Opposition MP on Lake Asphalt contract: $m deal linked to minister’s relative

A Lake Asphalt Ltd (LATT) contract was shifted from a Brazilian firm to a local firm allegedly owned by the close relative of a government minister, Opposition PNM MP Fitzgerald Jeffrey has said. Jeffrey, MP for La Brea, spoke about the situation during Monday night’s House of Representatives budget debate. He said the chairman of LATT was said to be a close relative of a senior Cabinet Minister and also a close friend of the Prime Minister.

Jeffrey added that the shift of the contract to the local firm incurred extra cost for LATT. He said: “I come to a scandal that warrants urgent attention, Lake Asphalt (1978) Ltd. There is a questionable operation at Lake Asphalt.” He said Lake Asphalt usually imports hardboard from a company called Pegasus from Brazil.

“They have been doing that for the past five years to make their ballast,” Jeffrey said. He said early this year, the chairman of the board, “who it is said to be a close relative to a senior Cabinet Minister, and is said to be a close friend of the Prime Minister, authorised the board and the CEO to stop importing the hardboard from Pegasus in Brazil and instead purchase the hardboard from a company called Fastec that is owned by a close relative of another minister in Government.”

Jeffrey said: “The cost of the hardboard from Fastec is twice as much as the hardboard from Pegasus. The quality at Fastec is inferior to the hardboard that is coming from Brazil. “As a matter of fact, Fastec hardboard has a 20 per cent rejection rate because the strength of the board is inadequate and difficult to work with.” He said earlier this year, the asphalt company spent $1 million more for hardboard from Fastec than it would have had to pay if it had imported from Brazil.

He added: “They had to pay an additional $300,000 to produce the drums, so, $1.3 million extra that this company, that is employing 185 persons only, had to pay. “What is more staggering is that the chairman has ordered the CEO and the board to double the importation from Fastec.”

Jeffrey said it would cost Lake Asphalt $2 million extra to import the hardboard and $500,000 extra in production costs. “That is a cause for concern,” he added. LATT chairman Kuralal Rampersad and Energy Minister Kevin Ramnarine did not answer cellphone calls yesterday.

Jeffrey said he also had information that a former senior LATT official went to Canada to set up a company to buy raw asphalt from LATT which was to be refined and sold, undercutting LATT’s product. Jeffrey claimed that was intended to rundown LATT in order for it to be sold.

Jeffrey said under the UNC, attempts were made to sell Lake Asphalt to one of the party’s financiers. Jeffrey added: “It took the population of La Brea to march around La Brea several times to stop the sale. I am putting Lake Asphalt on notice that the people of La Brea will stand by again if it happens again that they have to do that.”

Jeffrey called on Government to say if there was a plan to make Port-of-Spain deteriorate since Government was moving many ministries out of the capital, saying an El Socorro building was being rented out for government offices. He added: “There is a new development along the El Socorro Road in San Juan where buildings, once used to sell car parts, are being converted into office space and rented for as much as $80,000 a month.”

The budget debate is expected to end today, House leader Roodal Moonilal said yesterday. Debate begins in the Senate at 10 am on Monday.