date Parliament
Received Auditor
General Report
Date Auditor
General Report
was Laid in
Parliament
House of
Representative
Date Auditor
General Report
was Laid in the
Senate
Date Parliament
Approved PAC
Reports on
Auditor General
Report
FY2009/2010
Consolidated Fund (Central Government and MDAs) audit report 28th April 2011 12th May 2011
3rd May 2011
Yet to be
approved
FY2010/2011
Consolidated Fund (Central Government and MDAs) audit report 25th April 2012 4th May 2012
1st May 2012
Yet to be
approved
FY2011/2012
Consolidated Fund (Central Government and MDAs) audit report 29th April 2013 10th May 2013
14th May 2013
Yet to be
approved
Source: Parliament
(ii) Extent of hearings on key findings undertaken by the legislature
The structure of the Parliament of the Republic of Trinidad and Tobago is such that
Parliamentarians work as part-time officers, attending to the chamber once a week. It should
however be noted that various committees, including the Public Accounts Committee (PAC) could
meet more than once a week and for longer hours. On the average, there are 76 central
government entities under the purview of PAC and a maximum of 7 meetings per session. In
practice, there are 4 sittings a year; the Public Accounts Committee meets once a month for public
hearings on the Auditor General's report of public accounts. This should translate into 12 meetings
a year but practically, only 4 meetings are held mainly due to ministerial responsibilities of some
PAC members as well as the formation of a quorum. The result of these limited meetings of PAC
has resulted in a backlog of un-reviewed Auditor General's report dating back 2007/2008 fiscal
year. As part of measures to be up-to-date, PAC has decided to review Auditor General's report
from fiscal year 2008/2009. During public hearings, accounting officers of some key ministries and
departments are invited to answer audit queries contained in the Auditor General's audit report.
(iii) Issuance of recommended actions by the legislature and implementation by the executive
It turns out that the limited time with which the PAC meets has had a significant negative effect on
the issuance of recommendations from the review of Auditor General's reports submitted to
Parliament as well as a follow-up on the implementation of these recommended actions by the
executive, even where PAC proffers some remedial actions thereof. Clearly, the accountability
framework on the executive is weak which then places no responsibility on the part of accounting
officers, thereby weakening the external scrutiny duties of the Auditor General. It is important to
state that there could be a demand or pull effect of the activities of the PAC as a result of the
incidence of the Public Accounts (Enterprises) Committee that has undertaken to write officially to
public enterprises demanding a report on the implementation of PAEC recommended actions.
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PI Dimension Score
2008
Score
2013
Justification for 2013 score
PI-28 Legislative scrutiny of
external audit reports
D+ D+ Scoring method M1
(i) Timeliness of examination
of audit reports by
legislature (for reports
received within the last
three years)
D D Even though the Auditor General is up-to-date
with regards to issuance of audit report on the
financial statements of central government,
Parliament and for that matter PAC is unable to
perform its oversight role by reviewing these
audit reports in a timely manner. There are
huge backlogs of un-reviewed audit reports
dating back 2007/2008.
(ii) Extent of hearings on key
findings undertaken by
legislature
C C Accounting officers of key ministries with
adverse audit findings are invited to the limited
sittings of PAC during public hearings.
(iii) Issuance of recommended
actions by the legislature
and implementation by the
executive
C C PAC issues recommended actions on those
audit reports reviewed but there is little
evidence suggesting follow-up of those actions
for executive implementation, thereby
weakening the scrutiny responsibility of the
Auditor General
Comparability of scores and performance change:
The scores are comparable; there is no change since 2008 PEFA
Ongoing reforms
No reform
3.7 Donor practices
3.7.1 D-1 Predictability of Direct Budget Support
(i) Deviation of actual budget support from the forecasts
It turns out that two main donors were actively involved in budget support to the Government - the
Inter-American Development Bank (IADB) and the European Union (EU). The IADB provides
policy-based loans (direct budget support) and sector-specific budget support disbursed or
triggered by the attainment of set targets through the National Treasury. The EU on the other hand,
provides grants (sector budget support) through the Treasury system, agreed upon in the
Financing Agreements, which incorporates disbursement schedules. The EU funds are disbursed at
a time when the Government meets the agreed targets.
Predictability of direct budget support plays a major role in a government's cash management
framework particularly where such support forms a significant part of the government's revenue
flows for expenditure commitments and payments. In Trinidad and Tobago, however, total direct
budget supports represents just about 0.15% of total national budget and may not have
ramifications in terms of unpredictability; nonetheless, it is best practice to know at forehand the
timely disbursement of donor support as well as the level of deviation between forecast
disbursements and actual flows. During the last three completed fiscal years, deviations from donor
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Trinidad and Tobago Limited Repeat & Sectoral PEFA 2013
forecasts were 65.29% in 2009/2010, -1.23% in 2010/2011 and 11.04% in 2011/2012. (Please,
refer to Table 3.13 below)
Table 3.3 Direct Budget Support Performance for the Period 2009/2010- 2011/2012 (US$, million)
FY 2009/2010 FY 2010/2011 FY2011/2012
Forecast Disbursed Forecast Disbursed Forecast Disbursed
GBS forecast transmit No date No date No date
GBS amount (IADB) 0.00 0.00 15.90 15.90 37.36 37.36
GBS amount (EU) 0.00 0.00 0.00 0.00 0.00 0.00
Total GBS 0.00 0.00 15.90 15.90 37.36 37.36
Annual Deviation 0.00 0.00 0.00
Annual Deviation (%) 0% 0% 0%
Sector BS amount (IADB) 4.57 5.98 5.46 2.97 10.96 4.10
Sector BS amount (EU) 12.66 0.00 60.87 64.37 13.79 13.79
Total Sector BS 17.23 5.98 66.33 67.34 24.75 17.89
Annual Deviation (US$ m) 11.25 (1.01) 6.86
Annual Deviation (%) 65.29% (1.52%) 27.72%
Total BS amount 17.23 5.98 82.23 83.24 62.11 55.25
Annual Deviation (US$ m) 11.25 (1.01) 6.86
Annual Deviation (%) 65.29% (1.23) 11.04%
Source: IADB & EU: Exchange rate: US$1=TT$6.29; EUR1=TT$8.85
(ii) In-year timeliness of donor disbursements
The budget execution framework entails the timeliness and the reliability of cash releases from
governments own resources and development partner support. A country with significant donor
budget support is likely to suffer from delays in disbursement of funds by the donors. It turns out
that, the ratio of donor budget support in Trinidad and Tobago to total national expenditure is about
0.15% and therefore may not have serious consequences to efficiency in budget execution;
nonetheless, it is an important element to the entire national developmental agenda. Further, there
is a lost opportunity for effective donor participation in improving donor-government dialogue on
PFM reform. The Financing Agreements from the two major donors do indicate an annual
disbursement schedule consequence to the achievement of agreed milestone, but a
comprehensive quarterly disbursement schedule is not prepared and agreed with the government,
particularly in the case of IADB contrary to the EU having a quarterly disbursement plan. As
presented in the table below, more than 50% of forecast disbursements delayed in 2009/2010 fiscal
year.
Table 3.14: Donor Budget Support (USD million)
2009/2010 2010/2011 2011/2012
Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4
IADB
Forecast 0.00 0.00 0.00 4.57 0.00 0.00 0.00 21.36 0.00 0.00 0.00 48.32
Disbursed 0.00 0.00 0.00 5.98 0.00 0.00 0.00 18.87 0.00 0.00 0.00 41.46
EU
Forecast 0.00 0.00 0.00 12.66 0.00 18.33 0.00 42.54 0.00 0.00 0.00 13.79
Disbursed 0.00 0.00 0.00 0.00 20.23 0.00 0.00 44.14 0.00 0.00 0.00 13.79
Total forecast 0.00 0.00 0.00 17.23 0.00 18.33 0.00 63.90 0.00 0.00 0.00 62.11
Total disbursed 0.00 0.00 0.00 5.98 20.23 0.00 0.00 63.01 0.00 0.00 0.00 55.25
Weighted delay 65.29% 1.39% 11.04%
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Trinidad and Tobago Limited Repeat & Sectoral PEFA 2013
PI Dimension Score
2008
Score
2013
Justification for 2013 score
D-1 Predictability of Direct Budget Support NS C+ Scoring method M1
(i) Annual deviation of actual Budget
Support (BS) from the forecasts
provided by the donor agencies at
least 6 weeks prior to the government
submitting its budget proposals to the
legislature
NS A In one out of the last three completed fiscal
years, direct budget support deviated by less
than 5%. Actual deviations were 65.29%,
-1.23% and 11.04% in FY2009/2010,
FY2010/2011 and FY2011/2012 respectively
(ii) In-year timeliness of donor
disbursements (compliance with
aggregate quarterly estimates)
NS C Whiles the EU prepares a quarterly
disbursement schedule, the IADB does not.
