One third of Bermuda Housing Corporation mortgagees are in arrears to the tune of a total of $533,472, it was revealed yesterday.

That brings the total owed to BHC to over $1.7 million when rental arrears of $1.2 million are included.

And eleven delinquent Bermuda Housing Corporation mortgages are being foreclosed, Housing Minister David Burch announced.

The Minister also said that nine rental clients will be evicted shortly for their debts to the Corporation.

At a press conference to update the public on his efforts to clean up the quango which has been wracked by allegations of massive corruption and mismanagement, Senator Burch made it quite clear that he intended to restore faith and integrity in the Corporation and its mission to provide affordable housing to those in need.

He said, while the Corporation regretted making such “tough decisions” they were necessary because delinquent clients prevented others from getting assistance.

“Clearly we would be able to assist a far greater number of families in need if those who have already received assistance met their contractual obligations.” A staggering 33 percent (101) of the Corporation's 310 mortgages in its portfolio are in arrears, he said. BHC's mortgage portfolio is worth $19 million and the arrears amount is $533,472.

“Following a review of the entire mortgage portfolio, we agreed to immediately carry out foreclosure proceedings on the 11 worst cases,” the Minister said. “These proceedings are in varying stages of execution; with foreclosures taking place next week and over the next few weeks as legal procedures are concluded.”

He said seven of the eleven cases date back to before 1998. “I should note that the oldest case has been in arrears since 1985 and an overwhelming 64 percent have been in arrears for more than six years. “To put this in perspective the highest arrears amount is $55,000 dating back to 1985 and the lowest of $6,000 dating back to 1995.”

The Housing Corporation is “working with the remaining 90 clients”, he added, and they can avoid foreclosure if they make an effort to reduce their debt. “However, I should caution that we will regularly monitor the situation and I therefore cannot guarantee we will not commence further foreclosure proceedings against the worst offenders.”

On the rental side, arrears to the Corporation is a “staggering” $1.2 million, Senator Burch said.

The highest rental arrears figure is $19,738 dating back to 1999, and the lowest is $7,815 from 2000.

The Minister said that seven of the nine worse cases will be evicted next week and the other two shortly after.

“Government cannot in all good conscience put families with children out on the street - in spite of their delinquency, or refusal to meet their rental commitment,” he continued. “However, there is something we can do and while the Support Services department of the Corporation continues to work with each Bermuda Housing Corporation family to address their arrears, delinquent families will be relocated to one of the BHC rooming houses to allow them time to erase their arrears, and thereby eventually graduate to apartment status again.” While most of the arrears date back from before the PLP came into power, Senator Burch said he would not play the blame game.

“I cannot comment on whose fault it is. It serves no purpose,” he said at question time. “I just want to be able to say we have the money.”

Asked about the size of BHC's emergency housing list, he said, while efforts at reducing it had delivered “encouraging” results there was more to be done.

“I'm not entirely happy... the numbers still hover above 100, which is a position that is unsatisfactory to me.”

He said some people on the list were there as a result of their own delinquency, which is against BHC policy.

“So we are going to go through the list in its entirety, one by one, and ascertain why people are on the list, whether they should be on the list and whether it does in fact constitute an emergency. So I expect that it will significantly reduce over the course of the next week or so.”

Senator Burch said that he will not be asking the Finance Minister for more money from the budget to be announced next month.

“We have some fairly radical ideas that we are carrying forward with the board next month that are going to cost us money... But I could not in good conscience ask for more money for the Corporation until I'm at the stage where we are spending what we have properly and we have made a genuine attempt and a significant dent in the amount of money outstanding. That is the biggest impediment to making real progress the fact that the people we have helped are not pulling their weight.”

He said action taken to recover money from contractors who may have done shoddy work for the Corporation or been overpaid, had been making “good progress”. Legal action has started with over 20 contractors. Senator Burch added that there were some cases which may not be able to be litigated.

“But we are writing to the individuals concerned indicating our position. We think that many of these people may not wish for us to name them and so far I have not done so. That is not a promise that necessarily will continue into the future. If we are not able to go to the courts and if we are unable to convince them that there should be some redress, and we'll come up with a figure as to what that is, then certainly I shall be standing at this podium at some point in the future telling you exactly who they are.”