It started with a stipend of $1,500 a month to get criminals into - TopicsExpress



          

It started with a stipend of $1,500 a month to get criminals into sport. To reform these criminals, $30,000 a month was paid to coordinators. A two-year $36 million contract would then be given to teach them Maths and English but no work would be done by contractor Adolphus Daniell for that sum. After borrowing to fund LifeSport, the Government’s final cost to the now defunct programme is about $400 million. Two years and $460 million later, the Government has been forced to write off that sum, with nothing to show for it except an active police investigation into white and blue collar crimes which it perpetuated. The country lost almost half a billion dollars in one initiative by the People’s Partnership Government. But that’s not the final cost of LifeSport as a legal battle now lies ahead which means legal fees. Attorney General Anand Ramlogan said his Ministry is intent on seeking restitution on the $36 million contract to Daniell and EBeam. Former Permanent Secretary in the Ministry of Sport, Ashwin Creed, as well as former Director, Cornelius Price, Theodore Charles and Ronnell Barclay have issued a pre-action protocol letter to Finance Minister Larry Howai alleging misconduct in the report conducted by the Central Audit Unit. LifeSport isn’t the only write-off of the Partnership Government. It has lost millions more in the last four years—the Government forked over $291 million to close the Alutrint project after millions was spent to start it, it lost an estimated $1 billion on associated costs after it broke a contract with British Aerospace Engineering (BAE) Systems for the financing of three Offshore Patrol Vessels (OPVs), lost about $1.5 billion in the illegal diesel racket and has had to pump $2 billion in the last two years into Caribbean Airlines (CAL) after two bad investments rendered the company cash-strapped. In four years, the Government has spent $227 billion. That’s the total of their budgets which cover their annual expenditure. According to Larry Howai, the largest parts of the expenditures were for transfers and subsidies—$120 billion, salaries and wages—$35 billion, goods and services—$12 billion, Interest and debt service—$12 billion), statutory boards—$28 billion and the development programme—$32 billion. In 2015, the Government is expected to increase that sum by $64.6 million more on T&T’s sixth consecutive deficit budget. But targeting basic problems like efficient healthcare, security and flooding alleviation remain a challenge—$3 billion will be spent on the Regional Health Authorities (RHAs), 296 people have been murdered for 2014 so far with a security ministry that has an annual budget of $6 billion and when it rains in Port of Spain the city always floods and farmers around the country have to be compensated annually. And while the ruling administration is credited for the expansion of its social welfare net by establishing a Ministry of the People and embarked on such initiatives like increasing the senior citizens grant to $3,500, a laptop for every Form 1 pupil and improving the minimum wage to $15 an hour, it has had challenges with governance. For all the money spent, the People’s Partnership administration has been dogged by allegations of mismanagement of public funds in the state enterprises, questionable tender practices in favour of financiers of the Government and nepotism in key appointments. The Dookeran Days During his two years as Minister of Finance, Winston Dookeran was criticised as being “conservative.” Stymied by an inheritance with included outstanding debts to contractors, wage negotiations with unions and a resolution to the CLICO issue, Finance Minister Dookeran could not see the blue skies he hoped for in 2011. The Government’s unpaid bills, left over from the People’s National Movement’s (PNM)’s tenure, were $2 billion for Value Added Taxes (VAT) refunds, $2.6 billion to contractors and $2 billion for the fuel subsidy. “That does not include the cost to complete ongoing projects at the time. There were a number of incomplete buildings that had to be completed such as the offices at the Government Campus Plaza in Port of Spain,” said Howai in an e-mailed interview with the Sunday Express. “I don’t have the details of those at hand at the moment but the cost of completing the Plaza is $1.2 billion billion if the Customs building is included).” Dookeran had his stumbling blocks—people were saving, not spending, and the late appointments of directors to state boards impeded decision-making and investment. Political promises—laptops, no Land and Building Taxes, no Alutrint—triumphed over economic ones such as reviewing an almost $5 billion fuel subsidy. And for the first two years of the