The local construction industry is on the brink of collapse, and in order to salvage the sector, government must pay outstanding monies owed to contractors and get promised projects off the ground. This from the president of the Trinidad and Tobago Contractors' Association (TTCA), Mervyn J Chin, who says tens of thousands of people are directly and indirectly affected.
Q: Mr Chin, it is said that the state of a country's economy can be gauged by the vibrancy of its construction sector. How is the health of our construction industry today?
A: (With a grim expression, Chin at his office at Kee-Chanona Ltd, corner of Warren and Smart Streets, St Augustine, where he is the senior projects manager, Thursday morning): Well, as you know, we have been contracting for the last three years and we have been going downhill ever since, it's about a third of what it should be.
That could never be healthy news?
No. It is very worrisome. A lot of people who have invested in this industry, they continue to face whatever overheads but the income is not there.
This situation is being blamed on the government...that the sector is catching its 'nenen' because they are not spending. Is that a fair assessment to make?
It is fair to say that because for the last 12 years or so government has been the largest (75 per cent) player in the industry.
Still, can the current untenable situation be completely attributable to this administration or is it the result of an accumulated scenario?
It is an accumulated situation and you cannot expect a regime that came in just under two years to reverse that trend. Most of the major development had been undertaken by government, so that the private sector, which is accountable for 25 per cent, can in no way be depended on to drive the industry, which should be turning around $10 billion annually.
What is the figure at this time?
About $2 billion.
Mr Chin, although the sector is on its back foot at this time, do you agree that the government has a responsibility not to spend in such a way that would bankrupt the economy?
Any responsible government ought to behave like that, yes.
And do you believe that pumping money into the sector simply for the sake of keeping the sector alive as it were, a prudent move?
(Contemplating his response) The way one should really pose that question is that spending, regardless of which government is in office, should be done for purposeful development, so whether you talk about hospitals, schools, community centres, and housing for those who cannot afford to do so on the private market; roads, bridges, drainage, those sort of things, there would always be development, as long as a country is developing there would always be construction working side by side. So it depends on what you spend the money on and as long as it is spent on development, it is money well spent.
From where you sit, having been in the sector for almost 30 years and now president of the TTCA, is it your belief that government is deliberately withholding expenditure in this sector?
I am not clear but when the 2010 budget was announced, it stated the projects on which funds were to be spent, the amount of money involved and in which ministries the projects would be undertaken, but what happened in 2011, he (the Minister of Finance Winston Dookeran) came back and said it failed to get started because of implementation issues...the emphasis was not on implementation.
Last October, that was made very clear to everyone. We are in March now and it hasn't gotten off the mark. It is like deja vu. And the question I am asking is why it is stagnant? You have gotten the money passed in the budget, you have identified the projects you want to do, and you have identified the vehicles (ministries or governmental agencies) through which you are going to do it. So what is the problem?
Why it is not being implemented and this is the question government needs to answer.
Has the TTCA approached government on this issue, requesting an explanation for this stalling?
Yes. On many platforms we have expressed this concern and the government has never responded. As a matter of fact, not only in our industry has government been chided, but also by many sectors of the business community, for lacking clarity as to why there is this stagnant situation in the country's economy.
Is this situation unique to this administration or is it a consistent pattern of governments through the years...?
It is unique to this government; there doesn't seem to be a clear plan of what happens because once you go by a budget that to me is the basis on which everything would flow but yet you would hear this minister talk about this development, and another minister talking about a next development, and you searching for it in the budget and you saying "where is it coming from".
But Clevon the building sector (infrastructural projects) was going well under Minister Jack Warner until last September, when they pulled the plug on PURE. The only vibrant sector that was happening in the industry got the plug pulled on it. They were the ones overseeing the upgrade, expansion and refurbishing of the infrastructure in the country...roads, bridges, that sort of thing.
Is it that serious as you just put it?
