“…Mr. Speaker, no coherent, co-ordinated planning or strategy for state enterprises exists. As a result we have begun to rationalise the state enterprises, including the special purpose companies, which will incorporate a new accountability system that goes beyond the presently operating company ordinances. It is these loopholes in public accountability that resulted in the UDeCOTT scandal. This must never again happen in Trinidad and Tobago…”
—Dookeran, Winston. “Facing the Issues: Turning the Economy Around,” (Budget Statement 2011, Port of Spain, 8 September 2010), pg 22.
The previous article – Cycle of Consequences – drew from the official record to detail the performance of UDeCOTT in terms of its accountability for the vast sums of Public Money for which it is responsible.
The reaction to that article was so striking that I am responding to the disbelief and many questions. I will also examine the record of e TecK in this related matter of the State-owned hotels. As always, I am relying on the official record and the written correspondence. Continue reading “Property Matters – Filling the Gaps”→
This article will delve deeper into the State Enterprise sector and its role as an agent of government policy with huge transactions in Public Money. I will do so by continuing my focus on the State-owned hotels and their performance, drawn from the official record.
The poor quality of investment decisions with our limited Public Money has left us saddled with projects no private investor would have contemplated beyond an initial appraisal stage. Public Money ought to be managed to and accounted for to higher standards than those applicable to Private Money. That standard learning appears to have evaporated in our country.
The Public Private Partnerships (PPPs) in relation to our State-owned hotels are evidently beneficial to the hoteliers but of limited, if any, benefit to the Public as shareholders. PPPs here in T&T are ones in which we have privatised the profits and nationalised the losses. That is what happened at Tobago Hilton and, in significant respects, at Carlton Savannah – as detailed in ‘Carlton Savannah Swirl‘ published in this space on 15 February 2015. What is more, some of the leading beneficiaries of those arrangements, such as Arthur Lok Jack, can declare – “Government has to get the hell out of private sector business.”. Continue reading “Property Matters – Cycle of Consequences”→
The 17th recommendation of the Uff Report states –
“…User groups and other interest groups should be properly consulted on decisions regarding public building projects, to ensure that relevant views can be expressed at the appropriate time and taken into account before decisions are made…” (emphasis is mine)
10.1 A small State such as Trinidad & Tobago must accord a very high priority to the judicious management and utilization of its land resources or perish. All elements of land policy must be designed to ensure that these finite resources are efficiently utilized and husbanded in such a manner as to serve the long term interests of the national community.
—Conclusion of “A New Administration and Policy for Land” (19 November, 1992)
Long-standing public concerns over land allocation have been increased by a number of recent events. Most notably there have been reports of leases of waterfront land at ‘Chagville’ for a waterpark and the Chaguaramas Convention Centre for a hotel project. The other episode to have attracted interest is the alleged occupation of 35 acres of Caroni land by SIS in Couva in contested circumstances.
When one considers the recently-announced projections for distribution of 100 new homes per week by the Housing Development Corporation (HDC) and the huge ‘Land for the Landless‘ proposals, it is clear that land is a hot topic. It is tempting to dismiss these proposals as being mere electioneering, but that would be a grave error, in view of the importance of land in our society. Justifiably so.
This article will set out some of the inescapable facts about our country’s land and housing situation. It is not possible to cover these vast, complicated and interlocking issues in a single column, so this is the start of an important series. History demands nothing less.
Proceeding from the general to the particular will mean deferring discussion of the specific controversies arising at this time so that the fundamental and serious issues can be properly framed.
The main points are –
The land area of Trinidad & Tobago is 5,128 sq. kilometres (1,980 sq miles), but apart from the raw quantity of land, we have to take proper account of the quality of our land. By which I mean to say that a majority of our land area is swamp, forest and mountainous terrain which is not suited for easy development – in my estimation, at least 60% of our land is in those zones.
The existence of those development-free zones is essential for the sustainability of the other zones, the developed ones. Some of the elements in that sustainability equation would include green cover on high ground to reduce run-off from heavy rainfall; aquifers which can replenish with clean water; swamps/mangrove coastal areas to buffer high-tides and form a vital link in the food-chain; forests to act as living repositories of our bio-diversity and so on.
The balance between the two types of zones is in constant tension, given the high level of national wealth; the tendency of wealthy persons to land-hoard; the tendency of poor people to take up unauthorised occupation of land and our growing environmental awareness. Those rising tensions as to land use can only be properly addressed by balancing of the needs of the human population against those of the other living elements; the present generation against those of the unborn and not least, the appetites of the wealthy against the needs of the poor.
