REPUBLIC OF VANUATU

OFFICE OF THE OMBUDSMAN

PUBLIC REPORT

ON THE

ILLEGAL TENDER PROCEDURE ADOPTED
BY FORMER DIRECTOR OF LANDS ROGER TARY AND
FORMER MINISTER OF LANDS PAUL TELUKLUK,
FOR
CANAL DU SECOND II AND PEPSI SUBDIVISION WATER PROJECTS LUGANVILLE

25 November 1998

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PREAMBLE

'By the blessing of the upright, the city is exalted, but it is overthrown by the mouth of the wicked.'

Proverbs 11v11

SUMMARY

In 1996, the Director of the Finance Department complained to the Ombudsman that public funds released for two water installation projects were not used in accordance with the Government of Vanuatu's Finance Regulations. Furthermore, public money appeared to have been wasted.

This report concerns the involvement of the government in 2 subdivisions in Luganville in the island of Santo in 1993-95 and the maladministration and breaches of Leadership code by the then Director of Lands, Mr Roger Tary and the then Minister of Lands, Mr Telukluk, (now Assistant Minister of Trade and Ni-Vanuatu business). They granted contracts for the water installations to a private company, Sowy Leing not on the basis of their ability or pricing but on the basis of their similar party allegiance and their belonging to the same island, Malekula, (Wantok system) without following any procedures.

Sowy Leing Company belongs to the Malere family who was also the beneficiary of the sale of a ship (at a discounted price) by former Minister Bangabiti and Minister Willie Jimmy (now Deputy Prime Minister) in total breach of the tender procedures.

The first water installation project at Canal du Segond II in 1993 was granted without any tender procedures and costs a total of Vt 10.300.000, Vt1,700,0000 more than the quote of the Public works Department. The result is unsatisfactory, of very poor standard and only covers half of the land. On the basis of this first bad experience, the government should have ceased all relationship with this private company.

Instead they were granted another project: the Pepsi subdivision water installation project in 1995.

This second project turned to catastrophe and is now incomplete. Its cost estimate was 19 million vatu, three times higher than that of Public Works Department. Mr Tary and Mr Telukluk still chose Sowy Leing Company to carry out this project in total breach of the Finance Regulations which had by then been put in place after the commencement of the first project in 1993.

More specifically there was no tender board to consider the tenders for the Pepsi subdivision, no competitive bidding for either of the two projects as they were never advertised in the press.

The Ombudsman found that:

(a)	The Government paid a total of Vt 19,683,436 to a private company for work that were of very poor standard and 9,600,000 were actually totally wasted. In the course of the 2nd subdivision, the Director paid Vt 7 million more than the worth of the job as estimated by the Public works Department.

(b)	The 2 subdivisions are yet to be completed and the second one has been totally abandoned with a pipe system too small for water pressure.

(c)	political affiliation to UMP and place of origin appeared to be the main reasons for former Minister, Mr Telukluk, and former Director, Mr Tary, granting the contracts to Sowy Leing Company instead of price or technical ability. Their conduct was based on improper motives.

(d)	Mr Tary’s conduct contravened ALL the tender rules provided under the Government Finance Regulations and the Public Service Act.

(e)	Following their conducts as mentioned above, Mr Tary and Mr Telukluk also breached the Leadership Code Article 66(1)(a) and 66(2) of the Constitution.

(f)	Sowy Leing Company did not have a proper trading licence and had been operating illegally. Sowy Leing Company also lacked a qualified and experienced manager to supervise its operations.

The Ombudsman made the following recommendations in her report:

1	Mr Telukluk should not be considered to hold any ministerial portfolio in any future government, as he has breached the Leadership Code section 66 of the Constitution.

2	Mr Tary should not be considered for any position in any future government.

3	The current Director of Lands should make sure that his officers both in Port Vila and Luganville have access to and follow the Government of Vanuatu’s Finance Regulations; and

4	The Department of Lands to follow the tender rules in the Finance Regulations to properly complete the projects. They should not accept Sowy Leing Company to complete the projects as it has proved itself to be incapable.

