Fuel tax not channelled into road maintenance
Published:Wednesday | May 5, 2010 | 12:00 AM
Edmond Campbell, Senior Staff Reporter
MORE THAN $1.5 billion in fuel tax was not placed in the Road Maintenance Fund (RMF) last year as was pledged by the Government when the tax was imposed.
When Finance and the Public Service Minister Audley Shaw announced the tax last year, he stated that 20 per cent of the proceeds would be channelled into the RMF.
Yesterday, Dr Alwin Hales, permanent secretary in the transport and works ministry, was in the hot seat as he fielded questions from Parliament's Public Accounts Committee (PAC) about the RMF.
He told the PAC that money from the fuel tax could not have been directed to the RMF last year.
Hales explained that about $1.6 billion was collected and transferred to the Capital A budget of the ministry to settle arrears and to carry out roadworks.
He said the finance ministry did not create a mechanism to facilitate the flow of funds from the Inland Revenue Department to the RMF.
According to Hales, the finance ministry was now working on a legislative framework which would allow the tax to be paid directly into the RMF.
Questions ignored
PAC committee Chairman Dr Omar Davies said questions posed by him late last year in Parliament to Mike Henry, transport and works minister, on the amount of fuel tax paid into the RMF had been ignored.
With the accounting officers from the transport and works ministry appearing before the PAC yesterday, Davies used the opportunity to quiz them about how the RMF was being spent and the amount allocated to the fund.
The chairman, along with Member of Parliament for Central Kingston, Ronald Thwaites, demanded answers on the sums allocated to the fund and how those amounts were being spent.
Thwaites wanted to know why the tax taken from motorists did not flow into the RMF as promised by the Government.
Davies asked whether the fund would be reimbursed the $1.6 billion in fuel tax expended on road projects by the ministry and spent to clear outstanding bills.
However, the permanent secretary said there were no additional funds in the budget to repay the RMF.
Hales will return to the PAC at a later date to provide details on how the money from the tax was spent.