More than 50% of forecast disbursements
delayed in one out of the last three completed
fiscal years
Comparability of scores and performance change:
Scores are comparable; there has been an improvement
3.7.2 D-2 Financial information provided by donors for budgeting and reporting on project and program
aid
(i) Completeness and timeliness of budget estimates by donors for project support
Donors adopt different kinds of aid modalities to assist governments in their developmental agenda.
Apart from the two main aid modalities, namely direct budget support (as well as un-earmarked
sector budget support) and earmarked sector budget support, donors provide development
assistance through the provision of special projects and programs, paid directly by the donors;
some of these could be technical assistance and assistance in kind. The budget, as an annual
operational policy document of a government, should be able to provide complete revenue and
expenditure estimates for efficient service delivery.
The practice, however, is that all the major donors do not provide complete budget estimates on
program and project aid in a timely manner to the Ministry of Finance. Government has no
information whatsoever as regards the forecasts for any donor support on technical assistance or
aid both in cash and in kind for inclusion into the national budget. It should be recognised that
although some level of engagement does occur at the ministerial level, it is insufficient to warrant
the determination and inclusion of the donor fiscal estimates into the ministries, departments and
agencies budget estimates for consolidation into the national budget.
(ii) Frequency and coverage of reporting by donors on actual donor flows for project support
The major donors in Trinidad & Tobago (IADB and EU) provide technical assistance to the
government in some selected ministries, departments and agencies. In order for the government to
ascertain its complete financial position in terms of revenue and expenditure, it is imperative for all
forms of revenue and expenditure to be included in governments' financial statement in accordance
with the national fiscal reporting calendar and the budget classification. At present, none of the
active donors provides quarterly financial reports in national formats and accounting standards
within two months following the end of the quarter, nor do they provide annual project/program aid
financial statements to the government.
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Trinidad and Tobago Limited Repeat & Sectoral PEFA 2013
PI Dimension Score
2008
Score
2013
Justification for 2013 score
D-2 Financial information
provided by donors for
budgeting and reporting on
project and program aid
D D Scoring Method M1
(i) Completeness and
timeliness of budget
estimates by donors for
project support
D D All major donors do not provide budget
estimates on program and projects to
government in any of the last three completed
fiscal years
(ii) Frequency and coverage of
reporting by donors on
actual donor flows for
project support
D D No quarterly or annual financial reports are
provided by donors to government referencing
actual disbursement made on project or
program aid
Comparability of scores and performance change:
Scores are comparable; there are no changes
3.7.3 D-3 Proportion of aid that is managed by use of national procedures
Donors agreed during the Paris Declaration 2005, the Accra Agenda for Action 2008 and the Busan
Action Plan 2011 to use country systems in providing development aid to countries aligned to
national strategies. The use of country systems and procedures is defined as adopting the use of
national procurement laws and procedures, disbursement of funds through the national treasury
system, accounting and reporting for the use of these funds through national accounting policies
and procedures, and auditing the use of these funds by adopting national auditing standards and
procedures.
Available evidence suggests the two main donor partners - IADB and EU have considerably
improved with regards to the use of national systems in aid modality. During the three years under
review, whiles IADB provided policy-based loans and sector budget support, the EU's budget
support was more sector driven; nonetheless, all disbursements from both donors were made to the
national treasury. Admittedly, both the IADB and the EU provided Technical Assistance, the cost of
which were paid using the donors' systems. In spite of this, more than 90% of total aid to Trinidad
and Tobago used national PFM systems. (Please, refer to Table 3.15 below)
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Trinidad and Tobago Limited Repeat & Sectoral PEFA 2013
Table 3.15 Use of country PFM and Procurement Systems
Total Direct
BS (USD
million)
Total
program/proj
ect (USD
million)
Use of country systems
Total Aid
(USD
million)
Procurement Budget
execution
Financial
reporting
Audit Weighted
average
2009/10
IADB 5.98 0.00 5.98 5.98 5.98 5.98 5.98
0.00 0.10 0.10 0.00 0.0 0.00 0.00
EU 0.00 0.00 0.00 0.00 0.00 0.00 0.00
0.00 0.54 0.54 0.00 0.00 0.00 0.00
Total 5.98 0.64 6.62 5.98 5.98 5.98 5.98 90.33%
2010/11
IADB 18.87 0.00 18.87 18.87 18.87 18.87 18.87
0.00 0.10 0.10 0.00 0.00 0.00 0.00
EU 64.37 0.00 64.37 64.37 64.37 64.37 64.37
0.00 0.35 0.35 0.00 0.00 0.00 0.00
Total 83.24 0.45 83.69 83.24 83.24 83.24 83.24 99.46%
2011/12
IADB 41.46 0.00 41.46 41.46 41.46 41.46 41.46
0.00 0.10 0.00 0.00 0.00 0.00 0.00
EU 13.79 0.00 13.79 13.79 13.79 13.79 13.79
0.00 1.03 1.03 0.00 0.00 0.00 0.00
Total 55.25 1.13 56.28 55.25 55.25 55.25 55.25 98.17%
Source: IADB & EU: Exchange rate US$1=TT$6.29; EUR1=TT$8.85
PI Dimension Score
2008
Score
2013
Justification for 2013 score
D-3 Overall proportion of aid funds to
central government that are
managed through national
procedures
D A More than 90% of donor funds are managed through
the Trinidad & Tobago's national systems. The actual
weighted averages are 90.33%, 99.46% and 98.17%
for FY2009/2010, FY2010/2011 and FY2011/2012
respectively
Comparability of scores and performance change:
Score are comparable; there has been an improvement
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Trinidad and Tobago Limited Repeat & Sectoral PEFA 2013
4 Government Reform Process
4.1 Recent and ongoing reforms
Trinidad and Tobago is considering undertaking a comprehensive integrated PFM reform program.
While there has been considerable discussion, there is not yet a cabinet approved PFM reform
strategy. Officials indicate that there is currently a draft PFM reform strategy that is being
considered and will be submitted to Cabinet in 2014. Some initiatives being considered include the
introduction of a multi-year fiscal framework, the introduction of performance based budgeting; the
introduction of decentralised public procurement , the implementation of an integrated financial
management information system (IFMIS).
The main PFM reform initiatives currently being pursued have taken a longer than expected time to
materialise. These include but not limited to the following:
A New Public Procurement Law - this process began in 2006 and it is still on the table yet
to receive the necessary cabinet and legislative approvals. Civil Society Organisations
have raised concerns referencing the current state of the draft bill and the pace of
executive action to ensure the smooth passage of the law
Development of a medium term macro-fiscal framework (MTMF) leading to the
development of a medium term expenditure framework (MTEF)
Development of a new chart of account to be consistent with GFS2001 and capable of
producing statistical reports for government use
The introduction of IFMIS which is largely dependent on the development of a new chart of
account
The PSIP being developed to have a multi-year perspective, going forward
Finalisation of the draft internal audit manual and revision of the existing accounting
manual
The amendment of some PFM laws to accommodate changes in PFM processes such as
IFMIS
The standardisation of the debt management software (CS-DRMS)
The training and capacity building of the Auditor General Department to undertake
specialised audits such as Value-for-Money (VFM) audits.
Empowerment of the Public Accounts Committee and Public Enterprises Account
Committee to effectively perform its external oversight role on government and state-
owned entities as required by law through capacity building and the provision of support
office and staff with technical acumen
The Government, according to officials, is committed to ensuring advancing the current and on-
going reform program.
4.2 Institutional factors supporting PFM reforms
Over the years, there has been strong political and civil society commitment towards the
advancement of PFM reform. There has however been a drawback in pursuing some important
PFM reforms, seen in the public domain as critical to improving transparency and accountability.
The 2008 PEFA identified major weaknesses in the PFM procedures and processes; this has been
highlighted by the 2013 assessment as well.
