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Thursday 20 September 2018
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HDC clears Rowley

STATE-OWNED Housing Development Corporation (HDC) has answered Prime Minister Patrick Manning’s question asked in Parliament, over the disappearance of $10 million from the Cleaver Heights housing project in Arima.

In a written submission filed on Wednesday afternoon with the Uff Commission of Inquiry into Udecott and the construction sector, the HDC effectively cleared former planning and development minister Dr Keith Rowley of any wrongdoing in the Cleaver Heights project by attributing apparent million-dollar discrepancies, in the contract total for the project, to “two errors” contained in a letter of award drawn up by the HDC and addressed to the project contractor, NH International Limited.

The errors resulted in the initial contract sum being wrongly stated as $143 million when it should have been $133 million, according to the document, a copy of which has been obtained by Newsday.

Further, the HDC submission – which does not name Dr Rowley – identifies approved project variations as well as several infrastructural problems which had the effect of inflating the total contract sum by more than $22 million.

During the 2009 Budget debate in Parliament on September 30, Prime Minister Patrick Manning alleged there was a $10 million discrepancy in the contract sum for the project, asking: “Where the money gone?”

Manning made the allegation after requesting an extraordinary extension of speaking time allowed to him during the debate. At a subsequent sitting of Parliament, on November 14, Manning said the discrepancy was not $10 million but really $20 million.

In its submission lodged at the inquiry secretariat on Wednesday afternoon, the HDC attributes the $10 million discrepancy in its letter of award to the repeat of an incorrect figure that was contained in HDC documents.

“The letter of award to NH dated May 3, 2005 contained two errors resulting in the contract sum being stated as $143 million as opposed to $133 million,” the HDC submission stated. This was due to the use of an erroneous figure in the letter.“This latter figure is a repeat of an error contained in the Note to the Board dated April 11, 2005...The letter of award overstated the contract sum by $10 million.”

Further, “the errors contained in the letter of award were repeated in subsequent documents including valuation reports and the errors were not detected by HDC personnel, until late 2008,” the submission noted. The HDC further explained the method of payment used on the project, noting that “overall payments made to the contractor are based on works executed as measured by the interim valuations done by the HDC’s quantity surveyor.”

But while it attributes any discrepancy in the project to error on the part of staff, the HDC in its submissions also revealed, that to date, “a formal contract is yet to be signed,” in relation to the million-dollar project. It further revealed that while the project had an original price-tag of $133 million, roughly $22 million in approved variations as well as other costs expected to be incurred have swollen the total cost for the 383-unit project, to $158 million.

Among the reasons for the additional costs are: underground electrical infrastructural works which were required by the TT Electricity Commission; unplanned provision of off-site sewerage by the contractor; unforeseen delays in the provision of water and sewerage for the project as well as unplanned expenses for security which the contractor was forced to undertake to prevent vandalism of completed units, not yet handed over, because of delays in the project which is expected to be completed by this March.

On November 14, Manning said he would refer the matter to the Uff inquiry. The terms of reference of the inquiry were eventually expanded on December 10 to include an examination of the Cleaver Heights project.

The inquiry had set aside two days, February 3 and February 4, for a detailed consideration to the project. The inquiry construction expert, Gerry McCaffrey, on Wednesday visited the HDC offices at South Quay. He is due to submit a note on his findings this week.

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