MONDAY, OCTOBER 24, 2016
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Allen’s $100k demand rejected by LOI group By NEIL HARTNELL Tribune Business Editor nhartnell@tribunemedia.net
THE group at the centre of the Renward Wells Letter of Intent (LOI) controversy rejected an exCabinet Minister’s alleged $100,000 demand for sending a solitary letter to the Government over its wasteto-energy proposal. Stellar Energy, in legal documents detailing its claim for $727.364 million in damages, claimed that Algernon Allen and his law firm sent them a $100,000 invoice after sending Mr Wells a letter that obtained “an encouraging reply”. The company’s statement of claim, filed with the Supreme Court just before Hurricane Matthew struck, alleges that it “entered into a legal representation agreement” with Mr Allen, and Allen, Allen & Company, in October 2013. A $15,000 retainer was paid to the Urban Renewal co-chair and his firm in return for providing legal services to assist Stellar with obtaining government approval for
Ex-minister allegedly sought sum for one Wells letter Stellar files for $727.364m default judgment Group ‘perplexed’ by events in LOI leak run-up its proposed $650 million waste-toenergy plant at the New Providence landfill. “At the time, the fourth defendant [Mr Allen] assured the plaintiffs [Stellar] that they would have no problem in acquiring the contract,” the statement of claim alleges. “Subsequent to the first payment, on December 6, 2013, [Mr Allen] wrote a letter to [Mr Wells], the government official responsible for the National Energy Task Force. “This letter obtained immediately See PG B5
Nine-fold increase in job placement rate now targeted By NEIL HARTNELL Tribune Business Editor nhartnell@tribunemedia.net A NINE-FOLD improvement in job seeker placement rates is being targeted by a $50 million initiative that aims to overhaul skills training and employment preparation in the Bahamas. The project, which will be funded 50/50 by matching contributions from the Government and InterAmerican Development Bank (IDB), aims to improve the Department of Labour’s job seeker placement rate from the current 2 per cent to 18 per cent. Called ‘Skills for current and future jobs in the Bahamas’, it also aims to better equip young Bahamians for the demands of the 21st century workplace via apprenticeship programmes that emphasise ‘on the job’ training. IDB project documents seen by Tribune Business reveal that 1,350 Bahamians will undergo a year-long nationwide apprenticeship programme, which is funded 50/50 by the Government and employer. The three sectors targeted for the apprenticeship programme are maritime services (Grand Bahama Shipyard); the medical industry;
$50m project unveils apprenticeship initiative Designed to benefit 1,350 Bahamians Maritime, medical and IT industries targeted and information technology (IT) and telecommunications. All three were said to have been chosen because the Christie administration believes they are ripe for growth as a result of new investments. Showing just why the project is needed, the IDB documents said the 2012 ‘Wages and Productivity’ survey of the Bahamas had revealed just three industries where more than 15 per cent of the employees were aged under 25. “The survey shows that only three industries have over 15 per cent of employees under the age of 25, consistent with the fact that younger workers are perceived with a lower level of soft skills found in several consultations,” the IDB said. See PG B9
‘Mischievous fantasy’: Ex-minister hits back By NEIL HARTNELL Tribune Business Editor nhartnell@tribunemedia.net AN ex-Cabinet minister has blasted the lawsuit initiated against him by the group at the centre of the Renward Wells controversy as “mischievous, illfounded and irresponsible”. Algernon Allen told Tribune Business that himself and his law firm, Allen, Allen & Company, had already hired attorneys to defend them against the allegations being levelled against them by Stellar Energy. Disclosing that he had yet to be served with the waste-toenergy group’s ‘statement of claim’, which lays out the details underpinning its action, Mr Al-
Allen slams Stellar claims; no reply to details Says yet to be served with ‘statement of claim’ Adds LOI group move a ‘puff of wind in hurricane’ len suggested Stellar was living out “a fantasy”. While declining to directly rebut the specific claims made against himself and his law See PG B9
Matthew puts building inspection outsource ‘back on the table’ By NEIL HARTNELL Tribune Business Editor nhartnell@tribunemedia.net THE outsourcing of building inspections “has to come back on the table for a serious conversation” if the Bahamas is to prevent future Hurricane Matthewtype devastation, the Bahamian Contractors Association’s (BCA) president believes. Leonard Sands told Tribune Business that while the Bahamas Building Code was acknowledged as “very robust”, both locally and internationally, Matthew had exposed flaws in its execution and enforcement.