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Some key PFM institutions such as the Ministry of Finance, the Office of the Auditor General and
Parliament, all realise the importance of these PFM reforms in order to accelerate the quest for
greater transparency.
Development Partners have been at the forefront of providing some financial and technical
assistance in that direction. There is the need to deepen the existing dialogue environment between
donors and government with the participation of civil society groups to fasten the PFM reform
agenda.
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Annexes
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Annex 1: PFM Performance Measurement Framework Indicators Summary
No. Indicator Score
2008
Score
2013
Justification for 2013 score Comparability of scores and explanation of
change since previous assessment
A. PFM OUT-TURNS: Credibility of the budget
PI-1 Aggregate expenditure out-turn
compared to original approved
budget
B A In one of the three completed fiscal years, the
aggregate expenditure deviation was 7.7%; this was
an improvement from the 2008 PEFA assessment of
10% in one of the three years - 2004/2005. Actual
deviations for the last completed fiscal year were
2.1%, 7.7% and 0.03% for 2009/2010, 2010/2011
and 2011/2012 respectively
Scores are comparable. There was an improvement
when compared to the 2008 PEFA where in one of
the three years - 2004/2005, the expenditure
deviation was 10% as compared to 7.7% in
2010/2011
PI-2 Composition of expenditure out-turn
compared to original approved
budget
C D+ The overall of D+ is as a result of change in scoring
methodology. If compared on the basis of the
original methodology, there is an improvement
Scores not comparable due to change in
methodology
(i) Variance in expenditure composition,
excluding contingency items
n/a D The reallocation of ministerial votes over the last
three completed fiscal years were 17.8% each for
2009/2010 and 2010/2011 and 20.4% for
2011/2012.
Scores not comparable due to change in
methodology
(ii) The average amount of expenditure
actually charged to the contingency
vote
n/a A The average percentage of actual expenditure
charged to the contingency vote over the last three
completed fiscal years was 0.07%. The charge for
each of the years was 0.11%, 0% and 0.11% for
2009/2010, 2010/2011 and 2011/2012 respectively
Scores not comparable due to change in
methodology
B. KEY CROSS-CUTTING ISSUES: Comprehensiveness and transparency
PI-5 Classification of the budget C C Over the last three years, Trinidad and Tobago's
national budget is classified into administrative and
economic headings; further the classification allows
for consistent budget execution and reporting even
though this is not fully GFS 2001 compliant
Scores are comparable; there is no change since
2008 PEFA
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No. Indicator Score
2008
Score
2013
Justification for 2013 score Comparability of scores and explanation of
change since previous assessment
C. BUDGET CYCLE
C(i) Policy-based Budgeting
PI-11 Orderliness and participation in the
annual budget process
C+ B The dimension (iii) has improved resulting in overall
improvement in the score
Scores are comparable. There has been an
improvement since the 2008 PEFA
(i) Existence of and adherence to a
fixed budget calendar
A A Clear and fixed budget calendar exist. These are
contained in the budget circular issued by the
Finance Ministry between February and March each
year; these dated are followed.
Scores are comparable; there is no change
(ii) Guidance on the Preparation of
budget submissions.
D D There is very little political involvement in the budget
preparation process. There are no budget ceilings in
the budget circulars issued by the Finance Ministry
to serve as a top-down fiscal discipline.
Scores are comparable; there is no change
(iii) Timely budget approval by the
legislature
C B In the last three completed fiscal years, the
legislature has approved the annual budget before
the start of the next fiscal year in two of the three
years under this assessment
Scores are comparable. There has been an
improvement in this dimension
PI-12 Multi-year perspective in fiscal
planning, expenditure policy and
budgeting
C+ C+ No change in overall score even though dimension
(iv) deteriorated from B to C due to poor linkages
between investment and forward linked recurrent
expenditure
Scores are comparable; there is no change in
overall score even though there was a slippage in
dimension (iv)
(i) Multi-year fiscal forecast and
functional allocations
C C The budget estimates have no forecast figures for
the two outer years. The estimates are by economic
and administrative classifications.
Scores are comparable; there is no change
(ii) Scope and frequency of debt
sustainability Analysis
A A A debt sustainability has been carried out in each of
the last three completed fiscal year 2009/2010,
2010/2011 and 2011/2012
Scores are comparable; there is no change
(iii) Existence of costed sector strategies D D There are no sector strategies, let alone costed
sector strategies. Nonetheless, there is some level
of collaboration during the preparation stage of the
annual budget
Scores are comparable; there is no change
(iv) Linkages between investment B C Major government projects have weak sector Scores are comparable; there is a slippage in this
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No. Indicator Score
2008
Score
2013
Justification for 2013 score Comparability of scores and explanation of
change since previous assessment
budgets linkages with some level of recurrent cost estimates dimension
C(ii) Predictability and control in Budget Execution
PI-15 Effectiveness in collection of tax
payments
D+ NR 5 No data to score dimension (i) Scores are comparable; there is a slippage in overall
score due to non availability of data to rate
dimension (i)
(i) Collection ratio for gross tax arrears,
being percentage of tax arrears at
the beginning of a fiscal year, which
was collected during that fiscal year
D NR No data to score Scores are comparable; there is a slippage due to
non availability of data to rate dimension (i)
(ii) Effectiveness of transfer of tax
collections to the Treasury by the
revenue administration
A A Transfers from commercial banks for cleared
cheques and cash are made within 24 hours of their
receipt from taxpayers.
Scores are comparable; there is no change
(iii) Frequency of complete accounts
reconciliation between tax
assessments, collections, arrears
records and receipts by the Treasury
D A The tax software GENTAX generates monthly
reports. Full reconciliation of tax assessed, tax
collected, tax transferred to the Treasury and tax
arrears are done with one month after the end of the
month.
Scores are comparable; there is an improvement in
score.
PI-19 Competition, value for money and
controls in procurement
D+ D Using the old methodology, there has been a
slippage in overall score
Scores not comparable due to change in
methodology
(i) Transparency, comprehensiveness
and competition in the legal and
regulatory framework
n/a C The Centrals Tenders Board Ordinance No 22, 1961
meets three of the six legal requirements stated in
Table 3.7 above
Scores not comparable due to change in
methodology
(ii) Use of competitive procurement
methods
n/a D Some data is generated by CTB on the type of
procurement method used but fails to include the
value of those contracts as well as the total value of
all government contracts.
Scores not comparable due to change in
methodology
(iii) Public access to complete, reliable
and timely procurement information
n/a D Information available to the public is very limited.
MDAs do not provide information on procurement
plans with bidding opportunities. Complete data on
contracts awarded as well as complaints resolved is
not available
Scores not comparable due to change in
methodology
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No. Indicator Score
2008
Score
2013
Justification for 2013 score Comparability of scores and explanation of
change since previous assessment
(iv) Existence of an independent
administrative procurement
complaints system
n/a D There is no independent administrative procurement
complaints mechanism provided for under the CTB
Ordinance No. 22 of 1961
PI-20 Effectiveness of internal controls for
non-salary expenditure
C+ C+ No change Scores are comparable; there is no change
(i) Effectiveness of expenditure
commitment controls
B B A manual vote book is used to manage and control
expenditure commitment. For most expenditures, no
commitments are made without the commitment
and/or cash release warrants. There are minor
cases of expenditure commitments without the
necessary releases.
Scores are comparable; there is no change
(ii) Comprehensiveness, relevance and
understanding of other internal
control rules/ procedures
C C Internal control procedures in the Treasury
accounting manual are fairly simple and understood
by accounting officers; however, there are
occasional minor breaches
Scores are comparable; there is no change
(iii) Degree of compliance with rules for
processing and recording
transactions
B B Internal control procedures in the Treasury
accounting manual are fairly simple and understood
by accounting officers; however, there are
occasional minor breaches
Scores are comparable; there is no change
PI-21 Effectiveness of internal audit C C No change Scores are comparable; there is no change
(i) Coverage and quality of the internal
audit function
C C Many central government ministries and
departments have internal audit units but with limited
human resource capacity. Focus of internal audit is
on compliance with limited time on systemic audit
not meeting international professional standards.
