The Tribune

By NEIL HARTNELL

Tribune Business Editor

nhartnell@tribunemedia.net

The Bahamas’ economic growth will continue to “flounder” unless it passes a State Sectors Act to combat recently-disclosed public spending controversies, a governance reformer warned yesterday.

Robert Myers, a principal with the Organisation for Responsible Governance (ORG), told Tribune Business that “a massive shift” in the Bahamas’ governance culture, and the way it does business, is required to restore private sector and investor confidence.

He described multi-million dollar allegations of waste, cronyism and mismanagement under the former Christie administration as “an absolute joke and embarrassing”, given that such behaviour was a significant reason why the Bahamas is in its current fiscal crisis.

“What one can say without a doubt is that there was a tremendous lack of responsibility on the part of the previous administration with regard to spending that would keep the country from further downgrades and fiscal problems. That I can say quite comfortably,” Mr Myers told this newspaper, declining to comment on each individual controversy.

“It sickens you across the board. That lack of responsibility is completely unacceptable. Therein lies the necessity, the screaming necessity, for a State Sectors Act.”

Mr Myers said such legislation would both make the civil service more accountable for its action and prevent “the political interference” that has undermined the proper functioning of almost every government ministry, department and agency.

He explained that a State Sectors Act would separate the political leadership from the civil service in a manner similar to the private sector, where company Boards and management have clearly defined boundaries and responsibilities.

The ORG principal said that in the private sector, “the Board doesn’t meddle in the operations of the company” - unlike in many Bahamian government ministries and departments.

“A State Sectors Act provides accountability at the civil service level,” Mr Myers said. “It creates accountability, holds their feet to the fire, and they’re held accountable for productivity and integrity.

“That is exactly why New Zealand passed the State Sectors Act, and a number of other Acts, to remove this political interference that has absolutely undermined the [Bahamian] public service and ministries.

“The State Sectors Act is to stop this nonsense happening again. It we don’t start getting ahead of these problems, we’re as dumb as the people committing this irresponsible behaviour.”

The 2017-2018 Budget debate has seen the newly-elected Minnis administration cite numerous examples of alleged cronyism, nepotism and mismanagement in the awarding of government contracts, which they claim has cost taxpayers millions of dollars and exacerbated the Bahamas’ fiscal woes.

Desmond Bannister, minister of works, revealed how the $6.5 million construction contract for the new Lowe Sound Primary School was given to three “inexperienced” persons, with the Christie administration ignoring warnings from Ministry of Works officials that this endangered the project’s success.

Mr Bannister said one had never been involved in construction, while the other two were a plumber and someone who had only worked on much smaller construction projects.

He added that all three, whom he described as Progressive Liberal Party (PLP) supporters, had initially submitted individual bids that were all rejected. However, the Christie administration told them to work together as a team and awarded the trio a contract, under the supervision of a contractor “who had not finished the last big job he received from the Government”.

Mr Myers said this epitomised why the Bahamas needed a State Sectors Act, describing the Lowe Sound situation as “obscene”.

He added: “What we’ve got to stop is ministers who don’t necessarily have experience in any particular area for which they provide oversight from meddling.

“What are we hiring people in the Ministry to do due diligence for if they’re going to be ignored? Send them home, or let them do their job and hold them accountable.”

Mr Myers told Tribune Business that the contract allegations also highlighted the need for the Bahamas to introduce a Whistleblowers Act, which would protect civil servants who discloses wrongdoing from retribution.

“What’s really disgusting, and at the public’s expense, is that public servants watched these acts and did not say anything until it was too late,” he added. “In my mind, they’re complicit. You serve the public; you must say something. That’s what a State Sectors Act must provide. You must make the public sector accountable, just like the private sector is accountable for certain things.”

Mr Bannister also highlighted wasteful, unnecessary spending on the Bahamas Agricultural and Marine Science Institute (BAMSI) construction, along with questionable contract awards on Grand Bahama.

He was followed by the Prime Minister, who said multi-million dollar ‘no bid’ contracts were awarded by Bahamas Power & Light (BPL) to a customs broker owned by the father of former education minister, Jerome Fitzgerald, and a firm where the PLP’s chairman emeritus, Errington ‘Minky’ Isaacs, was a director.

Mr Myers said the latter claims further exposed the need for the Minnis administration’s promised public procurement reforms, and “an open, fair and transparent bidding process that has no bias, nepotism, cronyism and corruption. We have to put these laws in place”.

The Public Treasury has consistently been used to reward supporters of whichever party is in government, but this ‘culture’ has prevented Bahamian taxpayers from receiving ‘value for money’ and led to immense wastage - in the hundreds of millions of dollars - going back almost five decades.

With the Bahamas stuck in a low growth, high unemployment trap, and with $300 million-plus annual fiscal deficits continuing to add to the $7 billion-plus national debt, the persistence of such practices now threatens to sink this country.

Mr Myers told Tribune Business that the public exposure of such practices was scaring bona fide investors away from the Bahamas, and areas such as energy reform “where we desperately need help because the former government made such a shambles of the bid process”.

Suggesting the failed tenders for BEC and the landfill were “an embarrassment”, he added: “When you get good bidders who have heard the horror stories, they’re going to say they’re not going to waste time with that.

“It’s an absolute joke and embarrassment. The best people are warned off.”

Mr Myers added of the Bahamas’ governance and accountability flaws: “That’s why we see GDP floundering. We can’t get GDP up because people have lost confidence in our ability to do things properly.

“If we want to succeed, it’s going to take everybody’s effort to change the culture and see that we actually walk the walk, not just talk the talk.”

He praised the Minnis administration for saying the right things during its first few weeks in office, but warned: “The proof will be in the pudding.”