Government finally broke its silence last night on the latest controversy surrounding the new Berkeley Institute and said it had been assured that the development was not being operated as a union site.

Acting Works and Engineering Minister Randy Horton released the statement after a lengthy meeting with officers and said Government categorically denied that it had made it a condition that the $70 million school contract be a union closed shop.

He said he had been assured by the Bermuda Industrial Union (BIU) and the general contractor Pro-Active Management Systems Ltd. that sub-contractors were not being told they had to become unionised or face losing the work. However, he said although Government was the owner of the development, it was not party to any contractual agreements between Pro-Active and any of its sub-contractors.

He said that in the contract between the Ministry and Pro-Active there was no provision for a closed shop, and nor would there ever be such a provision in any contract issued by the current Government.

Mr. Horton said: "The relationship between the general contractor and sub-contractors on this job is not being handled any differently than in the case of the contract awarded for construction of CedarBridge Academy, the other senior secondary school."

The Royal Gazette reported on Tuesday allegations from sub-contracting firms that they had been told by Pro-Active that they must negotiate with the union if they wanted to be awarded contracts for the massive site.

They claimed that Pro-Active had said it was under pressure from the BIU to ensure that everyone working on the massive Government project was a member of its union.

Some company executives said their staff were not interested in joining the union, but they were willing to pay the union dues for their employees while they were working on the site.

But they described the situation as "blackmail", "extortion", "undemocratic" and "illegal".

And President of the BIU Derrick Burgess, who is also a Government backbencher, claimed that the site had been declared a "union site".

Under the Trade Union Act 1965, it is unlawful in Bermuda to demand that a site be a closed shop, which means every worker must be a union member. The Bermuda Employers' Council has already said it was investigating the claims and intended to get to the bottom of the matter.

And the Construction Association said he had received numerous calls from members of the industry on the issue.

Labour and Home Affairs Minister Paula Cox told The Royal Gazette yesterday that she has not and will not be getting involved in the situation whatsoever, and said that a lot of "speculation" surrounded the matter.

She said claims that she had contacted the union to insist that they cease with the demand were untrue.

And the Government Labour Relations Officer Larry Burgess last night said the issue had not gone to his department, so he would not comment.

But Shadow Labour and Home Affairs Minister Michael Dunkley criticised the Government for not doing enough.

And Mr. Dunkley said both the Works and Engineering and Labour and Home Affairs ministers should be investigating. He said: "This statement walks like a duck, swims like a duck and quacks like a duck - in fact, it is a duck."

He added: "All we have received from the acting minister is sweet nothings. The fact remains that an awful lot of people involved in the construction industry are making these allegations. Are they all wrong?

"To top it off, these claims were verified by the union president Derrick Burgess. If the acting minister cannot shed any light on this, then you would think he and the Labour and Home Affairs minister Paula Cox would want to speak to people and try to get to the bottom of it.

"This statement is merely trying to make the matter disappear, but that's not good enough. The facts are still there.

"I will not stop until I get to the bottom of the whole Berkeley fiasco. The project has not got off to a very good start."