AUDITORS HIGHLIGHT NIUE GOVERNMENT FISCAL ANOMALIES

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ALOFI, Niue (February 1, 2002 – Niue Economic Review)---Niue's report card from Audit New Zealand for the year 2000 does not contain many pass marks.

Auditor General David Macdonald, who visited Niue recently, highlighted major anomalies in government spending during the first year of the Lakatani-led Niue Peoples Party ruling regime.

The report pointed out that government's overall financial condition deteriorated in the 2000 fiscal year and there was a high level of unauthorized spending, which totaled nearly NZ$ 1 million (US$ 417,000).

Half of that was in excess over the constitutional limit, with cash, bank and investment elements of working capital decreasing by NZ$ 1.3 million (US$ 542,074) to NZ$ 4.8 million (US$ 2,001,405), stated the report, which was tabled in the island's Assembly yesterday.

The report stated the most significant items of unauthorized expenditure included excess spending by Bulk Fuel (NZ$ 413,000/US$ 172,213) Niue Power (NZ$ 105,000/US$ 43,783) the Public Service Commission (NZ$ 137,000/US$ 57,127) and the Premier's Department (NZ$ 101,408/US$ 42,286)).

The government was warned by the Auditor General that it should "take serious consideration" to its financial position.

"There has also been a disturbing increase in doubtful debts, with an increase from NZ$ 544,443 (US$ 227,022) in 1999 to NZ$ 896,792 (US$ 373,944) in 2000," stated the report.

The Audit office also expressed concern at the lack of accounting expertise available to the government, with considerable Audit Department staff time being spent on the books of Telecom Niue, the Niue Tourist Authority, the Niue Philatelic and Numismatic Company and Niue Power Corporation.

The controversial Coral Air saga was mentioned again in the 2000 report, with the Auditor General recommending that in future full investigations be carried out into development project's economic viability before funds are committed.

The Coral Air debacle lost NZ$ 400,000 (US$ 166,792), which appears to be unrecoverable

For additional reports from the Niue Economic Review, go to PACIFIC ISLANDS REPORT News/Information Links: Magazines/Journals/Niue Economic Review. 

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