Contractors chief: Key to cutting future storm damage And reducing repair bill for homeowners, taxpayers Latest hurricane exposes enforcement weaknesses LEONARD SANDS Acknowledging that the Ministry of Works may lack sufficient personnel and other resources to cover the
entire Bahamas, Mr Sands urged the Government to again look at outsourcing See PG B4
$4.04 Insurer says 15% of Matthew roof loss ‘preventable’ RoyalStar chief blames ‘shoddy workmanship’ And lack of inspection enforcement Bulk of hurricane claims to be paid pre-Christmas By NEIL HARTNELL Tribune Business Editor nhartnell@tribunemedia.net AN insurer believes 15 per cent of Hurricane Matthew-related roof damage was preventable, blaming “shoddy workmanship” and enforcement failures for exacerbating losses. Anton Saunders, RoyalStar Assurance’s managing director, told Tribune Business: “What we are seeing from some of our engineers and loss adjusters going out is that 15 per cent of the roof damage should have been preventable if contractors and roof inspectors did their jobs properly.” Blaming “shoddy workmanship and a lack of inspections”, Mr Saunders said Matthew had exposed weaknesses in both New Providence and the other hard-hit islands. “If we enforced the laws and then the inspections, some of the losses would have been mitigated and preventable, especially on the roof,” Mr Saunders said. His comments are likely to reignite debate over whether the Bahamas has the resources, will and ability to properly enforce its Building Code, and hold See PG B8
PAGE PAGE 2, 2, Monday, Monday, October October 24, 24, 2016 2016
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Business non-compliance impacted Joaquin recovery 48 applicants successful; 3x as many non-qualifiers No takers for Venture Fund’s $250k loan facility
JUST one in four business applications for post-Hurricane Joaquin assistance was approved because many enterprises were non-compliant with tax and other legal requirements. Rebuild Bahamas, the joint relief effort supported by Rotary and the Bahamas Chamber of Commerce and
Employers Confederation (BCCEC), assisted 48 businesses in the southern Bahamas islands devastated last year by Joaquin. However, it said in a statement that applications from around three times’ this number did not qualify for aid because they did not have a Business Licence or
were non-compliant with other government requirements. The Ministry of Finance has suggested this will be less of a hindering factor for the Hurricane Matthew relief and recovery efforts, and is putting in place mechanisms to assist this. Rebuild Bahamas also
noted that no business took advantage of $250,000 set aside by the Bahamas Entrepreneurial Venture Fund for short-term loans. “Businesses just did not want to borrow, even at very low interest rates with extremely favourable terms,” See PG B4
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Monday, October October 24, 24, 2016, 2016, PAGE PAGE 3 Monday, 3
Govt slammed over landfill due diligence
BPL ‘set up to fail’
By NATARIO McKENZIE
in Hurricane Matthew’s aftermath made operating conditions unsafe. Michael Cox, Renew Bahamas chief executive, told Tribune Business that these incidents, combined with the loss of electrical power in the storm’s wake, had brought landfill operations - especially the revenuegenerating recycling activities - to “a grinding halt” for the past three weeks. Confirming that Renew Bahamas had exercised the ‘force majeure’ clause in its contract, Mr Cox said it was uncertain whether the company would return, potentially endangering around 50 Bahamian jobs. With the Department of Environmental Health Services (DEHS) now back in charge at the landfill, Mr Cox also hit out at what he described as the Government’s “two-and-a-half year” failure to properly engage with Renew Bahamas. Kenred Dorsett, minister of the environment and housing, told Tribune Business he was awaiting legal advice from the Attorney General’s Office before determining the Government’s “next step” on the landfill, admitting that it had been “surprised by Renew Bahamas’ decision to suspend its management of the New Providence landfill. Yet Mr Turnquest said: “This was squarely on the backs of the Government and its technical team that did the assessment. It is unacceptable that the Bahamian people are being asked to bail these people out. That was not the intent. “The intent was to make this a public-private partnership with no cost or liability to the Government. You can’t have it both ways. You can’t be a private entity then want to draw on the Government when you get in trouble.”
AMID intense criticism of the pace of New Providence electricity supply post-Matthew, the Opposition’s deputy leader believes Bahamas Power and Light (BPL) and its management company were “set up to fail”. K P Turnquest told Tribune Business: “There is no question that BPL was set up to fail. There is no way that it could continue to operate the way it was operating. Even with jettisoning the legacy debt, they are still straddled with a very inefficient plant. “Unless the private entity owns the facility, they are not going to put any skin in the game. They are not going to invest in any new equipment. They are going to do their technical assessment and advise you, the shareholder, that if you want an efficient plant you are going to have to put in money.” Rather than sell the former Bahamas Electricity Corporation (BEC) via a privatisation exercise, the Christir administration transferred all its assets to a new operating subsidiary, BPL. It then hired Carolinasbased PowerSecure as BPL’s management partner on a five-year deal worth a minimum of $10 million, and maximum of $25 million, depending on whether it hits performance and success targets. But, following a summer in which New Providence has been plagued by more energy blackouts, BPL and
AG praised for dropping union executives’ case