Scores are comparable; there is no change
(ii) Frequency and distribution of reports C C Quarterly audit reports are prepared within one
month after the end of the quarter and submitted
only to the Permanent Secretaries of the various
ministries. Copies are only made available on
request to the Auditor General and the Comptroller
of Accounts of the Ministry of Finance and the
Scores are comparable; there is no change
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No. Indicator Score
2008
Score
2013
Justification for 2013 score Comparability of scores and explanation of
change since previous assessment
Economy.
(iii) Extent of management response to
internal audit findings
C C Limited management action is seen on follow-up of
internal audit recommendation, the result of which is
the continuous flouting of financial regulations and
procedures
Scores are comparable; there is no change
C(iii) Accounting, Recording and Reporting
PI-23 Availability of information on
resources received by service
delivery units
D D No PETS nor PER has been conducted with the last
three completed fiscal years 2009/2010, 2010/2011
and 2011/2012. Further, the chart of account at its
current state is unable to track resources both cash
and in kind received by primary healthcare facilities
and primary schools across the country
Scores are comparable; there is no change
PI-25 Quality and timeliness of annual
financial statements
C+ C+ No change Scores are comparable; there is no change
(i) Completeness of the financial
statements
B B The annual financial statements prepared by the
Treasury are an amalgamation of the MDAs
financial positions. The financial statements are
complete except for the exclusion of expenditure
arrears and revenue arrears
Scores are comparable; there is no change
(ii) Timeliness of submission of the
financial statements
A A The Treasury prepares annual financial statements
and submits to the Auditor General four months after
the end of the fiscal year in accordance with Section
24 (1) (a) of the Exchequer and Audit Act
Scores are comparable; there is no change
(iii) Accounting standards used C C The financial statements are prepared on cash
accounting basis and are consistent over time with
some disclosure of the accounting standards
Scores are comparable; there is no change
C(iv) External Scrutiny and Audit
PI-27 Legislative scrutiny of the annual
budget law
D+ D+ No change in overall score but for some
improvement in dimensions (i) and (ii) but a slippage
in dimension (iv)
Scores are comparable; there is no change in
overall score even though there was an
improvement in dimensions (i) and (ii) and a
slippage in dimension (iv)
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No. Indicator Score
2008
Score
2013
Justification for 2013 score Comparability of scores and explanation of
change since previous assessment
(i) Scope of the legislature’s scrutiny C B Both revenue and expenditure estimates are
reviewed but only when they are laid before the
legislature. Review of macro fiscal policies takes
place but this is weak as proceedings are rushed.
Scores are comparable; there is an improvement
(ii) Extent to which the legislature’s C B Both the House of Representative and the Senate
have standing orders, which provide clear rules and
procedures for budget debates. Although generally
respected, there are concerns regarding the limit to
questions and the rush for approving bills in general
and budget estimates in particular
Scores are comparable; there is an improvement
(iii) Adequacy of time for the legislature
to provide a response to budget
proposals (time allowed in practice
for all stages combined)
D D A maximum of three weeks is used for laying and
approving the budget which is clearly inadequate
Scores are comparable; there is no change
(iv) Rules for in-year amendments to the
budget without ex-ante approval by
the legislature
A C There are rules for supplementary budget processes
that are followed, however with extensive
administrative reallocations. Parliament has become
a 'rubber stamp' entity as the executive might have
committed expenditure prior to legislative approval.
Scores are comparable; there is a slippage
PI-28 Legislative scrutiny of external audit
reports
D+ D+ No change Scores are comparable; there is no change
(i) Timeliness of examination of audit
reports by legislature (for reports
received within the last three years)
D D Even though the Auditor General is up-to-date with
regards to issuance of audit report on the financial
statements of central government, Parliament and
for that matter PAC is unable to perform its oversight
role by reviewing these audit reports in a timely
manner. There are huge backlogs of un-reviewed
audit reports dating back 2007/2008.
Scores are comparable; there is no change
(ii) Extent of hearings on key findings
undertaken by legislature
C C Accounting officers of key ministries with adverse
audit findings are invited to the limited sittings of
PAC during public hearings.
Scores are comparable; there is no change
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No. Indicator Score
2008
Score
2013
Justification for 2013 score Comparability of scores and explanation of
change since previous assessment
(iii) Issuance of recommended actions
by the legislature and
implementation by the executive
C C PAC issues recommended actions on those audit
reports reviewed but there is little evidence
suggesting follow-up of those actions for executive
implementation, thereby weakening the scrutiny
responsibility of the Auditor General
Scores are comparable; there is no change
D. DONOR PRACTICES
D-1 Predictability of Direct Budget
Support
NS C+ Availability of data from donors resulted in the
scoring of both dimensions and saw significant
improvement
Scores are comparable; there is an improvement in
overall score as a result of improvements in
dimensions (i) and (ii)
(i) Annual deviation of actual BS from
the forecasts provided by the donor
agencies at least 6 weeks prior to the
government submitting its budget
proposals to the legislature
NS A In one out of the last three completed fiscal years,
direct budget support deviated by less than 5%.
Actual deviations were 65.29%,
-1.23% and 11.04% in FY2009/2010, FY2010/2011
and FY2011/2012 respectively
Scores are comparable; there is an improvement
(ii) In-year timeliness of donor
disbursements (compliance with
aggregate quarterly estimates)
NS C Whiles the EU prepares a quarterly disbursement
schedule, the IADB does not. More than 50% of
forecast disbursements delayed in one out of the
last three completed fiscal years
Scores are comparable; there is an improvement
D-2 Financial information provided by
donors for budgeting and reporting
on project and program aid
D D No change Scores are comparable; there is no change
(i) Completeness and timeliness of
budget estimates by donors for
project support
D D All major donors do not provide budget estimates on
program and projects to government in any of the
last three completed fiscal years
Scores are comparable; there is no change
(ii) Frequency and coverage of reporting
by donors on actual donor flows for
project support
D D No quarterly or annual financial reports are provided
by donors to government referencing actual
disbursement made on project or program aid
Scores are comparable; there is no change
D-3 Overall proportion of aid funds to
central government that are
managed through national
D A More than 90% of donor funds are managed through
the Trinidad & Tobago's national systems. The
actual weighted averages are 90.33%, 99.46% and
Scores are comparable; there is an improvement
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No. Indicator Score
2008
Score
2013
Justification for 2013 score Comparability of scores and explanation of
change since previous assessment
procedures 98.17% for FY2009/2010, FY2010/2011 and
FY2011/2012 respectively
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Annex 3: List of Stakeholders Interviewed
