Full disclosure

Auditor General seeks answers on Four Seasons and LIAT

The ill-fated Four Seasons hotel project, as well as Government’s $142 million investment in regional airline LIAT, are among a set of dubious transactions for which this country’s Auditor General Leigh Trotman is seeking answers.

Government’s support for LIAT came under heavy scrutiny.
Government’s support for LIAT came under heavy scrutiny.

In his 2015 report, Trotman also raised serious questions about a number of loans which Government made to various private entities in which the state happens to be the main shareholder in some instances. The loans included $4.6 million which was issued by the Public Enterprise Fund to Needham’s Point for construction of the Hilton Hotel, $2 million to Southern Golf which operates the Durants golf course, and the sum of $950,000 to Durette & Co Caribbean Limited, a window manufacturer which subsequently went out of operation.

Hilton Hotel
Hilton Hotel

Since the Needham’s Point loan was issued back in financial year 2014/15, the principal has risen to nearly $6 million. However, the Auditor General said no repayments have been made. Furthermore, there have been no efforts by Government to recover the outstanding amount.

He also explained that in the case of the Southern Golf, there was no loan agreement to speak of, while suggesting a write-off of the Durette amount-

Government’s support for the Antigua-based LIAT also came under heavy scrutiny. However, after carefully reviewing Government’s financial statements, the Auditor General said he was still in the dark about its investments in the carrier. He has therefore called for “full disclosure” on the $142,733,148 that has been pumped into the loss-making carrier as at March 31, 2015.

The stalled Four Seasons project.
The stalled Four Seasons project.

Equally difficult to come by has been information on the stalled Four Seasons hotel project. However, the Auditor General is seeking to get to the bottom of a $120 million debt, which was issued with a Government guarantee by late Prime Minister David Thompson back in 2010 after the project went belly-up.

That guaranteed debt was called during financial year 2013/2014 by the bankers and Government was forced to pay an amount of $124,329,766 which entailed principal plus interest to the lenders. However, while the amount was subsequently recorded by the Treasury as an accounts receivable, the Auditor General says no payments have been received to date.

He therefore wants answers on whether there might be a need for a write down or when or how this amount will be repaid, since it is also not clear what assets this advance is linked to.

Another questionable sum of $141,500,000 was issued in loans to the Barbados Tourism Investment Inc (BTII), with accrued interest of $19,351,206 as at March 31, 2015. Trotman pointed out in his report that no formal contract exists for the amount and to date no repayments have been received.

However, he said in a previous meeting with the management of BTII, the auditors were informed that this amount pertained to work carried out on behalf of Government. “This matter needs to be clarified and resolved by the relevant parties,” the Auditor General advised.

A similar situation exists with the Small Hotel Investment Fund where a loan in the amount of $35,528,362 (including interest) is yet to be repaid.

The report also raised questions about $765,749,759, which has been recorded by the Auditor General as “cumulative advances outstanding” as at March 31, 2015. The monies were not properly authorized but, in some instances, transfers were granted to recipients who simply did not have the money to repay.

The net effect, therefore, is that the official deficit would have been “understated” for the years when these transactions took place, Trotman pointed out.

As has been the trend in recent years, this year’s report contains a number of recurring themes of unauthorized transactions, misplaced funds, and blatant under-reporting by a number of state entities, altogether painting a pathetic picture of this country’s public sector administration.

In this regard, the Auditor General highlighted variances on several accounts, including $118,177,914 for pending lawsuits, which did not match the $116,305,080 submitted by the Solicitor General, resulting in a variance of $1,872,834.

There was also a sinking funds variance of $28 million, as well as incorrect classification of assets, which affected the paymaster’s pension account which ended up with a debit instead of a credit balance of $2.4 million.

The opposite occurred at other Government departments, including the Transport Board, where the accounts receivable ended with a large credit balance of $5.5 million.

