Loan Authorization Bill passed – Opposition asks for more information on project

When finance minister Camillo Gonsalves moved a loan authorisation bill in Parliament on Wednesday, he did not expect that there would be much debate on the issue.

However, his two-minute opening statement was cause for contention from the opposing side of the House, with those rising to debate claiming that sufficient information had not been disclosed by Gonsalves about the nature of the project.

The objective of the Loan Authorisation Act is to authorise the government to borrow money in the sum of US$50 million (EC$135 million) from the Export-Import Bank of the Republic of China on Taiwan for the 250-room Mount Wynne Peter’s Hope Hotel Project.

“I am being asked as a member of Parliament representing the people of West Kingstown and a member of the Party that should be in government, but has been cheated into Opposition and I am being asked to make up my mind on the basis of a two-minute presentation by the minister who is piloting the Bill for the expenditure of 135 million dollars,” Daniel Cummings said in his debate presentation.

Cummings, speaking from his experience in project management, posed several questions in relation to the project, and said that he had no critical information that would allow him to make an informed decision of whether to support the authorisation bill.

The representative for West Kingstown further said that he was not aware of any environmental or other studies that had been done to prove the project a feasible one.

“This project for 135 million dollars cannot be presented in the manner it has been by the honourable minister of finance and considered to be something serious, something real. But on the contrary, one has to wonder if it is sinister, if it is a political ploy or what? We do not know,” he said. “We do not know if there is a study done to determine whether, as I said, there is a need for additional hotel spaces on mainland St Vincent; if the location down there is attractive and suitable. You know sometimes you get, ‘build it and they will come’ as in the case…at the airport.

But in today’s age Mr Speaker, one has got to be very careful in expending huge sums of money which generations yet unborn will have to pay back.”

St Clair Leacock, the representative for Central Kingstown also made similar comments, noting that this project could cost taxpayers approximately $10 million in yearly repayments.

He expressed thoughts that the government have been embarking on a number of capital projects “in which they circumvent or in any event, fail to present to this honourable House, the feasibility studies upon which we should proceed in proper project management of any capital programmes”.

Leacock said that this was the case with the Argyle International Airport and a number of other projects. And he said that the government has fallen short of “good financial fidelity”.

“The very thought process around this project should trigger within the mind of the honourable minister of finance himself …If there was so much money to be made out of this project then there would have been a lot of people knocking on my doors for a piece of the action. That’s how I would think it through, and in the absence of that, I think the opposite that there is a serious reason why the private sector is taking a risk averse position with respect to the Mount Wynne project. It ought to be seen as a red flag of some sort,” the Central Kingstown representative said.

In his wrap up, the finance minister expressed surprise at the length of time it took to debate the Bill.

“I confess some surprise at the length of the debate and the passion that it seemed to elicit. I believe Mr Speaker, that each session of the Parliament and indeed each successive Parliament and each Government is part of a continuum and the past informs the present, and I, before coming to this honourable House, read quite a few loan authorisation bill debates in the Hansard and one of the things that was striking about them was their brevity, both in the presentation by the mover of the Bill and in the debate by the Opposition,” he said.

Gonsalves said that the opposition leader and the representative for West Kingstown had both asked questions in relation to the government’s intention to build a hotel at Mount Wynne/Peter’s Hope.
And he said that he provided a lengthy response answering all those questions in the House.

“So I thought that the issues surrounding our process to this date had been canvassed and since we were bringing a bill simply to authorise the borrowing of money and a bill that contemplated that the terms would not even be present now, because the Bill says the minister shall cause a copy of any agreement conducted between the Government and Bank in respect of the loan to be laid before the House of Assembly after its concluded,” the finance minister said.

Gonsalves’ wrap up also served to address concerns raised by the Opposition which included the location of the hotel, the transportation route and whether black sand beaches would be kept.
“If this honourable House feels I erred and I should have repeated them up front again, I will take that under advisement in my future presentations. I have many presentations here and I pledge to you that I will be more long winded in my other presentations. I think that the information has been fully disclosed within the bounds of what we are allowed to disclose at this point, given the current state of negotiations,” he said.

“I take very seriously, the honourable member for Central Kingstown’s issues regarding fiscal space. I think it is an important issue and one that we have to continue to monitor and also the issue of implementation which is an issue I flagged in my last budget debate and will flag again because we have to improve our implementation.”

He further sought to provide reasons as to why the loan should be authorised by Parliament.

He said that authorising the loan may take some time and that they wanted to begin the New Year with the authority of the Government to seek the money so that construction of the hotel could begin.
The Loan Authorisation Act “to authorise the government to secure a loan to finance the construction of a hotel at the Mount Wynne / Peters Hope area as part of the government’s public sector investment programme and to provide for matters connecting therewith,” was passed on Wednesday evening.