THE Association of Bahamas Marinas (ABM) said yesterday that all 47 members were open for business and anticipating a busy winter season, most having experienced no significant damage as a result of Hurricane Matthew. “ABM members were reporting full restoration of power and water to their docks and resorts within a day or two of the hurricane, the small eye of which travelled over the Exumas, Nassau, Chub Cay and Grand Bahama,” the Association said in a statement. “All the Exuma marinas, including Highbourne Cay and the Marina at Emerald Bay (Sandals), reported no or slight damage with Safe Harbour at Cave Cay soon to repair two damaged docks and fully operational with other docks.” The statement continued:
Tribune Business Reporter
nmckenzie@tribunemedia.net
THE Opposition’s deputy leader has slammed the Government for failing to conduct proper due diligence on Renew Bahamas, after the New Providence landfill manager suspended its services in Hurricane Matthew’s wake. K P Turnquest said: “It is obvious that the due diligence that was done with respect to Renew Bahamas was inadequate. “Based on what I’m hearing they are saying that they do not have the financial resources to get this thing up and running in a manner that would lead them to whatever profitability they thought they could have achieved. It is an incomplete or poorly vetted business plan that was put forward.” Renew Bahamas had earlier this year sought to engage the Government in negotiations over revisions to its five-year management contract, having argued that its business model was unsustainable and had produced “millions of dollars” in losses. In response, the Christie administration appointed the Kikivarakis & Co accounting firm to analyse Renew Bahamas’ financials, and determine whether its request was justified. The Government indicated last week that it believed Renew Bahamas was using Matthew as potential justification for getting out of its existing contract, hinting that the issues leading to its withdrawal had been building for many months. Renew Bahamas exclusively revealed to Tribune Business last week that it had “suspended its services” as the New Providence landfill manager, after shootings, tyre slashings and widespread theft
By NATARIO McKENZIE
Tribune Business Reporter
nmckenzie@tribunemedia.net
THE Trade Union Congress’s (TUC) president has praised the Attorney General’s decision to drop charges against five union executives at the Sandals Royal Bahamian resort, describing the move as “a step in the right direction”. Obie Ferguson told Tribune Business: “I think that it’s a step in the right direction, dropping the criminal charges against those individuals who were only exercising their right to associate and peacefully demonstrate. “It now opens the door for the union and the employer to sit down and have
OBIE FERGUSON serious negotiations on an industrial agreement.” According to Mr Ferguson, he last week received a copy of a ‘nolle prosequi’ that was dated September 30. This drops the proscution of, See PG B9
By NATARIO McKENZIE
Couldn’t respond way it wanted after Matthew
Tribune Business Reporter
nmckenzie@tribunemedia.net
FNM deputy says utility is stuck financially
A BPL truck on the road carrying out repairs after the aftermath of Hurricane Matthew. PowerSecure have come under further fire for what many perceive as the protracted restoration process post-Matthew. Some areas have taken more than two weeks to be re-energised. Some have suggested the restoration would have been much faster under the ‘old BEC’, and claimed the monopoly utility’s efforts lacked sufficient manpower (help from outside contractors) and co-ordination. BPL, though, has said it is dealing with numerous wires downed by Matthew, while the devastation and proximity of surrounding tree branches has complicated efforts to rebuild its transmission and distribution network. “BPL asked for a rate increase and the Government said no. You’re set-up to fail; you’re stuck. It’s no secret they were not able to respond the way they wanted; they don’t have the resources. Old, inefficient equipment and a rate structure that is unsustainable,” said Mr Turnquest.
Bahamian marinas shrug off Matthew By NATARIO McKENZIE
Tribune Business Reporter
nmckenzie@tribunemedia.net
“In Nassau and Paradise Island, all marinas escaped unscathed. In the harbour, Bay Street Marina and Nassau Yacht Haven reported no damage and are fully functional. “Palm Cay on the southeast coast of New Providence only had a couple of channel markers misplaced, while marinas at Lyford Cay and Albany were undamaged. Albany chose to close temporarily to cleanup foliage and make the luxury estate pristine. “In Grand Bahama, Old Bahama Bay & Yacht Harbour is open for business, waiting to be reconnected with power soon. Bradford Marine in Freeport Harbour is up and running with restored power for its See PG B9
BPL appears financiallystrapped, and PowerSecure has its hands tied, until the Government refinances BEC’s legacy debt via the promised issuance of a rate reduction bond (RRB). That bond is designed to refinance $650 million, including legacy bank and
other debt; BEC’s pension deficit; environmental liabilities; redundancies and other problem areas. The refinanced debt will be removed from BEC’s balance sheet via a special purpose vehicle (SPV), paving the way for PowerSecure and BPL to raise new financing - such as the funds needed for a New Providence power plant. There has been no indication from the Government, though, on when the RRB will be placed, thus forcing BPL and PowerSecure to continue to muddle through as best they can.
PAGE 4, Monday, October 24, 2016
Business non-compliance impacted Joaquin recovery From pg B2 said Edison Sumner, the Chamber’s chief executive. Rebuild Bahamas, in a September 5 report on its Joaquin activities, said it would seek longer term solutions in conjunction with the insurance industry to help small to medium-sized businesses obtain affordable insurance coverage.
