Home »

Corruption, mismanagement and incompetence - Jamaica pays dearly

Shirley Williams

Sunday, December 10, 2006

This past week, the country shook from news that the dreaded disease, malaria, has re-emerged in Jamaica, the first since 1961 when it was eradicated. As far as I am aware, in this region, the only countries which have yet to eradicate malaria are:

Shirley Williams

. Belize;

. the Dominican Republic;

. Haiti; and

. Honduras.

It is alleged that the indexed case was a Haitian man who was presented at the Government's health clinic on Slipe Road. Reports are that he was diagnosed as having the disease, and as is required in law, reports were duly forwarded to all the relevant authorities.

This outbreak is an indictment on the Government for its failure to implement the necessary aggressive measures, such as widespread cleaning of drains and gullies, spraying and fogging of the environment and house-to-house checks in the areas concerned.

Malaria is transmitted by the female Anopheles mosquitoes, which are found not only in malaria endemic areas, but also in areas where malaria has been eradicated. The mosquitoes, which lay their eggs in water, live for one to two weeks (in nature, and up to one month in captivity) and will acquire the parasite if an infected host is bitten, then carry and transmit it to other persons. Critical it is, therefore, that our environment be kept free of the Anopheles and other disease-carrying insects and that the health status of our population be carefully monitored by the state.

As we boast of record levels of tourist arrivals, we are unaware of the basic required infrastructure for our population and visitors. Already, the Canadians have issued travel advisories for its citizens travelling to Kingston, and so to too did the Centres For Disease Control and Prevention in respect of citizens of the United States. We are grateful that these advisories have been tempered and so far ought not to create alarm amongst our visitors.

The reported cases of malaria, 43 as at Thursday morning, are located in the inner-city areas of Tivoli Gardens, Denham Town, Trench Town, Delacree Park and Sydenham (St Catherine). This newspaper carried a report on Tuesday of a resident in Tivoli Gardens complaining that there were pools of stagnant water and debris in the area, the breeding ground of large bodies of mosquitoes, as well as improper sanitary conditions and drainage. The resident reported: "We nuh have no toilet, we have to bathe out a door and doodoo inna di bush."

It is a shocking indictment that today, in the 21st century, there are residents of our country who have no access to sanitary conditions, not to mention a clean and healthy environment.

What does this have to do with corruption, mismanagement and incompetence?

Since the Government has failed to provide a clean and healthy environment, I assume it will excuse itself by declaring a lack of adequate resources. In examining just a few state entities, we will find that billions of dollars have been squandered and misappropriated since the year 2000. Had these funds been properly applied, no doubt there would have been more than adequate resources to ensure that basic necessities such as toilet facilities and clean drains and gullies were provided.

I start by looking at the agency charged with removing our garbage and keeping open spaces beautiful and clean - the National Solid Waste Management Authority (NSWMA).

To the best of my knowledge, the NSWMA has failed to table the required financial statements in Parliament. Last year, it tabled accounts for the following years:

. Metropolitan Parks & Markets (MPM) - 2000 & 2001

. Western Parks & Markets - 2000, 2001 & 2002

. North East Parks & Markets - 2003

. Southern Parks & Markets - 2000, 2001 & 2002.

IN 2001, MPM received an allocation of $497.8 million and spent $562.1 million, of which staff costs and administrative expenses amounted to $148.5 million. I am sure that I speak for us all when I say that this level of expenditure is not evident in the cleaning and beautification of those areas which fall under the umbrella of the MPM. Due to space constraints, I will not discuss the other entities, such as WPM, which also fall under the NSWMA and are inadequate in the services which they provide.

The incompetence and mismanagement of the NSWMA is compounded by the contractor-general's report in 2005 that there were breaches in the award of contracts amounting to $2 billion. In September of this year, the agency alleged that there was "mismanagement, and wanton spending of $20 million" and informed the country that it had called in the fraud squad.

Consider the likely savings, which no doubt would have accrued, had the agency adhered to Government's procedures and rules regarding the award of contracts. In the meantime, our cities, towns and villages are strewn with garbage, derelict buildings and wrecked cars on sidewalks, all resulting in a general state of decay. Have we not seen it, why have we not expressed outrage?

Ministry of Industry, Science & Technology with Energy

This so-called super ministry has racked up enormous losses since 2000.

