Urban Renewal Commission (URC) Co-Chair Algernon Allen yesterday admitted that contracts associated with the Small Home Repairs (SHR) project were not put to tender nor are contractors required to have insurance. Allen added that it was never envisaged for the contracts to be competitively bid on or for the contractors to have all-risk insurance.
"Competitive bidding defeats the purpose of the project, which engages small local contractors and tradespersons in urban and traditional communities, without the hoopla associated with regular construction," said Allen at a press conference at the commission's headquarters.
Allen said during his tenure as minister of housing and social development, competitive bidding was not a requirement for the then Ingraham administration's version of small home repairs.
"This practice has been ongoing for 40-plus years," he said.
Allen was responding to an audit into the SHR program which found that it lacks transparency and accountability. Auditor General Terrance Bastian said the lack of a competitive bidding process goes against guidelines outlined in the Treasury Accounting Procedural Manual.
As it relates to lack of insurance, Allen said, "Very pointedly we say no they are not required." He said home repair contracts valued between $5,000 to $10,000 do not warrant insurance coverage.
"We are now implementing insurance that will cover from a ministerial perspective, all of the ministry's potential liabilities," he said. "But we are certainly not inviting contracts for $5,000 to have that type of insurance. It simply cannot be done practically."
The report also revealed that contractors were not required to have proof of all-risk insurance and that 11 contractors were paid $171,000 for work that was either incomplete or not done at all. The report lists a litany of issues discovered in the issuance of contracts, contractor requirements and the lack of a competitive bidding process associated with the program.
"On reviewing business licenses of contractors who were awarded contracts in phase one, we noted that in most instances the licenses were granted just prior to the award of the contracts and that the nature of business generally indicated on the license was usually general maintenance or landscaping services," the report says.
"Based on the information provided, we were unable to attest to their technical competency as it relates to building construction."
When asked about this, Allen said, "The program is one of empowerment.
"There are many contractors who came and did not have a business license. We assured them that if they get their business license and their VAT registration that we would be able to accommodate them. We had determined by that time that they were able to do the small contracts."
Allen said many of the contractors were not able to compete on a large scale or had reformed from "their ways of criminality". Allen denied that contracts were awarded to "friends" of the commission or government.
"They are not our friends," he said. "It is a process by which we go into communities and persons are identified, needs are identified and we seek to focus upon the needs. We seek to empower communities."
Allen said in light of the report, he is concerned that people may not donate to Urban Renewal. According to the audit, phase one of the SHR program began in November 2013. A total of 312 homes were repaired during this phase at a cost of $3.2 million, the report says.
The audit covers the period July 1, 2012 to September 30, 2014. The auditor general surveyed 75 homes for the audit.
Bastian said in most instances it was difficult to ascertain if value for money was gained. Allen, however, said he is confident that value for money was secured.
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