CAL paid millions from 2007-2008 without proper contracts

The deputy chief financial officer of Caribbean Airlines (CAL) told parliament's Public Accounts Enterprises Committee (PAEC) Tuesday the airline paid millions of dollars to sub-contractors without having contract documents.

Andre Mills said told committee members he plans to meet with external auditors KPMG to determine how many contractors received payments without possessing contracts.

The PAEC was at the time looking over CAL's financial documents over the period 2007-2008.

Government members of committee questioned the lack of proper documentation, with Senator Subhas Panday calling it risky. "There were no checks and balances on millions of dollars," he said, noting that several institutions received payments with no formal documents to support such payments.

PNM members defended CAL. Colm Imbert said the government side is making an "issue out of nothing", saying they were making a big deal over the issue.

"I think the no-contract payments were being blown out of proportion. Remember CAL purchased 100 per cent of Tobago Express and operated that subsidiary out of their offices. They absorbed the company and made payments through CAL," he said.

Mills said he supports Panday's comments and assured members that the airline's financial team has changed its policy. "Now we have a policy that we must see the contracts before any payment can be issued. So that issue has already been corrected," he said.

Committee member Rudranath Indarsingh asked about another accounting discrepancy. He noted that the company's staff was reduced by 30 between 2007 and 2008, yet its national insurance and health surcharge figure was almost doubled over the same period.

"In 2007, the employee figure was 984, but by December 2008 that figure dropped to 954 yet for that same period NIS and Health Surcharge went from $3,199,000 to $6,206,000," he observed.

CAL's acting chief executive officer, Robert Corbie, said he would have to confirm the employee count.