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TABLE OF CONTENTS

1. JURISDICTION
2. PURPOSE, SCOPE OF INVESTIGATION AND METHODS USED
3. RELEVANT LAWS AND REGULATIONS
4. OUTLINE OF EVENTS
5. RESPONSES TO THE PRELIMINARY REPORT
6. FINDINGS
7. RECOMMENDATIONS
8. CONCLUSION
9. INDEX OF APPENDICES

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1.	JURISDICTION

1.1	The Constitution and the Ombudsman Act No 14 of 1995 allow me to look into the actions of the government and other organisations in which the government has interests. I can also look into defects in the law or the administration of the law, discrimination and breaches of the Leadership Code. This includes the conduct of Mr Roger Tary, the Director of Lands and Mr Paul Telukluk, the Minster of Lands.

1.2	The Ombudsman Act still applies to this case even though it has been repealed recently as the investigation began while the Act was in force. (Interpretation Act [CAP 132] s. 11).

2.	PURPOSE, SCOPE OF INVESTIGATION AND METHODS USED

2.1	The purpose of this report is to present my findings as required by Article 63 of the Constitution and Section 24 of the Ombudsman Act.

2.2	The scope of this investigation is to establish the facts and to determine whether;

∑	the conduct of Mr Roger Tary in awarding a contract to Sowy Leing Company was proper;

∑	the conduct of Mr Paul Telukluk in awarding a contract to Sowy Leing Company was proper; and

∑	Mr Tary and Mr Telukluk breached the Leadership Code.

2.3	This Office collects information and documents by informal request, summons, letters, interviews and research.

3.	RELEVANT LAWS AND REGULATIONS

3.1	CONSTITUTION OF THE REPUBLIC OF VANUATU

CONDUCT OF LEADERS

66.(1)	Any person defined as a leader in Article 67 has a duty to conduct himself in such a way, both in his public and private life, so as not to-

(a)	place himself in a position in which he has or could have a conflict of interests or in which the fair exercise of his public or official duties might be compromised;

(b)	demean his office or position;

(c)	allow his integrity to be called into question; or

(d)	endanger or diminish respect for and confidence in the integrity of the Government of the Republic of Vanuatu.

(2)	In particular, a leader shall not use his office for personal gain or enter into any transaction or engage in any enterprise or activity that might be expected to give rise to doubt in the public mind as to whether he is carrying out or has carried out the duty imposed by subarticle (1).

DEFINITION OF A LEADER

67.	For the purposes of this Chapter, a leader means the President of the Republic, the Prime Minister and other Ministers, members of Parliament, and such public servants, officers of Government agencies and other officers as may be prescribed by law.

3.2	Financial Regulations (FR)

2.2.1	The FRs Chapter 2 provide that Public Officers must be aware of the content of the Financial Regulations. Chapter 20 states that all monies released from the Development Fund must be used in accordance with the Government's FRs and other relevant laws safeguarding the use of public funds. Chapter 22 provides for the tender procedures for specific works to be carried out.

2.2.2	F. R. 361(3) says at least three (3) written tenders must be submitted where the cost of a specific work or service is over one (1) million vatu.

2.2.3	F R 362 provides that tenders will be called by open competitive bidding and all tenders are to be submitted in sealed envelopes.

2.2.4	F. R. 363 specifies that notice of invitation to tender must be given at least two (2) weeks before the closing date. This notice must be advertised. Invitations for tenders over 500,000 vatu must appear in the press and the Government Gazette.

2.2.5	F. R. 364(1) provides that tenders will be submitted to the secretary of the Central Tender Board in the Department of Finance.

2.2.6	F. R. 365 specifies clearly who are eligible to be the members of a tender board. The required number of the board members is also outlined in this section.

2.2.7	F. R. 367 states that a report on all tenders is to be provided by the appropriate technical officer to advise the Board. All written contracts over three (3) million vatu must be approved by the Attorney General before the contract is signed.

2.2.8	F. R. 368 states that upon receipt of the technical officer's report the Board shall meet and accept the lowest tender, and that all tenders over 3 million vatu must be approved by the Council of Ministers before they are awarded.

2.2.9	F. R. 369 states that where there is a contract for the supply of goods or services the Accounting Officer may authorise variations up to 20% of the original contract sum. Any variation beyond 20% has to be approved by the Minister of Finance.

3.3.	Public Finance Act

Section 3 of the PFA explains the duties of accounting officers as follows:

Every accounting officer and other people responsible for the collection, receipt, custody, issue or payment of public or other funds is subject to this Act and any order made and is to perform such duties specified in this Act or any instructions issued through an order of the Minister regarding matters of accounting or financial procedure in accordance with this Act.

