Public Report on the conduct of Hon. Willie Jimmy, Hon. Amos Bangabiti and Mr. Aime Malere in the sale of the M. V. Savin Fana – June 26, 1997 - Emalus Campus



Public Report on the conduct of Hon. Willie Jimmy, Hon. Amos Banagabiti and Mr. Aime Malere in the Sale of the M.V. Savin Fana – June 26, 1997

97-06

The M. V. Savin Fana, valued at 23,300,000 vatu was donated to the Government of Vanuatu in 1985 by the Government of Australia.  Its intended purpose was to provide health services to the islands of Vanuatu.  The operating costs for the vessel were to be gradually assumed by the Government of Vanuatu over a 5 year period.

Although the M. V. Savin Fana was put to its intended use, it spent up to 56% of its time in port due to poor planning and administration.  In 1988, it was badly damaged in a cyclone and had to be extensively repaired.  A review of the project was undertaken in 1991.  A decision was made to sell the vessel.  Between April 1991 and November 1993, the vessel was offered for sale by tender on three occasions.  At the time, tenders boards for the sale of Government property were appointed on an ad hoc basis.  At no time was the sale advertised outside Vanuatu nor was there any valuation of the vessel.  The captain of the vessel, Mr. Norris Hamish informed the Finance Minister that he considered the value of the vessel to be between 6 and 10 million vatu.  A number of offers were made for the purchase of the M. V. Savin Fana ranging between 2 million and 3 million million vatu.  These offers were never followed up by either the Minister of Finance Willie Jimmy or the Minister of Transport Amos Bangabiti.

Between October, 1993 and April 1994, the M.V. Savin Fana was towed with the assistance of the Ports and Marine Department into the custody of Mr. Malere who, using Government equipment rented from the Department of Public Works (but not paid for) conducted repairs to the vessel.  The Captain of the vessel, Mr. Norris Hamish was negligent in allowing the delivery of the vessel to Malere.  The vessel still belonged to the Government of Vanuatu.  During April 1994, Mr. Aime Malere, a Government appointee and strong supporter of the Minister of Finance and the Minister of Transport’s political party met with the Minister of Finance Willie Jimmy and the Minister of Transport, Amos Bangabiti.  He was asked what amount he “preferred” to pay for the vessel.  He said he preferred to pay 500,000 vatu (a quarter of the lowest bid previously made).  A cheque in that amount was immediately handed to the Minister of Finance.  Champagne was also presented to both the Minister of Finance and the Minister of Transport.  At no time did the purchaser make a tender for the purchase of the vessel.  The purchaser justified the purchase price to the Ombudsman as being consistent with other sales of Government property, including one instance where a vessel had been ‘sold’ by a former Prime Minister for nothing.

The Ombudsman found that the Minister of Finance Willie Jimmy and the Minister of Transport, Amos Bangabiti had both breached the Finance Regulations in respect of the sale of the vessel.  They had caused the Government to loose significant revenue. Their conduct amounted to a breach of the Leadership Code in that they demeaned their office and sold the vessel as if it was their own private property.  The Ombudsman made reference to previous reports involving Hon. Willie Jimmy and recommendations following on findings in those reports.  The First Secretary of Finance, Mr. George Pakoa was negligent in failing to approve the sale by original tender of the vessel.

The Ombudsman found that there was inadequate planning by the project planners and by the Government of Vanuatu which resulted in the originally intended use of the vessel failing.  It was noted that this failure is common to many aid projects in Vanuatu.
Recommendations

·       That Hon. Willie Jimmy and Hon. Amos Banagabiti be held personally responsible to the Government for the loss of 1.5 million vatu.

·       That Hon. Willie Jimmy and Hon. Amos Banagabiti in future not hold any leadership position.

·       That the Prime Minister take responsibility for the conduct of Ministers and ensure that they are aware of their duties and responsibilities.

·       That the Finance Regulations be amended to ensure that valid tenders are enforceable against tenderers and that ‘one of’ sales such as motor vessels be subjected to independent evaluation.

·       That the Prime Minister issue a circular instructing Public Officers not to interfere with the tender process.

·       That Government Financial Regulations be strictly followed.

·       That the Department of Public Works take steps to recover the debt owing by the purchaser for the rental of Government equipment used to repair the M. V Savin Fana.

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Written by Edward R. Hill
UNDP Governance and Accountability Project
January, 2001
Van/97/001
© Ombudsman of Vanuatu
Published here by University of the South Pacific, School of Law Web Site - www.vanuatu.usp.ac.fj






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