Property Matters – The Procurement Gap

Property Matters – The Procurement Gap

There is now a significant and unacceptable delay in implementing the new Public Procurement system. The Public Procurement & Disposal of Public Property law was Act No 1 of 2015, so come January 2018, it will have been passed by Parliament three years ago. When the current administration took office in September 2015, several amendments were made and those were passed by Parliament in June 2016 as Act No 5 of 2016.

Although I am convinced that this implementation is taking too long, it is noteworthy that the Central Tenders Board Act of 1961, was only activated by the swearing-in of the first Central Tenders’ Board in 1966. It took five years to implement that important Act with all the necessary arrangements in place such as offices, staff, stationery and so on.

So what is causing these delays with this critical new law? Apart from the law itself, which is now in place, there are three pre-conditions to the new system being started –

  1. Training – Given that the new Act imposes strict penalties all of which are custodial, there is a serious need for proper training. Every organ of the State which transacts in Public Money must have a named Procurement Officer, who will bear responsibility for those transactions under the new Act. The training started since 2014, with most of the Ministries and State Agencies having been prepared by now;
  2. Budget – The new Act will be operated by the Office of Procurement Regulation (OPR) and funding for that new Institution was approved in 2017;
  3. Appointment of Board – The OPR will be controlled by a Board which is appointed by the President of the Republic, after consultation with the Prime Minister and the Leader of the Opposition (S10 of the Act refers). That is the significant delay with which we are faced at this stage. There have been two invitations to apply for the full-time positions of Chairman and Deputy Chairman of the OPR Board. In both cases all the submissions have not been acknowledged, so there is an apparent gap at that level.

The Private Sector Civil Society (PSCS) Group is a lobby formed to push for this critical new law, operating under the Chairmanship of my erstwhile colleague, former JCC President and Chaconia Medal (Gold) holder, Winston Riley. The members of that group are the JCC; the T&T Manufacturers’ Association; T&T Chamber of Industry and Commerce; the American Chamber of Commerce; the T&T Transparency Institute; the T&T Coalition of Service Industries; Local Content Chamber and the Federation of Independent Trade Unions and NGOs (FITUN).

The PSCS Group pointed out in its 30th November 2017 letter to President Carmona –

“…The PSCSG has privately indicated to you on May 1st, 2017 its objection to the involvement of the Office of the President and of the Ministry of Finance as both bodies are listed under section 5 of the ACT as a public body and thus subject to the Act…”

That objection to the involvement of the Office of the President in the process for recruitment of the OPR Board is fundamentally untenable, for two reasons. Firstly, the proposal for that approach emanated from the said PSCS group and was accepted by Parliament, which leads to the second point, that the appointment procedure is the one stipulated by the Act.


Open letter to President Carmona

On Tuesday 12th December 2017, I published an open letter to President Carmona together with my colleagues, Reginald Dumas and Victor Hart, calling on him to make these appointments in as transparent and open a manner as possible. That letter was carried as a ‘letter to the editor’ in the Guardian of Wednesday 13th and was also the subject of a Newsday article on Thursday 14th – ‘President urged to give Procurement details‘.

The large-scale waste and theft of Public Money remains one of the most serious concerns for our country and the full implementation of the Public Procurement and Disposal of Public Property Act is therefore a matter of very high priority. That implementation should be done in a manner which fosters confidence and sets the table for a new era of proper dealings in the conduct of our nation’s public affairs.

We are encouraged by the 2nd November 2017 Press Releases from the Office of the President and the Ministry of Finance, both stating that the appointment of the Board for the Office of Procurement Regulation is anticipated to be made by the end of this month, December 2017.

As a matter of best practice in these most crucial appointments, the public should be apprised of the details of the selection process. This is simply not a matter we can afford to have go awry, since there is such a dire need for transactions using our increasingly limited Public Money to be properly supervised.

As a parallel example, we would offer for adoption the 39th recommendation of the Uff Report:

“The reviewing of tenders and the making of decisions upon the award of contracts should be undertaken in as transparent a manner as possible, including demonstrating clear compliance with procurement rules, so as to allay suspicion of improper actions or potential corrupt influences.”

The point is that contracts, particularly large-scale, shou ld not be awarded without elementary transparency so that the public can be assured of straight dealings. The appointment of the Procurement Regulator will be one of the most critical contract awards in the history of our Republic, albeit an employment contract.

We are therefore requesting, in the public interest, that the following details be published before the appointments are made:

  • the selection process being used;
  • the identity of the firm or personnel implementing that process;
  • the identity of the shortlisted applicants.

