Millions of United States dollars collected as levies from motorists to construct and maintain roads in the country are being diverted from the National Road Fund to other uses despite the deplorable nature of roads in the country.

An Audit of the National Road Fund conducted by the General Auditing Commission for two fiscal years July 1, 2018, to June 30, 2020, has observed that millions of dollars of petroleum levies paid by motorists for the maintenance and rehabilitation of roads in Liberia are either not being remitted to the Road Fund Account as required by the Act creating the National Road Fund or expended for the intended purpose.

Chapter 2.2 of the Act establishing the National Road Fund States: “All funds of the NRF shall be held in the Fund Account from which disbursement shall be made solely to finance the approved Annual Road Maintenance Expenditure Program and directly related costs as hereby required in this Act.”

According to the Act, the Road Fund is to ensure that road assets are sustained and that sufficient funds for both periodic and routine maintenance are allocated for this purpose. It is also intended to ensure that each of the categories of national, sub-national, and feeder roads have a sufficient share of the total budget such that these roads can operate as an integrated network; to defray the costs of loans approved by the Government to extend the length of maintainable roads; and to ensure that the needs of the road user and those impacted by roads are considered in terms of safety, security, and environment.

The GAC observed in the report released to the National Legislature last week, that the Liberia Revenue Authority collected US$53,018,871.54 and deposited the money in the Consolidated Fund Account instead of the National Road Fund Account as required by the Road Fund Act. The Consolidated Fund Account is the Government general revenue account that is controlled by the Ministry of Finance and Development Planning (MFDP). Of this amount, according to the report, the MFDP remitted US$28,152,231 to the National Road Fund thereby leaving a difference of US$24,866,637.54 which was not remitted.

The Management of the National Road Fund provided the below response to the GAC:

“The NRF brought to the attention of the Minister of Finance and the IMSC the issue of all fuel levies be remitted to the NRF accounts not through the Consolidated Accounts to avoid

interference with the fund flow and to avoid delay in payments to contractors and suppliers for road-related maintenance works. The MCC (MC-AL) made the issue of fund flow one of the paramount condition precedents. The non-adherence to this condition precedent by the MFDP caused NRF to lose the Matching Fund of $15,000,000 that was earmarked for the road sector. We hope this audit report will be made a resounding demand for the Government of Liberia to see reasons to allow fuel levies and other road user charges collected by the LRA to be directly remitted to the NRF Accounts not through the GOL Consolidated Accounts”.

Also, in the fiscal year 2019/2020, the GAC observed that the MFDP withheld the total amount of US$7,000,000.00 from the petroleum levy fees collection as National Road Fund support to the National Budget in contravention of the National Road Fund Act. The Management of the National Road Fund indicated to the GAC that the amount was requested by the MFDP to assist the Government meets its payroll obligations. The report says the program objectives of the National Road Fund will not be met when funds intended for road works are used for purposes not intended.

The GAC further noted that payments totalingUS$379,619.5 170,693.79 and LRD$123,644,698.52 were made on payment vouchers at the National Road Fund that were not approved or signed by the National Road Fund Manager and the Finance Officer respectively.

Further, samples of transactional documents such as payment vouchers, contracts, and certificates reviewed by the GAC showed, that the National Road Fund Management made overpayments for goods and services amounting to US$7,483.65.

Petroleum importers confirmed to the GAC through confirmation requests that they owed the National Road Fund US$6,355,221.59 whereas the National Road Fund accounting records showed that importers owed tUS$10,978,473 thereby resulting in the variance of (4,623.351.41).

The GAC report further noted that the National Road Fund Management did not disclose in the financial statements, commitments to contractors totaling US$6,100,508.3 which restricts the total cash balance of US12,936,639.00 brought forward as of 30th June 2020.

The GAC audit report also noted that the NRF Management did not maintain essential personnel records in several personnel files such as Letters of application, interview panel reports, proof of academic credentials, police clearance, and performance evaluations are done.

The report concluded that staff working for the National Road Fund are all contractors even though they have served the entity beyond the statutory period allowed for full-time employment.

NRF Reaction

In a statement issued in Monrovia, the NRF contends the GAC issued an Unqualified Opinion with an emphasis on matters relating to receivables due from petroleum importers which cannot constitute any amount of fraud, waste, and abuse at the entity.

According to Mr. Boniface Satu CEO, of the NRF, Per Certified Public Accounting Standards, an unqualified opinion is an audit report that has been issued with no reservations regarding the state of an audited client’s financial statements and that the auditor followed a standard opinion format to state that the financial statements are a fair representation of the financial results and condition of a client, by the applicable accounting framework.

The NRF stated that the GAC’s Opinion is a legacy issue before the operationalization of the National Road Fund Office in Liberia on May 1, 2018.

The NRF, however, admitted to levies intended for the Road Fund not being remitted to the Road Fund Account at prescribed by the Act. According to them, the unremitted amounts were retained by the Ministry of Finance for other government functionaries.

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