Idealists would suggest that those elements are not in actual conflict with each other, but realism and the facts before us speak of a grim kind of contest. The systems for environmental study, public consultation and urban & regional planning are all intended to set norms for the resolution of those conflicting demands.
Since the land area of our country is static (at 5,128 sq kilometres) apart from marginal gains and losses due to reclamation and erosion, the actual population is an important measure of the pressure that our lands are under.
It seems clear that our actual population is significantly higher than the official figure, which means that the population density is much higher than stated by Index Mundi.
For the reasons outlined earlier, there has been a steady stream of criticism of the systems in place for environmental management, public consultation and planning in relation to our nation’s physical development.
There is almost no discussion as to our land policy. The fact is that the national land policy was established in 1992 and has not been revised, superceded or withdrawn. As a practitioner in the field, I am aware of the policy and consider its contents to be substantially beneficial to our collective interests.
The problem is that the official land policy is seldom observed, so much so that I often wonder how widely-known is its existence or contents.
To test my suspicions, I decided to try an experiment by asking some surveyor colleagues at a recent conference and was astonished at the number of people who had no idea if there was a land policy. Some colleagues went beyond uncertainty to flatly deny its existence.
But that is not all, not at all.
I then caused queries to be raised with the relevant official bodies as to the existence of a national land policy. The replies need to be carefully noted, so that we can understand the turmoil and confusion which exists at the official level.
Here is what we were told –
Ministry of Housing & Urban Development – Did not confirm or deny, but referred us to the Land Settlement Agency, which is a Division of that Ministry.
Land Settlement Agency – Stated that they were unaware of any official land policy in existence and suggested that we contact the Ministry of Planning & Sustainable Development.
Ministry of Planning & Sustainable Development – Did not confirm or deny, but referred us to the Ministry of Land & Marine Resources. Another query to MPSD yielded the suggestion to contact the Town & Country Planning Division of that Ministry, but the TCPD then stated that “a policy was in process but nothing had been finalised.”
Ministry of Land & Marine Resources – Did not confirm or deny, but referred us to the Commissioner of State Lands, which office is yet to answer our repeated calls. Further queries to other departments within MLMR only yielded repeated statements that no such policy exists.
This official level of confusion and ignorance is unacceptable, given the critical importance of land in “satisfying the long-term interests of the national community.”
Quite frankly, the fact that only one of the many officials we spoke with was willing to give a name, which was actually someone else’s, speaks volumes to the pitiful position of official ignorance or obfuscation on this critical national resource. The responsible officials behaving irresponsibly in matters of the first importance. What is this?
We are either witness to woeful ignorance or a species of wilful blindness which can never serve our collective interests. The worst type of ignorance being displayed by those who do not know that they do not know. I tell you.
Given what is happening with State land in our country, this matter deserves our sternest scrutiny, so next week I will delve deeper.
This article is about the Las Alturas Enquiry into the collapse of two new Morvant apartment buildings erected by China Jiangsu International Corporation (CJIC) for the Housing Development Corporation (HDC). This Enquiry seems a politically-motivated one into a serious failure of professional practice which could have cost human lives. It is only in its opening stages, but it is already clear to me that this episode is one which contains serious lessons for our country in terms of the role of Enquiries; the role of the Chinese contractors; the culture of non-enforcement which we practice and of course, the impact of targets and political objectives on proper process. In the case of Las Alturas this is a large-scale multiple-housing project constructed on a former quarry-site on the Lady Young Road, just south of the lookout. Two apartment buildings which were completed in late 2010 were eventually declared uninhabitable due to severe cracking and the proposed demolition of those structures was announced at the end of May 2012. Each building comprised 24 three-bedroom/two-bathroom apartments, with the total cost of those buildings stated by HDC to be in the $29M range. The buildings were erected by CJIC on the design/build basis which usually places all responsibility for soil investigation, design and construction onto the contractor.
The role of Enquiries
The JCC offered to work with HDC in determining the causes of this serious failure and that offer was accepted, but our joint exercise did not last very long. The Commission of Enquiry was announced in September 2014 by the Prime Minister and despite the serious nature of the failure at this project, it seemed to suggest an attempt to discredit the Leader of the Opposition, Dr Keith Rowley, who was Minister of Housing between 2003-2007. I still feel that it was a poor choice of issue to investigate, given the burning questions at Invader’s Bay, the Beetham Water Recycling Project, UWI Debe and EFCL, to name just a few. The Terms of Reference of the Enquiry were published in the Gazette of 3 December 2014 and a five-month period was stipulated for its Report to be made to the President.The Enquiry, which is chaired by retired Justice of Appeal Mustapha Ibrahim, is to examine the causes of the structural failure of two blocks of apartments built in 2008-2010 for the HDC by CJIC. The other two Commissioners are eminent Structural Engineers, Dr. Myron Chin and Anthony Farrell. We have also seen reports of the contractor, CJIC, declining to appear at the Enquiry. I consider that refusal to be deplorable and a real sign that serious penalties need to be attached to that course of action. As it is, the fines for non-attendance are nominal, so people can refuse on a whim, since there are few prosecutions for that.
