Investigation into apparent leak of information at finance ministry |06 May 2015

An investigation is underway into an apparent leak of classified information involving different policies the Ministry of Finance, Trade and the Blue Economy has been working on since January.

Finance principal secretary Patrick Payet confirmed the investigation yesterday after a local newspaper printed in its yesterday issue a story containing two of the six policies the ministry has been working on.

 “There is reason to believe that a document that was subject to non-disclosure was released. Leaking information contained in the document may have an adverse effect on the government and the implementation of its future programmes. As instructed by President James Michel since January this year, the ministry has been working on six policies and a position paper was shared with the International Monetary Fund, one of our international partners, at the end of the month of April. And it’s a coincidence that two of the policies have come out in a newspaper article with an opposition leader early in May. I doubt that our external partners have published any of the information as they do not appear in any report,” said PS Payet.

He added: “It’s unprofessional for professionals of the Ministry of Finance, Trade and the Blue Economy to act in such a way. We will be investigating who had access to the position paper and following the result of the investigation, action will be taken against the person or persons responsible.”
Asked what the ministry is doing to avoid a repetition of the same scenario, PS Payet explained that the ministry is reviewing all internal procedures like who get access to such information.

Mr Payet said the two policies mentioned in the article in question are the 13th month salary and a property tax on land and dwellings owned by foreigners.

Although the document is not final as the ministry is still working on the different models and the ability for the government, the private sector and the small entrepreneurs to sustain all the additional costs, Mr Payet revealed the other four policies they are working on. These are retirement benefits, personal income tax, pension for ex-gratia, and the introduction of a weight for single mothers under the Agency for Social Protection.

“As the country is still under a macro-economic reform programme, we were still in discussion with the IMF, the World Bank and the African Development Bank about the policy changes we were hoping to make. We are sure that the information contained in the article has been leaked from the Ministry of Finance,” insisted Mr Payet.

The 13th month salary policy will concern mostly the public sector and possibly the private sector, and it is being evaluated in a macro framework programme as it is important to know how much money the government will need to carry it out.

As this could have an adverse effect on the private sector, one of the tools that can be used to give the 13th month salary is the performance assessment at work places the Ministry of Labour and Human Resource Development is working on.

Concerning the progressive personal income tax policy, the government is working on different scenarios like lowering income tax for people on basic salary or increasing that for people earning more than R100,000 monthly. Right now, all workers are paying 15% personal income tax on their salary.

The other three policies are: a 10% increase in retirement benefit to make it equivalent to the minimum wage, a possible R500 increase in the pension for ex-gratia, and a review of the actual weight for single mothers under the Agency for Social Protection. The idea is to have targeted weight instead.

PS Payet explained that a small committee with representatives from the Ministry of Finance, Trade and the Blue Economy and the Ministry of Land Use and Housing is working on how much revenue the government can collect from the policy that deals with property tax on land and dwellings owned by foreigners.

“All these policies have not been finalised as we are still evaluating their domino effect – their impact on the government annual budget and on the Seychelles economy. We are also taking into consideration the additional costs the private sector will have to incur and in meeting the goal of reducing public debt below 50% of GDP by 2018.

 “Like I said before we discussed the proposed policies with the IMF team in March here and when Minister Jean-Paul Adam went to Washington, USA for the Spring Meeting the different scenarios were presented in more details,” noted Mr Payet.

PS Payet explained that his ministry is liaising with the Attorney General’s office for advice on how to proceed with a legal case involving the person who has leaked the information.

“We do not only deal with money collected from taxes but also with expenses. These are sensible information,” concluded Mr Payet.