OCG slams ministry, NIF over Braco contract

Daraine Luton, Senior Staff Reporter

PARLIAMENT'S Public Administration and Appropriations Committee (PAAC) has been told to make itself ready to examine a report from the Office of the Contractor General.

PAAC chairman Edmund Bartlett told the committee last Wednesday that members should prepare themselves to examine the document, which has been referred to the committee by Contractor General Dirk Harrison following his probe in the short-term lease of the Braco Hotel and Resort property in Trelawny.

Harrison's report said the handling of the matter, which saw the property being leased to a foreign company, was improper, irregular and inappropriate.

Harrison's comments are contained in 67-page report on a special investigation into the circumstances surrounding the inking of an agreement for the operation of the hotel by the Blue Diamond Hotels and Resort Inc.

The report said the procurement and contract administration practises of the National Insurance Fund (NIF), and/or the labour and social security ministry, was irregular and lacking in transparency.

It added that the contract, "might not have been awarded in accordance with the relevant provisions of the Contractor General Act and/or the Government of Jamaica handbook of Public Sector Procurement Procedures".

Blue Diamond had been engaged to run the 84-acre resort following the exit of SuperClubs, which had managed the property for about 15 years. The agreement came to an end last May.

But, in his probe of the deal, Harrison found that Blue Diamond had "limited experience in hospitality management" based on an evaluation of proposals done by the NIF.

The NIF, owners of the property, had done evaluations on four entities, the others being Karisma Hotels and Resort Corporation, Desires Hotel, and H10 by Ocean Hotels.

The evaluation shows that Blue Diamond proposal, "provides a guaranteed income of US$500,000 for the six-moth period and possible upside of 20 per cent of earnings".

Karisma Hotels, based on the evaluation, would not guarantee a profit, H10 by Ocean Hotels indicated it would be uneconomical for them to operate the hotel for six months, while the proposal from Desires Hotel was said to be received before Braco was closed and at that time the NIF was seeking to have continued operation of the property.

specific details not provided

Notwithstanding the evaluation notes, Harrison's report said the evaluation form failed to provide any specific details of the criteria which were utilised in the assessment of the proposals or which was used to select the lowest responsive bid.

Blue Diamond, being a foreign entity, is required to be registered with the National Contracts Commission (NCC) prior to the award of a contract, but Harrison found that the hotel only became registered on February 15, 2012, some 13 days after the agreement for the interim management/ operation of the Braco Resort and Hotel was entered into by the Commissioner of Lands, the Accountant General, and Blue Diamonds.

Harrison also pointed to conflicting statements from Alwyn McIntosh, the permanent secretary in the labour ministry, on whether the ministry was acting on an unsolicited proposal from Blue Diamond in respect of the operation of the property.

According to the contractor general, the conflicting accounts "raise serious concerns and questions about the merit of the procurement process which was undertaken by the NIF".