One noticeable error and omission which the Auditor General took note of was a First Citizens’ Bank loan in the amount of US$25 million. There were also approved loans, which were not utilized in a timely manner. This affected commitment fees, in the amount of US$888,929 on a loan from the Caribbean Development Bank and US$266 023 on IDB loan funds.

In terms of unrecorded liabilities, Government is yet to bring to book the sum of $195 million owed to the University of the West Indies. There was a further $152 million in unrecorded Treasury Notes and Debentures, as well as $2.7 million in returned pension cheques and over $4 billion in unclaimed employee benefits.

The Accounts receivables were said to be overstated in the amount of $34 million.

Earlier, Barbados TODAY reported on $1.3 million in dishonoured cheques that were written to Government. According to the Auditor General, some Government departments also fell prey to the unsavoury business practice as a total of $32,263 in bounced cheques were issued by unnamed Government departments.

30 Responses to Full disclosure

  1. Shane Paul Castillo
    Shane Paul Castillo May 26, 2016 at 4:18 am

    Good heaven all this money is owed to the government ? are the figures right ?

    Reply
  2. Ibukunoluwa Ayanfe Ozioma
    Ibukunoluwa Ayanfe Ozioma May 26, 2016 at 4:25 am

    I am stunned and speechless! This isn’t poor administration. This smacks of fraud!

    Reply
  3. Josh May 26, 2016 at 5:10 am

    These sums are unbelievable, no wonder the country is skint, agree with the previous commentator, this is either fraud or serious maladministration. Either scenario brings into question the competence of those holding office as either politicians or senior civil servants.

    Reply
  4. Safiya Kamaria Kinshasa
    Safiya Kamaria Kinshasa May 26, 2016 at 5:27 am

    I’m reading the Bajan news and realising that every prediction I made about the government, tourism… everything I been preaching about has come true… HMMMMMMMM

    Paul Clarke I definitely think people ready to listen to me now.
    2 years ago I warned everyone about this project and everyone told me to shut up and that I didn’t know what I was talking about. I told wunna it was a bad idea but noooooo

    Reply
  5. dave May 26, 2016 at 6:07 am

    This is how our money disappears and then the Government claims that it does not have money to do this and to do that. But we know that money is going in somebody’s pocket because money does not disappear into thin air.

    In some countries heads would roll and necks would pop .

    All of this slackness is what new political parties such as Solutions Barbados are talking about but you have ignorant Bajans saying that a third party cannot work and all that crap.

    Bajans -wunna so HIGNORANT !! Wunna so foolish and wunna continue to let politicians fool wunna and keep running around singing dem praises –Oh ! so and so is a good man, he quiet and decent , he is a gentleman –all the while wunna getting shated with a ten foot pole- Slaves !!! to folly !!!!

    These things make so Angry !!!!!!

    Reply
  6. dave May 26, 2016 at 6:08 am

    These things make me so Angry !!!!

    Reply
  7. dave May 26, 2016 at 6:12 am

    Government departments issuing bounced cheques ? Say it aint frigging well So !!!!

    Reply
  8. The Negrocrat May 26, 2016 at 6:24 am

    Let we dress in white and march these demons out of office.

    Reply
  9. Ejd May 26, 2016 at 6:54 am

    Politicians do not run departments. This is highclass slackness on the part of the civil servants not the politicians only.

    Reply
  10. Looka This May 26, 2016 at 7:19 am

    $142 million into LIAT to be run by Antiguans ans service still more and loosing so much money when every airline in the world making record profits mainly due to low oil prices…..What a shame….I am so nervous….I believe much more bad news will be discovered

    Reply
  11. Alex Alleyne May 26, 2016 at 7:48 am

    WHEN THESE FELLAS GONE ALL WE CAN SAY IS “DEM DO THE DOG”.
    ELECTION IS WHEN AGAIN ???????.

    Reply
  12. eddy murray May 26, 2016 at 8:30 am

    Ejd they call all the shot. If all this money is out there in Barbados, who have it and where is it.

    Reply
  13. Carson C Cadogan May 26, 2016 at 9:17 am

    It is wonderful to be a part of the Barbados Private sector.

