New day for SLB
Published:Thursday | August 12, 2010 | 12:00 AM
Arthur Hall, Senior Staff Reporter
The drama surrounding the sudden dismissal of the long-serving head of the Students' Loan Bureau (SLB) continued yesterday with the resignation of the board of directors, the appointment of an acting executive director and the changing of locks at the agency's New Kingston offices.
Bank of Jamaica executive Monica Brown moved into the SLB yesterday morning as the acting executive director and was immediately on the job.
By late afternoon, a locksmith had arrived at the SLB offices and a staff meeting was under way.
During that meeting, staff members were asked to give their support to the temporary head during the transition period.
Immediate effect
Earlier in the day, the board resigned with immediate effect after an audit report raised questions about its operations.
This was compounded by the leak of the audit report which paints a picture of a cash-strapped Lenice Barnett manipulating the system to stay afloat.
"The analysis of the pay records of the ED (executive director) revealed that the ED is facing extreme financial challenges," the report states.
"The ED draws zero net salaries for most pay periods and has obtained inappropriate, if not illegal, approval from the board and the Ministry of Finance to augment her pay through payments of gratuity on a monthly basis, implementation of unapproved monetary incentive schemes and access to a loan ... without SLB management knowledge... ."
Finance ministry officials said yesterday that no decisions had yet been made on whether measures would be implemented to seek to recover money from Barnett.
But the ministry was adamant that the Andrew Cocking-led board would have to shoulder some of the blame for the questionable activities at the bureau.
Finance Minister Audley Shaw faced journalists at the weekly post-Cabinet media briefing and reported that Cocking and his fellow board members had offered their resignations.
Shaw said this came following an early-morning meeting at the finance ministry where discussions were held on the findings of the audit conducted by the Accoun-tability Inspectorate Division of his ministry.
The finance minister said he accepted the resignations and a new board would be submitted to the Cabinet for its approval next Monday.
"The general trend of the report would indicate that there should have been greater diligence on the part of the board. I will leave it at that," Shaw told journalists.
He rejected claims that the finance ministry failed to properly monitor operations of the SLB.
"We have boards of directors to assist us in monitoring activities, and among the activities of a board is supposed to be a subcommittee that deals with auditing functions," Shaw said, while pointing to the report from the Public Accounta-bility Inspectorate Division that is yet to be officially made public.
The former SLB board included retired banker Al Webb, Charles Ross, Kenneth Tomlinson, Philbert Dhyll, Winnie Anderson-Brown, Orville Walker and representatives of two tertiary institutions.
The report paints a damning picture of the operations of the SLB directors while arguing that: "Certain critical board decisions lack the necessary contemplation and the board's action may be interpreted as rubber-stamping the decisions of the executive director."
The report continued: "This issue is further complicated by the fact that the SLB has placed investment of $264,117,633.69 with Capital and Credit Securities, an entity that the board chairman, Mr Andrew Cocking, is also deputy group president, Capital & Credit Merchant Bank."
The audit team also reported that Barnett was being paid gratuity quarterly, based on the approval of the board chairman, while her contract scheduled her gratuity to be paid at the end of each contract year in lieu of participation in the retirement benefit scheme.
In addition, the audit team found that the management accountant approved gratuity and salary advances to Barnett without the approval of the board.
The report also charged that the board approved Barnett using her personal motor vehicle and claiming partial upkeep and sometimes full upkeep, despite the SLB purchasing a 2006 Mercedes-Benz and later a 2009 Toyota Prado, which were assigned to her.
Efforts to contact Barnett have so far been unsuccessful while Cocking was also unavailable for comment up to press time.
Excerpt from the Public Accountability Inspectorate Division Report
It was verified by the PAI that the ED (executive director) instructed the management accountant - Mr Gary Robinson - to remove her non-statutory deductions from her pay slip because she needed to give it to Minister Shaw to negotiate her contract.
The request was eventually granted by Mr Robinson and the ED used that pay slip to obtain a $307,400 loan from Jamaica National. The salary deduction from JN that was presented to the accountant was in excess of the ED's salary. This became the subject of an enquiry by JN because they were not receiving the monthly payment.