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Contractors to Govt: Pay up

Published: 
Sunday, December 17, 2017
The Reform Hindu School as it is now.

The Government is yet to outline any specific plans to address its growing debt to contractors. In the meanwhile, the association representing the group has advised its members to take legal steps to get money owed to them.

In an interview with the Guardian last week, Contractors’ Association President Ramlogan Roopnarinesingh estimated that the growing debt to contractors was over $4 billion.

The government agencies responsible for the majority of debt to contractors are the Education Facilities Management Company (EFCL) with a reported debt of between $800 million and $1.2 billion dollars; the Housing Development Corporation (HDC) with a reported debt of between $700 to $800 million; and the Water and Sewerage Authority (WASA), which faces a billion-dollar debt to contractors and suppliers.

In 2017 Finance Minister Colm Imbert budgeted $1.8 billion for the payment of debt to contractors but this reporter could find no similar amount allocated for fiscal 2018.

While Government, in an out of Parliament, has blamed the country’s economic problems for some of the delays, several contractors are considering legal action over breach of contract due to non-payment.

According to Section 3 of the Limitation of Certain Actions Act contractors only have four years from the breach of contract to take any action, and for several of them, 2018 is the fourth year.

However, sources said it was unlikely that Government would use this defence.

Even as contractors are considering legal action, some have already brought projects to a standstill with more reported to stop in 2018 as they demand payment for work done.

‘Businesses forced to close, people losing job’

Roopnarinesingh said Government’s lack of detailed information about payments was a major concern.

“If you are in charge and you don’t know when this debt will be paid, how will contractors know? How long can we tell the bank we have money outstanding and not getting paid? The bank will foreclose on you.”

Roopnarinesingh noted that Government had made some payments in 2017 but said he was not aware of how much was paid or to whom.

“Under the law, you are allowed four years to take action. If you send an invoice and you haven’t been paid you can take the other party to court.

“The thing about it, we have advised contractors they have a four year period that they could take the Government to court to get their money. We have advised members that they could pursue that avenue.”

He said contractors were dissatisfied with the pace at which Government was moving.

“There are a lot of contractors who closed down and lost businesses and properties and that means decreased employment for more and more people.

“Think of it like this, if you are working and not getting paid, your expenses would continue but you are not being paid. All your bills continue. Eventually, something is going to give. A contract is basicall a job.”

He said while many people thought contractors made a lot of money, what they saw reported in the news was the worth of the contract and not what contractors are paid.

In a Public Accounts Committee meeting last week, WASA officials admitted that the authority had a $300 million exposure due to litigation from contractors and a security services contract which was terminated.

While this reporter was unable to reach Public Utilities Minister Robert Le Hunte via his mobile phone last week, both Education Minister Anthony Garcia and Housing Minister Randall Mitchell responded to questions.

PM: Please be patient

PM Keith Rowley, meanwhile, has called for patience from contractors as the country tries to tackle some of its outstanding debts while taking on new projects.

“We pay them on the basis that we don’t satisfy one person and starve the other. We don’t have enough money to wipe off all the debts because the Government is carrying a large debt and at the same time we are entering into new contracts so you have the old debt from the work that was done and the new debt from the work that you are engaging in,” Rowley said.

He said the entire situation was a balancing act.

“If we don’t pay the old debt those contractors could die and if you don’t have new contracts then you have no economy so it is a balancing act we are doing and until we have enough revenue to smooth out the situation away from this peaks and troughs arrangement then we are going to have these problems but I am sure that we are going to get over it,” he said.

Rowley said the Government will continue to engage with contractors to correct all outstanding issues.

In terms of the country’s financial situation, Rowley said he hoped the population would begin to understand that the Government is trying to do as much as it can with very limited financial resources.

“Nobody is trying to hurt anybody or trying to harm anybody nobody is being wicked we are just trying to work with the limited resources that we have,” he said.