Action to recover the losses from state land concession fees and transference of properties to capital will take a long time as related regulations will be need to be devised as regulatory tools.
State Audit Organisation President, Dr Viengthong Siphandone revealed the circumstances when talking to media last week about the results of the audit made for 2014/15.
According to the audit report, 14.5 billion kip has been lost caused by declarations of concession fees lower than that determined by the Presidential Ordinance No.2 in relation to projects authorised in 2013/14.
If the calculation was made following the ordinance the state would have received 64.1 billion kip as revenue from the business.
This difference in the amount occurred because the Ministry of Natural Resources and Environment and the Ministry of Finance have not made joint comparisons in the calculation of the fees. The declaration of the fees did not comply with the ordinance, Dr Viengthong said.
She said the State Audit has made comment on this issue every year in the past eight years but the same problem has remained chronic with necessary regulations still not in place.
In addition, more than 190 billion kip has been uncovered by the audit as losses caused by the failure of provincial and local budgetary units in monitoring the implementation of concession fees on state land.
The audit found that 65.7 billion kip was passed on by project developers to the accounts of Departments of Planning and Investment in some provinces.
However the funds owed to the central government in relation to these transactions were not always passed on.
In addition, 28.3 billion kip was passed on to development funds, and 46.5 billion kip as compensation for residents’ properties.
The audit also found some government agencies used 52.1 billion kip of the uncovered revenue in paying rent fees.
The audit report uncovered 302 billion kip related to the transference of property to capital in the 2015/16 fiscal year but the amount has been not recorded in state revenue, while the deals which were made did not follow the procedure of bidding auctions and procurement.
Five ministries are related to the deals made in 2013/14 and 2014/2015, and the audit organisation was ordered by the prime minister to audit and identify whether the transference has been made in compliance with the related laws or not.
Dr Viengthong noted that 302 million kip was the value of transference, not including the value of related projects, explaining that the value of transference should be higher than the value of the project.
Due to the lack of specific regulations, the government has ordered a stop to the policy on transference of property to capital recently as it did not bring sufficient benefits to the state, and has even brought some losses.
According to Dr Vientgthong, the State Audit Organisation plans to audit two projects next year related to the transferences in three ministries, focusing on each project separately.
She said the losses would be recovered but this may take more time as the required specific regulations are not yet in place.
Source: Vientiane Times