    As a result you can ask for and receive million dollar loans and dont have to worry about repaying a single cent to the Bajan Taxpayers. The thing is no one is seeking to recover the Taxpayers money.

    So much so that overseas Private sectors are getting a piece of the action as well.

    Reply
  14. Bobo May 26, 2016 at 9:31 am

    Bajans 85 per cent– the mind is condition to a paradigm–fear- confusion and worthlessness guiding the psyche—impossible to understand ”the reality of facts”

    Reply
  15. Norma Isenegger May 26, 2016 at 9:50 am

    Local Bajans ‘please’ take time out and ask self what has the present two political parties has done for you and your children-”children” the future innovators of Barbados( of all countries) -where is your child –or- the next door child at the moment.

    The question is not how many Political Parties represents the Government — the question is— ”Innovations” is the way forward—”Barbados Solutions” is your call.

    Reply
  16. APOSTLE WINSTON CUMBERBATCH - BARNETT May 26, 2016 at 10:39 am

    Dear people ,,Some are talking Of Another Government, Another Party , My dear People… when we the people push out the present party just to bring in another Party,,,I WILL TELL YOU HERE AND NOW, THEY WILL DO THE SAME THING AS THE PARTY BEFORE THEM WHO WAS THE GOVERNMENT ,,pushing out one party just for another PARTY is not GOOD ENOUGH,, we need to get to the bottom of all of this MISSING MONEY MATTERS,,,,ALL THESE DEPARTMENTS should be made to answer Questions as to where and whom all the MONEY is gone , LET THESE MINISTERS ANSWER questions about the peoples MONEY or else it will be HAPPENING again and AGAIN and AGAIN, AMEN

    Reply
  17. lili May 26, 2016 at 11:14 am

    No surprise at all.

    Reply
  18. jrsmith May 26, 2016 at 11:54 am

    This is (fraud ) and (political corruption ) been seen by the world on a massive scale , we the people of Barbados needs help , we need help from the (British Government ) we need ( Scotland Yard ) to clean up this mess to put our corrupt politicians behind bars…
    Mia you need to do something bajans we cannot allow these people to get away with this, where is our (Governor General )speak my good person, we need justice…they are just a bunch of rum corned beef and biscuit people.. you could see the premeditation no book keeping no records all well planned out…

    Reply
  19. dave May 26, 2016 at 12:13 pm

    Well the present Government will be gotten rid of regardless – one way or the other. It is incumbent on Barbadians to make a fresh start. The incoming Government ‘s feet must be held to the fire !!! If we are lazy and preoccupied by folly we will continue to see nonsense happening

    Reply
  20. jrsmith May 26, 2016 at 12:39 pm

    @, Apostle Winston, hail, hail, on the button, our Barbados treasury has be cleaned out, that’s why the (Attorney General ) refuse to sign the proceed of crime act, we want to see they tax returns and bank accounts and holdings in the (British Virgin Island )

    Reply
  21. recoanthony May 26, 2016 at 3:12 pm

    WHAT AH STINKING MESS, THESE CESSPOOLS HATH DONE VERY WELL FOR THEMSELVES AN FAMILY, SO 950,000.00 GONE TO DURETTE AND THE COMPANY SHUT DOWN, SO MONIES & INTEREST DEAD, WONDER WHO SANCTIONED THAT LOAN? NO WONDER MORE LAYOFFS COMING HUMMMMM WHO IT IS THAT HAVE 23 ACCOUNTS BETWEEN TURKS &C BVI .

