Disputes led to "incomplete projects," Audit report finds
The Samoa Tourism Authority (S.T.A.) has advised hoteliers about the importance of fostering healthy relationships with village councils for their businesses to succeed.
The advice comes from the S.T.A. Chief Executive Officer, Fa'amatuainu Lenatai Suifua, in response to an Audit Report of the Tourism Cyclone Recovery Programme which was implemented by the Authority.
The Audit Report concluded that the output of the Project did not achieve the impact intended. The Tourism Cyclone Recovery Programme was funded under New Zealand's grant aid.
For the Financial Year 2015-2016, a total of $250,000 was appropriated under the programme for materials and was given to the Matareva Beach Resort and Maninoa Beach Fales.
However, the projects remain incomplete due to land disputes.
“The appropriate use of funds for reconstruction worth of $100,000 for Matareva Beach Resort was still incomplete; and reconstruction worth of $150,000 for Maninoa Beach Fales were found to have been completely removed, in relation to land disputes between the operators/owners and village councils," the Audit Report stated.
“The $250,000 tala of total funds spent for this output did not achieve the impact intended for the Project."
Asked for a comment, Fa'amatuainu told the Samoa Observer there were disagreements between the villages, operators and owners of the resorts, which led to the outcomes sought under the grant condition not being met.
“And that is why it is relatively important for the hoteliers to foster healthy relationships with the villages as there are a lot of good that come out of it," the C.E.O. said.
"The involvement of the village council, assures that no one in the village will interfere when resorts are undergoing developments and the village will provide for security in the area."
The response by the S.T.A. – which was outlined in the Audit Report – stated that the criteria and requirements for the grants were satisfied but unforeseen circumstances of conflict over land made these two cases exceptional.
“The Facilitation Group also removed land ownership requirements to avoid further delays of the application process."
The Maninoa Beach Fales rebuilding works were completed in June 2014.
But the lease agreement ceased due to unforeseen circumstances with the landlord and the land had to be vacated.
The owner has now relocated and are rebuilding their fales behind the Coconuts Beach Club Resort.
As for the Matareva Beach Resort, the restaurant, bar and exterior walls of two units have been completed except the interior walls.
The Village Council removed the owner and delayed the process.
The Authority's response to the Auditor noted they will not allow access of future funding, marketing advertisements, training and other benefits.
“The operator who signed the contract had been formally informed by letter and the recent site visit to return the remaining goods as agreed by Tourism Cyclone Recovery Programme (T.C.R.P.) contract," the Audit Report stated.
"The Authority will engage advice from the Attorney General and seek approval from Cabinet if there is no progress in the coming months.”
Fa'amatuainu, who was an Assistant C.E.O. at the time, said that policies have been amended to ensure that these problems are not repeated.
The current owner of Matareva Beach Resort, Leota and Togialelei Tavita Faletoese, said the grant was issued to the previous owners in 2015.
“We are the new owners and we have nothing to do with the grant you mentioned,” said Leota, in a telephone interview with this newspaper.
Repeated attempts to get comments from the owners of the Maninoa Beach Fales including messages and phone calls were unsuccessful.
Below is the full Audit Report on the T.C.R.P.
5.19 Tourism Cyclone Recovery Program for the period ended 1 May 2013 – 30
Implementing Agency: Samoa Tourism Authority
1. There were instances where various milestones and triggers were not complied with or satisfied throughout the life of the project from the review of the Project Grant Agreement signed on 22nd of April 2013.
According to STA, milestones were delivered according to the Costed Work plan and progress reports.
2. There was no list of all the meetings that were held at the Steering Committee level. There were also no signed minutes for the financial year audited.
All meeting folders including agenda for meetings an minutes were made available but there was no specific folder for the filing of minutes.
3. The roles and responsibilities of personnel could not be confirmed as they were subsequently reviewed to meet the changing needs of the Project. There has not been any official approval/review on those Terms of Reference by an appropriate government establishment such as the Tourism Sector Committee or Ministry of Finance (MOF) (Aid Division) to ensure each committee/group understands the importance and alignment of their role and accountability in implementing the project.
STA responded the roles and functions of the four groups highlighted in the KVA report was approved by Cabinet as per FK. MOF responded that the cabinet approval is the most prominent authorisation in establishing such Steering Committees as this is a Government official approval. Audit requested to revisit this issue.
4. The appropriate use of funds for reconstruction worth of $100,000 for Matareva Beach resort was still incomplete; and reconstruction worth of $150,000 for Maninoa Beach Fales were found to have been completely removed in relation to land disputes between the operators/owners and village councils. 21% or 250,000 tala of total funds spent for this Output did not achieve the impact intended for the Project.
STA responded that all criteria and requirements were satisfied but unforeseen circumstances of conflict over land make these two cases exceptional. The Facilitation Group also removed land ownership requirements to avoid further delays of the application process. Maninoa beach fales rebuilding works completed 100% in June 2014. The lease agreement was immediately ceased due to unforeseen circumstances with the landlord and had to vacate the land. The owner of Maninoa beach fales have now relocated and rebuilding their fales behind Coconuts Beach Club Resort. As for Matareva beach resort, the restaurant, bar and exterior walls of two (2) units have been completed except the interior walls. The Village Council removed the owner and delayed the process. STA will not allow access of future funding, marketing advertisements, training and other benefits. The operator who signed the contract had been formally informed by letter and the recent site visit to return the remaining goods as agreed by Tourism Cyclone Recovery Program (TCRP) contract. The Authority will engage advice from the Attorney General and seek approval from Cabinet if there is no progress in the coming months.
5. The original pledge for Marketing Activities was one million tala and was revised to $884,291.00. The actual spending for this Output was $1,127,906.90 which was overspent by $243,615.90 with no forecasted financial plan or approval to support the variation. STA responded that the properties included in the design were deemed as assessed and the non assessed properties with designs not included or new properties that did not exist prior to Cyclone.
6. There was a delay in processing of funds to cover project expenses as the Project is yet to receive $400,341.00 from the Donor. There are still outstanding invoices relating to the Project that need to be paid. STA responded that only $1,090,162 was dispersed instead of $1,320,503.
7. The STA Asset Register did not accurately and completely capture the assets purchased during the project.
8. There is an unrecorded interest of $49,229.15 from reconciliation of the Acquittals and Bank Statements for the Project.
STA responded that all financials for the project were handled by Ministry of Finance. MOF will ensure to strengthen monthly reconciliations of Central Bank of Samoa project accounts and the MOF Aid Coordination & Loans Management Division ledgers against the system.
9. There was a variation of approximately $3,598,578.00 signed to repatriate the funds originally planned for the Project. There was insufficient evidence to suggest active monitoring by the TCRP Committee in satisfying the agreed expectations for the Project. There was insufficient evidence of the Project Steering Committee identifying prominent project risks and related implementation constraints that could eventually lead to the repatriation of funds. There was lack of quality data to measure the success of the Project.
STA responded that there was slow utilisation of funds especially in the beginning of the program in 2013. The Secretariat and FP consistently followed up with applicants by visiting business and homes to ensure application are submitted on time with numerous follow ups.