The role of the Chinese contractors
The really stunning revelation here is that the State was aware, since 2011, that these two buildings at Las Alturas had to be demolished. Despite this, CJIC was able, from early 2012 onwards, to compete for and secure the $500M+ contract for UWI’s Debe campus. The JCC protested at the poor process used in procuring that large-scale project. UWI Principal Professor Clement Sankat was advised that in view of the poor performance by CJIC in local State projects – including UTT Tamana, ETeck Wallerfield and various EFCL – no proper evaluation could proceed to recommend that further contracts be granted to that firm. Given that the normal pre-qualification process requires prospective bidders to identify claims, litigations or disputed matters, one can only wonder how CJIC was able to prevail in that project.
Culture of non-enforcement
One of the seldom-discussed findings of the Uff Enquiry was as to the lack of any culture of enforcement of contracts in the State construction sector, as set out in the sidebar. So, I was both thrilled and intrigued by the headline in this newspaper on Friday 6 March 2015 ‘HDC to sue Chinese contractor‘. The role and reputation of Chinese contractors in the local market have long been a bone of contention for the JCC. That statement was made in opening remarks by Vincent Nelson QC, who is the lead Counsel for HDC at this Enquiry –
“…The Housing Development Corporation (HDC) is moving to pursue legal action against China Jiangsu International Corporation (CJIC), the company contracted to construct the two towers at Las Alturas, Morvant, which subsequently had to be demolished because of structural damage resulting from land slippage. Attorney for the HDC, Vincent Nelson, was adamant about this as he delivered his opening statement at the Commission of Enquiry into the housing project yesterday at the Caribbean Court of Justice in Port of Spain…”
The culture of non-enforcement, considered with the chiefs at HDC (who transferred there after abruptly departing Caribbean Airlines), together with the special influence seemingly enjoyed by the Chinese contractors, all make me very sceptical as to whether a real and forceful lawsuit will ever emerge against CJIC.
The role of targets
Finally, one needs to consider the detrimental role of politically-motivated overambitious targets. The 2002 National Housing Policy set an unforgettable target of 100,000 new homes to be built in 10 years, which translates to an annual average of 10,000, which means a literally impossible 200 homes per week. Those are the facts behind the bizarre ‘numbers game’ which in turn likely had a decisive influence on the decision-makers at UDECOTT, HDC and of course the Housing Ministry. It would be useful, in this season of 100 houses a week and a billion dollars in land each year being promised, to reconsider the role of over-ambitious targets in distorting proper process.
SIDEBAR: The Outline Timeline
This is only an outline, but it is instructive –
December 2002 – UDECOTT acquires the Las Alturas site.
2003 – Initial layout prepared for a total of 120 apartments, which was revised later that year to 292 units given the Town & Country Planning Division’s advice on the allowable number of units.
December 2003 – CJIC wins tender to design & build 297 apartments.
November 2004 – Start on Site.
2005/2006 – Soil problems identified on part of the site.
July 2005 – UDECOTT rejects project redesigns for lower units numbers of 142 and 167 apartments. Those redesigns were intended to avoid the unsuitable soils.
July 2006 – the project is transferred from UDECOTT to HDC.
2008-2010 – Blocks H & I are built onto the areas reported to be unsuitable.
2011 – Blocks H & I are recommended to be demolished due to severe cracking.
We have also seen reports that both UDECOTT and the HDC were resistant to any reduction in unit numbers on the site.
“Holding to account 29.21. …A recurrent feature of practice in the construction industry in Trinidad & Tobago is the extent to which rights and obligations prescribed by the Contract are or are not enforced. A simple example, discussed above, is the apparently mutual ignoring of contract provisions…”
At page 271 –
“…29.26. Underlying all the foregoing, however, is the question of enforcement of contractual rights and duties. What has been observed by the Commissioners is a culture of non-enforcement of rights, which appears to operate mutually, for example, by contractors not pressing for payment of outstanding sums while the employer does not enforce payment of liquidated damages. Whatever the explanation, the non-enforcement of contractual rights available to Government is a serious dereliction of duty on the part of those charged with protecting public funds. Equally, the non-pursuit of sums properly owed to commercial companies is a dereliction on the part of the directors of that company…”
The key point disclosed here is that contractual rights are seldom enforced in State contracts. A move to such a regular practice would require a major shift in our country’s governance culture.
