Millions of dollars in financial dealings by the state-owned National Housing Corporation
by Shawn Cumberbatch
Millions of dollars in financial dealings by the state-owned National Housing Corporation related to the awarding of contracts, functioning of its board, hiring of staff and receipt of government funding, are being called into question.
For the past year and a half the statutory corporation has been receiving $2.46 million from the Treasury each month to pay its workers and meet two loan repayments apparently without Parliament’s approval and minus the alternative loan agreement, something Auditor General Leigh Trotman today said, if true, was in breach of the Financial Management Act.
In January this year the NHC, which is technically insolvent and has been increasing staff since 2008, hired 47 workers for a debushing programme, but these individuals will soon be out of a job as that venture is nearing an end.
Additionally, uncertainty surrounds the alleged decision in which a contract to build new housing units at Exmouth in St. Michael was shifted from Rotherley Construction Inc. to a company associated with Preconco Limited, increasing the budgeted cost from $28 million to $33 million.
With the NHC not currently having a new board in place to govern its affairs, the role of the organisation’s immediate past Chairman, Anthony Wiltshire in contract matters is also now the subject of investigation.
These developments were made public today when senior NHC officials were summoned to give evidence before Parliament’s Public Accounts Committee today under the chairmanship of Leader of the Opposition Mia Mottley.
And at the end of the near hour-and-a-half long session in the Senate chamber, the Barbados Labour Party leader and other committee members were still searching for answers to several questions about the NHC’s financial management.
But Mottley also found herself fending off suggestions from Parliamentary Secretary in the Ministry of Economic Affairs, Senator Jepter Ince, one of Government’s representatives on the PAC, who objected to Mottley’s line of questioning and that of other BLP colleagues, Senators Dr. Jerome Walcott and Wilfred Abrahams, likening it to a commission of enquiry.
The NHC was represented at today’s meeting, which was broadcast to the public and in the presence of the media, by Ministry of Housing, Lands and Rural Development Permanent Secretary, Ronald Bascombe, General Manager Lynette Napoleon-Young, Financial Controller, Carolyn Barton and Chief Legal Officer, Henrietta Bourne-Forde.
After Barton revealed that her organisation was receiving $2.46 million each month from the Treasury and considered it a grant, Acting Accountant General Dane Coppin said his department considered it an advance to be repaid.
This prompted Mottley to ask Trotman for his opinion based on the law and he responded: “The Financial Management Act does allow the Government to advance sums to state enterprises, but there are certain conditions. They must have some agreement to determine the interest rate that will be paid and that type of thing for advances.
“The Ministry of Finance can instruct the Treasury to make advances, but the major point is that if it’s to a Government agency it should be by way of a loan agreement or debenture mortgage depending on the circumstances agreed to by Cabinet. In my opinion, any money that is advanced should have parliamentary approval,” he added.
None of the officials present could verify that there was either parliamentary approval or a loan agreement in place and the PAC head said there was a need for further investigation. As for the Exmouth contract, staff issues, and the absence of audited financial statements for the past five years, Mottley has requested the NHC officials to return to give further evidence on June 17 and to have Wiltshire also attend.
Ince was, however, concerned about the way the NHC representatives were questioned and noted Government supporting the agency predated the Democratic Labour Party Administration.
“We are here to look at some of the challenges that we have within the Auditor General’s report and [from] some of the questions being asked … we are beginning to sound like we have a commission of enquiry, … and I want to lodge my objection to it. If we want to we can ask questions, but I … think that we have gone off track when we start to get into things that I term … relevant but are irrelevant at this stage of our meetings and I want the minutes to reflect that I have objected to some of the line of questioning,” he said.
Mottley responded: “This is not an enquiry, this is a questioning pursuant to the Public Accounts Committee role, which is to find out how money is being spent, whether it is spent with parliamentary approval and whether it is spent in breach of any rules.” shawncumberbatch@barbadostoday.bb