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courage is contagious
Viewing cable 07KINGSTON343, ANTI-CORRUPTION STRATEGY: CONTRACTOR GENERAL OF
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| Reference ID | Created | Released | Classification | Origin |
|---|---|---|---|---|
| 07KINGSTON343 | 2007-03-12 20:01 | 2011-06-16 09:30 | UNCLASSIFIED | Embassy Kingston |
VZCZCXYZ0006
RR RUEHWEB
DE RUEHKG #0343/01 0712001
ZNR UUUUU ZZH
R 122001Z MAR 07 ZDK
FM AMEMBASSY KINGSTON
TO RUEHC/SECSTATE WASHDC 4462
INFO RUEATRS/DEPT OF TREASURY WASHDC
RUEAWJA/DEPT OF JUSTICE WASHDC
UNCLAS KINGSTON 000343
SIPDIS
SIPDIS
STATE FOR INL/C, INL/LP (BOZZOLO) AND WHA/CAR (BUDDEN)
JUSTICE FOR OPDAT (ROBERT LIPMAN)
TREASURY FOR OTA (FRED BORAKOVE)
E.O. 12958: N/A
TAGS: JM KCOR KCRM KJUS PGOV
SUBJECT: ANTI-CORRUPTION STRATEGY: CONTRACTOR GENERAL OF
JAMAICA
¶1. Summary: Please see the action request in paragraph 12.
Currently, the Mission is exploring mechanisms for
encouraging the Government of Jamaica (GOJ) to curb
corruption. In keeping with the Mission's evolving strategy
plan on anti-corruption, we are meeting with heads of
Jamaican government entities that can play key transparency
roles in promoting better governance. Most of these
government offices are empowered to expose violations of
laws/regulations and can refer violations by public officials
to the Director of Public Prosecutions (DPP). In pursuit of
our quest for better understanding of these key players and
possible avenues for improving their performance, the Acting
Director of the Narcotics Affairs Section (NASDIR) met with
Contractor General Greg Christie on March 1. Although his
powers are limited, Christie demonstrates courage in exposing
irregularities and violations with respect to government
contracts. End Summary.
BACKGROUND
¶2. Established in 1986 by the Contractor General Act of 1983,
the Office of the Contractor General (OCG) is an independent
commission of parliament. The Contractor General (CG) is
appointed by the Jamaica's Governor General after
consultation with the Prime Minister and the Leader of the
Opposition and serves a renewable term of 7 years. The CG's
primary functions are to a) monitor the award and
implementation of government contracts; b) monitor the grant,
issuance, suspension or revocation of government licenses;
and c) conduct investigations into registration of
contractors, tender procedures, award and implementation of
government contracts, circumstances of granting or revoking
prescribed licenses. While the monitoring functions are
mandated by law, the investigative function is discretionary.
In order to carry out these functions, the CG has a) the
right to be advised of the award of all Government contracts
by a pubic body; b) powers of inquiry, inspection and
discovery that allow his access to premises, documents,
records or information relating to contracts or licenses; and
c) the power to require any public officer or any person to
provide him with information regarding the award of any
government contract or the suspension or revocation of any
government license. Contracts are reviewed to determine
compliance with Government Procurement Guidelines.
¶3. The CG's secondary function deals with the National
Contracts Commission (NCC). He is responsible for obtaining
the budget for the NCC, as well as providing administrative
and technical assistance required for the operation of the
NCC. Like, the OCG, the NCC is an independent commission of
parliament with its own powers. It was established through
an amendment to the Contractor General Act, in 1999, and
became fully operational in 2001. Its eight members are
appointed by the Governor General (Christie is one of them),
who serve a seven-year term. The primary functions of the
NCC are to promote efficiency in the process of awarding and
implementing government contracts and to ensure transparency
and equity in the awarding of contracts. The NCC examines
and approves recommendations to award government contracts
valued at JA dollars 4 million and above. It makes
recommendations to Cabinet regarding award of contracts
valued at JA dollars 15 million or above. It registers and
classifies contractors who wish to bid on Government
contracts and constantly assesses their capacity to perform,
as well as their actual performance. The NCC can make
recommendations to Cabinet to improve the efficiency of
procedures for granting and implementing contracts. NCC
oversees the activities of the seven sectoral committees
through which contract award recommendations must be routed
by the sponsoring government procurement agency. Finally,
the NCC is empowered to make regulations prescribing the
registration and classification requirements for contractors,
the procedure for submission of tenders for contracts,
requirements for contractors to enter into performance bonds,
competitive bidding on government contracts, and the
circumstances under which a contractor's registration may be
canceled.