I call this the Season of Reflection, being the two-month period starting with Emancipation Day on 1 August, centred by our nation’s Independence on 31 August and closing with Republic Day on 24 September. To me that is a compelling sequence in which those days of national importance are celebrated. It is a good time for reconsidering the role Conscious Citizens should play in the process of National Development.
Our country is relatively tiny, at 5,128 square kilometres, and its population density is relatively high, at an estimated 239 persons per square kilometre. I say estimated, since those figures effectively yield a population of 1.225 million and it seems to me that our population is far higher, but that aspect is for another column. What concerns me here are the implications of our high population density in terms of our physical development.
Given that over 60% of our land is effectively alienated by physical factors such as its being swampy or heavily forested, there are in fact only very limited areas readily available for development. Place that fact alongside the concentrations of economic activity/population and the growing environmental awareness and there is cause for a pause.
The recent past has been a series of large-scale, impactful developments carried out in our small country with little or no regard for citizens’ input or review. The established pattern is the creation of big development plans, behind closed doors and in secret, to be announced at the most opportune moment for publicity purposes. The Citizen, who ought to be at the centre of our Republic’s development, would seem to have been ‘re-purposed’ into a mere audience. The factors I have outlined above mean that the present way of proceeding is no longer going to be acceptable.
The most glaring example of this obstinate and wasteful impulse to develop, at literally any cost, is the large-scale redevelopment of POS by the previous administration. The Patrick Manning/UDECOTT/Calder Hart axis was responsible for rebuilding a huge proportion of our capital with no consultation whatsoever. What is worse and as confirmed at Calder Hart’s cross-examination at the Uff Enquiry, every single project was commercially unfeasible. According to Hart, only UDECOTT’s so-called flagship project, the International Waterfront Project, was subject to a feasibility test, which was revealed, under oath, to have been entirely rigged. Bogus.
User groups and other interest groups should be properly consulted on decisions regarding public building projects, to ensure that relevant views can be expressed at the appropriate time and taken into account before decisions are made. (Emphasis mine.)
I maintain my view that UDECOTT has not been adhering to that standard, and despite its many statements to the contrary. That failure or refusal by UDECOTT was the issue settled in ‘The Uff Bluff’, published in this space on 8 January 2014, so that Uff recommendation is an important standard to which we should aspire in these areas.
In relation to the controversial Invader’s Bay project, a serious aspect of improper official conduct has been the failure or refusal of the Ministry of Planning & Sustainable Development to host even one Public Consultation. This is unacceptable since there are Public Consultations on King’s Wharf redevelopment proposals in San Fernando; the South-West Peninsula Growth Pole; the proposals for City status for Chaguanas and so many other issues. There is no justification for this blatant attempt to develop Invader’s Bay without public input.
Next we come to the sharpest example of them all, the actions of the Highway Reroute Movement (HRM) on the controversial Debe-Mon Desir segment of the Point Fortin Highway. That issue came to the fore during the November 2012 hunger strike by the HRM’s leader, Dr. Wayne Kublalsingh, intended to force a State review of the implications of that segment of highway. That hunger strike was only broken by both sides’ acceptance of the Civil Society proposal for an independent review of the issues in contention. That proposal was made by the JCC, the T&T Transparency Institute, Working Women for Social Progress and the Federation of Independent Trades Unions and NGOs (FITUN). The review was conducted over a 60-day period by a 19-member team under the Chairmanship of then Independent Senator Dr. James Armstrong and it is all here.
After a prolonged series of legal battles on the point, the Armstrong Report was finally accepted into evidence in the High Court case between the HRM and National Infrastructure Development Company Ltd. (NIDCO) on 10 July 2014. The HRM has now lost in the Appeal Court in its attempt to have the Court order a stop to work on the disputed segment and it is not clear whether or not the Appeal Court decision will be appealed via the Privy Council.
The reality is that the Armstrong Report is the first time a major State-sponsored development has been the subject of an independent review at the instigation of private citizens, with the State making a substantial financial contribution to the costs. The entire HRM episode represents a notable high-water-mark in this struggle for proper citizens’ participation in national development.
As in so many other episodes, the entire HRM issue has become pointedly political, with pronounced positions being taken. Some people have taken the position that the HRM’s concerns were definitely out-of-place, given the traffic woes suffered by people living in that South-Western part of Trinidad. Those people were anxious to have the political administration and the Courts dismiss the Armstrong Report.
