Anderson, Scott branded ‘grossly incompetent’

Two public officials have been tagged “grossly incompetent” in an Integrity Commission report for their handling of two contracts that cost Jamaican taxpayers $20 million.

The report, which was tabled in Parliament on March 8, covered an investigation into allegations of the non-performance of a contract awarded to car dealership GM Challenger by the Jamaica Defence Force (JDF) in 2014.

The report found that Major General Antony Anderson, the then chief of defence staff of the JDF, and Gilbert Scott, a former permanent secretary in the Ministry of National Security (MNS), as the relevant accounting officers, were “cavalier” in the manner in which the procurement activities were conducted for the contracts awarded to the company.

“… They allowed the same entity, GM Challenger, to be twice paid deposits totalling approximately $20 million for vehicles ordered but not supplied and that no refunds of those deposits have been received to date,” Director of Investigations (DI) Kevon Stephenson said in the report.

The report also said that both Anderson, the current commissioner of police, and Scott breached Section A7.6.3. of the Public Sector Procurement Procedures when they authorised partial payments to GM Challenger without first obtaining an advance payment security from the company.

In May 2014, the JDF contracted GM Challenger to provide a new ambulance at a cost of US$113,807.38 with a two-month deadline.

An advance payment of J$6,097,777.28 was made to the company, which failed to deliver the vehicle, resulting in the JDF terminating the contract.

A request for a refund was made, but GM Challenger replied with a claim for losses it said it suffered because of the termination of the contract.

GM Challenger said money would have been spent on ordering the manufacturing of the chassis for the ambulance, which had to be specially retrofitted for the JDF. It also made a claim for damages for breach of confidentiality.

The company said that it failed to meet the deadline because the JDF had been indecisive about the type of ambulance it wanted.

GM Challenger said that the JDF was informed that the ambulance it wanted would have taken five months to procure.

The dealership said the JDF indicated some time after that it could not wait and instead settled for another version of the ambulance.

However, months later, GM Challenger said the JDF indicated that it wanted the first ambulance, but by that time the supplier had sold the vehicle.

The JDF subsequently wrote to the attorney general (AG) to take steps to recover the sum paid.

In the matter of the security ministry, the Integrity Commission’s report said that it contracted GM Challenger to supply five 40-seater buses to the JDF in February 2006.

A deposit of $12,986,209.60 was made, but the company failed to supply the buses, resulting in the ministry’s termination of the contract.

“To date, GM Challenger has neither returned the deposit nor delivered the buses to the Ministry of National Security or the JDF,” the director of investigations said.

The Integrity Commission report said a year after GM Challenger was contracted to procure the buses, the ministry enquired about the delivery and was told by the company that they would be ready by the middle to the end of the month (August 2007) and that a shipper was being sought.

On October 24, 2007, GM Challenger wrote to the ministry advising that the five buses were ready but there were some challenges in importing them as the shipping cost which they had included in their bid price moved from US$9,000 per unit to between US$16,000 and US$20,000 per unit.

This prompted the ministry to request a refund, but instead, the company proposed that the ministry absorb the additional freight charges or allow it to supply police cars from its inventory to offset the obligation.

The security ministry rejected the proposal.

Stephenson concluded that Anderson and Scott, or their designate, “were grossly incompetent, at best, in their handling of the contracts outlined herein”.

“The foregoing is a clear breach of fiduciary on the part of the respective accounting officers, who, in contravention of the procurement rules, approved advance payments to GM Challenger without first obtaining the requisite advance payment security,” he said.

“... The DI finds it inexcusable that the Government of Jamaica, on behalf of taxpayers, remains out of pocket for over 14 years in one instance and over seven years in the other.”

He said the justifications proffered by GM Challenger for failing to meet its contractual obligations and/or refund the deposits paid were “questionable, at best, if unacceptable”.

Stephenson has recommended, among other things, that the current chief of defence staff, Antonette Weymss Gorman, identify the officers accountable for the breaches and consequential loss and “pursue the necessary disciplinary actions to deter such conduct and/or minimise the occurrence of similar breaches in the future”.

The report has been referred to the attorney general to pursue actions deemed appropriate to “put the Government of Jamaica (JDF and MNS) in the position it would have been had GM Challenger not breached its 2006 contract with the MNS and its 2014 contract with the JDF to supply five buses and an ambulance respectively”.

Stephenson has also asked the AG to consider the possibility of joining, where appropriate, the negligent officers in the JDF and the MNS in any action for breach of contract in respect of GM Challenger.

kimone.francis@gleanerjm.com