Former Premier and Minister for Finance, Hon. Ralph T. O'Neal has disclosed that contracts with Global Water Associates, which were signed in 2006 with the National Democratic Party (NDP) administration, were never brought to his attention.
Global Water Associates has threatened to seek legal action to recover approximately $22.9M, claiming that Government failed to honor the two agreements. A formal letter from O'Neal Webster law firm was sent to Government on September 27, 2012, which mandated that Government responds within 14 days or face action via the judicial system.
When contracted, Hon. O'Neal, who is currently the Opposition Leader, said that he never investigated the matter because it was never brought to his attention.
"Water and sewerage is dealt with by the Minister for Works and Communications and he should have brought the problem, if there was a problem, to my attention. It was never brought to my attention. I am sorry I cannot assist you any further," Hon. O'Neal stated.
Initial attempts to contact former Minister for Communications and Works, Hon. Julian Fraser were unsuccessful.
However, First District Representative and former Minister for Education and Culture, Hon. Andrew Fahie has been vocal in the past and has asked several questions relating to the Global Water Associates contracts. He has stated that he wasn't the Minister of Finance and as such, it would be difficult to give all the answers.
"One thing I know for sure, not being the Minister of Finance limits my ability to answer the question totally in-depth; however, one of the impediments in dealing with the project was the ownership of the plant...the last [NDP] administration assured us that Government owned the e plant, but the contents of the contract seems to suggest otherwise. What I could never understand is how could we pay over $2 million for a plant and allow the contract be phrased in a manner that suggests that the contractor owns the plant. This, among other areas, told serious impediments towards the previous administration carrying out the signed contracts," Hon. Fahie explained.
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Since 2007 during the NDP's administration and during the VIP's term in office, Hon. Fahie has been raising concerns about the two contracts.
Hon. Fahie pointed out that during the last sitting of the House, he asked Communications and Works Minister, Hon. Mark Vanterpool about the Global Water Associates contracts, but the Minister used sections of the Standing Order to refrain from answering the questions.
"In 2007, during the then NDP's administration during the question and answer period of the sitting of the then LEGCO, the NDP did not admit that there were two contracts, but rather only assured us that there was only one contract and that the Government paid for and owned the plant; however, the information now being revealed differs from that which we were assured," Hon. Fahie stated.
Based on communications sent to Government, the two agreements were signed between the company and the NDP administration on September 19, 2006, but were never honored during the Virgin Islands Party (VIP) administration led by Hon. O'Neal between 2007 and 2011.
According to the design build agreement No. 395/2006, Global Water Associates was contracted to design, build and install a water reclamation plant at Paraquita Bay, while the second agreement No. 398/2006 required the company to manage, operate and maintain the plant.
BVI Platinum News understands that Global Water Associates was paid $1,876,692.20 after the company submitted invoices for initial work done on design, engineering, purchase and shipment of equipment. According to information, the monies were paid via Banco Popular in three installments on October 2006, March, 2007 and April 2007.
Several persons confirmed that no other payment was made to the company and correspondence was sent to the Virgin Islands Party administration, but no acceptable way forward was agreed upon.
Hon. Fahie said essentially, Global Water was to be paid $20 per thousand gallon to refine sewerage water to make it environmentally safe to go into the sea.
Hon. Fahie stated that during the period that Global Water Associates was contracted, the then NDP administration hired a company that advised them to reduce the amount of money Government pays for water from Ocean Conversion from just over $12 per 1000 gallon to $6.88, which significantly contributed to the financial challenges of the BVI Investment Club.
According to Hon. Fahie, in addition, the Global Water contracts replaced a local engineer who was working on the sewerage and in his opinion, this was done for political reasons.
"During our VIP's administration, I stated that the two contracts by the then NDP left the door wide open for BiWater. Had they renewed Ocean Conversion's contract and take care of the local investment group, then a lot more monies that were paid out, is being paid out and will be paid out by Government would have been avoided. Instead, politics rather than country was allowed to rule from 2006 and now we are hearing that one of the possible repercussions is to pay twenty-one plus million dollars to Global Water for starters," Hon. Fahie stated.
He added that these are points he has been stating in the House of Assembly from 2007 during the NDP's administration to present.
"I always said that this and other water and sewerage contracts need reviewing in the best interest of the people of the BVI, but the NDP got a significant number of persons just to concentrate on BiWater when the truth be told that their careless and reckless behavior in this matter created the emergence of BiWater," Hon. Fahie stated.
He added, "As I always state that my people of the First District tell me, 'when destruction is your motivation, your motivation becomes your destruction'. As a result, we all must now pay for the careless and reckless acts of the NDP administration in a few matters for which the full effects and results are yet to be determined and felt."
Hon. Andrew Fahie
Photo Credit: Melissa Edwards/BVI Platinum News
He also pointed to the NDP administration's hospital expansion project that should have cost over $100 million, but was signed for approximately $64 million with a loan secured for only $35 million from the Social Security Board.
Hon. Fahie stated that during the recent House of Assembly sitting, he attempted to find out about the monies paid from the Consolidated Fund into the hospital contract, but did not get the answers from the Premier. The First District Representative said that the Premier's technical advisors refused to answer the question, despite the assurances that the information would have been provided by the end of the sitting.
According to Hon. Fahie, the financial decisions surrounding the hospital contract left the Government's savings, known as the Consolidated Fund, to carry the burden of finding the remaining millions of dollars required, which was also a careless and reckless act by the then NDP administration.
"This course of action left the treasury gasping for air and was a serious financial impediment during our 2007-2011 administration because the majority of funds used from the Consolidated Fund could not be returned to the treasury, as we were later informed that the Banco Popular loan clearly stated that all proceeds from the loan must go towards the project for which it was loaned. This was contrary to what was previously advised by the Government's financial advisors," Hon. Fahie stated.
He said these actions, coupled with five storms and one of the worst worldwide economic downturns in history is what the last administration had to battle financially. According to Hon. Fahie, now the Government is marketing that they met the country broke, forgetting that their careless and reckless actions in the lack of proper timely loan financing of the hospital expansion project for themselves, by themselves, is what they need to inform the people and get off their current non-factual marketing.
"But we are duly elected like them and the people's voice will not be silenced nor will we be intimidated. We will be assertive and extremely respectful. This apparent political bullying will not deter members of the Opposition from doing the people's work in terms of getting out information to people. With God's help we will move forward," Hon. Fahie stated.