Just consider the position of Dr. Keith Rowley, who stated in March 2014 his intention to implement the ‘Rapid Rail Project’ if he is elected Prime Minister. Rapid Rail was one of the heavily-criticised projects which had been proposed by the previous administration and to his credit, Rowley has said that proper feasibility tests would be carried out before proceeding with this, the largest single project ever proposed in our nation, at an estimated cost in the region of $20 Billion.
The important point here is that we need to keep sight of the important lesson of the HRM episode, that an independent, State-funded review of large-scale development projects is in our collective best interest. The HRM episode is still ‘in play’, but a critical aspect of that main lesson is that the review must be carried out before decisions are taken, as recommended by Uff.
The people must have their say, decisions must be fact-based and the public servants must do just that, serve the public. That has to be our goal.
R v Secretary of State for Social Services, ex parte Association of Metropolitan Authorities  1 All ER 164, where Webster J stated- “…in any context the essence of consultation is the communication of a genuine invitation to give advice and a genuine consideration of that advice…it must go without saying that to achieve consultation sufficient information must be supplied by the consulting to the consulted party to enable it to tender helpful advice. Sufficient time must be given by the consulting to the consulted party to enable it to do that, and sufficient time must be available for such advice to be considered by the consulting party…”
Also, the case of R v North and East Devon Health Authority, ex parte Coughlan  3 All ER 850, where Lord Woolf stated: “It is common ground that, whether or not consultation of interested parties and the public is a legal requirement, if it is embarked upon it must be carried out properly. To be proper, consultation must be undertaken at a time when proposals are still at a formative stage; it must include sufficient reasons for particular proposals to allow those consulted to give intelligent consideration and an intelligent response; adequate time must be given for this purpose; and the product of consultation must be conscientiously taken into account when the ultimate decision is taken…”
At para 71-
In Fishermen and Friends of the Sea v The Environment Management Authority and Another  2 LRC 384, Lord Walker at para 28, emphasizing the need for public consultations, indicated that –
“Public consultation and involvement in decisions on environmental issues are matters of high importance in a democracy.”
After a flurry of attempted explanations from the Minister of Planning & Sustainable Development, Dr. Bhoe Tewarie, as to the real meaning of the High Court’s 14 July ruling on the Invader’s Bay matter, the State has now appealed that ruling and applied for expedited hearing of the matter while having the judgment stayed.
What that means is that the State is asking the Court to agree an extension of the Stay of Execution until the appeal is decided, so that the requested information could be withheld while the case is being heard. Presumably, the State has asked for a speedy hearing so as to avoid any impression of them encouraging needless delay in this matter of high public concern.
This article will focus on the three critical findings in the judgment. I will be examining Dr. Tewarie’s statement to Parliament on Friday 18 July, alongside the facts and the actual High Court ruling.
Legal Professional Privilege
The very first point to be made in relation to this is that the reason given by the State for refusing the JCC’s request for this information was not originally ‘legal professional privilege’.
That reason for refusal was only advanced after the litigation started, literally arising out of the very briefcase of the State’s attorney, on his feet before Justice Seepersad on 4 December 2012.
We contested the State’s late introduction of these new reasons for refusal, but the Court ruled at para 37 –
The Court…is of the view that the Defendant is entitled to rely upon additional reasons with respect to the refusal to disclose the said information…
The question of whether the legal opinions are privileged was ruled-upon by Justice Seepersad –
It cannot be disputed that the said information requested, is information that would ordinarily attract legal professional privilege…
So that issue is not in dispute, in the Court’s mind at least. I continue to hold the view that it is highly-questionable to easily accept this notion of client confidentiality, given that the State ought to be acting on our common behalf.
In fact, no evidence was tendered nor was any real case made by the State as to the difficulties which would result from publishing the requested information. None. It is only now, with a ruling in the JCC’s favour, that we are getting these positions being advanced.
For the record, the JCC’s original request under the Freedom of Information Act (FoIA) was for the legal advices and the letters of instruction.
Consider this, from Dr. Tewarie’s opening statement –
The very first point that I wish to make with regard to the high court ruling is that there is no issue of disclosure here. There is no issue of failing to disclose or of wanting to withhold disclosures. The Government is not seeking to prevent disclosure of any matter nor is the Government fearful of making any disclosure of fact.
The only issue we are contesting is whether the advice of an Attorney to his/her client, which is generally regarded as privileged information, is subject to the jurisdiction of the Freedom of Information Act or whether, since it is a privileged exchange of information between Attorney and Client, it is exempt from the Act…”
If that is truly the case, with the State’s only concern being the possible adverse impact of releasing the legal advices, the question has to be – ‘Why not publish the letters of instruction now?’
