The 2023 Audit Report indicates that the Ministry of Lands and Mineral Resources faces significant financial management challenges that could jeopardize its financial security. Despite receiving an unmodified audit opinion, which confirms that the financial statements for the year were fairly presented, the Ministry has not succeeded in addressing compliance issues that plague its operations.
One critical concern is the failure to submit draft financial statements for individual Land-Owning Units (LOUs) for audit, as mandated by the Land Use Regulations 2011. As of the current fiscal period, the Ministry’s revised budget totaled $24.5 million, with actual expenditures at $23.1 million, resulting in an unspent $1.4 million. This unexpended amount primarily arose from salary adjustments linked to vacancies and unspent project funds, particularly concerning the Large and Small Island Groundwater Development projects.
Additionally, the Lands Trust Fund concluded the year with a healthy balance of $7.8 million after generating $3.5 million in revenue against expenditures of $2.5 million. In stark contrast, the Minerals Trust Fund reported a significant deficit of $1.64 million, a notable drop from the previous year’s surplus of $381,180, attributed to higher-than-anticipated expenses and decreased revenue.
The persistent issue of unresolved revenue arrears, currently reported at approximately $32.8 million, raises serious concerns. Although this figure marks a slight improvement from the earlier $35.8 million, it has consistently remained above $20 million since 2016, with most debts stemming from various business entities. In response, the Ministry has initiated strategies to boost revenue collection, including waiving interest, conducting site visits, and running awareness campaigns. However, the auditors recommend stronger enforcement mechanisms for improved revenue collection.
In recent articles, the Ministry highlighted plans to upgrade its outdated leasing system, which has hindered progress in categorizing aged arrears effectively. Permanent Secretary Raijeli Taga and Finance Manager Marika Qalo have expressed optimism regarding reforms aimed at improving financial practices, including a new debt recovery strategy and increased transparency in trust fund management.
Overall, these proactive measures and initiatives represent a hopeful trajectory toward rectifying financial discrepancies within the Ministry. With improved financial governance, the Ministry aims to enhance operational efficiencies and ultimately better serve the community through sustainable resource management practices.
Leave a comment