Rebuild Bahamas has now re-engaged stakeholders to assess needs and begin fund-raising restoration efforts in Matthew’s wake.. “Rebuild Bahamas, a partnership between the Bahamas Chamber of Commerce and Employers’ Confederation and the Rotary Clubs of the Bahamas, flew into action immediately fol-
Matthew puts building inspection outsource ‘back on the table’ From pg B1 this work - especially on the Family Islands - to construction industry professionals. Mr Sands said such representations from the contractors, architects and engineers had been “seriously considered” by the Ministry of Works around eight years ago, but ultimately the proposal “fell by the wayside”. He added that the BCA now planned to hold a Town Meeting on November 17 at the College of the Bahamas’ (COB) Harry C.
Moore Library, beginning at 6.30pm, to revive the ‘inspection outsourcing’ issue. “I think it has exposed the fact that there appears to be some people not properly adhering to it,” Mr Sands told Tribune Business of Matthew and the Bahamas Building Code. “We always believed the Code is very robust and stringent, but a lot of properties in the Family Islands seem not to be built as stringently as the code dictates.” He added: “What we probably can do, and the
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lowing the passage of Matthew,” said Mr Sumner. “As soon as planes could get into Andros and Grand Bahama, we had teams on the ground conducting interviews, photographing damage, checking businesses that were impacted and we are working on compiling the costs associated with repairs right now.” Damages from Matthew, which blew through the northwestern Bahamas onOctober 6-7 with winds of up to 145 miles an hour,
and strong storm surges that caused widespread flooding, have been estimated by the Government and insurers in the hundreds of millions of dollars, far exceeding Hurricane Joaquin. The repercussions from Matthew are more extensive because the storm struck heavily populated sections of New Providence, as well as much of Grand Bahama - from Port Lucaya to West End and portions of North Andros. Gowon Bowe, the Cham-
ber’s chairman and a member of several disaster-recovery related boards, said there was recovery and rebuilding activity at every level. “While several organisations have been working to assist with meeting emergency and immediate needs of individuals, some of whom do not even have a roof over their heads, Rebuild Bahamas is trying to get affected businesses back up and running as fast as possible so people can
get back to work and repair supplies are available especially for those areas hardest hit,” Mr Bowe said. Rotary was first to get emergency supplies to hardhit areas and will again partner with the Chamber for a Rebuild Bahamas effort that, according to the latest report, spent $573,926 helping to re-build or re-stock businesses in five islands and re-float fishing vessels - in the southern Bahamas devastated by Hurricane Joaquin.
BCA and other organisations have suggested, is the Government - through the Ministry of Works - can allow professionals like the architects and engineers to do inspections for it on the Family Islands, where it may cost too much to send persons down. “This is something the architects and engineers have offered to the Ministry of Works, and at one point it was under review.” Mr Sands told Tribune Business it was noticeable that the areas hardest hit by Hurricane Matthew appeared to be north Andros and the settlements of west Grand Bahama - districts where building inspections were likely to be less frequent in comparison to Nas-
sau and Freeport. “It seems that in places where there were not so many inspections and inspectors, the damage appears more severe,” Mr Sands said. “Where you have homes with inspections and inspectors, the damage is less severe, it appears. “That kind of tells the story of where enforcement is. The Code is fine by anyone’s estimate. A lot of persons from the UK and US agree that the Code is very robust, but application can only be ensured with enforcement.” Concerns that Bahamas Building Code enforcement gets laxer as you travel further away from Nassau, Freeport and Abaco, the
main population centres, is nothing new. Yet the issue has been brought into sharp focus, and highlighted, by the damage inflicted by Hurricanes Joaquin and Matthew - storms the Government estimates as costing it a combined $800 million. Mr Sands said there were likely many homes constructed in the southern Family Islands without the necessary permits and approvals. And by the time Ministry of Works inspectors arrived from Nassau, families were often already living in these properties, making it much harder to remedy any defects and bring them up to Code. As a result, these homes were often untested, and the only way of detecting whether they are up to standard is when a hurricane with the severity of a Joaquin or Matthew scores a direct hit. “You could probably presume there are some cases where the inspectors do not get to go to inspect in the southern islands, as they cannot get the funds to fly down,” Mr Sands said. “We at the BCA obviously have a position on making sure we fix this gap, as
the cost of construction and recovery is impacted directly when we have these kind of gaps in enforcement. Ultimately, it impacts the Budget of the Bahamas.” Given the relatively low level of insurance penetration in the Family Islands, and the minimal financial resources possessed by many residents, the cost of rebuilding storm-ravaged homes inevitably falls on the Government and the Bahamian taxpayer. To prevent this, and ensure construction is executed correctly first time, Mr Sands renewed the calls for the Ministry of Works to outsource inspections to qualified architects, engineers and construction services providers residing in the Family Islands. “We have identified it in the BCA, and the engineers and architects talked about this 10 years ago,” he added. “It was seriously considered eight years ago under the then-director of works. I know it fell by the wayside. “The scenario we had on the table needs to come back and happen, because on every island there’s an architect, an engineer or building professional. Many of the young persons who go to school for building and construction design and performance can offer that service as well. “If we’re looking to the future and how we reduce exposure to future storms, that has to come back on the table for a serious discussion.”