The answer to (c); the publication of the request for proposals was not the subject of nor required to be in conformity with the Central Tenders Board Act. Advice to this effect was received from the Legal Unit of the Ministry of Planning and the Economy, and subsequently from the Ministry of the Attorney General…
The point being advanced by the JCC was that a statement like that one, which purports to publicly disclose the very essence of the advice, has the effect of extinguishing the State’s right to suppress the document as being exempted.
The Court ruled clearly on this –
The gist and nature of the legal advice was in fact revealed when the Minister’s response was made and this amounted to conduct that is inconsistent with the stance that the said legal advice is exempt from being disclosed under the Act by virtue of section 29(1)…
So, the High Court found that Dr. Tewarie’s statement to the Senate neutralized the State’s ‘legal professional privilege’. That is an important aspect of this ruling, given the frequency with which legal opinions and names are brandished by our leaders, always when convenient, of course.
The Public Interest Test
This ruling is significant in that Justice Seepersad weighed the existing ‘legal professional privilege’ – making a clear ruling on that at para 41 – against the ‘Public Interest Test’ set out in S.35 of the FoIA.
At one point it was widely reported that Dr. Tewarie was insisting that the ruling had nothing to do with transparency, but was only on the narrow issue of legal professional privilege.
The substance of Justice Seepersad’s ruling was at paras 85 & 86 –
The nature of the project in this case and the process adopted by the Defendant to pursue the Request for Proposals process without regard to the provisions of the Central Tenders Board act, requires disclosure of all the relevant information that was considered before the said decision was taken and the refusal to provide the requested information can create a perception that there may have been misfeasance in the process and any such perception can result in the loss of public confidence. Every effort therefore ought to be made to avoid such a circumstance and if there is a valid and legally sound rationale for the adoption of the Request for Proposals process, then it must be in the public interest to disclose it and the rationale behind the process adopted ought not to be cloaked by a veil of secrecy.
The public interest in having access to the requested information therefore is far more substantial than the Defendant’s interest in attempting to maintain any perceived confidentiality in relation to the said information…”
The real point here is that Justice Seepersad has carried out the Public Interest Test, as mandated at S.35 of the FoIA and ignored by the State in this matter, to find that the ‘legal professional privilege’ is subordinate to the Public Interest in this case, given all the evidence submitted to the Court.
The entire process possesses all the ingredients for corruption, I maintain that view.
Dr. Tewarie has repeatedly claimed that the process was transparent because he disclosed the assessment rules for the Invader’s Bay development at the T&T Contractors’ Association Dinner on Saturday 5 November 2011. That assertion is perfectly tautological, in that it is entirely true that the rules were revealed for the first time on that occasion, but it does not explain anything of substance. The decisive fact is that the closing-date for the Invader’s Bay RFP process was 4 October 2011, a full month before the rules were disclosed. That fact alone renders the entire process voidable and illegal.
What is more, we have to consider the widely-advertised public consultations on the redevelopment of King’s Wharf in San Fernando; the South-Western Peninsula development; the issue of ‘City-status’ for Chaguanas; Constitutional Reform and of course, the latest one, the Civil Society Board. The glaring question has to be – ‘When is the State hosting the first in its series of Public Consultations on the Invader’s Bay development?’
Finally, will this development process continue, while the legal arguments continue?
It seems to me that we are entering a sustained and hard-fought Information War, global in extent, but with local flavour. The main features of this are the attempted redefinition of Privacy as a defunct notion, right alongside the State’s duty to know all about us, but tell us as little as possible of their own operations. That is the name of the game, so these issues are going to be challenged strongly as we go forward.
The High Court ruled on 14 July 2014 that the Minister of Planning & Sustainable Development must provide the legal advice which was said to have justified the development process at Invader’s Bay. This case was brought by the JCC after the Ministry refused to publish the legal advice obtained in response to our challenge that the Invader’s Bay development process was in breach of the Central Tenders’ Board Act. Given the repeated statements that the legal opinions supported the State’s actions in relation to the CTB Act, the obvious question is ‘Why the secrecy and refusal to publish those opinions?‘
The JCC requested the legal opinions and the letters of instructions under the Freedom of Information Act and the judge applied the ‘Public Interest Test’ in deciding that the public right to that information eclipsed the accepted point as to the existence of ‘legal professional privilege’. There have been many comments on what has been described as a landmark ruling and it appears that the question of just what is an official secret is once again up for discussion.
