Thu | Aug 17, 2017

Heading down the wrong road - Experts warn State about public-private partnerships

Published:Tuesday | May 9, 2017 | 5:00 AMRyon Jones
Clifton Yap
Jeanette Calder
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Experts in the local building industry are raising concerns about how contracts are being awarded under the public-private partnership programme (PPP).

Addressing a Gleaner Editors' Forum last Friday at the media house's North Street, Kingston, office, the building professionals argued that the Government's approach is creating an uneven playing field to the detriment of most local contractors.

In 2012, the Government established a PPP policy to guide long-term procurement contracts between the public and private sectors in which the skills of each party is focused in the designing, financing, building and operating of an infrastructure project or providing a service, through the optimum sharing of resources, risks and rewards.

PPPs have been used for several major projects, including upgrading of the Sangster International Airport, the development of the East-West and North-South legs of Highway 2000, as well as the Kingston Container Terminal expansion project.

But Clifton Yap, chairman of the Jamaican Institute of Architects, told Gleaner editors and reporters that the way PPPs are currently entered into by the Government is not good for the country.

"In Jamaica, when you look at historical precedence, when you give somebody a design-build contract and you don't tie down all the elements of what you are actually building, there are just too many loopholes in there," said Yap.

"There is no reason that the construction can't be a separate package that goes out. It does not have to be that one entity does everything. In fact, that is a recipe for disaster in Jamaica."

Yap added, "The person with the inside contacts to politics, which is how most of the big political jobs are given, can put in a low bid because there are a lot of areas that they can cut back afterwards or make claims for increases, and this has happened over and over again. So the full PPP is a dangerous road for Jamaica to take."

He argued that: "PPPs can only work if people negotiating for Jamaica are doing so in the interest of the country and not for other reasons. The entire Highway 2000 programme so far, including the recent revelation of our land giveaway to China Harbour, should be enough cause for concern.

"Then there was Falmouth Cruise Ship Pier, the Jamaica Development Infrastructure Programme, the Palisadoes Road unsightly mess, and Harmony Cove - another poorly conceived and wasteful venture which has cost the country billions so far and should be investigated."

... Concerned Government's decision counter to PPP policy - consultant

Public-private partnership (PPP) consultant Jeanette Calder is arguing that in other countries where governance is strong, having one company execute all the elements of a contract is ideal, but this could give way to corrupt practices locally.

"PPPs that are being conducted in a country where the governance is weak are a recipe for disaster," said Calder at a Gleaner Editors' Forum last Friday. "So I agree that there are dangers."

Calder is also questioning why the Government has entered into its latest PPP agreement with China Construction Company of America, which will see it providing consultancy services for the design concept of the new Parliament building and the proposed Government Offices Oval Zone project, without opening the project to tender, as is prescribed under the country's PPP policy and international best practices.

"We are concerned, and we think the country deserves an explanation as to what is it that has informed the Government's decision to go counter to the public-private partnership policy," Calder, who is also a civil-rights advocate, argued.

"[The PPP] really sets out that there are only two ways they (the Government) are going to play ball - through solicited invitations from the Government to the private sector, which would mean that it is going to be competition for the contract, or an unsolicited proposal, which in either case it has to be tendered."

ryon.jones@gleanerjm.com