We anticipate an early and positive reply in the collective interest of instilling and maintaining a high degree of public confidence in the processes involved in this critical matter.

We await your response.

Reginald Dumas

Victor Hart

Afra Raymond

VIDEO: Morning Edition interview on “Letter to President” on Office of Procurement Regulation

VIDEO: Morning Edition interview on “Letter to President” on Office of Procurement Regulation

This is the interview with Fazeer Mohammed on the Morning Edition programme on TV6 where he and Reggie Dumas discuss their open letter to President Carmona on the appointment of Board of the Office of Procurement Regulation.( See letter below.) Video courtesy TV6

Programme Date: 18 December 2017
Programme Length: 00:03:39 and 00:22:30

Our Open Letter to President Carmona is here for your attention –

The large-scale waste and theft of Public Money remains one of the most serious concerns for our country and the full implementation of the Public Procurement and Disposal of Public Property Act is therefore a matter of very high priority. That implementation should be done in a manner which fosters confidence and sets the table for a new era of proper dealings in the conduct of our nation’s public affairs.

We are encouraged by the 2nd November 2017 Press Releases from the Office of the President and the Ministry of Finance, both stating that the appointment of the Board for the Office of Procurement Regulation is anticipated to be made by the end of this month, December 2017.

As a matter of best practice in these most crucial appointments, the public should be apprised of the details of the selection process. This is simply not a matter we can afford to have go awry, since there is such a dire need for transactions using our increasingly limited Public Money to be properly supervised.

As a parallel example, we would offer for adoption the 39th recommendation of the Uff Report:

The reviewing of tenders and the making of decisions upon the award of contracts should be undertaken in as transparent a manner as possible, including demonstrating clear compliance with procurement rules, so as to allay suspicion of improper actions or potential corrupt influences.

The point is that contracts, particularly large-scale, shou ld not be awarded without elementary transparency so that the public can be assured of straight dealings. The appointment of the Procurement Regulator will be one of the most critical contract awards in the history of our Republic, albeit an employment contract.

We are therefore requesting, in the public interest, that the following details be published before the appointments are made:

  • the selection process being used;
  • the identity of the firm or personnel implementing that process;
  • the identity of the shortlisted applicants.

We anticipate an early and positive reply in the collective interest of instilling and maintaining a high degree of public confidence in the processes involved in this critical matter.

We await your response.

Reginald Dumas

Victor Hart

Afra Raymond

AUDIO: Interview on Sky 99.5 FM on corruption – 12 December 2017

sky995fmThis is my interview on 99.5FM on The Breakfast Roundtable on Sky 99.5 FM on Tuesday 12th December 2017, with Jessie-May Ventour, Dr. Wayne Heywood and Edison Carr to discuss the implementation of the Public Procurement & Disposal of Public Property Act and other topics relating to corruption in T&T being at serious levels now. Audio courtesy Sky 99.5 FM

Programme Date: 12 december 2017
Programme Length: 00:43:44

VIDEO: INVADERS’ BAY ISSUES on ‘The Morning Edition’ on TV6 – 20 September 2016.

tv6_logoJCC Immediate Past-President, Afra Raymond, interviewed by TV6’s Kejan Haynes on Morning Edition on Tuesday 20 September 2016 on the ongoing issues at development site at Invader’s Bay and their connection to the larger procurement public policy issues. Video courtesy TV6

  • Programme Air Date: Tuesday 20 September 2016
  • Programme Length: 0:20:45

Property Matters – Invaders’ Bay Reboot

invadersbay-bw
Once again, controversial development proposals for Invaders’ Bay are back in the news. Those proposals of the Peoples Partnership government appeared to have stalled after the successful legal action taken by the JCC in 2012, but we are now hearing of substantial proposals from the PNM government. Some serious questions have to be answered so that the public can understand the situation.

Invaders’ Bay is a 70-acre parcel of State-owned reclaimed land south of the Movietowne/Pricesmart/Marriott complex near to the National Stadium in west POS. In August 2011, the Ministry of Planning and the Economy published a Request for Proposals (RFP) inviting offers to develop those lands by design, finance and construct proposals.