We are now being told that the right of the client to maintain the confidentiality of legal advice is now under threat, so the State is reportedly considering an appeal of that High Court ruling. Continue reading “Public Secrets?”→
The recent announcements as to the upcoming completion of the ‘Government Campus Plaza’ offices in POS and the relocation of significant State agencies to central Trinidad are charged with meaning for the office sector. The previous article on this topic examined the huge quantity of State-owned incomplete office buildings in greater Port-of-Spain, the impact of that on the incomplete private office projects and the role of the ongoing process of decentralisation. For the purposes of this discussion, greater POS is the area bounded by the sea to the South, the WestShore Clinic to the West, the Queen’s Park Savannah to the North and the Lady Young Road to the East. This is going to be a closer look at those aspects, so that we might discern how this issue is going to be settled. There are interlocking issues which have created the Elephant in the Room –
the incomplete State offices, which will impact on the private office rental market as they are completed;
the existing offices leased by the State, which need to be re-examined;
the trend towards decentralisation, with its own profound implications.
To understand the issue requires the reconciliation of these large, seemingly-conflicting, elements. The first is of course, the ‘sunk capital’ in terms of the State-owned, incomplete office buildings in POS. The second is the existing leases the State holds from landlords of office space in POS. The third element is the ongoing programme to relocate significant Ministries and State Agencies out of POS, generally to Central Trinidad. I am also of the view that we need to enquire into the progress of the ongoing decentralisation process. The details we need are – Which Ministries/State Agencies are to be relocated from POS? What are the preferred locations for these offices? What progress has been made on those relocations? Has land been purchased/leased? Has State land been allocated? Has a building been identified? If a new building is to be constructed, what progress has been made in terms of project scoping, design, tendering and construction? When are these new non-POS State offices anticipated to be occupied? The key enquiries in this matter would be –
We need to know exactly what offices the State is leasing and that info would include – the Ministry or State Agency in occupation; the addresses of the buildings; the size of the office space and its facilities; the number of carparking spaces; the rent paid; the service charge paid; the parties; the extent of the lease/tenancy agreement (when did the lease start and for how long was it agreed). Apart from the info being presented in that type of detail for each rental, the overall picture will be instructive, as it will show the amount of space occupied and at what cost. That information will in turn disclose the average (mean) rent per square foot paid. Without details on the present arrangements for State offices, we cannot properly judge the alternatives.
An additional enquiry has to be raised on the particular instances where the State is paying a rent for property which remains unoccupied. The same details listed above need to be sought in those cases, but in addition, we need to be told why those properties are still unused. A great concern was raised recently on #One Alexandra, which concern was mostly justified in my opinion, but the fact is that it is not the only one. The public needs to be told the full extent to which the State pays rent for unoccupied offices.
Ministry of Tertiary Education and Skills Training and some of its portfolio agencies are to be relocated to an ‘integrated administrative complex‘ 15-acre site north of the Divali Nagar on the eastern side of the Uriah Butler Highway. No size was given for the complex and construction was noted to have started in April 2014.
Ministry of Community Development is to be relocated to new offices at a 10-acre site near the Divali Nagar on the eastern side of the Uriah Butler Highway. No size or start-date was given for these offices.
Ministry of Food Production is considering relocating out of its long-established offices at St. Clair Circle, at the northern end of the Magnificent Seven strip, to either Chaguanas or Farm Road in Curepe. That decision is pending.
In the last week we have been told that the headquarters of COSTAATT, which is a part of UTT, is to be relocated from Melville Lane in POS to a location near the new Chaguanas Administrative Complex. The main building occupied by COSTAATT is said to comprise 86,000sf, which is rented for $13.00psf – the total annual rent is $13.473M. We were also told that COSTAATT’s POS operations require further rental space to the annual amount of $1.64M. The new building is costing $168M inclusive of VAT, but no details were given as to its size or proposed completion date. There are other relevant questions as to the convenience of the new location for students and faculty, but the fact that Chaguanas remains the fastest-expanding town in the country for the past 20 years is a part of that issue.
As per the previous article in this series, the State has built, but not completed, a total of 1,329,000sf of offices in POS. According to Minister of Finance & the Economy, Larry Howai, on 5 May 2014 – “Cabinet has approved a sum of approximately $1.5 billion to complete the Government Campus buildings in downtown Port-of-Spain,” said Howai. Once this is completed in the next 12 months I expect that the OSH problems being complained of at the BIR will be a thing of the past.”
That Cabinet approval equates to $1,129 per sq ft, which seems high unless one considers that a significant part of that money is stated to be for remedial works and not strictly for fittings and finishes. The impending completion of those offices will be a sea-change in the fortunes of POS, since their occupation will force the landlords who were renting to the State to seek other tenants. In my estimation at least half the rented offices in the capital are occupied by the State, so that office market is largely driven by the public sector.