3.4	Public Service Act [Cap 129]

Section 11(i) explains an offence and a disciplinary proceeding as follows:

Every officer commits a disciplinary offence for the purposes of disciplinary proceedings who is guilty of any improper conduct in his official capacity, or of any other improper conduct which is likely to affect adversely the performance of his duties or is likely to bring the Public Service into disrepute.

4.	OUTLINE OF EVENTS

Canal du Segond ll Subdivision Water Installation Project

4.1	On 29.03.93, the Public Works Department (PWD) submitted their estimate for 8,674,000 vt. for water installation at Canal du Segond ll subdivision (Refer to Appendix A). There was no mention of any other company submitting estimates and it was assumed that the PWD would carry out the projects.

4.2	On 14.06.93, Sowy Leing Company (SLC) submitted its estimate to the Port Vila Department of Lands, bypassing Santo Urban Lands Office ('Urban Lands Office') (Refer to Appendix B). The amount was 7,500,000 vatu. There had been no discussion between Urban Lands Office and the Department of Lands in Port Vila even though the project was in Santo, and apparently SLC was awarded the contract and started work on the project. Urban Lands Office only became aware that the contract had been awarded and work commenced on the project in 1995.

4.3	In July 1993 the Finance Regulations came into effect.

Pepsi Subdivision Water Installation Project

4.4	On 10.05.94, in a letter to SLC, Mr Tary stated that he had a discussion with Mr Telukluk about another project, the Pepsi subdivision project. Payment for the works on the Pepsi project was to be in three instalment payments (Refer to Appendix C).

4.5	On 16.01.95, PWD was officially requested by Urban Lands Office to submit its estimate for the Pepsi project.

4.6	On 09.02.95, the Council of Ministers approved the use of 30 million vatu for these water works from unallocated funds from the two urban lands offices, Port Vila Urban Land Corporation and the Luganville Urban Land Corporation. These funds were raised through payment of urban land rents in Port Vila and Luganville (Refer to Appendix D).

4.7	The money was transferred to the control of Mr Tary under project no. 471.101 for the development of the Fresh Wota and Canal du Segond ll subdivisions in Port Vila and Luganville. Mr Tary was the project manager and he alone signed all payment vouchers for release of payments to SLC. Mr Willie Jimmy, the Minister of Finance, authorised Mr Tary to expend the fund (Refer to Appendix E).

4.8	By this time, the Urban Lands Office had become aware that there were problems with the quality of work being done by SLC on the Canal du Segond ll project. On 10.08.95, PWD’s engineer, Mr Philip Amos, was requested by Urban Lands Office to inspect the works and to make an inspection report. On 28.08.95 Mr Amos made an inspection report. He discovered: that there appeared to be no working plan for the project and the pipes used did not have the capacity to serve all the properties, and that there was no bedding of 100 mm thick sand as was necessary to protect the pipes. It became clear that SLC was not competent to carry out this type of work (Refer to Appendix F). 

4.9	On 12.09.95 PWD submitted two estimates for the Pepsi subdivision. One estimate was for the construction of roads at 12,323,515 vatu and a working time of 12 weeks. The other estimate was for the installation of the water supply at 7,146,906 vatu with a working time of 11 weeks (Refer to Appendix G).

4.10	On 17.10.95 Urban Lands Office requested Mr Tary to prepare a contract for the Pepsi subdivision water installation project. It was also suggested that a local company, Tukro Plumbing Service, carry out the Pepsi water installation project as that company was involved in a similar project for National Housing Corporation at Chapui subdivision in Luganville, and its quotation was similar to that of PWD (Refer to Appendices H1 and H2).

4.11	On 03.11.95 SLC submitted its estimate for the Pepsi subdivision water installation project. The estimate was 19,206,379 vatu, three times more expensive than PWD and Tukro’s estimates and no working time was stated. This estimate was accepted (Refer to Appendix I).

4.12	On 11.12.95, the Director General of Finance informed Mr Tary that Internal Audit was conducting an investigation in the contracts granted to Sowy Leing Company to carry out the two water installation projects. The Director further requested the Ombudsman to investigate the irregularities in the tender procedures under the Finance Regulations (Refer to Appendices J and K).

