NSWMA probe report
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Observer Reporter
Tuesday, April 05, 2005
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THE following report was issued by the board of the National Solid Waste Management Authority on Monday. The document was signed by 10 board members - K Stephen Ashley, Karl Binger, Angela Brown-Burke, Robert Bryan, Neil Lawrence, Bevon Morrison, Errol Needham, Loraine Robinson, Alston Stewart and Horace Williams - signalling their 'full endorsement' of the contents.
The Board of the National Solid Waste Management Authority (NSWMA) met on Tuesday, March 28, 2005 to discuss a series of articles appearing in the press that raised a number of issues relative to its operations.
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| One of the garbage trucks in the solid waste agency's fleet. (Observer file photo) |
After full and detailed examination of the facts, the board now presents its responses to the issues as follows:
1 Allegation: The unavailability of completed audited financial statements for NSWMA for fiscal years 2002/03 and 2003/04.
The National Solid Waste Management Authority was established in April 2002. It incorporated the operations of four parks and markets company - North Eastern Parks and Markets Limited (NEPM), Southern Parks and Markets Limited (SPM), Metropolitan Parks and Markets Company Limited (MPM) and Western Parks and Markets Limited (WPM).
Three of the companies - MPM, SPM and WPM - did not have audited financial statements for years subsequent to 1999. These accounts had to be brought up to date before the NSWMA audit could be concluded.
The present situation is that the audited financial statements for all four companies have been completed as follows:
. MPM has audited financial statements up to 2000/01
. SPM has audited financial statements up to 2001/02
. WPM has audited financial statements up to 2001/02
. NEPM has audited financial statements up to 2002/03.
The prerequisite for completing NSWMA's audit has been met. The auditors of the company, PricewaterHouseCoopers, is now in the final stages of completing the audit for the authority.
The projected dates for completion for financial year 2002/03 is April 2005; and for financial year 2003/04 is July 2005.
Once this process is completed, the breach that has been raised by the Auditor General would have been satisfied.
2 Allegation: The authority purchased luxury SUV vehicles without the requisite approval.
In November 2003, the board considered a submission from the management requesting approval for the purchase of twenty 4x4 Suzuki Jimnys to be utilised in the supervision of solid waste activities islandwide.
The board approved the purchase but noted that funds were scarce and therefore the units should be acquired incrementally.
The board accepts that in the absence of a capital budget, the regulations required that the Ministry of Local Government, Community Development & Sport should have been requested to seek the necessary approval for virement of the resources from the recurrent budget to facilitate this decision.
Under this approval (from the board), six vehicles were purchased - three Jimnys and three two-door Vitaras - between November 2004 and January 2005.
We do not consider these vehicles as luxury vehicles.
A seventh vehicle was purchased to replace an existing vehicle which was written off as a result of a crash. The seventh vehicle was purchased from the proceeds of the insurance settlement.
These vehicles were assigned to parish managers and zonal monitors to monitor collection activities and improve cost effectiveness of our operations.
3 Allegation: Inappropriate employment of information technology and human resource development consultants.
The NSWMA board is satisfied that the appropriate and correct steps were taken to retain the services of the two consultants confirmed to be employed to the authority.
Additionally, they are, without question, qualified to undertake the duties assigned to them.
All the required reporting and government regulations have been consistently complied with. The board of the authority is fully satisfied with the competency and output of the individuals concerned.
4 Allegation: Suspected irregularities concerning the construction of an access road at the Riverton landfill.
The authority, after a number of outcries from both public and private contractors as to the state of the access road and in response to the damage being done to its own fleet of vehicles using the site, decided to repair the road as an in-house project, given its ability to do same.
The Operations Sub-Committee of the board reviewed extensively the extremely poor status of the road, the regular hold-ups and hijackings at gun point, as drivers had to slow down to traverse extremely bad patches of roadway, and concluded that it was imperative that the road be repaired immediately.
On staff, at the time, was a construction engineer employed by the IDB (Inter-American Development Bank), and the decision was taken, having recommended and discussed this with the board, to do this urgent repair in-house, using the engineer from the IDB.
To date $8 million has been expended on the project which is to be completed by mid-April 2005, at a total cost of $9.2 million.
5 Allegation: The NSWMA has re-employed persons previously employed to MPM Waste Management found to be corrupt.
In November 2003, an investigation was conducted to evaluate the effectiveness of the public cleansing inspectors within the Riverton wasteshed, the use of supplementary fleet, and the possible abuse of the systems.
Three managers in the exercise were found to be culpable, in terms of the execution of their responsibilities, and they were terminated and never re-engaged.
A restructuring exercise was implemented based on the investigations, and the following measures were implemented:
. Those inspectors who did not have the requisite educational background to qualify in the new zonal monitor disposition were made redundant.
. Those persons meeting the criteria of zonal monitors were re-employed as zonal monitors.
. Zones that were executed directly by the NSWMA through MPM Waste Management were packaged, documented, and ex-MPM employees contracted from the original supervisory corps as independent contractors to clean these zones.
The board is satisfied that these arrangements have produced a better result and this is in keeping with the mandate of the authority.
6 Allegation: Equipment usage at the Riverton and Retirement landfills.
The landfill operations of the authority require the continuous use of 16 pieces of earth-moving equipment.
The authority owns seven of these equipment and, as a consequence, must rent the other pieces from private sources. These services are retained from private contractors across the island on an on-going basis, as is required in cases of emergency and down-time.
At the Riverton landfill, a number of suppliers have provided services over time. The authority has had different issues with different suppliers at varying times and over the last 24 months, one main supplier has supplied the equipment to supplement the Riverton operations. From time to time other suppliers are used as required.
The authority is aware and accepts that its contracting methodology is not ideal and to that end the present work with the National Contracts Commission which has been occurring over the last nine months has resulted in draft standards being established to cover aspects of the operations, which will lead to the establishment of further standards for other aspects of the operations inclusive of landfill activities.
The Riverton landfill is the largest disposal site and requires specialised equipment. In addition it is operated under difficult and special conditions.
7 Allegation: The award of contracts to political supporters It is a fact that political supporters on both sides of the political divide are engaged in the sweeping, collection and disposal of solid waste in Jamaica. This is the practice which has evolved over time and is directly related to the question of safe access to some communities.
These persons are employed not because of their political persuasion but because of the community in which they reside, which in many cases are clearly defined politically.
8 Allegation: The authority is holding $200m worth of unauthorised debt based on an over-expenditure of its budget.
In order to have been able to provide the level of service delivered by the NSWMA during the fiscal year 2004/05 and given the extremely difficult and urgent nature of our mandate, the authority has overspent its budget allocation by approximately $193.4 million.
The composition of this over-expenditure is as follows:
Activity Over-Expenditure
Captial/Rehabilitation $53.0-m
Hurricane Ivan clean-up deficit $82.4-m
Trade and other expenses $58.0-m
Total $193.4-m*
.The supplementary budget provides $106 million of the total clean-up cost of $188 million - hurricane clean-up cost.
This over-expenditure was incurred in the normal operations and response mechanism of the authority and was significantly influenced by the extraordinary events of Hurricane Ivan.
The board and the Ministry of Local Government have agreed that this over-expenditure will be financed as a first call on the 2005/06 budget.
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