Partnership Government, the country had stagnated with a “confidence crisis.” Even at $7 billion, the Public Sector Investment Programme (PSIP) lacked the impetus to kick-start the stagnating construction sector. The tunnel to Maracas remained a proposal on paper.Investment in T&T’s agricultural sector, impacted positively on T&T’s headline inflation. On the other hand, improved incentives for the energy sector hasn’t attracted the top tier energy players in the global market to T&T’s bid round. Howai’s expenditure After two years of a tight-fisted Dookeran, Howai assumed the portfolio and the country’s costs have since escalated but so too has investment. If Dookeran was criticised as “conservative” for proposing to settle wage negotiations with a 0-0-1 per cent offering to the Public Services Association (PSA) for a three year period in 2010, then Howai was spending to earn. He managed to incorporate the wages and salaries into the country’s recurrent expenditure even at a staggering 16 per cent. Questioned by the Sunday Express just where the $227 billion has gone, Howai explained: “There are about 50 Ministries and Departments that incur expenditure, ranging from the President to the Judiciary, the Office of the Prime Minister (this year over $600 million partially due to the addition of the National Operations Centre), the Auditor General and all of the various Ministries. The largest parts of the expenditures are for Salaries and Wages ($35 billion), Goods and Services ($12 billion), Interest and Debt Service ($12 billion), transfers and subsidies ($120 billion), Statutory Boards ($28 billion) and the Development Programme ($32 billion). “These expenditure figures are approximations as some of the classifications vary according to the publications and represents four years of expenditure, not all incurred just yet as the financial year is not complete. As I had indicated, the transfers and subsidies include the allocations for the THA, RHAs, Regional Corps, pensions for public servants, transfers to the Infrastructure Development Fund, State Enterprises and the Heritage Fund.” The $19.8 billion CLF/CLICO Expenditure Perhaps the greatest expenditure on a single matter, which the Government has yet to get a return on, is its investment in collapsed insurance company, CLICO and CL Financial. Howai says: “The total spent up to 2012 when I took over was $19.8 billion. Since then, I have advanced US$52 million to the liquidators of BAICO and a further US$200 million to assist Caricom in meeting the cost of the BAICO collapse in those islands. This latter figure will probably not be recoverable. There are other unpaid liabilities that we have not met but which can crystallise depending on the decision of the courts eg, the INCs of CIB and the current court matters involving some of the investors in CLICO. It was estimated that this could add another $3 billion depending on the decision of the courts.” Howai’s cost is exclusive of the cost of the Commission of Enquiry which was held into the failure of the CLICO. Building Bridges The Government has been spending money on massive projects such as the $7.5 billion highway extension to Point Fortin, building bridges, compensating farmers for losses, but little is being spent on projects on which this country could derive revenue. Howai however doesn’t see it that way. “The cost of VAT removal on food cost about $500 million. We have given some tax holidays to new investors but these aren’t ‘losses’ given that the investors would have not done the project if we hadn’t provided the incentives. This also applies to the energy sector. There has been a lot said of the amounts lost due to energy sector maintenance but we need to bear in mind that the alternative is a disaster offshore which would cost us more in the end. The figures stated for NGC, I am told are exaggerated but the Ministry cannot divulge the figure. That would have to come from NGC itself,” he said. Asked why the Government boasted about building bridges when they were an expectation of any Government, Howai responded: “I don’t think that ‘boast’ is the correct word. It’s really advising that work was done in a number of areas and I normally leave it to the Ministers to give more detailed reports, which they do as part of the debate. It is true that the Government is there to serve the people and as a consequence must provide goods and services...as the Prime Minister repeats often. When Ministers list the projects done, they most times do so in responding to the Opposition in a debate, so it sometimes comes across as boasting (to use your term) but that’s not really the Minister’s intention as far as the general public is concerned.”
Posted on: Sun, 21 Sep 2014 14:55:56 +0000

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