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Phillips wants probe - Urges auditor general to investigate Shaw's claims about waste of public funds

Published:Sunday | May 29, 2016 | 12:00 AMArthur Hall
Dr Peter Phillips

Opposition spokesman on finance Dr Peter Phillips has written to Auditor General Pamela Monroe Ellis, urging her to probe claims made by Finance Minister Audley Shaw while closing the Budget Debate last Wednesday.

According to Phillips, Shaw's allegations questioned the "bona fides" surrounding the sale of the old Oceana Hotel and the subsequent rental of a part of the building to the Accountant General's Department (ACD) and the circumstances surrounding the issuance of a letter of credit by Noranda Bauxite Company to the Government of Jamaica in the sum of US$5 million.

"Given the implications that these allegations have for damaging public confidence in the institutions, the Government of Jamaica, and the conduct of public officials, I am requesting that your office conduct an investigation into these matters and the circumstances surrounding these transactions so that the Parliament and the public interest in good governance may be satisfied," said Phillips in his letter to Monroe Ellis.

Shaw told the House of Representatives that the previous administration had agreed to provide J$400 million to renovate the ground floor of the Oceana Hotel, which the Urban Development Corporation had previously sold for J$385 million.

We are not begrudging the AGD the space, obviously. They need it. We are looking at the economic value of the transaction," said Shaw.

He added: "Is it good value for the Jamaican people, government mismanagement at its peak, or is it a sweetheart deal?"


'The same slackness'


In the bauxite matter, Shaw charged that "the same slackness" involved in the handling of money and government affairs was applied to dealing with the troubled Noranda Bauxite relationship.

According to the finance minister, the new administration was left shocked to find that the former minister of finance had allowed a US$5 million letter of credit, issued on behalf of Noranda, to pay the company's levy to expire in December 2015 without making a claim on the irrevocable letter of intent.

"The Noranda people expressed great surprise to our negotiators that the then Government allowed the letter of credit to lapse, thereby avoiding being paid the US$5 million," charged Shaw.

"So because of that fiscal and managerial slackness, the Jamaican people were short-changed to the tune of J$625 million by the previous Government," added the finance minister.

Phillips interjected during Shaw's presentation to say he had nothing to do with the exchanges with Noranda.