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Monday, October 24, 2016, PAGE 5
Allen’s $100k demand rejected by LOI group From pg B1
an encouraging reply on December 12, 2013, to the effect that the plaintiffs’ proposal was under consideration by the Bahamas Government.” It was then, Stellar alleges, that Mr Allen and his law firm sent them a $100,000 invoice, a demand it baulked at paying. “Together with the letter in response, the fourth defendant presented the plaintiffs with an invoice of $100,000, which the plaintiffs refused to pay,” Stellar claimed. “Following meetings and discussions with the fourth and fifth defendants [Algernon Allen and Frank Forbes], the fourth defendant agreed to waive the invoice and proceed in any event.” Stellar’s statement of claim sheds light - at least from one side’s perspective - on the murky developments that led up to the controversy which forced Mr Wells’ to step down as parliamentary secretary in the Ministry of Works. The group, headed by Dr Fabrizio Zanaboni and Jean-Paul ( JP) Michielsen, is demanding that the Supreme Court award damages in its favour and against Mr Wells, the Government, Mr Allen and his firm, and Mr Forbes and his company, Sigma Holdings/Management. They are also seeking declarations that the Government both “honour” the LOI contract and not award a waste-to-energy contract to any other company until damages are paid. Tribune Business can reveal that Stellar and its attorneys, Ian Cargill & Company, on Friday filed for a $727.364 million default judgment against the Government, and Messrs Allen and Forbes, on the grounds that all have failed to file a defence or give notice of their intention to do so. Accompanying court documents, seen by this
newspaper, allege that Ian Cargill & Company could find no trace of any such filings despite conducting a thorough search of the Supreme Court Tribune Business understands that Mr Wells has not been included in the ‘default judgment’ filing after his legal representatives request a further 21 days to respond. Meanwhile, Stellar’s statement of claim alleged that it was “peculiar” that Mr Forbes, who Mr Allen encouraged them to bring on board as ‘honorary chairman’, never gave them the LOI version that was intended for Deputy Prime Minister Philip Davis to sign. This was despite Mr Forbes allegedly providing them with a copy of the letter sent to the Inter-American Development Bank (IDB) by Michael Halkitis, minister of state for finance, seeking the bank’s support for a $40 million guarantee that would underwrite Stellar’s engineering studies at the New Providence landfill. As revealed previously by Tribune Business, Mr Halkitis’s letter showed the Government was aware, at Cabinet level, of the LOI’s existence some six weeks before Mr Wells was fatefully prevailed upon to sign the final version. The letter referred to Stellar having been issued with an LOI, but the waste-to-energy group said it never saw a copy of this version or the other attachment noted by Mr Halkitis.
Stellar then claimed it was told by Mr Forbes that it needed to sign a “partnership contract”, or otherwise the waste-to-energy proposal would never be approved by the Government. “On or around the beginning of June 2014, the fifth defendant informed the plaintiffs that in order to progress the project approval he needed, on behalf of his principals, some additional contractual documentation on a partnership basis, which the plaintiffs reserved the right to consider,” Stellar alleged. “It was made quite clear to the plaintiffs that, in the absence of such documentation, the project would not proceed to the approval stage.” Mr Forbes’s “principals” are not identified, and neither is the nature of the “partnership”, although it appears to be a reference to a joint venture agreement with him that is mentioned later in the court filings. Stellar later alleges that the LOI was leaked as part of “a conspiracy” against it, with “clear intent at the Government level to sabotage the project”. It also claimed that Mr Forbes “and his political partners” were reneging on their agreements with Stellar, including the LOI and other arrangements al-
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PUBLIC NOTICE
INTENT TO CHANGE NAME BY DEED POLL The Public is hereby advised that I, Philip Edwin Smith Gould intend to change my name to Philip Alexander McCartney. If there are any objections to this change of name by Deed Poll, you may write such objections to the Chief Passport Officer, P.O.Box N-742, Nassau, Bahamas no later than thirty (30) days after the date of publication of this notice.
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legedly “forced upon” the group, “for the benefit of third parties close to the Government, and in particular to the Deputy Prime Minister and other local business group(s) close to him”. Amid the fog and seeming confusion surrounding Stellar’s project, the group was then informed on June 20, 2014, by Astrid Wynter, the IDB’s then-Bahamas country manager, that the multilateral lending institution “had no intention” of providing the necessary financial support. Stellar alleged it had been further “perplexed” several days before when Ms Wynter purportedly caused one of Mr Halkitis’s officials to contact the group, seeking copies of the
attachments to the minister’s letter. Stellar said it provided the drafts and, “immediately thereafter... Ms Wynter sent an e-mail on July 10, 2014, disclaiming any part in the proceedings or any consent in the financial support”. The LOI was then ‘leaked’ to the media the following day, consuming Stellar and its project in a firestorm of controversy due to Mr Wells allegedly signing the document without authorisation. Stellar claimed that once the LOI was made public, it was suddenly contacted by two persons - including an ex-Cabinet minister in the first Christie administration - seeing copies of the document.
