Ken Ali

An of­fi­cial high-lev­el re­port in­to state-run Hous­ing De­vel­op­ment Cor­po­ra­tion (HDC) has re­vealed graph­ic de­tails of fraud, "silent" projects, in­ef­fi­cient ac­count­ing and a sea of oth­er fi­nan­cial and man­age­ment bungling. The study tells of pay­ments be­ing made with­out ap­proval of the Ten­ders Com­mit­tee of the Board of Di­rec­tors, of poor su­per­vi­sion of projects and of cer­tain fi­nan­cial de­ci­sions be­ing car­ried out by "word of mouth," in­stead of prop­er in­voic­ing and sup­port doc­u­ments. "A project man­ag­er can go to a hard­ware store and sim­ply or­der ma­te­r­i­al on the ac­count of the HDC with­out ap­proval of project jus­ti­fi­ca­tion," said the re­port. The study was said to be au­thored by Louis Nurse, who served last year as HDC man­ag­ing di­rec­tor. The re­port bears no date.

The Nurse re­port tells of "silent" projects, "to which pay­ments are be­ing made but they are not on any of­fi­cial list­ing of the com­pa­ny."

He ex­plained: "A silent project is an ac­tiv­i­ty that is not of­fi­cial­ly list­ed by the projects de­part­ment and is not su­per­vised or ac­knowl­edged." Nurse iden­ti­fied an ex­am­ple as Al­mond Court Apart­ments in Mor­vant. "Al­though these projects are not ac­knowl­edged, costs are still be­ing ful­ly in­curred and pay­ments are made through the fi­nance func­tion," he said. Nurse clas­si­fied the "silent" projects as "an­oth­er fac­tor" which "in­val­i­dates the bud­get­ing process." He un­cov­ered that some con­trac­tors have di­rect re­la­tion­ships with em­ploy­ees of HDC "and it is re­flect­ed in the pay­ment pri­or­i­ties for in­voic­es..."

The for­mer MD said: "The HDC has shown a dis­re­gard for com­pli­ance re­quire­ments, in­clud­ing statu­to­ry ap­provals, ad­her­ence, with reg­u­la­tions and in­fra­struc­ture con­struc­tion stan­dards." The "lack of statu­to­ry ap­provals al­so af­fects the is­suance of com­ple­tion cer­tifi­cates, which af­fects the sale and mort­gages on the prop­er­ties to cit­i­zens," said Nurse. He ques­tioned the project gov­er­nance mod­el and said "it means that projects will al­ways be over-bud­get." The Trinidad and To­ba­go Mort­gage Fi­nance Com­pa­ny Ltd has "dif­fi­cul­ty in man­ag­ing and ex­e­cut­ing mort­gages on be­half of HDC," be­cause of "im­prop­er doc­u­men­ta­tion and project com­ple­tion cer­tifi­cates," the re­port stat­ed. Nurse ad­vo­cat­ed: "The Gov­ern­ment should con­sid­er pro­vid­ing a prop­er val­u­a­tion for the projects and the de­liv­ery cost of the hous­es."

This ap­proach, he ex­plained, "al­lows for bet­ter ac­count­ing..." He stat­ed that HDC has not shown that risk man­age­ment and mit­i­ga­tion rep­re­sent "an un­der­pin­ning ac­tiv­i­ty in the project ex­e­cu­tion pro­ce­dures." As a re­sult, changes in ma­te­r­i­al costs, en­vi­ron­men­tal stan­dards, avail­abil­i­ty of hu­man re­sources and ap­proach­es to project su­per­vi­sion "have not been re­flect­ed in their project lead­er­ship strate­gies." Nurse added: "This omis­sion cre­ates an at­mos­phere of cri­sis man­age­ment and many de­ci­sions are not prop­er­ly con­sid­ered be­fore ex­e­cu­tion, cre­at­ing more cost in­creas­es." The re­port al­so re­vealed that "a lot of re­spon­si­bil­i­ty has been placed on the con­trac­tors hired by the HDC, who use the op­por­tu­ni­ty to in­crease cost and ex­tract as much as pos­si­ble from the cor­po­ra­tion."

He said that "once a client is com­mit­ted and a project be­gins, the con­trac­tors are able to change the scope and, with­out a process of au­tho­ri­sa­tion, cre­ate li­a­bil­i­ties for HDC." Nurse ar­gued that be­cause of "the over­all in­ef­fi­cien­cy and in­ef­fec­tive­ness in the per­for­mance of the projects, the se­lec­tion process for con­trac­tors at HDC re­quires re­view." The for­mer MD said that the ex­per­tise, ex­pe­ri­ence and ed­u­ca­tion of "these in­di­vid­u­als and their com­pa­nies" in many cas­es "have not been val­i­dat­ed." He said: "As a re­sult, the ca­pac­i­ty of these firms to pro­duce qual­i­ty work and ex­e­cute the re­spon­si­bil­i­ty of project de­liv­ery through all the phas­es are weak and, in some cas­es, non-ex­is­tent." This is "par­tic­u­lar­ly ev­i­dent" in the es­tate man­age­ment of HDC, "where many small con­trac­tors op­er­ate with­out prop­er doc­u­men­ta­tion and man­age­ment sys­tems."

Nurse said it was dif­fi­cult for con­trac­tors to be ac­count­able for the lack of progress or flaws be­cause, "in many in­stances, prop­er doc­u­ment­ed con­tracts do not ex­ist or there are no agree­ments with claus­es that are legal­ly bind­ing." He re­vealed that for the pe­ri­od un­der re­view, more than 500 con­tracts had not been signed off. Fur­ther, he said, "Many large ven­ture con­tracts, worth mil­lions of dol­lars," were be­ing ex­e­cut­ed "with­out prop­er doc­u­men­ta­tion." Nurse said many small HDC con­trac­tors were un­trained. As a re­sult, the qual­i­ty of some work, such as tiling and plumb­ing, "is not up to stan­dard." He added, "These per­sons are weak in the man­age­ment of their projects, cre­at­ing prob­lems with the even­tu­al de­liv­ery." Nurse stat­ed that HDC has no sys­tem that sup­ports the jus­ti­fi­ca­tion, ver­i­fi­ca­tion, val­i­da­tion and au­tho­ri­sa­tion of pay­ments re­gard­ing earned val­ue.