I have heard many colleagues attempting to rationalise the coming change by reference to OSHA requirements which require more office space allocated to each worker and therefore those requirements would ease the impact of the impending new offices. Another rationalisation I have heard is the one about how some landlords would be leaving their places locked-up so they will not actually be offering those on the market, so there will be no real effect and so on.
All of those are coping mechanisms for dealing with the reality of change on an epic scale. This is the Manning Plan, in full effect. To quote the CEO of leading private sector office developer, RGM, Gerard Darcy, in a May 2013 interview – “…The Government Campus is still the 800-pound gorilla in the room because it is too large to ignore…”. I expect a significant adjustment in office rent levels in POS in the medium term. The financial sector, especially those who have expanded their loan portfolios on the basis of the property boom, will need to take careful stock of the extent to which these rapidly-approaching changes imply severely impaired assets.
The huge potential supply of State-built, unfinished office buildings in our capital is the ‘Elephant in the Room‘. There are potent elements at play here in terms of the viability of the long-term and large-scale investments which have been made in Port-of-Spain by private and public capital.
At this point, taking account of offices over 25,000 sf in size, there are over 1,500,000 sf of incomplete offices in our capital. This article will examine the likely outcomes for our capital and those investors as the various projects are completed.
The State has 1,329,000 sf of incomplete offices in POS and the private sector has 224,800 sf. The State has virtually seven times more incomplete offices than the private sector and that is the ‘Elephant in the Room’. This chart portrays the reality – the details are set out in the table below.
The legacy of the POS offices built during the previous administration is a matter which deserves serious consideration. The sheer volume of offices built by the State during the previous administration is sobering – 2.3M sf. Given that Nicholas Tower – that elliptical, blue tower on Independence Square – contains 100,000 sf, it means that the State built the equivalent of ‘23 Nicholas Towers‘ in our capital in that period of rapid development.
We also know that there was no attempt at public consultation or feasibility studies by the State or its agent, UDECOTT. At the Uff Enquiry, the Executive Chairman of UDECOTT, Calder Hart, admitted that a feasibility study had been done for only one of those projects. That project is the International Waterfront Centre (IWC), which comprises the two office towers of 890,000 sf, the Hyatt Hotel, New Breakfast Shed and car-parking/outdoor facilities. Hart also admitted, under oath, that the value of the land had been omitted from the viability study for the IWC, so it was a bogus exercise. The break-even rent is the amount which must be earned by a project to repay the cost of land, construction, professional fees and finance. The IWC, repeatedly boasted-of as UDECOTT’s flagship project, is not a viable project, since its break-even rent exceeds the highest rents now earned by A-class offices in POS.
The Parliament has now relocated there during the Red House repairs and renovations. A number of other Ministries and Public Bodies have also started to occupy those offices.
The Office of the Prime Minister is now in the new 75,000 sf building on St. Clair Avenue, opposite to QRC grounds.
The rationale advanced by the Manning administration for that surge in office construction in our capital is that it would free the State from the payment of large monthly rents to private landlords. Although I made several requests, I was never able to get the actual figures for the rents paid by the State in POS. My own familiarity with that market allowed me to estimate the average rent at that time (2007-2009) at about $8-9 per sf. The break-even rents of those new buildings exceeded $25 per sf, so the costs of those office projects would never be recovered. I have read reports that the estimated cost of the Government Campus Plaza, which is the largest element in the POS offices, was recently stated by UDECOTT’s Chairman, Jearlean John, to be of the order of $3.2 Billion.
We can reasonably estimate that the rate of rents paid by the State for office buildings has now increased since 2007, in terms of dollars paid per sf.
The completion of those State-owned office buildings is therefore a matter of the first importance, given the high carrying-costs. There is also the significant issue of the high opportunity cost of the State continuing to occupy rented offices alongside virtually-completed offices.
Against this background, we are now seeing an active policy of decentralisation of POS offices by the present administration, with several Ministries and Public Bodies being relocated to south and central Trinidad. The decentralisation discussion is one which has been going on since the 1970s and it is an important issue to be pursued, in my opinion. That said, one has to wonder how is the decentralisation to be rationalised, given the existence of this over-supply of State-owned offices in our capital. That is a serious question which needs to be discussed if we are to achieve any proper resolution.
The completion of the State-owned offices is under the management of UDECOTT, the original developers, with recent disclosures from the Finance Minister of plans to sell the buildings and lease them back as a means of financing their completion. The terms of any such proposals would have to be carefully considered to avoid the mistakes and fraudulent behaviour of the past.
The completion and occupation of the State-owned office buildings in POS will pose an existential challenge to those private investors who have built offices for rent. The rental levels for offices in POS are likely to decline significantly, which will impact on the revenues of those investors.