The Tribune

By NATARIO McKENZIE

Tribune Business Reporter

nmckenzie@tribunemedia.net

THE Government was yesterday urged to implement procurement policies consistent with best international practices, a leading contractor charging that there was absolutely nothing in place to protect the public’s investment.

Stephen Wrinkle, president of Wrinkle Development Company, told Tribune Business that the recent furore over the Christie administration’s decision to award a $20 million contract for a construction project similar to one the chosen contractor had previously been terminated from, highlighted the need for the long-awaited Contractor’s Bill.

“We need a policy in place that’s consistent with international standards. This goes back to licensing of contractors and the passage of the Contractor’s Bill,” Mr Wrinkle said.

“Unless and until the Government passes a Contractor’s Bill that licenses, regulates and controls the construction industry, we will not have control over the tender process or the quality of the contractors performing the work.

“There is absolutely nothing in place to protect the public’s investment. We have it in the Contractor’s Bill. It makes provision to properly license, certify and regulate contractors, so that when projects of such a scope come up there is a list of qualified contractors that have proven that they are able to carry out the work to standards that are acceptable in the industry.”

The Christie administration has come under fire for awarding a contract to Holiday Industrial Builders International (HIB) to build a replica of the same project from which it was terminated in 2008.

HIB has been awarded a contract to construct a new building for the Ministry of National Security on John F Kennedy Drive. The building will be a replica of the office of the Attorney General, which was formerly proposed as the new Ministry of Tourism.

That structure, located west of the Ministry of Works building on John F Kennedy Drive, was originally contracted to HIB in 2004 for $5.9 million. However, the total cost of the project rocketed to just over $14 million by September 2008.

In documents tabled by former Prime Minister Hubert Ingraham in the House of Assembly, cost overruns were attributed to “defective work” and overpayments.

The building had been originally slated for the Bahamas Mortgage Corporation (BMC) and the Department of Housing head offices when the first contract for its construction was signed between the BMC and Lloyd Smith of HIB.

The BMC terminated its contract with HIB in November 2008, after which an independent review of the project by Construction Cost Engineering (CCE) was commissioned by the National Insurance Board (NIB).

HIBI’s legal counsel challenged the termination, and was successful in arbitrating the matter, according to attorney Kelphene Cunningham, who said the total sum of money paid to HIBI upon completion of arbitration was “just shy of $700,000”.

Ms Cunningham said the decision to cancel the previous contract awarded to HIB was “purely for political expediency”.

Mr Wrinkle, though, looking at the bigger picture, said past and present governments have continued to award contracts to contractors who have been known to fail, or not complete, their previous work.

“It’s a misuse of the people’s money and trust. A very carful analysis needs to be given to all government contracts. We ran into this same issue with the Ministry of Housing. We’re talking millions of dollars with no accountability,” Mr Wrinkle said.

“When you have contracts upwards of $20 million there really should be a pre-qualification process so that you know that they are capable of carrying out the work, and and then it should be bonded, where a performance bond is put up so that if the work is not up to standard, there are funds in escrow.

“Every precaution available should be to ensure successful conclusion to these projects. That would include pre-qualification, tender bond and performance bond at a minimum. We should be adhering to those policies to ensure that the taxpayer’s money is properly protected,” said Mr Wrinkle.

Michael Halkitis, minister of state for finance, has previously told the House of Assembly that planned public procurement reforms could save the Government up to 20 per cent in this area.

However, these reforms have yet to be enacted.