On the fifth day of the parliamentary debate on the former Principal Auditor’s 2018/2019 Report, the Chief Minister continued his detailed analysis, focusing on two principal areas: the delays in the publication of the Report and the criticisms concerning government-owned companies.

Delays in the Publication of the Report

The Chief Minister demonstrated with evidence that the unprecedented delay in publishing the 2018/2019 accounts, almost four years between their preparation and submission to Parliament, was the direct result of the former Principal Auditor’s unilateral decision to abandon the longstanding practice of accepting draft accounts.

Previous Principal Auditors had accepted advance copies, which enabled them to complete audits promptly. By contrast, the former Principal Auditor insisted that only finalised and signed accounts could be accepted, a restrictive and novel interpretation of the law that inevitably slowed the process.

The Chief Minister confirmed that this choice, and this choice alone, caused the delays. The Government had no role in it, and suggestions by the Opposition that the delay was engineered to avoid scrutiny were false.

The Chief Minister highlighted the historical timeline of audit report submissions to show clearly where responsibility for delays lay. Under former Principal Auditor Jimmy Posso, reports for the years 2007 to 2015 were consistently completed within 12 to 18 months of the financial year-end, with some submitted within weeks or even days of the relevant Supplementary Appropriation Act.

By contrast, under the immediately former Principal Auditor, reports for 2015/2016, 2016/2017, 2017/2018 and 2018/2019 were delayed for years, with the 2018/2019 report not reaching Government until July 2025. This, the Chief Minister said, was unprecedented and demonstrated beyond doubt that the delays were caused by the Auditor’s own restrictive approach, not by the Government.

Timeline of Delays

Civil Service Obstruction

The Chief Minister also dismantled the claim that senior public servants had obstructed the audit process. Records show that officials replied promptly, often within days, and gave the audit office full access to primary records. Any longer response times were the result of legitimate factors such as multi-agency input, retrieval of archived records, or parliamentary scheduling. Officials acted with professionalism, fairness, and dedication to public service.

The accusations in the Report unfairly damaged the reputations of civil servants who cannot answer back in political debate. The Chief Minister made clear that Gibraltar’s public servants do not, and would never, collude to avoid scrutiny. Far from obstructing audits, they went out of their way to facilitate them.

Future Reforms

To further strengthen processes, the Government confirmed that a cross-government audit liaison function, service-level timelines, and a shared tracker will be introduced. These reforms demonstrate a commitment to best practice, transparency, and efficiency.

Government-Owned Companies

Turning to government-owned companies, the Chief Minister was clear that the Principal Auditor had exceeded his remit by criticising existing audit arrangements and calling for legislative reform.

Under the Constitution, the Principal Auditor’s role is limited to auditing the public accounts of Gibraltar and Government offices. It does not extend to government-owned companies, which are independent legal entities under the Companies Act 2014. By law, their audits are conducted by reputable external firms subject to strict regulation and international standards.

The former Principal Auditor’s suggestion that these audits were insufficient was not only wrong but unlawful. It is for Parliament, not an auditor, to decide whether to change the statutory framework. The attempt to expand his mandate amounted to a classic ultra vires overreach.

Independent Counsel

Independent legal advice confirmed this. Mr Fisher KC advised that the existing arrangements are adequate, that all transactions already pass through Government accounting systems to which the Auditor had full access, and that the former Auditor had misdirected himself. He concluded that the section of the Report dealing with government companies should be withdrawn.

The Chief Minister stated: “A Principal Auditor does not design laws. He does not decide his own remit. By purporting to do so, the Report stepped into territory reserved for Parliament, and that is both wrong and unlawful.”

Conclusion

The Government made clear that the facts are unarguable:
• The delay in publishing the 2018/2019 Report was entirely caused by the former Principal Auditor’s restrictive decision to stop accepting draft accounts.
• Civil servants fully cooperated and acted with integrity, contrary to insinuations in the Report.
• The criticisms on government-owned companies were ultra vires, politically charged, and professionally unsustainable.

The Government confirmed that the motion before the House will be amended to reject both of these sections of the Report, ensuring Parliament upholds fairness, legality, and the integrity of Gibraltar’s institutions.