In 2001, the minister with portfolio responsibility, Minister Phillip Paulwell, by Ministry Paper # 78, informed Parliament of losses to the INTECH fund, which was established with approximately $1.36 billion (as at December 2001), this being proceeds of $3.9 billion raised from the auction of cellular licences.

The records show that approximately $200 million was loaned from the INTECH fund to Netserv, one of the companies which came to Jamaica to establish a call centre. The rest is history - Netserv being placed in receivership and its assets subsequently 'sold' to Touch Point Centres International Jamaica Limited for $240 million with a deposit of $27 million, the balance payable over seven years at 4.25 per cent.

We all are aware that Touch Point was also subsequently placed in receivership. Its debt to the Government of Jamaica is US$3.25 million, approximately J$217.7 million, in addition to statutory payments of some J$28 million. Is there any truth to the allegations that the principals of Netserv and Touch Point are one and the same? The Government must answer.

Then, as if this was not enough, we were faced with the debacle of the Springfield Technology Park (formerly the Goodyear Factory) which was refurbished for an informatics centre at a cost of $138.3 million. Completed since October 2002, this building remains closed as the ministry claims that it is unable to source an investor willing to operate at the site. The security costs incurred up to March 2006 were $6.2 million. I estimate that on this project to date, the total un-recovered costs are close to $200 million.

In addition to these projects, the Opposition has questioned the management of the Universal Access Fund established last year with the levy of US$0.03 cents on incoming international calls (fixed lines) and US0.02 cents on cellular network. This fund is projected to gross J$1 billion annually. The entire operation of this Fund must be laid before the Parliament for its scrutiny.

In summary, these few mentioned projects under the Ministry of Industry have accumulated losses of more than half-a-billion dollars, which when compounded with the lack of residual value in respect of funds disbursed by the Intech Fund to several entities, amount to $1 billion - a conservative estimate.

Ministry of Housing, Transport, Water & Works

Here, I will look at only two projects - Highway 2000 and the North Coast Highway.

My research shows that under Highway 2000, Phase 1a (running from Caymanas to Sandy Bay, including the Causeway), has accumulated an overrun of US$101 million, or J$6.7 billion.

To compound this disaster, I am advised that the Government has used US$150 million of Petrocaribe funds to pay off the bank loans of the investor, which means that effectively the Government has fully funded the project. Why then does the investor have a 35-year concession to collect the toll fees?

On the North Coast Highway, Phase 1, which runs from MoBay to Negril, there is an estimated US$50 million overrun (J$3.35 billion) despite variations omitting several components of the highway and reductions in specifications.

In addition, it was reported in the press a few years ago that Phase 2, running from MoBay to Ocho Rios, accumulated J$2 billion in cost overruns.

In respect of these two projects alone, Highway 2000 and the North Coast Highway (Phases 1 & 2), I estimate cost overruns of over J$12 billion.

Inner City Housing Project

This project, which spans three years, has moved from J$3 billion to J$15 billion. While the number of units have increased from 3,000 to 5,000, in the absence of facts to contradict my assumption, I conclude that there is implicit an unquantified cost overrun.

Sandals Whitehouse

Here we have the former Prime Minister PJ Patterson giving his commitment to the Parliament of Jamaica that he had requested Mr Noel Hylton of the Port Authority to audit and report to Parliament on the operations of the Sandals Whitehouse Project which had a cost overrun of US$43 million (J$2.9 billion). Members of the Government have consistently denied that this report was sent to Mr Patterson.

I was astonished at the statement from the assistant general manager of NIBJ, Ms Denise Arana, to the PAC, confirming that findings of Mr Hylton's report were reportedly sent to Mr Patterson. I would be surprised if anyone in this country really believes that the report was never sent to the former prime minister.

I call upon the Opposition to ignore the diversionary tactics of censorship and denials as to whether or not the report was sent, and instead proceed to act on the contents of the report in an attempt to ensure that the full force of the law is brought to bear on all who violated government's rules and procedures.

Total cost

By simple addition, the few projects which were discussed here have accumulated in excess of J$15 billion in cost overruns.

While I cannot prove that the abuse, mismanagement and incompetence in the spending of government resources are corrupt acts, in the absence of relevant and appropriate justifications, I conclude that there is just cause to assume elements of corruption.

Consequent on the enormous waste of government funds, we are left in this country to suffer from an inadequate quality of life, whereby our health, security, education and state of surrounding environment are greatly compromised.

When and where will it all end?