A special audit of the Fiji Roads Authority (FRA) by the Office of the Auditor-General (OAF) revealed it owed $40million to its contractors.
This was revealed by Minister for Public Works and Transport Ro Filipe Tuisawau, who was provided a summary of the finding of the special audit commissioned by the FRA board for the three years from July 2020 to July 2023.
He said a new FRA board was appointed in April 2023, which then identified systems and governance breakdowns including a huge cash flow crisis that was crippling the organisation.
Ro Filipe said FRA had utilised its 2022/2023 capital budget allocation within five months (by December 31, 2022) without any capital expenditure funds for the remaining seven months up until July 2023.
“This cash flow crisis had a significant impact on the delivery of required service by the FRA with mounting public complaints and outcry due to the continuing deterioration of road network systems around Fiji when we came into government,” Ro Filipe said.
“The board had no choice but to take immediate steps to address this crisis and with collaboration and approval by its line ministry and the Ministry of Finance, secured a $50m overdraft facility to pay off arreas to our contractors amounting to about $40m.
“With this payment, contractors were able to mobilise immediately and continue the required urgent maintenance works from May 2023 to date.
“This also triggered the board to commission a special audit well supported by the Government and the OAG.”
He said the total cost variation and escalation of $405m were largely facilitated and approved by the former board via flying minutes.
Ro Filipe said preliminary and feasibility studies were not carried out and a significant number of key positions remained vacant, which were critical to the functions of the FRA during the reporting period.
He said he would refer the report next week to the FRA board and relevant authorities for a forensic and detailed investigation.