¶4. There are 200 public bodies that are subject to the CG's
scrutiny. They include ministries, departments, and agencies
of the Government, as well as statutory bodies, statutory
authorities and companies registered under the Companies Act,
in which government or any agency of government holds shares
or, through other financial input, is in a position to
influence the policy of the company. However, the CG's power
is restricted with respect to contracts/licenses involving
the security forces. The CG can monitor these documents, but
cannot conduct investigations without express authorization
of Cabinet.
¶5. Following an investigation, the CG must inform the
principal officer of the public body and the appropriate
Minister of the results of the investigation and make
recommendations for resolving any problem. He may, at any
time, submit a report to Parliament regarding a matter that
he has investigated, which he believes requires the special
attention of Parliament. After reports are presented to
Parliament, the CG can publish any that are in the public
interest.
RECENT EXAMPLES OF THE CG'S WORK
¶6. Corruption takes many forms. Over the years, it has been
openly speculated that the awarding of government contracts
was a major avenue of public corruption. The party in power
would make an effort to reward loyal supporters (campaign
contributors) with government contracts. That problem is
compounded when loyal party supporters sit on public bodies
that award contracts to private companies owned by the same
person. Such things might be considered a conflict of
interest, bQ maybe not, in Jamaica. In any case, since the
beginning of the year, CG Christie has been exchanging salvos
with Barbara Clarke, Chairperson of the Petroleum Company of
Jamaica (PETCOM) over what appears to be a conflict of
interest. Ms. Clarke apparently is the principal owner of
companies that have benefited from government contracts by
PETCOM since 1998. Clarke claims she has done nothing
unlawful because she declared her holdings when she assumed
the position with PETCOM and her company's initial contract
with PETCOM predated taking the chairmanship of PQCOM. On
March 1, the CG was quoted in the press as saying that he
will look into the possibility of referring the case to the
Director of Public Prosecutions. Comment: On March 5,
Jamaica's Auditor General Adrian Stachan mentioned to NASDIR
that Jamaica needs a law that clearly spells out a code of
ethics (including conflict of interest) and provides serious
penalties for violations. Stachan was probably signaling
that there may be little that the CG or the DPP can legally
do in the Clarke case. But, if nothing else, Christie is not
adverse to highlighting the need for conflict of interest
laws. From another source, NASDIR was told it might be
difficult to have a strong conflict of interest law in
Jamaica. The reason is that Jamaica's business community is
relatively small. To attract competent managers for public
bodies, government must draw on executives from the private
sector. If such a person were forced to relinquish control
over his/her private business in order to chair a public
body, that person would probably refuse the job. End comment.
¶7. The Contractor General does have the monitoring authority
to require that all public bodies submit to him quarterly
reports on the status of their government contracts.
However, non-compliance was common and previous CG's did
nothing about it. Christie (who was appointed in November
2005) announced in early 2007 there would be zero tolerance
of non-compliance, which is a criminal offense. After giving
fair warning to public bodies who failed to provide their
last 2006 quarterly report (due midnight of January 31,
2007), he decided to refer these cases to the DPP. Christie
told NASDIR there are 54 such cases. His intent is to send a
message that public bodies must comply with his instructions.
He knows the penalty will not be tough (maximum penalty is
JA$5000/US$77 or up to one year in prison). But, unless
reports are filed with him, he has no way to identify and
investigate irregularities. Christie said he asked the DPP
(Ken Pantry) to help him put the cases together, carefully
documenting the fact that public bodies had received the CG's
timely warning about compliance. The DPP's office assisted,
and the cases should be presented formally to the DPP around
March 15.