Name Organisation Position Email
Ministry of Finance and the Economy
Eric James MoFE Permanent Secretary [email protected]
Narine Charran MoFE Senior Economist [email protected]
Michelle Durham-Kissoon MoFE Assistant Director, Economic Management Division [email protected]
Roselyn Ramdin-Doobraj MoFE Comptroller of Accounts [email protected]
Narine Charran MoFE Senior Economist [email protected]
Joycelyn Vialmosa MoFE Ag Senior Treasury Accountant [email protected]
Karen Seeboron-Timothy MoFE Ag Treasury Director [email protected]
Cherryann Le Gendre MoFE Ag Director of Budget [email protected]
Savitree Seepersad MoFE Director, Treasury - Pensions Management [email protected]
Yvonne Neemacharan MoFE Director, Treasury Management [email protected]
Catherine Laban MoFE Deputy Comptroller of Accounts [email protected]
Yvette Babb MoFE Senior Business Analyst [email protected]
Feroza Matthew MoFE Research Officer [email protected]
Eunice Walton MoFE Deputy Permanent Secretary [email protected]
Denis Cox MoFE Senior Investment Analysts
Board of Inland Revenue
Errol Ramsubeik BIR Ag Commissioner - Legal & Administration [email protected]
Charles Cudjoe BIR Ag Commissioner, Collections and Enforcement [email protected]
Nayak Ramdahin BIR Commissioner, Audit & Compliance [email protected]
Trevor Lalai BIR Commissioner, Reform, Objections and Planning [email protected]
Allison Raphael BIR Ag Chairman, BIR [email protected]
Ministry of Food Production
Myrna Thompson MoFP Permanent Secretary [email protected]
Yvonne Davidson-Mc
Kenzie
MoFP Director, Planning [email protected]
Beena Persad MoFP Planning Officer II [email protected]
Kamal Ragbir MoFP Auditor II
Geraloine Ferdinand MoFP Accounting Executive II [email protected]
Indra Arjoon MoFP Accountant II
Oswald Wright MoFP Project Analyst [email protected]
Parliament
Senator Colm Imbert Parliament Chairman PAC [email protected]
Keiba Jacob Parliament Clerk, PAC [email protected]
Julien Ogilvie Parliament Clerk of Committees [email protected]
Subhass Ramkhe Lawan Parliament Chairman, JSC - Municipal Corporation Services [email protected]
Nataki Atiba-Dilchan Parliament Clerk to the Senate [email protected]
Senator Dr. Victor Wheeler Parliament [email protected]
Ministry of Planning and Sustainable Development
Arlene Mc Comle MPSD Permanent Secretary [email protected]
Samantha Sharma MPSD Associate Professional [email protected]
Marion Lewis MPSD Assistant Program Coordinator - EDF Unit [email protected]
Marilyn Joseph MPSD Administrative Officer [email protected]
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Name Organisation Position Email
Marlene Nicholas MPSD Administrative Officer [email protected]
Zelmina James MPSD Auditor II [email protected]
Karlene Roach MPSD Director, Planning [email protected]
Joanne Deoraj MPSD Assistant Director [email protected]
Ayleen Ovid MPSD Director [email protected]
Ministry of Environment and Water Resources
David Persand MoEWR Environmental Manager [email protected]
Praimatee Chandoo MoEWR Administrative Manager [email protected]
Ajodia Rattansingh MoEWR Manager, Human Resource [email protected]
Rhoda Gunnesslal MoEWR Ag Accountant II [email protected]
Sara Randass-Maharaj MoEWR Ag Clerk II (Payroll) [email protected]
Allan Elder MoEWR Ag. Accounting Assistant [email protected]
Donors
Gregory Dunbar IADB Financial Expert [email protected]
Julian Belgrave IADB Operations Specialist [email protected]
Terhi Karvinen EU Program Coordinator [email protected]
Solomon Ioannou EU Program Coordinator [email protected]
Lydga Mohammed EU Cooperation Assistant [email protected]
Kathrin Renner EU Program Coordinator [email protected]
Civil Society Organisations
Afra Raymond JCC President [email protected]
Rishi P. A. Dass TTTI Member [email protected]
Ronald Ramcharam TTTI Director, Treasury [email protected]
Lorraine Rostant TTTI Director, Communications [email protected]
Stacey Honore TTCIC Trade & Research Economist [email protected]
Camille Sear-Carter Wells TTCIC [email protected]
Jerome Chambers TTCIC [email protected]
Auditor General's Department
Sharnan Ottley AGD Auditor General [email protected]
Majeed Ali AGD Ag Deputy Auditor General [email protected]
Jaiwantie Ramdass AGD Assistant Auditor General [email protected]
Gary Peters AGD Assistant Auditor General [email protected]
Gaitrie Maharaj AGD Assistant Auditor General [email protected]
Lorelly Pujadas AGD Assistant Auditor General [email protected]
Ministry of Labour and Small and Micro Enterprise Development Small and Micro Enterprises Development
Carl Francis MOLSMED Permanent Secretary [email protected]
Allisa Francis MOLSMED District Coordinator [email protected]
Shanmabee Singh Sang MOLSMED Director, Research & Planning [email protected]
Clement Ragoobar Singh MOLSMED Auditor II [email protected]
Susan Jaglal-Beharry MOLSMED Ag Accounting Executive [email protected]
Michael Gordon MOLSMED Manager, Enterprises Development Division [email protected]
Ministry of Education
Jennifer Daniel MoE Permanent Secretary [email protected]
Vidya Rambharose- MoE Deputy Permanent Secretary [email protected]
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Name Organisation Position Email
Heeraman
Chanwati Sookra MoE Ag Deputy Permanent Secretary [email protected]
Anjasie Samasoo MoE Auditor III [email protected]
Kristy Mahato Maharaj MoE Director, M & E [email protected]
Lemor Baptiste-Simmons MoE Director, Educational Planning [email protected]
Central Bank of Trinidad & Tobago
Marie Borely CBTT Chief Financial Officer [email protected]
Christopher Subryan CBTT Assistant Manager, Finance & Accounting [email protected]
Ministry of Trade, Industry and InvestmentIndustry and Investments
Joycelyn Hunte MTII Ag Permanent Secretary [email protected]
Sharla Codrington MTII M & E Specialist [email protected]
Janice Piarris MTII M & E Specialist [email protected]
Troy Chuerw MTII Senior HR Officer
Leeza Nondalal MTII Ag Accountant II
Ramzan Hosein MTII Coordinator [email protected]
Pamela Job MTII Administrator [email protected]
Brennan Guwin MTII M & E Specialist
Randall Karim MTII Director [email protected]
Ministry of Works & Infrastructure
Isaac James MoWI Permanent Secretary [email protected]
Sonia Francis-Yearwood MoWI Deputy Permanent Secretary [email protected]
Marissa Chattergoon MoWI Auditor III [email protected]
Parbatu Bachan MoWI CAS [email protected]
Lisa Balkaran MoWI CPI [email protected]
Wayne Kuyless MoWI Senior Economist [email protected]
Kamal Lewis MoWI Accountant II
Ramroop Maharaj MoWI Accounting Expert II
Elizabeth Roach MoWI Accounting Executive I
Ministry of Energy & Energy Affairs
Selwyn Lashley MEEA Ag Permanent Secretary [email protected]
Richard Oliver MEEA Deputy Permanent Secretary [email protected]
Heidi Wong MEEA Ag Deputy Permanent Secretary [email protected]
Grace Corneal MEEA Senior Audit Analyst [email protected]
Cindy Roopchand MEEA Planning Officer [email protected]
Poorandi Ramjitsingh MEEA Ag Accountant II [email protected]
Azizah Baksh-Backredee MEEA Senior Chemical Engineer [email protected]
Richard Jeremie MEEA Chief Technical Officer [email protected]
Barbara Nelson MEEA Auditor II [email protected]
Hazra Parasramsingh MEEA Ag Auditor V [email protected]
Marc Rudder MEEA Senior Petroleum Engineer [email protected]
Randy Maurice MEEA Senior Planning Officer [email protected]
Monty Beharry MEEA Director of Minerals [email protected]
Centrals Tenders Board
Shamdaye Singh-Ramdial CTB Ag Assistant Director of Contracts [email protected]
Jenepha Khan CTB Ag Assistant Director of Contracts [email protected]
Ministry of Health
Ramesy Gooster MoH Auditor II [email protected]
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Name Organisation Position Email
Veronica Pedro MoH Accounting Executive I [email protected]
Andy Thomas MoH Senior Health Economist [email protected]
Sarita Ghouralal MoH Auditor II [email protected]
Dave Francois MoH Procurement Specialist [email protected]
Geeta Maharaj MoH Director, Finance & Accounts [email protected]
