Posts Tagged patrick manning
Afra Raymond and Peter Permell are interviewed on the ‘Election Hardtalk‘ show on Power 102FMFM by Tony Fraser about the continuing impact of the CL Financial bailout on the economy and the request to get back the company by Lawrence Duprey. 16 July 2015. Audio courtesy Power 102FM
- Programme Date: Thurday, 16 July 2015
- Programme Length: 1:19:47
“…The question really is integrity, and if he or she does not have it he or she should not be a Commissioner in the first place. The simple fact is that try as we might, we cannot legislate for integrity…”
From Press Release of 21 June 2013 by then Integrity Commission Chairman, Ken Gordon, in response to strong criticisms of his meeting privately and alone with opposition Leader, Dr Keith Rowley.
Once again we are beset by what appears to be yet another fiasco at the Integrity Commission, so Ken Gordon’s fateful words echo in my mind.
Given the current political season, there is every temptation to discuss this crisis as being caused by the impending election, together with either the improper behaviour of the present Peoples Partnership government or the ‘PNM operatives’ who infest the public service. You can take your pick from those prevailing theories, but I think these recent and alarming events were preceded by earlier ones. So much so that when the entire situation is placed in context, we are facing a troubling scenario in terms of the extent to which we can trust high public officials.
The current crisis is serious enough grounds to require a full Commission of Enquiry into the conduct of the Integrity Commission since the 2000 revisions to the Integrity in Public Life Act (IPLA).
I do not agree with those who call for the abolition of the Integrity Commission, since it is critical that any progressive society establish what are its aspirations and work towards those. Despite the social, religious and legal restrictions on murder, robbery and rape, those acts occur all the time. That sobering truth is no reason at all to retreat from putting strong legal and social prohibitions in place. Society needs laws and institutions to promote its values, so I am not calling for any move towards abolition of the Integrity Commission at all.
Such a Commission of Enquiry is necessary to clear the air on strategic issues and its Terms of Reference would cover aspects such as –
- What is the record of the Integrity Commission in deterring corrupt and improper behaviour by Public Officials?
- To what extent would the amendments to the IPLA, as proposed by the Ken Gordon-led Commission in its 2012 Annual Report, be effective in improving the Commission’s performance?
- Given their growing importance of Public Private Partnerships in large-scale projects and commercial enterprises, to what extent should the IPLA apply to those organisations.
- Apart from the legal framework as outlined above, how can the limited resources of the Integrity Commission be best applied to promote ‘Integrity in Public Life’?
The specific issues
- 19th October 2004 – The Integrity Commission wrote to then PM Patrick Manning seeking detailed instructions on how to handle Ganga Singh’s complaint against Dr Keith Rowley. According to the ruling in the case brought by Dr Rowley against the Commission – “…The Court does not accept the Integrity Commission’s explanation as to why it wrote to the Honourable Prime Minister on the 19th October, 2004, to ascertain whether an inquiry was to be undertaken and if so, the names of the persons to man the enquiry and their terms of reference…”. The public needs a full and proper explanation as to how and why the Integrity Commission took such an extraordinary decision.
- The TSTT exemption – In 2006 the Commission was alleged to have written to TSTT Directors to confirm that they were exempted from filing declarations as required by the IPLA. That letter was the subject of Freedom of Information litigation at both High Court and Appeal Court levels – Magdalene Samaroo vs TSTT CV 2006-0817 and CA 180 of 2010 – and it is fundamental that at no point was the existence of that letter denied. A simple denial would have readily defeated the request for that letter since the Court cannot order publication of a document which simply never existed. The matter was ‘compromised’ by agreement between the parties at an Appeal Court hearing on 28 October 2013, which means that both sides agreed to discontinue the lawsuit. There is obviously something substantial and improper at work here, so an Enquiry can force publication of that suppressed correspondence.
- The TSTT litigation – Since 2005 TSTT has been in prolonged litigation to remove its Directors from Integrity Commission oversight. The High Court ruled in 2007 that TSTT’s Directors were required to file declarations under the IPLA. That judgment was reversed in the Appeal Court ruling of 27 June 2013 that TSTT was not a State Enterprise, with its Directors therefore not required to file declarations to the Integrity Commission. Upon careful reading of those judgments it seems clear that the Integrity Commission offered little, if any, resistance to the TSTT challenge. This sustained collaboration between the Executive, the supposedly-independent Integrity Commission and the Public Private Partnership also known as TSTT is nothing less than remarkable, given the challenges in getting agreement on important and beneficial matters. A proper account is also required for how and why the Commission agreed to this course of action.