¶8. The CG emphasized to NASDIR that his investigative power
was discretionary. His point was that his predecessors did
not exercise that power. Christie is changing that, although
he is hampered by an insufficient number of investigators.
The CG said that, before he took over, there had been only
one investigation into irregularies. Last year, he submitted
over 20 reports on investigations. So far this year, he has
opened 18 investigations. Comment: It will be interesting to
see what comes from these investigations. Christie's
willingness to pursue his responsibilities energetically
contrasts with his predecessors. He has the power to keep
specific corruption issues before the public for longer
periods of time. In the past, irregularies were sometimes
exposed and then, after a couple of days of play in the
media, they were quietly forgotten. Of course, public
exposure also embarrasses the party that governs. During an
election year, public exposure can inflict more damage to the
ruling party than would otherwise be the case. However,
Christie insists convincingly that he is non-political. End
comment.
STRENGTHENING THE OFFICE OF THE CONTRACTOR GENERAL
¶9. NASDIR expressed support for the work being done by
Christie and explained the embassy's interest in engaging
more pro-actively in anti-corruption efforts. Christie was
grateful for the recognition. NASDIR mentioned that we would
be working with other donors, particularly the British and
Canadians, to identify ways in which we can be of assistance.
According to the CG, there has been a long-standing problem
of insufficient budget support to his office. Of a staff
complement of 57, authorized in 1999, they never have had
more than 45. This year Christie requested authorization to
fund 66 positions. Of the 45 people, 12 inspectors work on
investigations and only two of these are skilled
investigators. The OCG staff is divided into five
directorates: Technical Services, Construction Contracts,
Licenses and Permits, Information Systems and Administration
and Finance. His staff also supports the NCC, which does not
have a staff of its own.
¶10. Christie also pointed out that insufficient budget
support impacts negatively on his information technology
capability. He has devised an electronic form for public
bodies to complete and submit regarding contracts. He also
believes his office should be totally transparent and puts a
great deal of information on a website (www.ocg.gov.jm). Due
to the funding shortfall, he has to use his own laptop as his
office pc. He constantly updates the website, also monitors
e-forms.
¶11. As a follow up to our meeting, Christie sent NASDIR a
letter dated March 7. He explained that he had attempted to
address resource shortfalls through a restructuring
assessment conducted last year by the Public Sector Reform
Unit of the Office of the Cabinet. Resulting proposals were
approved by the Ministry of Finance and Planning for
implementation during the 2007/2008 fiscal year, "subject to
budgetary considerations." To have a clearer view of needs
for possible outside assistance to his office, Christie
indicated that he must wait until April to learn of Cabinet's
decision on the budget request. His operating and capital
budget request is for JA$185 million, compared to the current
JA$85 million. In the meantime, Christie made an urgent
request for training in the following fields:
anti-corruption management and governance; conduct of
investigations (techniques, interviews, analyses, report
writing); forensic auditing and auditing techniques; fraud
detection; procurement, contracts and contractor monitoring
management; information technology; utility of information
technology and systems in procurement monitoring and
anti-corruption management; strategic management/strategic
plan development and implementation; and general management.
¶12. Action Request: The embassy would welcome Washington's
advice about possible sources to provide elements of the
requested training and availability timeframes (if possible).
We would like to help OCG strengthen its investigative
skills. Some NAS funds could be make available for that
purpose. We should consider providing the same training to
more than one Jamaican government entity when U.S. trainers
are here. The embassy also would appreciate being informed
of the US legal regime (how does our government go about
making investigations and processing suspected contract
irregularies and what are the criminal penalties for
violations). In terms of strategy, the mission recognizes
that anti-corruption also must focus on the upper levels of
the GOJ. Christie's is one of a few offices that can do
that. Probably future attention must be given to addressing
the problem of weak penalties for violators. Nonetheless,
the CG already is exercising his power to keep the issue of
official corruption in the public eye, which may translate
into pressure for reform. End Action Request.
HEG