“The plaintiffs further found disturbing that immediately after the leak occurred, both Giles Deal (assistant to the minister of housing and the environment, Kenred Dorsett), and Vincent Peet, also advisor on the matter, called the plaintiffs within 10 minutes from each other to ask for a copy of the signed LOI,” Stellar alleged. The group’s legal filings also disclose that after the LOI controversy broke, Mr Forbes arranged for radio personality, Steve McKinney, to run a PR campaign to defend Stellar’s reputation. Mr Forbes and Sigma are understood to own Mr McKinney’s radio station, Radio Peace 107.5.
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PAGE PAGE 8, 8, Monday, Monday, October October 24, 24, 2016 2016
Insurer says 15% of Matthew roof loss ‘preventable’ From pg B1 contractors to account for flawed construction. The RoyalStar chief’s remarks indicate that had the Building Code been followed to the letter, a significant portion of Matthewrelated losses would have been prevented, easing the post-storm financial burden for homeowners, the insurance industry and the Government. Mr Saunders, meanwhile, said RoyalStar hoped to pay “90 per cent” of Matthew-
related damages to validated claims before Christmas. “We think about 75 per cent of our claims have been reported, and we are starting to settle them,” he told Tribune Business. “We’re paying out already to our clients. “We expect that process [of receiving claims] to continue for the next two weeks, and we hope to get as many claims settled between now and November as possible.” Mr Saunders said RoyalStar’s loss adjusters were
completing final damages reports now, and added: “We hope that 90 per cent of the losses will be paid before Christmas. “You always have those losses that lag on for longer. They’ll be the bigger clients. Those ones take a long time, but they will expect their interim payments in the meantime.” Mr Saunders conceded that many Bahamian home and business owners had suffered “a double whammy” from the rainstorm that occurred on Sunday, October 16, which caused further water leakages through roofs compromised by Matthew.
He added that RoyalStar already had estimates for its total Matthew-related losses, but declined to disclose them, saying the property and casualty underwriter wanted to inform its reinsurers first. The Bahamian general insurance market buys huge amounts of reinsurance annually to underwrite the risks covered locally, meaning it is the reinsurers - rather than the Bahamas-based carriers - who will absorb the bulk of Matthew payouts. “They do pay the bulk of the losses on our portfolio,” Mr Saunders said. “All of us in the Bahamas will have our deductible, and the deductible will be a small percentage of the losses. We all are relying on the reinsurers.” Both Mr Saunders and Patrick Ward, Bahamas
First’s president and chief executive, agreed that the Bahamian industry’s initial estimate of $400 million in total insured losses from Matthew was holding true. Describing that figure as “reasonably accurate”, Mr Ward said of Bahamas First: “We’ve seen well over 1,000 claims registered already, and that number is increasing on a daily basis.” Mr Ward said claims were being submitted electronically and via ‘walk ins’ at its offices, plus through brokers and agents. “The numbers are going to come in steadily for the next couple of weeks, and then tail off after that,” he added. “There are no real surprises. We are seeing essentially what we thought would be the case. The one thing we’re particularly happy about is that we don’t
PUBLIC NOTICE
INTENT TO CHANGE NAME BY DEED POLL The Public is hereby advised that I, SOPHIA ANTOINETTE SMITH of Nassau, Bahamas intend to change my name to SOPHIA ANTOINETTE FACEY. If there are any objections to this change of name by Deed Poll, you may write such objections to the Chief Passport Officer, P.O.Box N-742, Nassau, Bahamas no later than thirty (30) days after the date of publication of this notice. Notice of Appointment of a Liquidator under Section 204 of the BVI Business Companies Act. SWIFTLEY PROPERTY HOLDINGS LTD. (In Voluntary Liquidation) Company No. 162234 NOTICE is hereby given pursuant to Section 204, subsection (b) of the BVI Business Companies Act, 2004 that the Company is in voluntary liquidation. The voluntary liquidation commenced on 9TH SEPTEMBER, 2016 The Liquidator is Kevin Ackermann, c/o General Wille-Strasse 10, 8027 Zurich, Switzerland Dated 17th day of October, 2016. (Signed) Kevin Ackermann Voluntary Liquidator
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have any real evidence of widespread structural damage. It’s roof and water damage, especially in the coastal locations.” Mr Ward said Bahamas First would likely determine the extent of its Matthewrelated losses “with some reasonable precision” within the next two weeks. He added that the Category Three/Four storm “still seems to be” Bahamas First’s record payout for a single loss event, suggesting it would be higher than the $60 million and $28 million it paid out in 2004 for Hurricanes Frances and Jeanne, respectively. “This will certainly be higher than those on an individual basis,” Mr Ward told Tribune Business, “but I don’t want to throw numbers out there and be irresponsible about it. “We are already starting to see funds from reinsurers trickle into the country, and we’re already paying claims. Based on the performance in prior years, I would expect the majority of claims to be paid over a three-month period.” Terrence Rollins, Security & General’s general manager, said the underwriter had received more than 300 Matthew claims to-date. “As of today, we’ve had over 300 in total,” he told Tribune Business. “I can tell you as a rough rule of thumb that there are probably five property claims for every motor claim. “I wouldn’t be surprised if we end up with 400 claims when all is said and done, but what it’s going to amount to [in value], I just don’t have the data at the moment. It’s just too early to tell, and for us to give projections and estimates.” Mr Rollins added that Security & General’s Grand Bahama clients appeared to have suffered more than those in Nassau, although it insures fewer risks in the northern island.
