Imbert admits error on project figures
Finance Minister Colm Imbert is admitting to additional cost overruns at the ANR Robinson Airport which differ from figures he provided to journalists during a media conference on Thursday. As of now, the cost is closer to TT$118 million (US$17.5 million) and not TT$16.9m (US$2.5m) he originally stated.
The new information initially came from a leaked Cabinet note which showed the Finance Minister’s request and approval for additional funding for the project. The note was circulated hours after Imbert addressed the matter on Wednesday and was raised by Opposition Leader Kamla Persad-Bissessar, as she doubled down on her claims that Government had mismanaged the project.
This forced Imbert to call a second media conference yesterday, where he addressed media reports highlighting the discrepancies in his original statements.
When Imbert spoke at the post-Cabinet news conference on Thursday, he said, “As of today, the original construction contract sum has been exceeded by US$2.5 million or two per cent.”
That sum, according to the Cabinet note, came from an estimate of US$14.2 million (TT$96.3m) for variations to the contractor – China Railway Construction (CRCCCL). A total of US$11.7 million (TT$79.3m) was paid from the project contingency fund, and the balance of US$2.5 million came from the Ministry of Finance’s budgetary allocations.
But the leaked cabinet note dated November 28 also shed more light on some of the other funds requested, namely an advance payment of US$15m (TT$101.5m) to CRCCCL to address pending claims. The contractor, Imbert explained, made a claim of US$30m (TT$204m), and Nidco recommended they pay the advance while Government settles the claim.
The discrepancies were pointed out to Imbert, with a clear question as to why he didn’t state all of this information on Thursday.
Imbert explained that he only wanted to address what he knew with certainty at the time. He said he wanted to be careful not to speak about things he was not fully informed about, since reporters had asked him to comment on reports he didn’t have in front of him.
But when it was pointed out to Imbert that he had access to the Cabinet note which contained all the information about all possible additional costs, he responded: “I’m sure you would have got it in due course, remember, this is a live project, an active project. We’re pushing to have it finished, and nothing is secret in Trinidad and Tobago, this would have eventually come into the public domain.”
Imbert said he was not concerned about anyone leaking the Cabinet note, which is supposed to be confidential.
In explaining the additional costs being paid, Imbert said, “All that has been approved by the employer project manager consultants is that 2.5 million US dollars. The claims have not been settled. And as I said, they are in negotiation with the contractor right now on the claims. There’s an advance; it may go up, it may go down.”
The claims come from extensive delays. The project was initially expected to be completed in 2023 but had to be pushed back because of COVID-19. There would have been additional delays because of the time it took to complete the land acquisition, which was 290 days.
Another delay came once consultant CEP’s contract came to an end.
Imbert again defended the decision not to rehire CEP but also stressed they were not fired because they declined to “rubber stamp” questionable aspects of the design.
He said CEP was hired by Nidco as the initial design review consultant for the project. CEP reviewed and signed off on the contractor’s (China Railway) initial structural designs.
However, later on, Nidco decided that the original design approved by CEP was not adequate enough, especially in light of concerns about climate change and more powerful hurricanes.
“CEP’s contract was for a particular period of time to provide this design review service for a particular period, and because the project was delayed due to COVID and also land acquisition, CEP’s contract came to an end, and I’m told by Nidco that the price that they asked for to continue is very high, and Nidco was unable to agree on it,” Imbert explained.
But Imbert said the costs for delays were expected.
“I knew that claims were going to come for delays, and I also was aware that Nidco had enhanced and improved the design and construction, and the contractor would need to be paid for that,” he said.
Imbert said CEP had “signed off on a design that was inadequate.”
He also said Government had saved some money, since the original budget for land acquisition was $300 million but the actual payments made to date were $251m, a savings of around $49m.
Kamla: Colm should resign
Opposition Leader Kamla Persad-Bissessar, in an immediate response, said Imbert should now step down or be removed as Minister of Finance.
“He has absolutely discredited himself,” she said.
She said the Cabinet note revealed Imbert was either “an incompetent, or a liar.”
“It seems that he had amnesia at Thursday’s presser but regained his memory by 1 pm on Friday. What is also concerning is that every member of the Cabinet must have known about these massive cost overruns and design issues, but they all remained quiet and assisted in covering it up from the public,” Persad Bissessar said. She also accused Imbert of misleading the public about savings on land acquisition, noting that funds from a $300 million loan were diverted to cover cost overruns.
She also called for Nidco chairman Herbert George to step down or resign as well.
“Only last month he told the media that the project was on budget; this has now been exposed as a lie. He must be removed as chairman of Nidco,” she said.
Meanwhile, former Minister in the Ministry of Finance, Mariano Browne, said yesterday he didn’t see a need for Imbert to resign, but he did acknowledge Imbert’s credibility could take a hit.
“I think there are a few other questions that have to be answered,” Browne said.
“Simple. I don’t think there’s anything wrong with answering the questions.”
When asked if Imbert may be hiding some of the figures because of an impending election, Browne said, “It is embarrassing when one’s memory fails in matters such as this, if you take into consideration that the minister is also in a fight with the auditor general over a question of a reconciliation with an item in terms of how much revenue was actually received. I think that Minister Imbert is reminded that you would have to be a little bit more precise.”
Summary of Recommendations (Point 17) of the Cabinet note which was approved:
Payment of Variations:
US$14.2 million for variations categorized as “approved, instructed, and anticipated” to the contractor CRCCCL.
Funding source:
US$11.7 million from the project contingency fund.
US$2.5 million from the Ministry of Finance’s budgetary allocations.
Risk Management Allocation:
An additional US$5.0 million to be allocated for unforeseen project risks (variations), subject to proper justification. This is a proactive measure to address any future risks.
Advancement of Claims:
An advance of US$15 million to CRCCCL to address cash flow challenges related to pending claims. This is based on NIDCO’s Claims Assessment Report and will be subject to legal terms and conditions.
NIDCO’s Management Fees:
A lump sum payment of TT$10 million to NIDCO to cover Project Management Fees for the project’s delayed timeline, sourced from the Ministry of Finance budget.
Outstanding Payment to ACQ and Associates:
TT$1.8 million to be paid to ACQ and Associates for land acquisition services. This payment will be sourced from the remaining balance of a TT$300 million Scotiabank Loan.
Non-objections Previously Granted:
TT$11.5 million for a contract with Acuitus Caribbean Facilities Management Company for construction supervision (to replace CEP Limited).
US$776,244.29 for the extension of consultancy services by ZABIR 2005 S.L. through December 2025. Both expenses will be funded under the Ministry’s Infrastructure Development Fund.
The post Imbert admits error on project figures first appeared on CNC3.