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Annex 4: List of Documents Consulted
Legislation, Regulations
Constitution of the Republic of Trinidad and Tobago 1976 (Amendments to 2007)
Exchequer and Audit Act (EAA), 1999 + Amendments
Customs Act 1938 + Amendments to date
Value Added Tax Act, 1939 + Amendments to date
Income Tax Act, 1938 + Amendments to 1980
Centrals Tenders Board Ordinance
Central Bank Act
Appropriations Act 2009/2010, 2010/2011 and 2011/2012
Financing Agreements
Support to the National Sugar Adaptation Strategy
Support to Enabling Competitive Business (plus addendum)
Support to Environmental Governance
Budget and Planning Documents
Public Sector Investment Programme
Supplementary Public Sector Investment Programme
Budget statements of Trinidad & Tobago
Estimates of Revenue for 2009/2010, 2010/2011 and 2011/2012
Details of Estimates of Expenditure 2009/2010, 2010/2011 and 2011/2012
Mid Term Policy Framework 2011-2014, National Performance Framework and Annual Performance Report 2012
Open Budget Index
Use of contingency fund 2009/2010, 2010/2011 and 2011/2012
Treasury
Public Accounts of the Republic of Trinidad and Tobago Volumes 1 and 2 for 2009/2010 , 2010/2011 and 2011/2012
Board of Inland Revenue
Guidelines relating to discretionary powers of the Commissioner
Taxpayer information materials
Auditor-General Office
Auditor General’s Reports for 2009/2010 , 2010/2011 and 2011/2012
Capacity assessment of Trinidad & Tobago's Auditor General's Department, November 2011
Central Bank of Trinidad and Tobago
Central Bank periodic reports on the economy 2009/2010 to 2011/2012
National Assembly
Standing Orders
Reports of Public Accounts Committee and Public Accounts (Enterprises) Committee
Report on the Joint Select Committee of Parliament on legislative proposals to provide public procurement and disposal of public property and the repeal and replacement of the Centrals Tenders Board Act
A study of parliamentary scrutiny and existing parliamentary practices in Trinidad & Tobago
Internal Documentation and Log Books
Budgetary mapping tables
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Monthly expenditure returns
Internal Audit Plans
Log of receipt of monthly expenditure returns
Draft Internal Audit manual from the Comptroller of Accounts
Accounting Manual 2011
Copies of the chart of accounts
Reconciliation sheets for suspense accounts
Reconciliation sheets for revenue transfers to the Treasury Account
Sample quarterly request for cash releases
Sample Cash flow statement
Sample activity progress report
Other publications
Trinidad and Tobago, Country Profile 2012, Economist Intelligence Unit
Strengthening Macro fiscal Capacity and Introducing a Medium Term Framework, IMF 2008-10-14
Reform of the Public Sector Procurement Regime, Progress Reports
EU Delegation PFM annual reports
Status report: PFM reform process by George Bindley-Taylor
Inception and Governance report with respect to PFM reform consultancy, July 2012 by George Bindley-Taylor
Integrity Commission Annual Reports
Heritage & Stabilisation Fund reports
State Enterprises Performance Monitoring manual
State Enterprises Investment Programme
Investment opportunities in Agriculture
Agric incentive programme
National Food Production Action Plan 2012-2014
Trinidad and Tobago Extractive Industries Transparency Initiatives Report 2010/2011
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Annex 5a: Data used for scoring PI-2 - FY2009/2010
Source: Budget Estimates, Auditor General's Report and Appropriations Act 2009/2010
Data for year = 2009/2010
MDA Total budget Total actual adjusted budget deviation absolute deviation percent
Tobago House of Assembly 1,771,500,000.00 1,757,931,379.00 1,808,126,845 -50,195,466 50,195,466 2.8%
Ministry of Finance 6,012,622,000.00 9,051,361,612.00 6,136,936,634 2,914,424,978 2,914,424,978 48.5%
Pensions and gratuities 2,226,475,000.00 1,858,567,231.00 2,272,508,731 -413,941,500 413,941,500 18.6%
National Security 4,792,834,850.00 4,637,331,031.00 4,891,929,639 -254,598,608 254,598,608 5.3%
Ministry of Food Production, Lands and Marine Affairs 740,439,598.00 613,765,847.00 755,748,639 -141,982,792 141,982,792 19.2%
Ministry of Education 3,952,851,967.00 3,780,132,553.00 4,034,579,597 -254,447,044 254,447,044 6.4%
Ministry of Health 3,903,191,200.00 3,746,215,325.00 3,983,892,063 -237,676,738 237,676,738 6.1%
Ministry of Labour, Small and Micro Enterprises Dev 191,170,300.00 177,012,996.00 195,122,863 -18,109,867 213,232,730 111.5%
Ministry of Public Administration 1,337,767,000.00 347,080,718.00 1,365,426,150 -1,018,345,432 1,018,345,432 76.1%
Ministry of Public Utilities 2,734,483,500.00 2,515,467,826.00 2,791,020,617 -275,552,791 275,552,791 10.1%
Ministry of Energy & Energy Affairs 1,546,958,420.00 1,438,999,780.00 1,578,942,731 -139,942,951 139,942,951 9.0%
Ministry of Local Government 1,970,719,147.00 1,723,876,374.00 2,011,464,970 -287,588,596 287,588,596 14.6%
Ministry of Works and Transport 2,713,254,900.00 2,477,359,456.00 2,769,353,103 -291,993,647 291,993,647 10.8%
Ministry of Science, Technology & Tertiary Education 2,306,536,177.00 2,412,131,702.00 2,354,225,222 57,906,480 57,906,480 2.5%
Ministry of People and Social Development 2,436,542,510.00 2,696,032,541.00 2,486,919,515 209,113,026 209,113,026 8.6%
Ministry of Housing and Environment - 241,381,838.00 0 241,381,838 241,381,838 100%
Ministry of Trade and Industry 308,952,410.00 437,736,377.00 315,340,190 122,396,187 122,396,187 39.6%
Ministry of Planning, Housing and Environment 1,260,777,400.00 1,060,055,638.00 1,286,844,743 -226,789,105 226,789,105 18.0%
Judiciary 47,000,000.00 322,912,111.00 47,971,754 274,940,357 274,940,357 585.0%
Ministry of Community Development 613,011,600.00 504,546,666.00 625,685,989 -121,139,323 121,139,323 19.8%
All Other Votes (Residual) 2,929,319,049.00 2,902,025,504.00 2,989,884,510 -87,859,006 87,859,006 3.0%
approved total budget expenditure 43,796,407,028.00 44,701,924,505.00 44,701,924,505 0 7,835,448,596
contingency 100,000,000.00 49,065,120.00
total expenditure 43,896,407,028.00 44,750,989,625.00
overall (PI-1) variance 1.9%
composition (PI-2) variance 17.5%
contingency share of budget 0.11%
Budget Actual
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Annex 5b: Data used for scoring PI-2 - FY 2010/2011
Source: Budget Estimates, Auditor General's Report and Appropriations Act 2010/2011
Data for year = 2010/2011
MDA Total budget actual adjusted budget deviation absolute deviation percent
Tobago House of Assembly 1,959,507,638.00 1,978,347,218.00 2,109,464,515.9 -131,117,297.9 131,117,297.9 6.2%
Ministry of Finance 6,923,414,601.00 11,014,183,369.00 7,453,248,533.8 3,560,934,835.2 3,560,934,835.2 47.8%
Pensions and gratuities 2,374,860,000.00 2,019,920,926.00 2,556,602,895.1 -536,681,969.1 536,681,969.1 21.0%
National Security 3,277,808,627.00 3,242,388,021.00 3,528,652,226.0 -286,264,205.0 286,264,205.0 8.1%
Ministry of Food Production, Lands and Marine Affairs 1,045,554,291.00 1,032,139,282.00 1,125,568,297.7 -93,429,015.7 93,429,015.7 8.3%
Ministry of Education 4,311,442,062.00 4,076,067,389.00 4,641,387,390.4 -565,320,001.4 565,320,001.4 12.2%
Ministry of Health 3,943,457,510.00 3,848,296,611.00 4,245,241,777.1 -396,945,166.1 396,945,166.1 9.4%
Ministry of Labour, Small and Micro Enterprises Dev 207,283,630.00 172,986,273.00 223,146,597.5 -50,160,324.5 50,160,324.5 22.5%
Ministry of Public Administration 1,934,194,859.00 879,591,118.00 2,082,214,604.8 -1,202,623,486.8 1,202,623,486.8 57.8%
Ministry of Public Utilities 2,484,707,500.00 2,545,573,743.00 2,674,856,786.5 -129,283,043.5 129,283,043.5 4.8%
Ministry of Energy & Energy Affairs 1,597,015,370.00 1,502,670,802.00 1,719,231,499.3 -216,560,697.3 216,560,697.3 12.6%
Ministry of Local Government 1,841,157,130.00 1,673,366,613.00 1,982,056,899.7 -308,690,286.7 308,690,286.7 15.6%
Ministry of Works and Transport 3,103,714,124.00 3,876,891,708.00 3,341,234,647.5 535,657,060.5 535,657,060.5 16.0%