4.13	On 12.12.95, Mr Tary authorised an additional payment of 2,580,746 vatu to SLC on top of the agreed contract price to cover the costs of extra piping in line with PWD’s inspection report (Refer to Appendix L). In normal circumstances, any contractor submitting a tender is bound legally to finalise the works for the quoted price. SLC was obliged to carry the additional cost of the extra piping, however in the end, the government paid a total of 10,080,746 vatu for the Canal du Segond ll subdivision water installation. The original estimate from PWD was 8,674,700 vatu.

4.14	On 16.04.96, the PWD Subdivisioner advised Urban Lands Office that the water pipes that were to be used by SLC for the Pepsi water project were not the proper ones. They would not cope with the pressure of the main water supply. 75mm pipe or more was the correct pipe to be used. This was confirmed by the Regional Engineer for PWD, Mr Amos.

4.15	On 28.08.96, PWD Engineer Mr Calum Murray, submitted a brief report on the Pepsi water project and the works carried out by SLC. It covered the laying of class 10 poly pipes which are inadequate for the water pressure. The trenches had been left open for an extended period of time and represented a serious health and safety risk. Water in the trenches was an ideal breeding place for mosquitoes and the soil from the excavation had been dumped onto the road (Refer to Appendix M).

4.16	On 05.09.96, Mr Murray submitted another report on Canal du Segond II water project and the work done by SLC. (Refer to Appendix N).

4.17	On 09.09.96 the Principal Lands Officer from Urban Lands Office wrote to the Ombudsman’s Office about SLC. He stated his concerns about both projects and explained that it was difficult to check the work of SLC because there was no contract conditions to follow. He also stated that PWD had raised several complaints regarding the quality of services provided by SLC, and that he himself had lodged a formal complaint to the Director. (Refer to Appendix O).

4.18	On 14.10.96, PWD Subdivisioner wrote to the Ombudsman about SLC getting the projects, PWD's estimates and the work done by SLC. He explained that PWD was not aware of any tender board and could not understand how SLC finally got the two contracts. He further confirmed that the works were not fully completed and were badly done (Refer to Appendix P).

Information Obtained Through Ombudsman’s Inquiry

4.19	The Ombudsman requested that PWD inspect the work of SLC at the Pepsi subdivision water project and supply the Office of their estimation of the costs expended by SLC on the project. PWD reported that in their estimation the actual work done by SLC was valued at 2,694,775 vatu inclusive of materials and labour (Refer to Appendix Q). SLC was paid 9,602,690 vatu for this work, 7 million vatu more than it was apparently worth. Regardless of the massive cost of the project, it was never completed. PWD and Tukro Plumbing Services both estimated that the whole project could have been completed at a cost of approximately 7 million vatu. The amount overpaid was 7 millions. Furthermore the work already done was of very poor quality.

4.20	During the investigation the Ombudsman discovered that SLC did not have a licence to undertake construction work. It was not until 9 June 1997 that Mr Aime Malere, chairman of the company applied for a licence from the Department of Finance (Refer to Appendix R). By this time his company had carried out four different water projects without a proper licence. Mr Tary, as project manager was obliged to ensure that the contract was awarded to a properly licensed company and in fact should have been managed by the Urban Water Supply section of PWD. No action has been taken against Mr Malere’s company.

4.21	The Ombudsman discovered that the manager of SLC, Mr Ernest Malere, has no formal qualifications in either construction or plumbing, and the only experience he has is through working with SLC on two other projects in Vanuatu.

4.22	It was also discovered that procedures in place for setting up development projects were bypassed for these two projects. The usual procedure is for projects to be presented to the National Planning Office (NPO). NPO checks the project to ensure that it is in line with current government policy, checks the basis of the project estimates and checks the qualifications of the persons or Company appointed as the project manager to ensure that he or she is capable of managing the project. After NPO approves the project, it is sent to National Development Commission for discussion. It is then forwarded to the Council of Ministers for approval.

In this particular case the Council of Ministers first approved the funds for the projects and then documentation was sent to NPO for approval. As the Council of Ministers had approved the project documentation, NPO felt powerless to alter the proposals and to check the credentials of the project manager who had been named.

