In response to statements made by the Minister of Defence the day before yesterday, Monday, 10 April 2023, the National Audit Office (NAO) notes the following:
(a) In his letter dated 13.2.2023, the Attorney General acknowledged that, while examining a matter leading to a waste of public funds falls within the scope of EY's duties, he nevertheless decided to act as an audit authority himself and, in doing so, requested and received information and evidence from the Ministry of Defence. On the basis of these, he did not find an increase in the National Guard's need for Contracted Armed Forces Personnel (CAF). In fact, instead of the assessment as to whether there was an increase in the need for contracted military personnel, which would be wasteful and/or would lead to increased expenditure, being carried out by the competent department of the State, which is the EEAS, it was carried out by the Legal Service, substituting its own judgment for that of the EEAS, which the EEAS considers impermissible.
The above decision of the Attorney General was taken in his capacity as Public Prosecutor and his authority in this matter is unreviewable under the Constitution.
EY notes in this regard that when in a similar manner in 2009 the Department of Merchant Shipping had refused to provide evidence to the then Auditor General, Attorney General Petros Clerides had made it clear that when the Auditor General judges that evidence is needed as part of his audit "this judgement of the Auditor General is outside the control of the Legal Service".
(b) On 10/04/2023 the Minister stated that he found that, of the ten officers serving in the administration of the Ministry of Defence and the General Staff of the National Guard (GNF) in similar duties, half are not needed. This leaves exposed first and foremost the Legal Service which allegedly did not identify any waste of resources.
(c) The EEAS has repeatedly explained the importance of upholding the principles of independence as an indispensable prerequisite for sound financial management and the fight against rampant corruption.
(d) On the basis of this unacceptable attitude of the Ministry of Defence, the EO will not reduce control over arms programmes, as the Minister wrongly stated the other day. On the contrary, by now downgrading the Ministry's overall assessment of corruption issues, it will increase audits and these will all be done after the fact, when the EO is invited to express its views before the Defence Committee of Parliament before the release of the relevant funds.
(e) At the same time, the EO is proceeding with all the other measures announced in its announcement of today. 29.3.2023.
Unfortunately, the previous government temporarily prevented the EIF (for about a year) from controlling the Cyprus Investment Programme files, and the present government, even worse, permanently denies the EIF the control of human resources management (which as an object of control falls within the hard and unquestionable core of the EIF's activities), in a matter that refers to corruption and bribery phenomena. For this, the Audit Office regrets.
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