UDeCOTT Responds to Allegations

Contact: Corporate Communications Unit, 627-0083

May 1, 2008:The Board and Management of the Urban Development Corporation of Trinidad and Tobago (UDeCOTT), strongly deny spurious allegations of improper conduct, unauthorized and unaccountable behavior leveled against the Corporation and its Executive Chairman, Calder Hart, in the conduct of its business on behalf of the Government of Trinidad and Tobago. UDeCOTT also describes as ludicrous; statements that “elements” at the Corporation sought the dismissal of any Government Minister.

UDeCOTT also categorically refutes statements, to support those allegations, by Dr Keith Rowley, that Cabinet only recently found out about a 60-room hotel, incorporated as part of the Port of Spain Performing Arts Academy at the Prince’s Building grounds. The suggestion that the hotel was first made public at a presentation to Cabinet’s Finance and General Purposes Committee (FGP) at Whitehall on April 14, 2008 is not true.

The timeline of cabinet approvals of the arrangements for the project is as follows:

January 19, 2006

Cabinet approves the financing arrangements with the Government of China for a US$100 million concessionary loan for the establishment of the two Academies of Performing Arts.

January 20, 2006

Following Cabinet approval, Agreement entered into by UDeCOTT and SCG detailing responsibilities and containing project proposal which references a 60 room hotel and project size of 25,000 sq metres.

May 12, 2006

Agreements signed at a formal ceremony in Port of Spain including Prime Minister Manning and Chinese officials, Foreign Affairs Ministry, Ministry of Finance, UDeCOTT and SCG. Financing agreement references agreement of January 20, 2006 as comprising project definition for purposes of implementation (Preamble pt 5).

November 9, 2006

Cabinet approves the Vision 2020 Operational Plan 2007 2010, which includes the Performing Arts Academies as major projects to Develop Innovative People (the first Development Pillar) on page 59, with clear identification of a 59-room hotel in the Port-of-Spain Academy and another hotel in the San Fernando Academy. Cabinet also approves that the Plan be launched publicly in November 2006.

August 17, 2007

Cabinet approves the 2008 Public Sector Investment Programme (PSIP), which includes a provision of $190 million for the continuation of construction of the two Performing Arts Academies, complete with hotels.

August 20, 2007

Cabinet approves “The Appropriation Act 2008” and the laying in Parliament of a number of Budget Documents, including the 2008 PSIP, which include provision for the two Academies, with hotels.

Information regarding the Port of Spain Performing Arts Academy specifically stating that it would include a hotel was publicly revealed in UDeCOTT’s August 2007 calendar page and it is listed on the Corporation’s website. The calendar was printed in late 2006 and was distributed to Government Ministries, state agencies, media houses, among others in December 2006.

Information is available to the public on the websites of the Ministry of Finance – http://www.finance.gov.tt/, the Ministry of Planning, Housing & the Environment http://www.planning.gov.tt/ and UDeCOTT – http://www.udecott.com/

UDeCOTT operates under the strictest standards of accountability and global best practice, reporting through the Minister of Planning, Housing and the Environment, its line Minister. The Corporation also reports to the Ministry of Finance and the Public Accounts (Enterprises) Committee. UDeCOTT also reports to the Ministry under whose auspices particular projects are being undertaken and in the case of the Performing Arts Academy, it is the Ministry of Culture. UDeCOTT is also audited by independent auditors, PriceWaterhouseCoopers, with its last audited statement being 2006. The Company also has a Board of Directors whose responsibility is the development of operating policy, project and budgetary control and financial oversight in the conduct of the Company’s business. The Companies Act imposes on Board Directors, both individually and jointly, a fiduciary responsibility and a duty of care to act in accordance with the provisions of the Law.

All projects undertaken by UDeCOTT have been approved by Cabinet. Before Cabinet makes a decision to approve a project, it is briefed through the relevant line Minister of its feasibility and components. Additionally, in order to obtain funding through the Ministry of Finance, Cabinet approval must also be sought. If the project is to be funded by Government through the IDF, funds are not disbursed to UDeCOTT simply on the basis of its request, but only after relevant documentation has been provided and screened by the Ministry to substantiate the request. The same process obtains if funding is sourced from private financing (banks). During the life of any project the Ministry of Finance can look into the award of any contract granted by UDeCOTT and upon completion of any project, decisions as to the end user are again made by Cabinet.

UDeCOTT also dismisses claims that it is “loose” in its operations, especially in light of the checks and controls which are in place. There has always been a distinct separation between the Chairman of UDeCOTT and the Audit Committee which is chaired by a Chartered Accountant, and includes an Attorney at Law.

With regard to allegations that there was a conspiracy between Government and UDeCOTT which led the Integrity Commission to investigate a former Government Minister, UDeCOTT categorically denies that there was ever any conspiracy between Government and itself or that any UdeCOTT official made any complaint, which led the Integrity Commission to investigate any Minister.

Subsequent to the Commission of Enquiry into what has become known as the “Landate” matter, the Integrity Commission wrote to UDeCOTT on August 19, 2005, requesting that the Corporation provide its investigators with access to all documents and files in respect to contracts awarded to contractors, relating to an investigation into allegations made relative to a Government Minister. At all times UDeCOTT cooperated fully with the investigators of both the Police and the Commission and it must be emphasized that at no time did anyone at UDeCOTT initiate this or any other investigation by the Commission or the Police.

With respect to the statement attributed to Dr Rowley that the Chairman suggested he meet with the Contractor who submitted the lowest bid, this had nothing to do with the tender consideration, but was in response to comments made by Dr Rowley to the Chairman that there were adverse statements being made about the integrity of the Contractor. As such, in keeping with the principles of natural justice the Chairman enquired of the Minister whether he wished to speak to the Contractor in respect of same in order to get his side of the story.

With respect to Dr Rowley’s comment that he had problems with the Chairman of UDeCOTT from day one, the Executive Chairman categorically denies any knowledge of this deterioration in the relationship prior to the consideration over the award of a contract on the Customs & Excise Building.

With respect to the transfer of most of the housing projects to HDC by UDeCOTT, this occurred as a result of a negotiation involving the former Chairman of the HDC and the Chairman of UDeCOTT, wherein with the increasing commercial work-load on UDeCOTT and cash flow issues being faced, it would be more expeditious to shift the housing programme to HDC as they would inevitably be responsible for distribution.

UDeCOTT, like other special purpose companies and HDC, does not fall under the ambit of the Central Tenders Board Ordinance and procures goods and services pursuant to its own tender rules which are approved by the Minister of Finance. These tender rules have been in existence since the company commenced operations in 1995.

The UDeCOTT Board and Management wish to state their unequivocal confidence in its Executive Chairman, Calder Hart.

UDeCOTT is developing the structures that form part of the innovation for lasting
prosperity; the development plan of the Government of Trinidad and Tobago.