4.23	Mr Tary, as project manager, was obliged to ensure that any agreement made between his department and any other company was legal and that the proper tender process was followed. In the case of the Pepsi subdivision water installation project, proper tender procedures outlined in the Finance Regulations were not followed. The project was over 3 million vatu and three written tenders should have been obtained. However, only two were obtained. Tenders should have been advertised in the press, but this was not done. Tenders were not submitted to the secretary of the Tender Board as required by the Finance Regulations, nor was a proper tender board appointed. No written contract was made nor approved by the Attorney General. No tenders were approved by the Council of Ministers.

4.24	In interviews with the Ombudsman, Mr Telukluk blamed Mr Tary for the mismanagement of the project, and Mr Tary the former Director blamed Mr Telukluk. Mr Tary stated that it was their joint decision to offer SLC the contracts. It is interesting to note that both Mr Telukluk and Mr Tary are from Malekula and strong UMP supporters. It was also on Mr Telukluk’s recommendation that Mr Tary was appointed to head the Department of Lands (Refer to Appendix S). SLC is a company owned by the Malere family who are also from Malekula and strong UMP Party supporters. Mr Tary was authorised by the Minister of Finance, Mr Willie Jimmy, a member of UMP, to expend the 30 million vatu on the two projects.

Mr Tary told the Ombudsman that Mr Telukluk had instructed him to proceed with these that as 1995 was election year, these projects would be used as political propaganda.

5.	RESPONSES TO THE PRELIMINARY REPORT

5.1	The preliminary report in this matter was issued on 27.01.98 to comply with Article 62(4) of the Constitution and Section 16(4) of the Ombudsman Act. These state that the person or body complained about must have an opportunity to reply to the complaints made against them.

5.2	Responses to our preliminary report:

Only Mr Steven Tahi responded. He stated that:

(a)	he did not know who had instructed that the project be carried out the way it did;

(b)	there was no tender. He could recall that the quotations from the Public Works Department in Luganville was to find out roughly what the cost of the project was;

(c)	he had no idea how Sowy Leing was qualified for the projects because all along he had been making negative remarks on their previous performances on the Canal du Segond II Project following reports from the PWD’s Engineer, Mr Philip Amos;

(d)	Mr Roger Tary has to answer on the standard of the works carried out by Sowy Leing since he did not consult the Urban Lands office prior to carrying out the projects.

Mr Tahi went on to state that Mr Tary was negotiating and making arrangements with Sowy Leing through the Department of Lands in Port Vila. The Santo Urban Lands Office did not get any instructions to deal with the projects and this was probably because of Mr Tahi opposing the idea of allowing Sowy Leing to carry out the projects (Refer to Appendix 'P').

5.3	Mr Paul Telukluk Minister of Lands and Mr Roger Tary Director of Lands Department declined to respond.

6.	FINDINGS

6.1	Finding 1:	The conduct of Mr Paul Telukluk former Minister of Lands, and now Assistant Minister of Trade and Ni-Vanuatu Business was based on improper motives, irrelevant grounds and blatantly unreasonable

Mr Telukluk instructed Mr Tary to award the two projects to Sowy Leing Company which was owned by Malekula people who were supporters of UMP. Mr Telukluk’s electorate was in Malekula. Mr Tary stated that in 1995, he was put under pressure by Mr Telukluk as that was an election year and Mr Telukluk wanted the projects to be used as his own political tool. It was blatantly unreasonable for Mr Tary and Mr Telukluk to accept Sowy Leing Company to do the second project, the Pepsi subdivision water installation project when the work done on the first project, the Canal du Segond ll water installation project was not done to the required standard, lack of qualified manpower, experiences and even lack of a proper licence by Sowy Leing Company.

6.2	Finding 2:	Mr Paul Telukluk former Minister of Lands, and now Assistant Minister of Trade and Ni-Vanuatu Business breached the Leadership Code, Article 66(1)(a) and 66(2) of the Constitution.

	Mr Telukluk placed himself in a position of a conflict of interest by instructing and pressuring Mr Tary to award the contracts to Sowy Leing Company for his own political benefit, and to favour his own UMP supporters.

6.3	Finding 3:	Mr Roger Tary’s conduct (former Director of Lands) was contrary to law in that he breached the Finance Regulations and s.3 of the Public Finance Act

∑	Breach of Finance Regulation 343 and s.3 of Public Finance Act

Mr Tary failed to ensure that the funds released from the Development Fund were spent on the projects in accordance with the Finance Regulations and the Public Finance Act.

