ALBERT BRANDFORD: Lashley in grotto hot seat
AN INVESTIGATION INTO two Government housing projects just released is an amazing and revealing document.
Part of its cachet is that it was submitted by the Auditor General to Parliament since September 15; what’s revealing is that neither the former nor current Minister of Housing seems willing to respond to its findings, including actions that “could not be substantiated in law”.
Barbadians have a shared desire to “own a piece of the rock”.
Those less fortunate look to Government to fulfil that aspiration at an affordable cost.
In the first term, Minister of Housing Michael Lashley brought an enthusiasm to the job that was noticeable. It was as though he was given a portfolio that meant much to the Democratic Labour Party and he used the media to his advantage.
In contrast, the Special Audit on the National Housing Corporation (NHC) high-rise apartments at the Grotto and Valery (the proper name), which covers his tenure, has been met with little or no enthusiasm by Government.
We’ve heard only a jejune response from the current minister that he does not agree with everything in the report but has not addressed key concerns.
Some of these were raised October 2014 by Mia Mottley at the Barbados Labour Party’s annual conference. In the Budget debate of 2015, she reported that $28 million from the Housing Credit Fund (HCF), managed by the Central Bank, was used to pay for the construction of apartments.
The audit says “the corporation sought funding of $23.58 million from the Government to settle liabilities on the Valerie (sic) project. In addition, the sum of $27.85 million was utilised from the Housing Credit Fund . . . to pay the contractor for the Grotto Project”.
These sums are substantially in excess of the original estimates of $15.799 million and $18 million for Valery and the Grotto, respectively.
A major issue is a legal opinion that the transfer of funds from the HCF “could not be substantiated in law”.
This finding is clear. The transfer would have required the involvement of the minister of finance and Cabinet. This charge alone demands a response.
However, there is increasing evidence of a climate of secrecy in the Stuart administration.
The NHC Board approved the projects AFTER they had been approved by Cabinet. The practice is for approval to be given FIRST by the Board and then submitted Cabinet.
Lashley must provide an explanation of the unusual and hurried line of approval.
Further, the audit found no evidence of a financial and/or technical review of the projects before submission to the Board. And given that Cabinet approved them before the Board, it follows that Cabinet approved them without the reviews as well.
The audit says “the management of the corporation did not go to public tender with these projects . . .”.
It means, therefore, that management was involved in the process. Yet, the Board did not approve the projects BEFORE the Cabinet. This means then that the Minister dealt directly with management, since a Board paper had to be written to Cabinet.
In addition, there was confusion over the number of units for the Grotto. According to the report, “the NHC Board approved the Grotto project for the construction of seventy-six (76) apartment units in three (3) blocks at $18 million”.
However, the developer was requested to build units in three blocks by March 2011, without the amount being stated, and by October 31, 2012, the developer had a proposal for 80 in five blocks with 84 parking spots for $27.85 million.
There was no indication of the basis for the increase, but in response, the NHC said its general manager “sought to bring to the attention of the Permanent Secretary the request for the increase”.
“This is against a background that the land was owned by the Crown and it was the Crown that would be financing the project. It would have been within the jurisdiction of the Ministry of Finance to assess the same.”
On the basis of over 3 000 applicants for rentals accommodation over a seven-year period, the cash-strapped NHC justified the two projects. The majority were from urban districts and earned less than $1 500 per month. So the objective was to build low income high-rises.
This meant the construction cost had to range between $125 000 and $195 000. The actual cost ranged from $300 000 to $450 000.
The execution of these projects was disgraceful at the technical, financial and political levels.
Albert Brandford is an independent political correspondent. Email: [email protected]