Former Minister of State for Finance Zhivargo Laing has questioned why the Christie administration has hired KPMG Bahamas to advise on the reform of the Bahamas Electricity Corporation (BEC), when the Progressive Liberal Party (PLP) criticized the firm for its involvement in the privatization of the Bahamas Telecommunications Company (BTC).
KMPG is one of the government's advisors for the breakup of BEC and will make recommendations to the government this month about the preferred bidders that propose to take over the corporation's management and power generation.
The company also advised the Ingraham administration before it sold BTC to Cable & Wireless Communications (CWC).
While in opposition, the PLP opposed the deal and at one time questioned if KMPG was in a conflict because it was one of the financial and regulatory advisors to the BTC privatization committee and an external auditor of CWC.
"It would be odd that they would decide to use KPMG when you consider the harsh criticism they seem to levy against their participation in the BTC privatization, even to the extent of invoking conflict of interest [claims]," Laing said.
"I would think that one would be concerned to use any entity that you alleged may have been caught up in a conflict of interest to do any work for you. Because anybody who is caught up in a conflict of interest that you deemed credible can't at the same time be trusted by you to do work that doesn't involve a conflict of interest."
The Nassau Guardian contacted Laing for comment after a PLP MP, who did not want to be named, expressed displeasure that the government had engaged KMPG for advice on the BEC deal.
The former administration sold 51 percent of BTC to CWC in 2011. Since assuming office, the Christie administration has been in negotiations to regain the majority of shares of the company.
The government's lead negotiator, businessman Franklyn Wilson, has said previously that the sale was a "horrendously bad deal".
"To use an advisor on a deal you described as atrociously bad would speak volumes about whether or not you really believed what you said you believed when you made the claim against us," Laing said. "You don't turn around and use advisors on a bad deal to do a new deal for you. That's odd, but that's the world we live in now."
Yesterday, Wilson said he never criticized KPMG's involvement in BTC's privatization, but has only found flaws in the Ingraham administration's decisions over the sale.
"KPMG didn't make any executive decisions, the executive decisions in BTC were made by the government of the day and it's the executive decisions that were criticized, not the advice," Wilson said.
"I never criticized KPMG. I criticized to me what I called horrendously bad decisions and they were made by the Cabinet of The Bahamas.
"They didn't make the decisions just as I assume in this instance they would not make the decisions as it relates to BEC."
Negotiations over the two percent stake in BTC appeared to be in limbo in October after CWC announced that its CEO Tony Rice resigned.
His successor, Phil Bentley will assume his position on January 1, 2014.
Yesterday, Wilson said he could not give an update on the BTC talks.

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