The Tribune

• US again cites deficiencies, irregularities

• Anti-corruption Bills seen as ‘too intrusive’

• ORG chief: ‘Status quo’ is not acceptable

By NEIL HARTNELL

Tribune Business Editor

nhartnell@tribunemedia.net

Governance reformers yesterday warned The Bahamas “is not doing enough to change perceptions of corruption” as the US government again cited irregularities in this nation’s procurement and investment approvals process.

Matt Aubry, the Organisation for Responsible Governance’s (ORG) executive director, told Tribune Business it was “not good enough” for The Bahamas to believe its “status quo” ranking as less corrupt than many Caribbean competitors was sufficient at a time when “we cannot leave anything on the table economically” due to COVID-19’s devastating fall-out.

He spoke out after the US State Department released its annual investment climate statement on The Bahamas and all other nations. While the narrative and findings were little different or changed from previous reports, and no specific or named incidents of corruption were cited, it could also be argued that this nation is making little headway in addressing concerns regarding the level and presence of government graft.

“The government has laws to combat corruption among public officials, but they have been inconsistently applied,” the US Investment Climate report on The Bahamas said. “The law provides criminal penalties for corruption by public officials, and the government generally implemented the law effectively.

“However, there was limited enforcement of conflicts of interest related to government contracts and isolated reports of officials engaged in corrupt practices, including by accepting small-scale ‘bribes of convenience’. The political system is plagued by reports of corruption, including allegations of widespread patronage, the routine directing of contracts to political supporters, and favourable treatment for wealthy or politically connected individuals.”

Noting that there was no “independent verification” of the asset/wealth declarations submitted by MPs and Senators under the Public Disclosures Act, the report added that the process also lacked transparency because no summary of these declarations was made public.

“The campaign finance system remains largely unregulated, with few safeguards against quid pro quo donations, creating a vulnerability to corruption and foreign influence. The procurement process also remains susceptible to corruption, as it contains no requirement to engage in open public tenders, although the government routinely did so,” it said, noting that the Public Procurement Act is due to be implemented in early September.

“According to Transparency International’s 2020 Corruption Perceptions Index, The Bahamas ranked 30 out of 180 countries with a score of 63 out of 100. There are no protections for NGOs (non-governmental organisations) involved in investigating corruption. U.S firms have identified corruption as an obstacle to FDI and have reported perceived corruption in government procurement and in the FDI (foreign direct investment) approvals process.”

The US Investment Climate report on The Bahamas did cite one dispute between an American company and the Government, which appeared to be the row involving Aqua Design and its threat to cease operation of reverse osmosis plants in south Eleuthera, San Salvador and Inagua unless the state-owned Water & Sewerage Corporation paid the multi-million dollar sum that was owed to it.

“Throughout 2020, a US investor and a government utility company were engaged in a civil dispute concerning the termination of a contract, non-payment for services provided and ownership of equipment and materials. This case is ongoing,” the US report said. The dispute was subsequently said to have been resolved with a payment schedule and transition timeline for the Corporation to take over those plants agreed.

Many informed observers will likely identify with numerous concerns raised by the US report on The Bahamas, and Mr Aubry yesterday argued it further highlighted what he described as “the biggest risk” - the absence of a system for reporting and vetting corruption-related allegations “outside of the political sphere” and its influences.

Legislation to address these deficiencies, especially the Integrity Commission Bill and Ombudsman’s Bill, were tabled in the House of Assembly by the Minnis administration in November 2017 but have advanced no further. Mr Aubry said ORG and other anti-corruption NGOs were now receiving feedback from the political level that the Integrity Commission Bill, and particularly its 40-page Code of Conduct, were deemed to be “too intrusive”.

However, he argued that “bringing it forward for debate allows an opportunity for the Government and public to develop a piece of legislation that is functional and transparent”. Letting these Bills simply sit and gather dust, Mr Aubry argued, would defeat their purpose of strengthening integrity in government and public life by cracking down on opportunities for graft.

“If they’re not moving forward because they’re too intrusive, we don’t do anything to change our reputation with the US, international partners and the World Bank,” he told this newspaper. “All those folks are looking for us to act and improve in this area because economically it makes us more competitive, more inclusive and creates opportunities. 

“We have to change perceptions locally and internationally, and legislating and passing such a Bill will make a tremendous statement and create opportunities. That’s what we have to move forward on, opportunities and creating the most competitive environment for foreign investment and the most favourable for local businesses. 

“If we sit and decide that we’re OK with current corruption perceptions, and the status quo is better than other parts of the Caribbean, it is not good enough in this time. We cannot leave anything on the table economically.”

Mr Aubry said the Integrity Commission Bill would establish just such a process for receiving and scrutinising corruption allegations that was free from political interference. He added that The Bahamas’ reputation “can be more damaged on perception than what is actually happening” in terms of actual corruption.

The US Investment Climate report referred to so-called “bribes of convenience”, and the ORG executive director noted that Transparency International’s Caribbean regional corruption perceptions index in 2019 “shows The Bahamas lead in bribes paid without being asked.

“The perception that it’s required, it just becomes an accepted norm,” Mr Aubry said, “and that you have to pay and this thing doesn’t move without some level of graft. Whether that’s true or not, we’re not doing enough to change that perception.

“That requires strong, clear legislation, and the Government’s inactivity in passing the Integrity Commission Bill, the Ombudsman’s Bill and not enacting the Public Procurement Bill..... they’re sitting there being treated as secondary.... If the Integrity Commission Bill was to move forward it sends a very clear message that we want to change this to alter that perception.”

Paying a public official “lunch money” to obtain a permit, approval or some other document is widely known to be a common practice that is regarded as the norm, or routine, encouraging the belief and perception in some quarters that such low-level graft is acceptable and relatively harmless.