Ministry of Science, Technology & Tertiary Education 2,775,864,225.00 2,696,949,365.00 2,988,295,105.4 -291,345,740.4 291,345,740.4 9.7%
Ministry of People and Social Development 3,357,097,340.00 3,739,105,834.00 3,614,008,732.6 125,097,101.4 125,097,101.4 3.5%
Ministry of Housing and Environment 1,602,791,350.00 1,851,710,323.00 1,725,449,502.6 126,260,820.4 126,260,820.4 7.3%
Trinidad & Tobago Police Service 1,484,234,300.00 1,479,989,050.00 1,597,819,538.2 -117,830,488.2 117,830,488.2 7.4%
Ministry of Trade and Industry 291,413,850.00 276,444,813.00 313,715,121.1 -37,270,308.1 37,270,308.1 11.9%
Ministry of Planning, Economic and Social Restructuring 180,361,820.00 109,613,403.00 194,164,519.7 -84,551,116.7 84,551,116.7 43.5%
Judiciary 412,939,340.00 363,087,434.00 444,540,693.8 -81,453,259.8 81,453,259.8 18.3%
All Other Votes (Residual) 3,337,864,815.00 3,774,880,974.00 3,593,304,384.1 181,576,589.9 181,576,589.9 5.1%
approved total budget expenditure 48,446,684,382.00 52,154,204,269.00 52,154,204,269.0 0.0 9,059,052,814.8
contingency 100,000,000.00 -
total expenditure 48,546,684,382.00 52,154,204,269.00
overall (PI-1) variance 7.4%
composition (PI-2) variance 17.4%
contingency share of budget 0.00%
Budget Actual
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Annex 5c: Data used for scoring PI-2 - FY 2011/2012
Source: Budget Estimates, Auditor General's Report and Appropriations Act for 2011/2012
Data for year = 2011/2012
MDA Total budget actual adjusted budget deviation absolute deviation percent
Tobago House of Assembly 2,180,038,000.00 2,076,532,056.00 2,180,639,759.0 -104,107,703.0 104,107,703.0 4.8%
Ministry of Finance 9,418,823,996.00 11,471,380,644.00 9,421,423,887.6 2,049,956,756.4 2,049,956,756.4 21.8%
Pensions and gratuities 2,382,136,000.00 2,183,625,072.00 2,382,793,544.4 -199,168,472.4 199,168,472.4 8.4%
National Security 3,474,459,700.00 3,062,678,640.00 3,475,418,760.1 -412,740,120.1 412,740,120.1 11.9%
Ministry of Food Production, Lands and Marine Affairs 1,285,881,075.00 1,080,319,152.00 1,286,236,018.6 -205,916,866.6 205,916,866.6 16.0%
Ministry of Education 4,585,941,618.00 4,017,166,637.00 4,587,207,482.1 -570,040,845.1 570,040,845.1 12.4%
Ministry of Health 4,237,732,552.00 3,905,770,765.00 4,238,902,299.4 -333,131,534.4 333,131,534.4 7.9%
Ministry of Labour, Small and Micro Enterprises Dev 202,438,032.00 170,577,295.00 202,493,911.3 -31,916,616.3 31,916,616.3 15.8%
Ministry of Public Administration 1,738,657,220.00 945,530,184.00 1,739,137,144.1 -793,606,960.1 793,606,960.1 45.6%
Ministry of Public Utilities 3,101,633,700.00 2,281,163,965.00 3,102,489,848.4 -821,325,883.4 821,325,883.4 26.5%
Ministry of Energy & Energy Affairs 2,054,778,573.00 2,063,449,732.00 2,055,345,756.5 8,103,975.5 8,103,975.5 0.4%
Ministry of Local Government 2,033,726,000.00 1,778,653,233.00 2,034,287,372.3 -255,634,139.3 255,634,139.3 12.6%
Ministry of Transport 1,157,571,332.00 1,100,158,350.00 1,157,890,858.1 -57,732,508.1 57,732,508.1 5.0%
Ministry of Works and Infrastructure 2,297,403,899.00 3,063,810,873.00 2,298,038,054.7 765,772,818.3 765,772,818.3 33.3%
Ministry of Science, Technology & Tertiary Education 2,806,400,985.00 1,663,293,346.00 2,807,175,639.9 -1,143,882,293.9 1,143,882,293.9 40.7%
Ministry of People and Social Development 3,540,230,995.00 3,458,000,056.00 3,541,208,210.1 -83,208,154.1 83,208,154.1 2.3%
Ministry of Housing and Environment 1,739,999,130.00 2,697,974,283.00 1,740,479,424.5 957,494,858.5 957,494,858.5 55.0%
Trinidad & Tobago Police Service 1,696,042,900.00 1,604,226,288.00 1,696,511,061.2 -92,284,773.2 92,284,773.2 5.4%
Ministry of Trade and Industry 404,781,500.00 548,931,865.00 404,893,232.4 144,038,632.6 144,038,632.6 35.6%
Ministry of Planning, Economic and Social Restructuring 244,857,640.00 112,386,097.00 244,925,228.4 -132,539,131.4 132,539,131.4 54.1%
Judiciary 445,137,620.00 352,895,113.00 445,260,492.0 -92,365,379.0 92,365,379.0 20.7%
All Other Votes (Residual) 3,694,726,725.00 5,099,980,925.00 3,695,746,585.8 1,404,234,339.2 1,404,234,339.2 38.0%
approved total budget expenditure 54,723,399,192.00 54,738,504,571.0 54,738,504,571.0 0.0 10,659,202,761.0
contingency 100,000,000.00 60,625,663.00
total expenditure 54,823,399,192.00 54,799,130,234.0
overall (PI-1) variance 0.04%
composition (PI-2) variance 19.5%
contingency share of budget 0.11%
Budget Actual
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Trinidad and Tobago Limited Repeat & Sectoral PEFA 2013
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Trinidad and Tobago Limited Repeat & Sectoral PEFA 2013
Annex 6: Comments to the Draft Report
FWC Lot 11 – Macro economy, Statistics, Public Finance Management
This document summarises the way and the extent to which the expert team responded to the comments received from the client on the first draft report.
Project Reference 2013/322918/1
Project Title Limited Repeat & Sectoral PEFA assessment 2013 - Trinidad & Tobago
Status of Report Final report - Volume 1 - Central Government and Volume 2 – Sectors
Names of the different Team Members
and their position in the Team
Ronald E. Quist (team leader), Charles K. Hegbor ( Expert 2)
Section or
Indicator
Comments Response from Team
Central Tenders Board
Page 21 under Efficient Service Delivery - Central
Government (Volume 1)
Insert:
"These companies however have some guidelines set out by
the Investments Division of the Ministry of Finance and the
Economy"
Sentence inserted
Page 35 under Executive - Central Government (Volume 1)
Insert:
"...which includes the Regional Corporations, Borough
Corporations and the Port of Spain and San Fernando City
Corporations."
Phrase inserted
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Trinidad and Tobago Limited Repeat & Sectoral PEFA 2013
Section or
Indicator
Comments Response from Team
PI-19 (i) page 48 - Central Government (Volume 1)
Revise sentence to include:
"The Ministerial Tenders Committees have been chaired by
both the two (2) Ag Assistant Directors of Contracts for the
past three (3) years"
Sentence revised
Table 3.7 page 48 - Central Government (Volume 1)
Insert under item 5 of the elements:
"All contracts awarded are published in the Trinidad and
Tobago Gazette and on Ministry of Finance website. It has
the name of the project, the name of the Ministry/Department,
date of award, name and address of contractor/firm and
contract sum"
The insertion of this sentence is irrelevant as it fulfils only part of the
requirements of the fifth element. Please, note that data on procurement
complaints are not available and therefore renders the fifth element unavailable.
Central Government (Volume 1)
PI-19(iii) page 49 - Standardized tender documents are used
for any form or type of procurement; the tender documents fail
to consider the type of item to be procured; for instance tender
documents for IT infrastructure with all the technical
specifications are the same for tender for the supply of
stationery.
"Definitely not ! The instructions to tenderers may have some
similarities depending on the nature of the project but
technical specifications are different for each project."
Sentence revised to reflect the accurate position
Table 3.9 page 50 - Central Government (Volume 1)
"If there is no established body to review complaints, do all
these questions apply? And although there is no established
body all complaints at the Central Tenders Board are
addressed. If there are legal matters involved, the Chief State
For purposes of complying with the PEFA framework, those questions are
relevant. Further, the last paragraph under PI-19(iv) has taken note of the fact that
CTB receives and addresses bidders' complaints.
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Trinidad and Tobago Limited Repeat & Sectoral PEFA 2013
Section or
Indicator
Comments Response from Team
Solicitor's Office is consulted before replies are issued."
Central Government (Volume 1)
PI-19(iii) - Justification for the Score
"As indicated on page 48 contracts awarded are made public.