Well, actually, yes it is. Over the preceding years we constructed high-rise buildings but the infrastructure remained the same and this is where you got all the traffic choking because the infrastructure remained stagnant. PURE was dealing with several vital projects in this regard but they felt they wanted to do an audit on PURE. The Prime Minister said it would have been completed in two weeks and this was in early December.
Didn't the PM say the plug was not pulled on PURE? Yes she did say that but that very same day the minister in charge of PURE said he could not do anything and so much so that many of the engineering staff in PURE are no longer there, some were transferred to other departments, some smelled the rat and... Corruption...?
No. No. I am not saying that. I was saying that for self-preservation they had to seek jobs elsewhere and they have gone. Up to this day the issue of PURE remains unresolved. But that is only one side of the matter, what about dependents on PURE? All the contractors, all the workers, approximately the thousands who got dismissed just before Christmas...everybody is affected.
Mr Chin from your vantage point, do you have any idea why that action was taken against PURE?
My only comment is I don't know why it (the second audit) took place. All I know is that Minister Warner said a first audit was prepared by the Auditor's Department and nothing untoward was unearthed. And this second audit, at the end of the day, was not worth the paper it was written on. He found out like everyone else what was reported about it in the media. So here is a minister who is in charge of PURE saying that his hands are tied and he cannot do anything and on the converse, the Prime Minister is saying "I don't know what he is talking about. PURE can't continue as is."
So what do you make of that?
That is an issue between the Prime Minister and the Minister of Works and Infrastructure to clarify. But they cannot be talking the same thing; they are saying the total opposite.
What's your take on the opposition, at the behest of Opposition Leader Keith Rowley, pulling out of the Joint Select Committee, which is currently looking at the long-promised procurement legislation, something that several groups including the TTCA have been calling for over the years?
Yes, we have been strenuously pushing this matter and we have asked the opposition leader to reconsider and let us resume the discussions with the JSC.
What has been the result?
Well up to yesterday the opposition said they would not be attending a sitting of the committee today, which to my mind is utterly disappointing.
Isn't that a rather mild slap on the wrist for the opposition or are you being politically correct?
(Eyes dropping) Let me say this. If I have to say what is on my mind you would not be able to print it, right? Ok. Let's turn to the strike at Trinidad Cement Ltd (TCL). Would that action add to the woes of the sector...? Of course. It would just make a bad situation worse.
Whatever little work that came along and you in dry season try to take advantage of it, and next thing is this strike. Cement is one of the most widely used ingredients, whether it is in the foundation or in laying tiles, you using cement and what has made it more acute is that TCL is the only company that is selling the cement. Both TCL and its workers have to be a little more responsible.
How long do they have to settle an agreement?
Who is going to pay consumers and contractors for this loss in productive time...because you have to send home your workers...who paying for them? This sector cannot last very long without an adequate supply of cement, although I understand the company has taken steps to import some supply...
What about this question on the debt owed to contractors?
I see where the HDC is saying they do not owe contractors a cent. I do not wish to conduct a fight with the HDC but it has been years the industry has been saying monies are being owed to it...
Listen Mr Chin, the lay man such as myself cannot understand why is it governments have been owing contractors these large amounts over the years...how is that possible? Is it the system?
(Sipping a glass of iced water) Government has to answer that.
But you all have gone along with that for such a long time...why?
Whatever monies are owed were all done with bona fide contracts.
Nobody is questioning that; the issue here is you don't have that in the private sector, even at the level of individuals who would pay contractors immediately after they have completed their jobs, be it a home or a commercial building...?
How come we have reached that situation? Well we were always told it would be settled at some point in time.
Finally Mr Chin, it has been agreed that the industry is precariously perched. What do you see as an imperative if the situation is to be salvaged?
One way of sustaining the industry is to ensure that government pays the contractors and secondly, there must be implementation, which is to say we can suggest to government what they should develop but government's role is to decide what should be developed. We will then have to support it by getting involved but right now we cannot do anything because of the lack of implementation as the governmental agencies are not coming out with the various tenders.