Corruption warning over island lease tender process

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  • White's Island

    White's Island

Leasing White’s Island without a tender process is the very definition of corruption, according to One Bermuda Alliance MP Trevor Moniz.

But Premier Paula Cox has already moved on ensuring all leases are subject to Cabinet scrutiny and review by the Attorney General, she says.

“What everybody’s missing here is the word ‘corruption’,” Mr Moniz told The Royal Gazette. “Unless you have an open tender, that is the definition of corruption. You have a responsibility with the people’s land to obtain the best possible deal if you do it on a commercial basis. And if you are doing it on a non-commercial basis you still need an RFP (Request for Proposal).

“Not to do so is the definition of corruption.”

Mr Moniz was reacting to yesterday’s story in this newspaper in which Leroy Bean said that he had not gone to the Public Works Minister to get his anti-gang organisation, CARTEL, a 21 years less one day lease for White’s Island, but instead negotiated directly with the Permanent Secretary.

“For one of the best buddies of the Premier to say ‘I didn’t use my contacts’ — well, Joe Blow couldn’t negotiate with the PS to get a 21-year lease without there being any Request for Proposal,” he said.

A spokesman for the Government Estates Ministry pointed out that the Public Lands Act, 1984 provides that the Minister can delegate authority for such negotiations to the Permanent Secretary.

Asked whether she was satisfied with the process by which Mr Bean got his lease, Premier Cox said she had made improvements in the awarding of contracts and leases since she assumed the office in October 2010.

“There were already long-established protocols in place for signing of leases. However nothing remains static,” she said.

“The new norm for 21st Century Government requires a change in processes. This is important given the higher global scrutiny and focus on governance. So as Premier, I committed to take deliberate action to bolster existing standards.

“This saw the establishment of the Office of Project Management and Procurement. Also I requested that going forward all leases should be shared with Cabinet and reviewed by the Attorney General's Chambers.

“The thinking is that justice has not just to be done but to be seen to be done.”

Ms Cox added: “Transparency is so important and critical so that the integrity of action by Government has to be beyond reproach. So a determined course re legislative changes, re governance and added controls re procurement, were vital to a fresh start.

“I have delivered on the promised improvements to scrutiny of leases and contracts and to transparency in the tendering process.”

This newspaper asked whether the statement meant that future leases would be put out to tender, but we received no response by presstime last night.

Mr Moniz dismissed the Premier’s response, saying it was predictable and unhelpful.

“That’s the same sort of thing we usually hear. She hasn’t answered your question ‘what’s the deal with this lease?’” he said.

“If she’s changed the process presumably she’s not satisfied with this particular lease. What is she going to do? Are they going to review this and report back within a certain time frame?”

Mr Bean’s lease for White’s Island was signed on September 28, 2010, just a month before Ms Cox assumed the premiership.

The Minister in charge at the time was Derrick Burgess, MP for Hamilton East where Mr Bean serves as the ruling party’s branch chairman.

Mr Bean is also a general election candidate for St George’s South and served as Deputy Chairman of the Bermuda Land Development Company

In 2010, according to Auditor General Heather Jacobs Matthews, public funds were misused when BLDC, which Mr Burgess had ministerial responsibility for, paid $160,000 in consultancy fees to Mr Bean and BLDC’s chairman, despite warnings of a potential conflict of interest.

The Public Accounts Committee concluded that Mrs Matthews was correct in her findings.

Mr Moniz questioned why Government had not announced the lease in the House of Assembly even if it didn’t have to be approved by the legislature.

“They do that every week. All of a sudden you find something they’ve been very quiet about. You kept it secret because you were doing a deal with one of your buddies.”

Asked his definition of corruption, Mr Moniz said: “Corruption has a broad definition. It’s something which is done which is not fair. It’s not a fair process and it’s done to the advantage of someone who has an inside track.”

He continued: “If you cannot prove a person got paid, the process is still corrupt. She (Premier Paula Cox) has been banging on about process. There are regulations and the whole thing has to go to tender.

“How can you say you didn’t have the inside track if you were the sole person negotiating and nobody knew about it? How did it come about? What was the rationale, other than a good buddy with the Minister?

CARTEL is not the only organisation with a lease which was not put out to tender. Outdoor education organisation Outward Bound got a five-year lease for Paget Island in 2009, its first, after using the island for some 30 years.

Its chairman Rees Fletcher said the organisation drafted the lease and submitted it to Government for their approval. Mr Burgess was the Minister in charge then, too.

But Mr Moniz argued that a distinction should be made between the two organisations.

“The thing we know for Outward Bound is they use Paget Island for Outward Bound. So far from CARTEL the indication is he’s rented it out for a party,” he said.

“Outward Bound has a track record, as does an organisation like BFA. I’m not sure Leroy Bean has a track record for White’s Island. But there’s all sorts of red flags here — he’s a candidate, he’s been involved with the Minister and BLDC. And what I want to know is what was his proposal? What is he bound to do under that agreement?

“I’m presuming they liked what Outward Bound was doing and they had a track record. They’re not people who got in the bed with the Minister.

“You could still argue that there should have been a RFP. But I’m a little bit less uncomfortable with Outward Bound because all of these red flags don’t exist with them. We got the same actors [as with BLDC] with a different play but the plot looks remarkably similar.”

Mr Bean said that CARTEL is now running its second Youth Empowerment Camp on the island. Young people aged seven to 16 attend the summer camp which uses a “holistic” approach and a “therapeutic concept”.

“Location is key if we are going to see a therapeutic concept be effective,” he said when asked why he needed an island for a summer camp. “And an island is an ideal environment” removed from influences the youth might get on the mainland.

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Published Aug 9, 2012 at 8:04 am (Updated Aug 9, 2012 at 8:04 am)

Corruption warning over island lease tender process

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