THE Auditor General’s Report on accounts of the Republic for the financial year ended December 31, 2020, has revealed that amounts totalling K211,200 was irregularly paid to 25 officers from the Ministry of Mines as sitting allowances for the Mining Licensing Committee meetings.
The Report stated that the payment was irregular because the said officers did not have appointment letters.
“Section 6 of the Mining and Minerals Act No. 11 of 2015 provides for the creation of a Mining Licensing Committee whose members are appointed by the Minister. During the period under review, amounts totalling K211,200 were paid to 25 officers as sitting allowances for the Mining Licensing Committee meetings. However, the payment of sitting allowances to the officers was irregular as they did not have appointment letters from the Minister,” read the Report.
The report stated that the ministry owed K495,913 and €55,000 in respect of recurrent departmental charges and advertising.
“As at 31st December 2020, the Ministry owed amounts of K495,913 and €55,000 in respect of Recurrent Departmental Charges and advertising. The debt had accumulated from as far back as 2014. There was no clear explanation from management on how they would settle the outstanding arrears,” the report read.
The Report stated that the ministry did not withhold Value Added Tax in amounts totalling K19,442.
“Ministry of Finance through Treasury and Management Circular No. 6 of 2017 instructed all institutions which were appointed to act as tax agents to withhold and remit Value Added Tax (VAT) effective 1st June, 2017. Contrary to the circular, the Ministry did not withhold VAT in amounts totalling K19,442 on a payment made for the procurement of conference services,” the Report stated.
The report stated that the ministry did not collect K7,537,314 from the mining right holders.
“Section 77 (1) (2) of the Mines and Minerals Development Act No. 11 of 2015 provides that a holder of a mining right or mineral processing license should pay to the Republic an annual area charge of such amount as may be prescribed, or as may be calculated in the manner prescribed by the Minister. The annual area charge referred to in subsection (1) should be payable on the grant of the mining or mineral processing license, and thereafter annually on the anniversary thereof until the termination of the mining right or mineral processing license. As at 31st December 2020, 688 mining right holders owed the Ministry amounts totalling K20,675,454 in respect of annual area charges. However, it was observed that as at 31st August 2021, the Ministry had only collected amounts totalling K13,138,140 leaving a balance of K7,537,314. Further, the Ministry did not maintain a debtors age analysis,” read the report.
The Report further stated that as at June 30, the ministry had not established the Mining Appeals Tribunal.
“Section 98 (i) of the Mines and Minerals Development Act No. 11 of 2015 requires the Ministry to establish a Mining Appeals Tribunal. The Tribunal has jurisdiction among others to inquire into and make awards and decisions in any dispute relating to exploration, gold panning and mining. However, as of 30th June 2021, the Ministry had not established the Mining Appeals Tribunal,” read the Report.