Leader of Government Business McKeeva Bush strongly criticised Auditor General Dan Duguay for announcing Friday that his office would conduct an audit of the tendering process for the proposed new cruise berthing facility.
Mr. Duguay announced on Friday morning’s Rooster 101 Cayman Crosstalk radio show that his office would proceed with the audit as soon as the winning tender was announced.
‘We’ve been watching with growing interest the reports in the media about the tending process,’ Mr. Duguay said in an interview later Friday.
‘Whenever government acquires an asset worth $250,000 or more, it must go to the Central Tenders Committee,’ he said. ‘We’re interested in hearing the rationale for not doing that.’
Last week, Mr. Bush and Port Authority Chairman Stefan Baraud confirmed that instead using a bidding process through the Central Tenders Committee, potential developers for the cruise berthing project were vetted through a select committee consisting of Mr. Baraud, Port Authority Deputy Chairman Woody Foster and four government backbench MLAs.
Potential developers responded to a request for expressions of interest advertised on 1 September 2009.
Mr. Duguay said there was nothing wrong with asking for an expression of interest as a first step in awarding a contract as long as there is a more formal process afterwards.
‘But as far as we can tell, there will be nothing between the expression of interest and the awarding of the contract,’ he said.
The decision of who will develop the new cruise berthing facility is expected to be made by Cabinet Tuesday. A press conference to announce the details of the project is schedule for Wednesday.
Mr. Bush responded to Mr. Duguay’s comments and explained the reasons for using the method that has been used for choosing the developer of the cruise berthing facilities.
‘Cabinet can, in the interests of the country, decide these things,’ he said. ‘Cabinet can say ‘yes, it goes to Central Tenders’ or ‘no, it doesn’t’.’
Mr. Bush said the Central Tenders Committee was a board appointed by the government, just like the Port Authority board and the cruise berthing facility selection committee is appointed by government.
‘As minister, I was concerned that a fair process was carried out and I believe that was so,’ he said. ‘I was concerned that a proper evaluation process was done and I am assured the Port Authority board is satisfied this was done.’
Mr. Bush said he felt confident the selection committee would recommend ‘the best and most capable developer’ for the project.
With regard to Mr. Duguay’s announcement that he would conduct an audit of the tendering process so soon, Mr. Bush said he had some concerns.
He asked why the auditor general hadn’t stepped in when former minister with responsibility for the Port Authority, Charles Clifford, bypassed the Central Tenders Committee and signed a Memorandum of Understanding with the Atlantic Star developer to essentially do the same development.
He also asked why Mr. Duguay had never conducted a value for money audit on the two high schools projects award to Tom Jones International, especially in light of the potential cost overruns and other problems that have surfaced.
Mr. Bush noted that the two high schools did go through Central Tenders.
‘But they did so in a roundabout dirty way that shut the door on people who could have given [the bid process] competition,’ he said.
‘Those two projects are causing… million of dollars of problems,’ Mr. Bush said, ‘and [award of the contracts] was in the control of Central Tenders.’
Mr. Bush said what had gone on with the capital projects started by the previous administration ‘under the nose of the auditor general’ did not represent value for money or even the perception of it.
He warned that if government were forced to use Central Tenders and another situation similar to the schools occurred, he would take action.
‘I will see to it that the governor and the auditor general will not be absolved from a lawsuit,’ he said. ‘I will personally see to that.’
Mr. Bush said government would not spend any money on the development of the cruise berthing facility.
‘There is no government expenditure,’ he said, explaining that the developer would pay for the project and then get paid by an arrangement with the Florida-Caribbean Cruise Association through fees charged on cruise ship passengers coming to port here.
‘There is no government guarantee in any way, shape or form,’ he said. ‘All government is saying is we’ll get an enhanced port at the end of the day.’
Mr. Bush said the method of choosing a developer also reflected the urgency of the situation.
‘When I came into office, I found an economy in shambles; people unemployed; people losing their homes; small businesses suffering; and people generally in a bad state.’
Mr. Bush said the government needed to move quickly on the $150 million project, which he said would have about $450 million worth of economic impact.
‘If we can move on this quickly, people will get employed,’ he said, adding that there will be spin-off benefits in all sectors of the economy.
‘It means the Turtle Farm gets more business and stops the bleeding. It’s a win-win situation.’
Mr. Bush said if Central Tenders got involved, the process would delay the project for at least another year.
‘The country will lose an estimated $28 million and this unnecessary roadblock could possibly kill a project that can benefit the people.’
Mr. Bush said he believed the auditor general was not acting on his own in announcing the audit.
‘I am concerned with what I see as an agenda,’ he said. ‘They want to stifle every investment opportunity.’
Speaking about recent statements coming out of the UK’s Foreign and Commonwealth Office, Mr. Bush said it was clear that the UK had an agenda to see Cayman introduce an income and property tax.
‘If we do not go forward with project to stimulate the economy, then what will happen is the UK will come back to us and say we’re non-compliant with our borrowing again,’ he said. ‘Then I might have to impose some sort of taxation.’