Udecott breached law

Urban Development Corporation (Udecott) chairman Calder Hart yesterday admitted the state enterprise had breached the law in the $850 million Tarouba project.

He was responding to a question from chairman of the Public Accounts Committee (PAC), Senator Wade Mark, at a PAC meeting yesterday at the Parliament Chamber.

Hart said there were some design issues (tied to the engineering of the waste water and sewage) which the Environmental Management Authority (EMA) had concerns with. He said Udecott gave the EMA a commitment to address its concerns.

“For me it came as a shock that kind of commitment would not be acceptable to them, especially since we were doing this project for the State,” Hart stated.

He added that once an agency of the Government gave a commitment to meet the required engineering standards, Udecott should be “more pragmatic” since “we are not living in a perfect world.”

Corporate secretary Neelanda Rampaul said although Udecott was fined by the EMA, it was for a “procedural breach” rather than any breach related to environmental damage.

While the committee’s members appeared to accept Udecott’s position on this issue, they had serious reservations about Udecott’s admission that it did not have an internal auditor. In fact, CEO Ricardo O’Brien revealed the company’s audit committee only consisted of its chairman, who was a member of the board. He said the board lost some of its members last year (which stripped the audit committee of its membership).

PAC member Mary King said she could not understand how a company which was managing 60 projects worth an estimated $10 billion had a tenders committee which consisted of directors of the board and a chairman of the audit committee who is also a director. She said it was unacceptable that Udecott should be receiving the type of loans it did when there was no auditor who could supervise the management of these assets.

Hart eventually offered as an excuse the “stringent requirements” of the Integrity Commission, which he said led to people not being prepared to take up board appointments. He said the company was looking for an internal auditor.

In response to other questions, Hart revealed Udecott’s debt was $1.8 billion while its assets were $2.5 billion.

Hart also admitted the only project which was “absolutely on time and on budget” was the Waterfront Project.

He said while Udecott has had to source some of its construction expertise outside, the company wanted to ensure that learning was retained by citizens after the experts have gone.