The Tribune

By NEIL HARTNELL

Tribune Business Editor

nhartnell@tribunemedia.net

A union’s claim to have ‘right of first refusal’ over all Water & Sewerage Corporation outsourcing initiatives, including the multi-million dollar Windsor water plant contract, were yesterday branded as “nonsensical”.

Bradley Roberts, who was the Corporation’s chairman up until his recent resignation, dismissed assertions by its management union that the industrial agreement gave them ‘first call’ on any privatisation initiatives, saying no government would give away such “pre-emptive rights”.

However, Ednel Rolle, the management union’s president, asserted both orally and in writing to Tribune Business that terms in its latest contract with the Corporation gave it such rights.

And he made a thinly-veiled threat that the union would embark on either legal or industrial action should the Government proceed with plans to put the Windsor reverse osmosis plant contract out to public tender.

Mr Rolle’s assertions add a new twist to the uncertainty that has surrounded Windsor, one of the two plants responsible for New Providence’s water supply, ever since the contract with its current operator, BISX-listed Consolidated Water, came to an end in July.

Tribune Business previously revealed that at least three Bahamian groups, including the management union, knowing Consolidated Water’s contract was coming to an end, submitted unsolicited offers to take over the Windsor plant.

It represents an attractive top and bottom-line opportunity, the plant generating $1.8 million and $7.5 million in revenues during the three months ended March 31, 2013, and the year ended December 31, 2012, respectively for Consolidated Water.

However, those offers appear to have been rendered irrelevant by the decision by Deputy Prime Minister, Philip Davis, to instead put the Windsor contract out to a transparent, competitive public tender process.

Yet step forward Mr Rolle and the management union who, in a statement issued in response to Tribune Business’s revelation of their Windsor offer, said: “The union advises the public that it has a contract with the Government that provides the right to first refusal for all outsourcing or privatisation by the Water and Sewerage Corporation, of which the Windsor [plant] is included.

“Any attempt to violate this contract will result in serious action.”

When contacted by this newspaper, and asked why the union seemingly raised no objection to the Water & Sewerage Corporation awarding the Blue Hills plant contract to Consolidated Water, Mr Rolle said this happened before its latest contract was concluded.

He cited Article 29 as the relevant clause in the industrial agreement, adding: “If it comes down to that, it’s easy to prove.”

Tribune Business has been unable to obtain a copy of the industrial agreement to verify this, and Glen Laville, the Water & Sewerage Corporation’s general manager, was yesterday said to be out of office and did not return this newspaper’s call seeking comment.

Still, asked what would happen if the Government did not give the union ‘first crack’ at Windsor, Mr Rolle replied: “There are only two horses we have: Industrial [action] or legal

“Apparently the Deputy Prime Minister [Philip Davis] said he’s going out to bid. He’s going to have a problem, because he needs to come and talk to us. The Deputy Prime Minister has got to come and talk to us.”

Mr Rolle added that he was “90 per cent” confident that the management union would end up with the Windsor contract via its industrial agreement.

However, Mr Roberts yesterday dismissed the union’s claims, questioning why it would bother to submit an offer on Windsor if it was so sure of its ‘first refusal’ rights.

“It’s nonsensical,” the Progressive Liberal Party (PLP) chairman told Tribune Business, “because your newspaper reported they were one of the bidders. How can they bid and, when unsuccessful, turn around and say they have a right of first refusal?”

Although unable to confirm whether the management union’s contract contained what Mr Rolle asserted, Mr Roberts cast doubt on this, saying: “You don’t give no pre-emptive rights to anybody.

“I can’t say [if such a clause is in the agreement]. If such a thing as that is in there, it’s idiocy, nonsensical if it is.”

Tribune Business previously reported that EPS Consultants, the group headed by former chairman Don Demeritte, had initially been the frontrunner for the Windsor contract because it offered the lowest cost per 1,000 gallons of water.

This newspaper was told that EPS Consultants offered a $5.75 per 1,000 gallons price, better than the management union’s $5.87 per 1,000 gallons and PCP’s $5.78 per 1,000 gallons.

Its bid was also significantly better than Consolidated Water’s offer, which was $8.63 per 1,000 gallons.

While confirming the Water and Sewerage Managers Union’s (WSMU) offer, one source close to the situation confirmed it was “never taken seriously” because the union did not have the required capital and financial backing.

“There were several people who applied,” the source said. “The union did apply, but they didn’t have any money.

“They applied for applying’s sake. They didn’t have any money. They jumped in a political way, and it wasn’t a serious application.”

Mr Rolle, though, dismissed these assertions, telling Tribune Business the Corporation knew it had the necessary financial backing via a joint venture partner.

Declining to name the ‘partner’, Mr Rolle added: “They [the Corporation] wanted to make sure we have the technical know how and how we would reduce the cost of water, which we did.

“They know we have it [financing], so we’re not worried about it. We have a joint venture with a couple of people.”

The union president said it was trying to reduce Windsor’s water costs, and cited “errors we made in dealing with Consolidated in the first place. We made errors, let things slip, so we need to fix those”.

Referring to an unspecified “investigation” that the Water & Sewerage Corporation was conducting, Mr Rolle also described an “unfunded liability issue” that had to be addressed.

One source, familiar with the Water & Sewerage Corporation, told Tribune Business that the Government would not let the union “cherry pick” at the expense of Bahamian entrepreneurs who had put up risk capital.