As to complaints resolved- not all contractors would want
their information viewed by John Public e.g. A firm may
complain about not being considered for a project when they
submitted all the required documents. If the firm has doctored
an Income Tax Clearance Certificate and submitted it with
their tender, would they want anyone to know that they are
unethical?"
In accordance with the PEFA framework, there should be an independent
administrative complaint body for complaint resolution. The resolutions must be
made public irrespective of whether they favour the bidder(s) or not.
Auditor General's Department
Page 23 under Prospects for PFM Reforms - Central
Government (Volume 1)
VFM Audits conducted since 1980’s. Formal risk-based
approach for financial audit being introduced.
Sentence rephrased accordingly
Page 33 Table 2.3 - Central Government (Volume 1)
Only salary and allowances of AG are a direct charge on the
Consolidated Fund
Sentence rephrased accordingly
Page 33 Table 2.3 - Central Government (Volume 1)
'Section 41 refers to audit of accounts of AGD by Treasury'
Correction effected
Page 33 Table 2.3 - Central Government (Volume 1)
'Refers to statutory boards as against state-owned enterprises
registered under the Companies Ordinance'
Correction effected
Page 33 Table 2.3 - Central Government (Volume 1)
Proper books of account should be maintained for public
accountability and transparency
Correction effected
Page 34 Table 2.3 - Central Government (Volume 1) Correction effected
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Trinidad and Tobago Limited Repeat & Sectoral PEFA 2013
Section or
Indicator
Comments Response from Team
'Authority to audit statutory boards. AG would have to be
appointed by shareholders with respect to audit of accounts for
SoEs registered under the Companies Ordinance. AG does not
currently audit any SoEs.'
Page 35 under Auditor General - Institutional Framework
for PFM - Central Government (Volume 1)
AGD not fully independent. Staff appointed by Public Service
Commission. Funding subject to Ministry of Finance
procedures.
Correction effected
Page 35 under Auditor General - Institutional Framework
for PFM - Central Government (Volume 1)
Only salary and allowances of the Auditor General are direct
charges on the Consolidated Fund.
Correction effected
Page 36 under Public Enterprises - Institutional
Framework for PFM - Central Government (Volume 1)
AG does not audit SoEs registered under the Companies Act
nor does she appoint private accounting firms to conduct
audits on her behalf.
Correction effected
Page 37 Table 2.4 - Central Government (Volume 1)
AGD not fully independent. Also VFM audits conducted
under section 9(2)(c ) of the Exchequer and Audit Act re
“avoidance of waste and extravagance
Correction effected
Page 38 under Key Features of PFM Systems - Central
Government (Volume 1)
'Only salary and allowances of AG are a direct charge on the
Consolidated Fund'
Correction effected
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Trinidad and Tobago Limited Repeat & Sectoral PEFA 2013
Section or
Indicator
Comments Response from Team
'Only audit reports for public accounts are on the website
currently.'
Page 56 under Completeness of Financial Statement -
Central Government (Volume 1)
This explanation could give the wrong impression concerning
Treasury Accounts. Not aware of any “netting off”.
Definition rephrased
Consolidated Financial Statement is defined as:
"Financial information in which assets, equity, liabilities and operation accounts
of a firm and its subsidiaries are combined, after eliminating all inter-firm
transactions".
Page 60 Table 3.12 - Central Government (Volume 1)
Dates Auditor General audit reports were laid in the House or
Representative and the Senate
Correction effected
European Union Delegation - Trinidad & Tobago
Please correct throughout the document - Central Government
(Volume 1):
Ministry of Trade, Industry and Investment
Ministry of Labour and Small and Micro Enterprise
Development
Centrals Tenders Board
Correction effected
Page 31scoring table - Ministry of Environment (Sector PEFA
- Volume 2)
Ministry of environment is a new ministry…does this take
into account the new composition of the ministry, which may
explain some of the high variance?
Yes, it does
Page 44 PI-12(iii) - Ministry of Trade Industry and Investment
The MTII strategic plan is still pending approval. It is not
finalised.
Sentence rephrased to include the word "draft"
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Trinidad and Tobago Limited Repeat & Sectoral PEFA 2013
Section or
Indicator
Comments Response from Team
Ministry of Finance - Budget Division
Page 13 under Policy-based Budgeting
"They are however not developed within fiscal frames"
Not sure what this means. This point needs to be elaborated.
Sentence rephrased
Page 15 under Predictability and Control in Budget Execution
Expenditure under the Infrastructure Development Fund is
implemented through these special purpose companies and so
means that a substantial proportion of development
expenditure is not subject to public procurement
regulations
It should be noted that there is a Comptroller of Accounts
Circular which provides the operational guidelines to be followed
under the I.D.F.
Sentence rephrased to reflect the existence of Comptroller of Accounts circular
No. 12 dated 9th November 2005
Page 42 under Existence and Adherence to a Fixed Budget
Calendar
The Ministry of Finance around February each year normally
issues budget call circulars.
Only one Call circular is issued each fiscal year
Correction effected
Page 47 under Effectiveness of transfer of tax collection to
Treasury by tax authorities
The Comptrollers of Customs and Inland Revenue head the
Customs and the Inland Revenue divisions of BIR respectively.
This should read “Ministry of Finance and the Economy”
Correction effected
Page 52 under Effectiveness of internal controls Correction effected
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Trinidad and Tobago Limited Repeat & Sectoral PEFA 2013
Section or
Indicator
Comments Response from Team
The Ministry of Finance issues a quarterly general release
warrant
The releases for recurrent expenditure are issued via a
memorandum not a Warrant. Warrants are only issued for
withdrawals from the special funds.
Page 52 under Effectiveness of internal controls
MDAs are allowed to vire having obtained the necessary approvals from
either the Budget Director of the Ministry of Finance or the Minister of
Finance depending on the level of virement.
Permanent Secretaries have delegated authority to vire funds from votes
under recurrent expenditure except for those which specifically require
the approval of the Budget Division or in the case of “Official overseas
travel” – the approval of the Minister of Finance
Sentence rephrased
Page 59 under scoring table for PI-27: Comparability of scores
There is no change in overall score but there is a decline in dimension
(iv) from A to B
What is the correct score for 2013 for dimension (iv) B or C which is
stated in the table?
Correction effected; the correct score is C
Pages 38 and 58 under Key Features of PFM and Adequacy of time
for the legislature to provide response to budget proposals
respectively
"....... but this takes place within a day each for both houses"
The legislative process usually takes 3-4 days in each house to debate
Correction effected
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Trinidad and Tobago Limited Repeat & Sectoral PEFA 2013
Section or
Indicator
Comments Response from Team
the Appropriation Bill for the budget. However, for the debate on
Supplementary /Variation of Appropriation Bills the time could be as
short as 1 day in each place
Parliament
Page 34 under Institutional Framework for PFM: Legislature
(Volume 1 - Central Government)
The House of Representatives has 41 seats but 42 members
because of the Speaker.
The Senate has 31 members inclusive of the President of the
Senate
Correction effected
Page 35 under Institutional Framework for PFM: Executive
(Volume 1 - Central Government)
The 14 municipal corporations are made up of the 2 city
corporations, 3 borough corporations and 9 regional corporations
Correction effected
Page 43 under Timely budget approval by the legislature or
similarly mandated body (Volume 1 - Central Government)
Minister of Finance tables the Estimate as required by law and on
behalf of the Cabinet. (See section 113 of the Constitution of
TT)
Correction effected
Page 58 under Adequacy of time for the legislature to provide a
response to budget proposals (Volume 1 - Central Government)
The Senate has limited powers with money bills. There is no
finance committee or provision like the House of Representatives
for it to review in detail the estimates.
The Senate debates the Appropriation Bill.
Correction effected
Page 59 under PI-28 Legislative scrutiny of external audit reports
(Volume 1 - Central Government)
Correction effected
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Trinidad and Tobago Limited Repeat & Sectoral PEFA 2013
Section or
Indicator
Comments Response from Team
Is this reference being made to the implementation of the
Republican Constitution ? Act No. 4 of 1976? Assented March
29, 1976
We continually revise parts of the Constitution when necessary.
The last revision being in 2007.
Page 60 under Extent of hearings on key findings undertaken by
the legislature (Volume 1 - Central Government)
Sittings..that is plenary ( chamber ) debates average once a week
per House. Committees meet sometimes earlier that day or on
another day averaging once a month. Length of Committee
meetings are on average 4 hours
Correction effected