- The 2009 collapse – The newly-appointed Commission collapsed in early 2009 due to disastrous appointments by then President Max Richards. One of the several outstanding issues at that time was the strong complaint from Justice Zainool Hosein who claimed that President Richards had promised him the position of Deputy Chairmanship and then reneged on that commitment. President Richards proceeded on an extended leave before deigning to make a public statement on 29th May 2009 which amounted to a stunning ‘I don’t have to explain myself’. An important part of this Enquiry would be to establish just how this series of unfortunate appointments were made.
- CL Financial group of companies – The Commission has never explained its failure or refusal to seek declarations from the Directors of the CL Financial group of companies, which have been under State control since June 2009. I have personally checked and those Directors do not submit declarations to the Commission. CL Financial is the largest by far of the ‘bodies under the control of the State’, yet the Commission has not exercised its lawful duties in respect of proper oversight, so a full and public examination is necessary.
- Emailgate Fiasco – The Commission’s role in this charged affair certainly needs a full, public Enquiry if trust is to be restored. Fixin’ T&T claimed, in its 7 May 2015 letter to the Commission, that the PM had claimed to have had possession of certain files ‘containing information which the IC had requested from Google’. The Commission was asked in that letter whether it was aware of any information being passed onto the PM or any other person. The Commission’s response on the same day was remarkable, in that there was neither confirmation or denial of any information being passed to anyone else. That reticence on such a critical point is even more remarkable when one examines the Commission’s letter of 19th May 2015, which confirmed the end of its ‘Emailgate’ investigation. The first part of that letter states that the provisions of S.35 (1) & (2) of the IPLA prohibits any release of information unless charges are to be recommended. On the one hand, the Commission declines to say if information was released to the PM or anyone else, yet, on the other hand, it stresses the legal rules against such a release. So what is really happening here? What is more, the resignation of two of the IC’s five Commissioners can only add to the sense of confusion in the air. The first resignation came from Dr Shelly Ann Lalchan, supposedly for personal reasons, but the clear statements from the second Commissioner to resign, former Deputy Chairman, Justice Sebastien Ventour, are worrying to say the least. Can it be true that the media was the first place the Commissioners were made aware of that important letter of the 19 May? If that is indeed so, it is clearly unacceptable for a public body to conduct itself in that fashion.
A final issue for an Enquiry to consider would be the role of whistleblowing within bodies such as the Integrity Commission. On the one hand the Commission could not perform its work without reports from people who are reporting suspected wrongdoing, probably in breach of their employers’ rules, yet the very officers within the Commission are prevented from reporting wrongdoing in its own operations. That is the true irony at work and a proper Enquiry will be able to take evidence and make recommendations to deal with this.
A full and urgent Commission of Enquiry into the Integrity Commission is now required.
The recent announcements as to the upcoming completion of the ‘Government Campus Plaza’ offices in POS and the relocation of significant State agencies to central Trinidad are charged with meaning for the office sector. The previous article on this topic examined the huge quantity of State-owned incomplete office buildings in greater Port-of-Spain, the impact of that on the incomplete private office projects and the role of the ongoing process of decentralisation. For the purposes of this discussion, greater POS is the area bounded by the sea to the South, the WestShore Clinic to the West, the Queen’s Park Savannah to the North and the Lady Young Road to the East. This is going to be a closer look at those aspects, so that we might discern how this issue is going to be settled. There are interlocking issues which have created the Elephant in the Room –
- the incomplete State offices, which will impact on the private office rental market as they are completed;
- the existing offices leased by the State, which need to be re-examined;
- the trend towards decentralisation, with its own profound implications.
To understand the issue requires the reconciliation of these large, seemingly-conflicting, elements. The first is of course, the ‘sunk capital’ in terms of the State-owned, incomplete office buildings in POS. The second is the existing leases the State holds from landlords of office space in POS. The third element is the ongoing programme to relocate significant Ministries and State Agencies out of POS, generally to Central Trinidad. I am also of the view that we need to enquire into the progress of the ongoing decentralisation process. The details we need are – Which Ministries/State Agencies are to be relocated from POS? What are the preferred locations for these offices? What progress has been made on those relocations? Has land been purchased/leased? Has State land been allocated? Has a building been identified? If a new building is to be constructed, what progress has been made in terms of project scoping, design, tendering and construction? When are these new non-POS State offices anticipated to be occupied? The key enquiries in this matter would be –
We need to know exactly what offices the State is leasing and that info would include – the Ministry or State Agency in occupation; the addresses of the buildings; the size of the office space and its facilities; the number of carparking spaces; the rent paid; the service charge paid; the parties; the extent of the lease/tenancy agreement (when did the lease start and for how long was it agreed). Apart from the info being presented in that type of detail for each rental, the overall picture will be instructive, as it will show the amount of space occupied and at what cost. That information will in turn disclose the average (mean) rent per square foot paid. Without details on the present arrangements for State offices, we cannot properly judge the alternatives.
