St Kitts and Nevis PM Terrance Drew unveils new resolutions to fight financial mismanagement

Less than a month since he vowed to restore public trust and financial integrity in the Development Bank of St Kitts and Nevis after a forensic audit brought to the fore serious monetary mismanagement, Prime Minister Terrance Drew unveiled plans last week to achieve his goal.

The PM announced his intent to introduce two resolutions in Parliament to safeguard the bank’s financial integrity and the Social Security system, ensuring that no mismanagement is repeated.  

“The first resolution will mandate that any decision to suspend external audits at the Development Bank must be brought before Parliament, and the second will require full parliamentary approval for any borrowing from Social Security. These measures are critical to protecting the interests of our people and maintaining public confidence in our financial institutions,” Dr Drew, who is also the finance minister, said. 

Recently, the mismanagement exposed by the audit included a massive debt of more than $300 million and the lack of audited accounts during the previous dispensation. The revelations triggered serious concerns over the bank’s governance and financial operations and prompted the PM to ask: “Where is the money?”  

Dr Drew, while speaking on Freedom FM’s Issues program on November 14, said his government will recover what belongs to the country’s people. 

The prime minister added that the lack of external audits resulted in mismanagement of millions of dollars in secrecy. It weakened the Development Bank besides endangering the Social Security system, which held sizeable loans with the lender. 

The bank encourages economic growth and development by offering financial and advisory services to ventures and programs in areas such as business, industry, housing, education and agriculture.

Truth deliberately hidden from the public, says PM

Drew, who said it was a deliberate attempt to hide the truth from the public, also explained how the absence of external audits in 2018-19 saw a continuation of poor governance practices, including dubious loans and uncurbed financial measures, said reports. 

The prime minister said it was during the previous administration, when his predecessor acting as the minister of finance and his brother working as the CEO of the Development Bank, audits were deliberately suspended and massive funds were mismanaged. 

Drew took office in August 2022, succeeding Timothy Harris who served for seven-and-half years. 

To ensure that financial integrity and security are not compromised in future, the prime minister said the first resolution aims to make the Development Bank subject to audits which are regular and transparent. Any decision to suspend them would require a parliamentary approval. 

He said such a resolution would make it impossible for future governments to run secret operations and mismanage public money without accountability and help people stay informed about the financial state of the Development Bank.

The other resolution, on the other hand, will need complete parliamentary backing for any borrowing from the Social Security system. It will protect citizens’ pensions and other benefits by ensuring that funds meant for Social Security are not squandered. 

PM Drew expressed concerns over risks that Social Security faces due to mismanagement of Development Bank loans. The loans account for seven to 10 per cent of the total assets of Social Security. He said the previous government’s handling of these funds threatened the pensions and benefits of several thousands of citizens of St. Kitts and Nevis.  

He said the twin resolutions do not only intend to make amends but also aim to bring a framework for better governance. 

Corruption remains a major challenge to the countries in the Caribbean and there has been little improvement over the past 10 years with the nations located in the region finding themselves at the bottom of the Corruption Perception Index.