∑	Breach of Finance Regulation no. 361

Mr Tary breached the Finance Regulation No. 361 by accepting only two tenders for Pepsi subdivision water installation project. Since the cost of the project was well over 3 million vatu, they should have obtained three (3) written tenders as required by Reg. 361.

∑	Breach of Finance Regulation No. 362

Mr Tary breached the Finance Regulation No. 362 for not calling tenders by open competitive bidding. He simply accepted Sowy Leing Company’s estimates and awarded them the contracts.

∑	Breach of Finance Regulation No. 363

Mr Tary breached Finance Regulation No. 363 when he asked for tenders to be sent to the Urban Lands Office. They should have advertised the tenders in the press and the Government Gazette as the amounts were superior to VT 500.000 as required by this regulation. They did not do so.

∑	Breach of Finance Regulation No. 364

Mr Tary breached the Finance Regulation No. 364 when he obtained the tenders from Public Works Department and Sowy Leing Company. He did not submit all tenders to the Secretary of the Tender Board in the Department of Finance as required by this regulation. He instead discussed the matter with Minister Paul Telukluk and they both decided to award the contracts to Sowy Leing Company.

∑	Breach of Finance Regulation No. 365

Mr Tary breached the Finance Regulation No. 365 because he failed to ensure there was a proper tender board appointed. He asked for the tenders and considered the tenders with Minister Paul Telukluk which resulted in Sowy Leing Company getting the contracts. This Regulation also specifies the eligible members of a tender board and Mr Tary and Mr Telukluk were not the appropriate people to approve tenders.

∑	Breach of Finance Regulation No. 367

Mr Tary breached the Finance Regulation No. 367 by not providing written contracts for the projects since the costs of the works were over 3 million vatu. The contracts were supposed to be approved by the Attorney General. No contract was prepared for either project.

∑	Breach of Finance Regulation No. 368

Mr Tary breached Finance Regulation No. 368(1) as he approved and accepted Sowy Leing Company's high tenders for the two projects. It is the responsibility of a tender board to consider and approve the lowest evaluated tender.

∑	Breach of Finance Regulation No. 368 (2)

Mr Tary breached Finance Regulation No. 368(2) for accepting the tenders over 3 million vatu and the payments made to Sowy Leing Company were not approved by the Council of Ministers. It is a requirement under this Regulation that any tender over 3 million vatu has to be approved by the Council of Ministers before they are awarded. Mr Tary approved and awarded the tenders to Sowy Leing Company.

∑	Breach of Finance Regulation No. 369

Mr Tary breached Finance Regulation No. 369 by authorising variation of the original sum of 7,500,000 vatu for Canal du Segond II project when he authorised an extra payment of 2,580,746 vatu to Sowy Leing Company because the Company was short of water pipes following their original quote. Any variation is only allowed up to a maximum of 20%. Anything beyond 20% has to be approved by the Minister of Finance. The above additional payment authorised by Mr Tary was well beyond 20% and it was not approved by the Minister of Finance.

6.4	Finding 4:	Mr Roger Tary former Director of Lands breached the Leadership Code, Article 66(1)(a) and 66(2) of the Constitution.

Mr Tary placed himself in a position of a conflict of interest by awarding the contracts to Sowy Leing Company following Mr Telukluk’s instruction. He did not follow the proper procedures and demeaned his position by acting for the benefit of his friends instead of the people of Vanuatu which he was representing and supposed to serve as public servant.

7.	RECOMMENDATIONS

Recommendation No. 1:	mr telukluk should not be considered to hold any ministerial portfolio in any future Government

7.1	Mr Telukluk has had previous findings of maladministration and breach of the Leadership code made against him in the following Ombudsman’s public report:

(a)	Illegal Ex-Gratia Payments to 23 1988 MPs

Mr Paul Telukluk as Acting Minister of finance in 1997 breached Finance Regulation No. 176 in authorising his own Payment Voucher as quickly as possible even though the Ex-Gratia payments were not authorised by Parliament.

(b)	Improper Sale of Government houses by the Office of the Prime Minister under Prime Minister Maxime Carlot Korman

Although Mr Telukluk was advised by the Attorney General that the Sale was improper, he took no appropriate steps to stop the transfers and registration of the leases. He did it for his own benefit and the benefit of his political friends in Government then.