An additional enquiry has to be raised on the particular instances where the State is paying a rent for property which remains unoccupied. The same details listed above need to be sought in those cases, but in addition, we need to be told why those properties are still unused. A great concern was raised recently on #One Alexandra, which concern was mostly justified in my opinion, but the fact is that it is not the only one. The public needs to be told the full extent to which the State pays rent for unoccupied offices.
On 2 April 2014, Minister of Planning & Sustainable Development, Dr. Bhoe Tewarie, gave some details in the Senate on these relocations –
- Ministry of Tertiary Education and Skills Training and some of its portfolio agencies are to be relocated to an ‘integrated administrative complex‘ 15-acre site north of the Divali Nagar on the eastern side of the Uriah Butler Highway. No size was given for the complex and construction was noted to have started in April 2014.
- Ministry of Community Development is to be relocated to new offices at a 10-acre site near the Divali Nagar on the eastern side of the Uriah Butler Highway. No size or start-date was given for these offices.
- Ministry of Food Production is considering relocating out of its long-established offices at St. Clair Circle, at the northern end of the Magnificent Seven strip, to either Chaguanas or Farm Road in Curepe. That decision is pending.
In the last week we have been told that the headquarters of COSTAATT, which is a part of UTT, is to be relocated from Melville Lane in POS to a location near the new Chaguanas Administrative Complex. The main building occupied by COSTAATT is said to comprise 86,000sf, which is rented for $13.00psf – the total annual rent is $13.473M. We were also told that COSTAATT’s POS operations require further rental space to the annual amount of $1.64M. The new building is costing $168M inclusive of VAT, but no details were given as to its size or proposed completion date. There are other relevant questions as to the convenience of the new location for students and faculty, but the fact that Chaguanas remains the fastest-expanding town in the country for the past 20 years is a part of that issue.
As per the previous article in this series, the State has built, but not completed, a total of 1,329,000sf of offices in POS. According to Minister of Finance & the Economy, Larry Howai, on 5 May 2014 – “Cabinet has approved a sum of approximately $1.5 billion to complete the Government Campus buildings in downtown Port-of-Spain,” said Howai. Once this is completed in the next 12 months I expect that the OSH problems being complained of at the BIR will be a thing of the past.”
That Cabinet approval equates to $1,129 per sq ft, which seems high unless one considers that a significant part of that money is stated to be for remedial works and not strictly for fittings and finishes. The impending completion of those offices will be a sea-change in the fortunes of POS, since their occupation will force the landlords who were renting to the State to seek other tenants. In my estimation at least half the rented offices in the capital are occupied by the State, so that office market is largely driven by the public sector.
I have heard many colleagues attempting to rationalise the coming change by reference to OSHA requirements which require more office space allocated to each worker and therefore those requirements would ease the impact of the impending new offices. Another rationalisation I have heard is the one about how some landlords would be leaving their places locked-up so they will not actually be offering those on the market, so there will be no real effect and so on.
All of those are coping mechanisms for dealing with the reality of change on an epic scale. This is the Manning Plan, in full effect. To quote the CEO of leading private sector office developer, RGM, Gerard Darcy, in a May 2013 interview – “…The Government Campus is still the 800-pound gorilla in the room because it is too large to ignore…”. I expect a significant adjustment in office rent levels in POS in the medium term. The financial sector, especially those who have expanded their loan portfolios on the basis of the property boom, will need to take careful stock of the extent to which these rapidly-approaching changes imply severely impaired assets.
The huge potential supply of State-built, unfinished office buildings in our capital is the ‘Elephant in the Room‘. There are potent elements at play here in terms of the viability of the long-term and large-scale investments which have been made in Port-of-Spain by private and public capital.
At this point, taking account of offices over 25,000 sf in size, there are over 1,500,000 sf of incomplete offices in our capital. This article will examine the likely outcomes for our capital and those investors as the various projects are completed.
The State has 1,329,000 sf of incomplete offices in POS and the private sector has 224,800 sf. The State has virtually seven times more incomplete offices than the private sector and that is the ‘Elephant in the Room’. This chart portrays the reality – the details are set out in the table below.
