$69M reconstructed NIS Corriverton office…Jail corrupt state officials, contractors involved in blatant fraud – Ramjattan

Aug 30, 2011 News

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“It is utterly ridiculous. I believe we have to jail some of these corrupt contractors, and more importantly, the state officials involved in these blatant frauds.”
Presidential Candidate of the Alliance For Change (AFC) Khemraj Ramjattan expressed this notion after taking note of a comparison of the $69M NIS building with three other one-flat buildings with approximately the same length and width, but which cost less than $7M, made in yesterday’s Kaieteur News edition.
One week after the commissioning of the reconstructed NIS office at Lot 8 Springlands Corriverton, Berbice, there is a grave doubt that the building and whatever else that may be within in terms of equipment, could attract such a significant cost.
The one-flat office, which is reported to be state-of-the-art, is said to cater for all the different aspects of the NIS’s operations, including Medical, Inspectorate and General Office.

Chairman of the NIS Board of Directors, Dr Roger Luncheon, and Finance Minister Dr Ashni Singh, who were present to cut the ribbon to commission the building, were not available yesterday to answer questions pertaining to the specifications of the building, and any other related issue, that caused the cost of renovation to be as much as $69M.
General Manager of the NIS, Doreen Nelson, when contacted, was said to be in a meeting and not available.
Commenting on the issue, Ramjattan said that he had addressed the issue of construction sector/Government corruption in his 2007 budget debate where he quoted extensively from a World Bank expert and now Oxford Professor, Paul Collier, who wrote a book called “The Bottom Billion”.
Ramjattan noted that Collier had said: “Corruption in the construction sector has been a dirty secret. Construction has all the ingredients conducive to corruption. Each project is a one-time only thing, and so cannot readily be priced.  There are so many uncertainties in execution that it is not possible to draw up what economists refer to as a “complete contract.  As a result, it is easy to evade the discipline that would otherwise be imposed by competitive tendering.  A crooked construction company

colludes with a public official to win the contract with an artificially low bid, but then they re-contract on points of detail that crop up during construction.”
Adding that corruption has its epicentres, Ramjattan said that one is “the banking system where much of the loot from corruption is deposited and laundered”.
He said that the others are the companies that pay massive bribes, and companies in two sectors seem to stand out:  resource extraction and construction.
“It is a rule of thumb that the Guyana Government likes to give out contracts because as we all know and Collier’s studies discovered, it got small piece and big piece passing back to Government officials….That happens here in Guyana!  Almost all our contracts afterwards go back for some re-adjustment. This is what happened with the NIS Skeldon building. Corruption in the construction sector is raising the cost of infra-structure and thereby reducing growth, and these effects are large,” Ramjattan noted.
Underscoring that corruption in the construction sector is particularly important now because largely the World Bank, the IDB and the IMF are granting large loans for infrastructural works, the AFC Presidential Candidate said another thing it brings is that it undermines the political process enabling the strategy of patronage to triumph over honest politics.
“Election time come and they giving out $25,000  (twenty-five thousand dollars) to dig drains all over the place!  This PPP/C Government does that kind of thing all the time.”
He said that aid for infrastructure makes sense, but only if it is matched by a radical tightening of the enforcement of anticorruption norms and regulations in the construction sector.
“But what we are seeing is now that the World Bank is tightening up, the Guyana Government is using taxpayers’ monies to avoid these norms set by the World Bank and other financial institutions.” Ramjattan asserted.
He continued: “I know reforms in Guyana under the PPP would not come. Why? Because those of them who feel safe and satisfied with the system will feel that it will affect their gravy trains.  The vested interests in this status quo will use all their power, all their resources, all their ingenuity and, on the other extreme, all their bullyism to ensure that there is no change and no growth.”
Noting that the Private Sector Commission must speak out on these issues, Ramjattan said the Government will lay in ambush against them whenever they start being brave enough to talk about such issues, but they have to confront and fight the battle.
“The battle is against this feeling that all is right.  The Administration feels that all is right.  We got to understand that all is not right. We have to rid this country of bad governance, of corruption, so as to bring back a patriotic zest, to bring that energy to engage in profitable activities, especially for our young people who want to stay here.” Ramjattan stressed.
However, speaking at the commissioning ceremony, Minister of Finance Dr. Ashni Singh said NIS is a striving social security organization, which has grown over the years from paid benefits of $100M in 2001 to $9B in 2010.
He challenged the institution to accelerate its database system using novel and advanced technologies, to ensure that contributors can access service in a timely manner. Dr Singh also urged the staff to fast-track its public awareness campaigns, in order to increase knowledge of the scheme and encourage self-employed persons to become au fait with the benefits of contributing to the NIS.
The minister called for speedier payments, the regularization of contribution records, and stressed the importance of reducing waiting time.
It was noted that the NIS building will be of service to 130 active employers and over 2,850 workers, most of whom are from the GuySuCo Skeldon Estate.

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