The entire RFP process was deeply flawed and strongly criticized by the JCC, the T&T Chamber of Commerce, the T&T Manufacturers’ Association and the T&T Transparency Institute, as well as the PNM, then in opposition. To make just one example, the RFP entries were judged in accordance with Assessment Criteria which were published a full month after the closing date. At the time, I labelled the entire scheme as possessing all the ingredients for corruption – see http://www.jcc.org.tt/invadersbay.htm – but most importantly, the RFP was issued in breach of the Central Tenders Board Act.
Continue reading “Property Matters – Invaders’ Bay Reboot”

Property Matters – Housing Issues – part 5

hdc-logo

SIDEBAR: CORRECTION

With apologies to readers, this is to correct my figures in relation to the amount of Public Money which TTMF received in relation to the 2% subsidised mortgage programme. The figures disclosed in TTMF’s Summary Financial Statements are actually liabilities, being the reducing balance on the original allocation of $200M for this programme.

The recalculated figures for TTMF’s recovery of 2% mortgage subsidy 2007 to 2014 are

YEAR SUBSIDY (cumulative)
2007 $.9M
2008 $5.3M
2009 $16.5M
2010 $34.1M
2011 $52.7M
2012 $70.4M
2013 $87.4M
2014 $105.2M

These figures are far less than those I cited in my article, since only $105.2M has been drawn from the original allocation of $200M, as against my erroneous claim that $1,227.5M of Public Money had been spent on this subsidy.

Last week I examined housing subsidy to illustrate the ways in which Public Money is used to provide better housing opportunities.

The sidebar contains my correction, which shows that a total of $105.2M was spent in this 2% subsidised mortgage programme between 2007-2014. I was also informed that the 2% subsidised mortgage had been granted to 1,466 applicants, who earn less than $10,000 per month, to buy homes under $850,000. In late 2014, TTMF also started offering 5% mortgages to applicants who earn up to $30,000 per month for homes up to $1.2M – 298 of those mortgages have been granted to date.

This revision and the new information will require that we pay even greater attention to the HDC’s operations, since it far outstrips the other agencies providing housing options.

So, what is the proportion of applicants between the lower and middle income groups? At pg 28 of the Vision 2020 Housing Sub Committee Report (2005) that is estimated as follows –

…shows that more than half of the demand for housing to 2020 (57.3%) falls within the low-income group with 30.7% in the middle income group and 12% in the high-income group…”.

It is difficult to reconcile those researched conclusions as to the demand for homes with the actual distribution of new HDC homes, in which only 21.7% were rentals. The pattern of distribution of those homes seems to indicate that the decision was taken to promote home-ownership in preference to building rental units. There is no doubt that this decision was detrimental to the neediest applicants, who were unable to qualify for mortgages, while at the same time being beneficial to those whose earnings qualified them for mortgages. Continue reading “Property Matters – Housing Issues – part 5”

AUDIO: The Breakfast Roundtable interview on Sky 99.5FM – 23 March 2016

sky995fmAFRA RAYMOND, Immediate Past President of the Joint Consultative Council (JCC), comments briefly on the firing of Jearlean John by the new HDC board, after being on administrative leave for a couple of months. He says we should not be too quick to believe the Marlene McDonald dismissal is a sign of greater accountability to come on the part of governments. Mr. Raymond also lauds Government’s proposal to use the housing sector to create opportunities for construction industry, to help pull T&T out of recession.

  • Programme Date: Wednesday, 23 March 2016
  • Programme Length: 26:04

Property Matters – Housing Issues – part 4

hdc-logoAlthough the HDC is the State’s main implementing agency for its housing policy, there are other important elements to be considered. The main one I will examine here is the role of public subsidy in the housing program.

Given that we live in a relatively wealthy and very densely-populated small island state which operates a free market system, the prices charged for property sales or rentals have moved upwards historically. One of the objectives of the housing policy is to assist those who are unable to compete in the market, so it is justifiable to apply State resources to reduce the cost of housing to those needy persons.

That allocation of Public Money and land to the housing program is intended to create the new homes for the applicants. In addition to the direct construction of the new homes, Public Money is also used to reduce the cost of housing.
Continue reading “Property Matters – Housing Issues – part 4”

The Proposed changes to the new Public Procurement Act

The Public Procurement and Disposal of Property (Amendment) Billprocurement-bill was tabled in Parliament on Friday 13th November 2015 and a Joint Select Committee appointed – under the Chairmanship of Finance Minister, Colm Imbert – to invite and consider comments on the changes being proposed. Overall, I took the view that the proposed amendments would likely improve this new law, so these are my formal comments as submitted to that JSC. CLICK HERE TO READ.

This is a critical law to tackle the high levels of waste and theft of Public Money and it is therefore critical that it is implemented as swiftly and as solidly as possible, even if we know that certain parts would need to be closely monitored and subject to early adjustments as necessary.