The legacy of the POS offices built during the previous administration is a matter which deserves serious consideration. The sheer volume of offices built by the State during the previous administration is sobering – 2.3M sf. Given that Nicholas Tower – that elliptical, blue tower on Independence Square – contains 100,000 sf, it means that the State built the equivalent of ‘23 Nicholas Towers‘ in our capital in that period of rapid development.
We also know that there was no attempt at public consultation or feasibility studies by the State or its agent, UDECOTT. At the Uff Enquiry, the Executive Chairman of UDECOTT, Calder Hart, admitted that a feasibility study had been done for only one of those projects. That project is the International Waterfront Centre (IWC), which comprises the two office towers of 890,000 sf, the Hyatt Hotel, New Breakfast Shed and car-parking/outdoor facilities. Hart also admitted, under oath, that the value of the land had been omitted from the viability study for the IWC, so it was a bogus exercise. The break-even rent is the amount which must be earned by a project to repay the cost of land, construction, professional fees and finance. The IWC, repeatedly boasted-of as UDECOTT’s flagship project, is not a viable project, since its break-even rent exceeds the highest rents now earned by A-class offices in POS.
The Parliament has now relocated there during the Red House repairs and renovations. A number of other Ministries and Public Bodies have also started to occupy those offices.
The Office of the Prime Minister is now in the new 75,000 sf building on St. Clair Avenue, opposite to QRC grounds.
The rationale advanced by the Manning administration for that surge in office construction in our capital is that it would free the State from the payment of large monthly rents to private landlords. Although I made several requests, I was never able to get the actual figures for the rents paid by the State in POS. My own familiarity with that market allowed me to estimate the average rent at that time (2007-2009) at about $8-9 per sf. The break-even rents of those new buildings exceeded $25 per sf, so the costs of those office projects would never be recovered. I have read reports that the estimated cost of the Government Campus Plaza, which is the largest element in the POS offices, was recently stated by UDECOTT’s Chairman, Jearlean John, to be of the order of $3.2 Billion.
We can reasonably estimate that the rate of rents paid by the State for office buildings has now increased since 2007, in terms of dollars paid per sf.
The completion of those State-owned office buildings is therefore a matter of the first importance, given the high carrying-costs. There is also the significant issue of the high opportunity cost of the State continuing to occupy rented offices alongside virtually-completed offices.
Against this background, we are now seeing an active policy of decentralisation of POS offices by the present administration, with several Ministries and Public Bodies being relocated to south and central Trinidad. The decentralisation discussion is one which has been going on since the 1970s and it is an important issue to be pursued, in my opinion. That said, one has to wonder how is the decentralisation to be rationalised, given the existence of this over-supply of State-owned offices in our capital. That is a serious question which needs to be discussed if we are to achieve any proper resolution.
The completion of the State-owned offices is under the management of UDECOTT, the original developers, with recent disclosures from the Finance Minister of plans to sell the buildings and lease them back as a means of financing their completion. The terms of any such proposals would have to be carefully considered to avoid the mistakes and fraudulent behaviour of the past.
The completion and occupation of the State-owned office buildings in POS will pose an existential challenge to those private investors who have built offices for rent. The rental levels for offices in POS are likely to decline significantly, which will impact on the revenues of those investors.
Afra Raymond chats on the show ’Forward Thinkers‘ with David Walker on 104.7FM, dealing with the CL Financial bailout and my lawsuit against the Minister of Finance to get at the detailed information as to how the $24B in Public Money was spent. 24 October 2013. Audio courtesy More 104.7 FM
- Programme Date: Thursday 24th October 2013
- Programme Length: 0:45:41
The previous column discussed the Appeal Court judgment in #30 of 2008, in which both TSTT and the Integrity Commission sought to challenge the High Court ruling in #1735 of 2005. That High Court ruling found that the phrase contained at para 9 of the Schedule to the Integrity in Public Life Act (IPLA) was to be taken ‘as read’ to define those people who are subject to its provisions –
- “Members of the Boards of all Statutory Bodies and State Enterprises including those bodies in which the State has a controlling interest.”
The Appeal Court – comprising CJ Archie, together with Mendonca JA and Smith JA – ruled that –
- TSTT is not a State Enterprise. The members of its Board are not subject to the Integrity Provisions.
- It is only the members of the Boards of those Statutory Bodies which exercise public functions that are subject to the jurisdiction of the Commission.“ Read the rest of this entry »
This is the Order by Justice Boodoosingh to grant me the right to have the Judicial Review heard in Court…our first hearing is set for 1 May 2013