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Nine-fold increase in job placement rate now targeted From pg B1 “Across several consultations and qualitative analyses, one of the main explanations behind the skills shortage is the disconnection between the training provision and the private sector employers in the Bahamas, making training less pertinent and relevant for the labour demand side.” The Bahamas’ education, training and workforce productivity problems are wellknown to most employers, with the wages and productivity survey revealing that a lack of so-called ‘soft skills’ is the main reason for employee dismissals and turnover in 65 per cent of companies. “Despite this reality, more than half (53 per cent) of the firms do not train their staff, and for those that do, training is focused on productivity, sales and marketing, with limited emphasis on developing soft
skills,” the IDB added. “Employers point to the lack of specific skills for the job as the most important recruitment obstacle (34 per cent), followed by applicants’ lack of experience (29 per cent) and of soft skills (28 per cent). “Among the consequences of the lack of right skills for the job, 24 per cent of respondents state that staff skill levels are a main obstacle to productivity, due to unsatisfactory performance, absenteeism, lack of responsibility and commitment to the job.” To measure the apprenticeship programme’s success, the IDB will assess the employment rate and income of those who graduate from it against a ‘control’ group that will not participate. It is targeting a 5 percentage point difference in employment rates among those who take the programme compared to those
‘Mischievous fantasy’: Ex-minister hits back From pg B1 firm, the Urban Renewal co-chairman described Stellar’s action as “a puff of the wind in a hurricane’. “I don’t particularly wish to,” Mr Allen replied, when asked by Tribune Business to respond to Stellar’s specific allegations, including its rejection of his purported $100,000 demand for sending a single letter. “I’ve instructed counsel in that regard,” he added, telling this newspaper he had yet to see Stellar’s ‘statement of claim’. “I’ve not seen such a thing,” Mr Allen said. “I’ve not seen a statement of claim. I saw a simple filing, and have never seen any particulars. I have not yet been served; I may well be.” Stellar’s ‘statement of claim’ was filed with the Supreme Court just before Hurricane Matthew struck, which may explain why Mr Allen and his attorneys have yet to be served with it. “Frankly speaking, I think it is a mischievous and ill-founded and irresponsible action that has been taken,” Mr Allen blasted of the Stellar claims. “It is all a bit of mischief
and fantasy; mischief and fantasy. Frankly speaking, I suspect it will be like many of these ill-fated and wishywashy exercises; a puff of the wind in a hurricane.” Mr Allen then declined to comment further, on the grounds that the case was now before the courts. Stellar, though, is likely to gain the attention of Mr Allen and his fellow defendants now after filing for a $727.364 million default judgment from the Supreme Court on Friday. Apart from Mr Allen and his firm, the defendants also include Renward Wells, forced to resigns as parliamentary secretary in the Ministry of Works for signing the LOI; the Government (Ministry of Works and the Attorney General); and businessman/accountant Frank Forbes and his Sigma Holdings firm. The listed telephone numbers for Mr Forbes and Sigma’s offices, said to be located at the British Colonial Hilton’s Centre of Commerce, were permanently engaged when Tribune Business tried them last week. The LOI for Stellar’s proposed $650 million waste-
who do not, plus a 20 per cent difference in earnings. It is also aiming for 1,215 of the 1,350 to graduate. In addition, the National Training Agency’s (NTA) existing infrastructure will be used to deliver ‘soft skills’ pre-apprenticeship training to 1,100 Bahamians, equipping them with basic skills for the workplace. “This is targeted to the unemployed and school leavers between the ages of 16-40 years,” the IDB papers said. “[It] will seek to fulfill two main objectives: first, to increase the relevant skills and employability of workers, and their probability of employment in three strategic sectors (maritime, medical services, and IT/telecommunications) for the economy. “Second, to promote communication between employers and training providers in these sectors in terms of skills needs, so as to ensure the development of a programme that promotes relevant skills and higher labour market pro-
ductivity.” The IDB documents said graduates from the National Training Agency’s preapprenticeship programme will “feed into” the apprenticeship training, where 80 per cent of learning will be ‘on the job’. “The apprenticeship programme will also help consolidate a network of offthe-job training providers, using the existing capacity of well-established institutions such as BTVI and other public and private training bodies,” the IDB said. “Some of the costs related to the on-the-job training portion will be covered directly by participating firms, while the loan will provide support for small and medium enterprises within the selected sectors, and with a minimum structure, to take on an apprentice with structured training.” To participate, companies will need to finance 50 per cent of the apprentice’s wage stipend and also ensure staff monitor and assess their progress over the year.