(c)	Improper Granting of Land Lease Title 11/OE22/016

Mr Telukluk placed himself in a position of conflict of interest between his official duty and his desire to serve the interest of his relatives when he used his ministerial power to grant the lease to Mr and Mrs Edmond Rory. He also breached the Leadership Code under Art. 66 of the Constitution.

The Ombudsman recommended in the reports that Mr Telukluk not to ever act as Minister of Finance again and not to be appointed to hold any ministerial portfolio in any future governments.

Mr Telukluk has recently been reappointed Assistant Minister of Trade and Ni-Vanuatu Business.

Recommendation No. 2:	mr tary, former director of lands not to be considered for any position in any future government

7.2	Mr Roger Tary has had previous findings of maladministration and breach of Leadership Code made against him in the following reports made public by the Ombudsman’s Office:

(a)	Improper Sale of Government Houses by the Office of the Prime Minister under the former Prime Minister Mr Maxime Carlot Korman

Mr Tary committed direct misappropriation when he proceeded to his own transfer of the government house without paying any monies to the Government for the property. He acted contrary to law and for his own gain to acquire the house.

(b)	Improper Granting of Land Lease Title 11/OE22/016

Mr Tary acted contrary to art. 5 of the Constitution by not treating equally the first applicant for the above lease. He instead made sure that the interests of Mr Telukluk’s relatives were served when he instructed his officers to process the lease documents for Mr and Mrs Edmond Rory for Mr Telukluk’s approval. He also breached the Leadership Code under art. 67 of the Constitution and s.14(12(g) of the Ombudsman Act.

It was recommended that Mr Tary should not be accepted as Director of any government departments or government statutory body in future.

(c)	Former conviction

Mr Tary was convicted and jailed in July 1996 (when he was still the Director of Lands) for misappropriation of public funds.

Recommendation No. 3:	the current director of lands to make sure that his officers both in port vila and santo have access to and follow the government finance regulations.

Recommendation No. 4:	the department of lands to follow the right procedures in accordance with the finance regulations to properly complete the projects. they should not accept sowy leing COMPANY to complete the projects as they have proved themselves to be incapable to do a proper job according to export from the government.

8.	CONCLUSION

8.1	To comply with Article 63(2) of the Constitution and Section 22 of the Ombudsman Act, the Ombudsman requests the Prime Minister and the Minister of Lands and the Director of Lands to consider these recommendations and to put them into effect.

8.2	The Office of the Ombudsman must be notified of the decision and proposed steps to implement these recommendations within thirty (30) days of the date of this report.

Dated the 25th day of November 1998

Marie-Noëlle FERRIEUX PATTERSON
OMBUDSMAN OF THE REPUBLIC OF VANUATU

9.	INDEX OF APPENDICES

A	PWD’s estimate for Canal du Segond ll water installation project

B	Sowy Leing Company’s estimate for Canal du Segond ll subdivision water installation project

C	Roger Tary’s letter to Sowy Leing Company regarding their estimate

D	Approval of 30 million vatu for the two projects by the Council of Ministers

E	Authorisation to expend the 30 million vatu by the Minister of Finance

F	PWD’s inspection report on Canal du Segond ll Project

G	PWD’s estimates for Pepsi subdivision road construction and water installation

H1	Santo Urban Lands Office’s letter to Roger Tary

H2	Tukro’s estimate for Pepsi subdivision water installation project

I	Sowy Leing Company’s estimate for Pepsi water installation project

J	Dept. of Finance’s letter to Roger Tary

K	Dept. of Finance’s letter of complaint to the Ombudsman

L	Additional payment made to Sowy Leing Company authorised by Mr Tary

M	PWD’s inspection report on Pepsi water installation project

N	PWD’s inspection report on Canal du Segond ll water installation project

O	Santo Urban Lands Office’s letter to the Ombudsman

P	PWD Subdivisioner’s letter to the Ombudsman

Q	PWD’s estimation of the cost of work done by Sowy Leing Company on Pepsi subdivision water installation project

R	Sowy Leing Company’s proper trading licence obtained in 1997

S	Appointment of Roger Tary as Director of Lands following Minister Paul Telukluk’s recommendation to the Public Service Dept.

T	Santo Urban Lands Office’s response to the Ombudsman’s preliminary report.

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