Egg on Thompson’s Face and foot in his mouth

  

From Albert Brandford The Nation

There is no need for the Leader of the Opposition … to be casting aspersions about corruption or lack of integrity or the need for him to be snide about insinuations he’s making about the lack of integrity in this country. – Prime Minister Owen Arthur (March, 2007).

WHATEVER might be our differences, no one should doubt that, as has been said before, I have a great deal of respect and admiration for Leader of the Opposition David Thompson as a politician.

It, therefore, pains me when I see Thompson allowing himself to be manipulated into taking ill-considered, even foolish, public stances on potentially embarrassing issues by some around him who have only their own interests – not his – at heart.

This is an election season, and those to whom I have previously referred in this space as “semi-literate bandits” are crowding Thompson and feeding his well-known political ambitions with dangerous nonsense that may not only hurt him with the electorate but also the great party he has the honour to lead.

In a desperate search for a great “scandal” with which to bring down the Owen Arthur administration, this group of Thompson advisors apparently encouraged him this past week to “try a t’ing” with the Hardwood Housing Factory.

Now, it is quite legitimate Opposition politics to test and pressure a Government at its weak points; but, and this is very important for politicians, and journalists (present or former), the information should be checked FIRST before going public.

One can readily understand and appreciate Thompson’s call for a forensic probe into Hardwood Housing, if only on the basis that his predecessor as Leader of the Opposition, Clyde Mascoll, is not only a leading political opponent, but also publicly associated with the company.

Fundamental error

But behind all of the allegations about “kickbacks” and “sweetheart handouts”, Thompson made one fundamental error, which, even if there were “infelicities” at the company, would undermine his standing with the public on the issue.

And that is, that he and his advisors in their hurry to find a “potential scandal” before the general election, failed to do their homework about ownership of the company and may very well wind up with egg on their collective faces.

There were references from advisors to Hardwood Housing variously as a “small black-owned company” and a “state-favoured company”.

Did anybody bother to check the corporate registry?

But Thompson, who as a lawyer and journalism aficionado, should know better, delivered of himself this statement with the certainty of a man who had thoroughly checked his facts: “It is amazing, for example, that this company – not on the corporate record as belonging to a Barbadian – (my emphasis) could have benefited in less than two short years from royal handshakes from various Government agencies including direct cash investments.”

My own investigations have determined that Hardwood Housing Factory Inc. – company No. 27882, was incorporated on November 2, 2006 under the Companies Act of Barbados.

At the time of its establishment, the Enterprise Growth Fund Limited (EGFL) – a Government agency within the Ministry of Finance – acquired one million Class “A” preferred participating shares at $1 each.

Chief executive officer Anthony Murrell’s equity stake in the company was valued at $100 000 for an equivalent number of common shares in recognition of the value of the equipment contributed and his “sweat equity”.

Murrell is a Barbadian who lives at Market Hill, St George. He is a joiner/carpenter by profession who worked in Grenada, in the aftermath of Hurricane Ivan, supervising the building of 500 wooden houses over a six-month period.

He put the concept of Hardwood Housing to the EGFL – which is the fund manager of the Industrial, Investment and Employment Fund – in a professional business proposal and it was accepted.

The factory, I was told, is designed to mass-produce hardwood houses, and as a result of the use of technology, has been able to offer houses at 20 per cent less cost than the market, thus making houses more affordable to low income Barbadians.

Documented evidence

The documented evidence is that approximately 90 per cent of the shares in Hardwood Housing is owned by the EGFL which “was formed in 1998 as part of Government’s initiative to respond to the void created in the supply of risk capital financing. The funds were designed to assist in the transformation of small and medium sized entities into international competitive businesses”.

According to the EGFL’s Indicative Term Sheet to the company, the $1 million investment was under these terms and conditions: building upgrade, $50 000; plant and equipment, $350 000; inventory, $350 000; working capital, legal costs and contingencies, $240 000; and EGFL’s fee $10 000.

On the basis of such easily retrievable information, I find it hard to understand terms like “small black-owned company”; “state favoured company”; and “not on the corporate record as belonging to a Barbadian”.

Thompson’s grab for a “potential scandal” might have better rested solely on the call for a forensic probe; but even then, one wonders why he would want an expensive international police and forensic investigator like Bob Lindquist, rather than use his own power and authority as chairman of the newly re-configured and empowered Joint Public Accounts Committee (PAC) of Parliament.

Lindquist is now into the second phase of two periods of work over the last 16 years on behalf of the government of Trinidad and Tobago for which he has so far received between US$3.3 and US$3.5 million for investigating the late government minister John O’Halloran and the continuing saga of the Piarco Airport Development Project.

Some Barbadians would remember well that the Malone and Duffus commissions, of late and unlamented memory, proved essentially useless, except perhaps for boosting the political ego of one man.

To hire Lindquist to examine the books of a company that only formally opened its doors to business on February 14, this year, seems like using a sledgehammer on a fly.

Would it be too much to require a competent, independent local auditor to examine (1) the management and supervision of all Hardwood Ho using cash transactions; (2) the accounts operations (3) the physical plant; and (4) the management structure?

How long would that take?

But Thompson does not have to “outsource” the job.

As the Prime Minister said in the report referred to at the top of this piece, Government changed the “system of governance to give more power to the Leader of the Opposition and the PAC as a watchdog” of state spending.

“We changed it so that the Opposition would always be guaranteed to be able to constitute a quorum and we said the Public Accounts Committee could investigate not only central government but any agency of Government, any account that belongs to Government if there is anything whatsoever . . . ,” Arthur added.

Last July, Thompson responded with a statement to my call for the PAC to step up its work, and confirmed that he now has the power to enquire into “all statutory corporations [and] entities in which the Crown owns not less than 50 per centum of the share capital or controls at least 50 per cent of the voting rights in the entity”.

Save us the foreign exchange for the Lindquist fee, Mr Thompson.

Again Thompson has opened his mouth just to put his foot in it.

He has gone public with false an unsubstantiated accusations just for political gain.

Once again he has come out the other end with egg on his face. Proven wrong at every turn.