to-energy plant, which would be located at the New Providence landfill, states that it is valid for just 12 months from the date that Mr Wells signed it. The document, which appeared to be non-binding on both Stellar and the Government, states: “This LOI is valid for 12 months from the date of its signing, and will terminate automatically unless extended by mutual consent of the parties releasing the other from their respective obligations, if for any reason the project does not proceed and is terminated as a result.” Given that Mr Wells signed the LOI on July 4, 2014, many observers are likely to view it as having expired at the same time last year, depriving Stellar of any basis upon which to launch a legal action. However, the waste-toenergy group headed by Dr Fabrizio Zanaboni and Jean-Paul (JP) Michielsen, is alleging that Mr Wells and the Government defendants breached and “frustrated” the LOI. And, as a result, Stellar is arguing that the LOI, which it deems a contract, has been “automatically extended” because there was “no mutual consent between the parties to terminate and release each other from their respective obligations”. Therefore, the group is
claiming the $727.364 million as a “prospective loss of earnings”, and “risk of damage to reputation”. Despite being described by Mr Wells as a “storm in a tea cup” and “tempest in a tea pot”, which it is, the LOI situation remains a controversy that will not die for the Christie administration, not least because the key actors - Mr Wells, the Prime Minister and the Deputy Prime Minister - have all yet to give cogent explanations as to what happened. Several observers have suggested to Tribune Business that Mr Wells’s continuing reluctance to speak publicly on the issue suggests a ‘deal was cut’ with the Government, when he was still a member of the PLP, to ensure he remains silent on the matter. This has never been confirmed, though. Yet Stellar’s ongoing legal action holds out the prospect for the Bahamian people that the truth, or at least some of it, may emerge. It is rare for an investor group, both Bahamian and foreign, to take on the Government in such a manner through the courts. Most prefer to keep such complaints to themselves, fearing ‘victimisation’ and an inability to obtain previous permits/approvals (resulting in lost revenues/profits) if they speak up too loudly.
Bahamian marinas shrug off Matthew From pg B3 dry dock, travel lift and all its repair services. Port Lucaya Marina is open for yachts, having reported a few vessels underwater, while Grand Bahama Yacht Club’s clubhouse and docks are fine.” Stephen Kappeler, the Association’s president, said: “Our association’s marinas have been extremely lucky. This was a powerful storm, yet our 31 marinas and 16 allied members recovered within a couple of days. All 31 marina members are open, except one that is merely cleaning up, and all members are fully open. “With the Bahamas’ exceptional building codes and strong structures we’ve withstood this Category 3 and 4 test generally very well. Our hearts go out to those ravaged by floods in the Carolinas who fared far worse.” Mr Kappeler added:
“We greatly appreciate all the help and donations our island settlements have received, both from generous locals and our friends abroad. Many settlements such as West End and Eight Mile Rock in Grand Bahama were hit hard. We’re very grateful for all the supplies and assistance pouring in to help rebuild homes and roofs where the eye swept over. “Our many years experience in preparation and recovery - as well as our customer service - have stood us in good stead. Our associated group all around the Bahamas are already welcoming boats, yachts and fishermen, and they are having a great time. “The storm has actually lifted communal spirits and is inspiring a greater-thanusual warm, eager spirit to make sure all our guests are totally happy and wellserved.”
AG praised for dropping union executives’ case From pg B3 and charges against, five executives of the Bahamas Hotel, Maintenance and Allied Workers Unio, who had been accused of obstruction for protesting near the Sandals property on West Bay Street. Mr Ferguson said he hopes the Government will “act more as a facilitator going forward”. The BHMAWU, which falls under the TUC umbrella, has since 2009 been seeking to negotiate an industrial agreement with Sandals Royal Bahamian. Referring to the terminations of that property’s former 600 staff, he added: “What happened on August 15 was very serious. We are resolved to do what we have to do to deal with the outstanding issues.” The TUC and its BHMAWU affiliate previously blasted Sandals Royal Bahamian for its abrupt clo-
sure, which resulted in some 600 emloyees being made redundant, arguing that it was a ‘union busting’ move. The Government also came under fire for its handling of the matter. Both the TUC and the National Congress of Trade Unions (NCTU) slammed the Christie administration for what they described as its “deception” towards workers, after the Attorney General had directed that the criminal case against Sandals Royal Bahamian and its top executives be discontinued. The resort chain, though, has repeatedy argued that the closure, which resulted in 600 employees being made redundant, was essential for much-needed $4 million repairs to take place at the Cable Beach property. Sandals Royal Bahamian is now set to re-open this week, with a full complement of staff.
NOTICE SOUTH OVERSEAS LTD. In Voluntary Liquidation Notice is hereby given that in accordance with Section 138(4) of the International Business Companies Act. 2000, SOUTH OVERSEAS LTD. is in dissolution as of April 13th, 2016. International Liquidator Services Inc. situated at 3rd Floor Withfield Tower, 4792 Coney Drive, Belize City, Belize is the Liquidator. LIQUIDATOR ______________________
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