    I’VE BEEN SAYING WE NEED SCOTLAND YARD OR INTERPOL TO LOOK INTO THESE CORRUPTION, AND BRING THESE CESSPOOLS TO JUSTICE, DE FBI CIA SOME BODY, WE NEED HELP AND QUICKLY…LASTLY THIS INEP DISGRACE FOR AH GOV’MENT WANT GETTING RID OF…SHAMEEEEEEEEEEEEE

    STINKING CESSPOOLS

    Reply
  22. jrsmith May 26, 2016 at 4:06 pm

    We must get international police help on this matter, they must pay for this, this is not going away…

    Reply
  23. Alex Alleyne May 26, 2016 at 4:53 pm

    THIS MESS WILL BR SWEEP UNDER THE CARPET LIKE ALL OTHERS.
    TAX PAYERS YOU SUCKERS……A NEW ONE IS BORN EVERY DAY.
    REMEMBER TO RUN FOR POLITICAL OFFICE IN BARBADOS , NO TEST IS TAKEN, ALL YOU HAVE TO DO IS JOIN A PARTY AND TALK PRETTY.
    ON THE OTHER HAND TO PICK UP GARBAGE YOU MIGHT NEED 5 CXC’S , 5 O’LEVELS AND A POLICE CERTIFICATE.

    Reply
  24. David Hall May 26, 2016 at 5:26 pm

    Here we go again! Another Auditor general’s report that will be punished with laughter and buried in silence by our leaders; whilst the average Bajan continue to catch his/her tail and crafty politicians and others like them, who are responsible for this mess, and others like it, continue to live high off the hOg.

    Reply
  25. dave May 26, 2016 at 10:47 pm

    The D in DURETTE -check and see where it leads
    Yes David Hall

    Living off the Hog and giving us the hair off the hog

    Reply
  26. Don December 9, 2016 at 9:38 am

    Imagine if this money was used for the QEH, water systems, The University, sewage systems and garbage trucks.

    There must be a reason a billion dollars went in the wrong direction.

    Reply
  27. Jim Reid December 9, 2016 at 12:08 pm

    With government debt at $7.6 billion, and annual GDP at $4.45 billion, the “Diamond of the Caribbean” government is bankrupt. But the people aren’t. It is time for every civil servant and every politician to lay their resignation on the table and for righteous people to choose those who must go and those who must stay. With good people in charge, and a new National Vision, the debts can be forgiven and the reconstruction of the tourism industry can be started from the family funds hidden under the mattresses. It is time for the Trident of Barbados to remove the evil sharks. (As my citizenship is still buried in a government file somewhere, please forgive my impertinence in sharing my opinion. My wife and kids are Barbadian.)

    Reply
  28. richard barrow December 10, 2016 at 1:17 am

    This is high class wickedness, some one need to be held accountable, to much corruption.

    Reply
    • Samuel Morrison May 27, 2017 at 5:36 pm

      You stupid, stupid people. Track your history. The money placed at the disposal of Liat has been done over the years the airline has been functioning. The bulk of it being done under the administration of the BLP. It is accumulated debt, which is now equity in the airline. That is why Barbados is the single largest shareholder. Needhams point ltd owns the Hilton Hotel. That money owed is recoverable by the sale of the hotel property. The Auditor General must go further in his analysis rather than make comments that are merely superficial. The BTII is a fully owned by the government of Barbados. It’s emphasis is on infrastructural improvement. So the St. Lawrence improvement project, the careenage Boardwalk, some street lighting, the Harrbour road car park are all of its projects. Why this mischievous contentions at this time? All those projects were done in the period 1994 to 2008. The Four Seasons project was a private sector project which collapsed in the aftermath of the financial crisis in 2008. Govt placed substantial equity in the project as a means of rescuing it. That equity was through a loan, that loan has been repaid so that government is in a position to sell the property and recover its investment. There is nothing sinister about that. What this shows is a civil servant who has joined the faux news department of e-news papers. The persons who reissued this article is about mischief since it was published before.

      Reply
  29. Johnathan May 29, 2017 at 8:46 am

    Carson C Cadogan should be ashamed to even write a word on this. He is part of the government and he supports everything they do and this is no exception. He seems to want to pull a Donville Inniss and this is same man who criticize Donville. This government has taken the tax payers of this country for a ride and it is so obvious. They have not mismanaged since they seem to have shown up for work in 9 years. They have found all types on novel ways to siphoned off the money and full thu duh guts…

    Reply

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