So much has been found to be wrong with the secret contract signed between the Mayor and City Council (M&CC) and Smart City Solutions (SCS) for parking meters over a 49-year period that it is amazing that it hasn’t been cancelled as yet.
Former Auditor General, Anand Goolsarran has already made the point that the city is in breach of its own procurement rules. In his accountability column in Stabroek News he recently noted that in accordance with Section 231 of the Municipal and District Councils’ Act, before entering into any contract for the execution of any work or the supply of any goods to the value of $250,000, or more, a council is required to give notice of such proposed contract and “shall by such notice invite any person willing to undertake the same to submit a sealed tender thereof to the council…”
This was not done and on this ground alone the contract should be revoked as it places the city at the centre of an unlawful procurement act which will damage its credibility and leave serious questions about its commitment to transparency and probity. It also puts the city council, elected at historic polls long after the contract had been signed, at a great disadvantage. The council will be hard-pressed to emphasise to municipal workers and contractors that the letter of the law be observed in all contracting work.
Under public pressure over the parking meters deal which had been engineered by an APNU+AFC council, the government then intervened and announced that it would undertake a review of the contract. This is a delicate matter since in the aftermath of the March 18 Local Government Elections there is an expectation that central government will make no attempt to unduly interfere with the business of municipal and neighbourhood democratic councils.
As it so happens, based on revelations about the contract, it is the City that has drawn Central Government into this matter via a promise of vast tax concessions to SCS. Such a promise is completely outside of the remit of the City and provides Central Government with the opportunity to state that these concessions cannot be granted in this manner and won’t be countenanced.
The disclosure of the promised tax concessions was contained in a Ministry of Finance review of the contract which was received by the government on July 2nd but is yet to be released to the public. Instead, at a recent post-cabinet press conference, the Minister of State, Joseph Harmon spoke in general terms about the review and adverted mainly to another review of the contract by the Attorney General’s Chambers which appeared to be more favourable to the deal proceeding.
As a mark of respect to the public and in light of the major controversy over the contract the government should have released forthwith both reviews for scrutiny. Instead, it has released information in dribs and drabs and selectively as if it is doing its utmost to save this deal. This is not a good augury.
The Finance Ministry review seen by this newspaper raises reservations about the absence of feasibility and social impact studies to properly inform a decision on whether parking meters are needed and the tolls that should be charged. This is elementary in any such project and is another stinging indictment of the way the city hatched this deal in November last year.
According to the contract, SCS expects to receive exemption from income, corporation, VAT, capital gains and all other levies, taxes, duties, cesses and rather grandly, “other impositions of a similar nature.”
The value of these concessions is unknown but raises further questions about the sweetness of the deal that SCS is getting and about the negotiating of the city both in terms of what it had granted SCS and its overreach into tax concessions.
The contract also caters for value-added services unrelated to parking which the Finance Ministry review said would bar new entrants to the metered parking industry and enable entry into the country’s economic activities “via a back door”.
It is unclear what steps Central Government will take in this process in light of the two reports. The onus is however on the Mayor, Patricia Chase-Green to take whatever measures are necessary to protect the citizens of the city from what can be an extremely burdensome arrangement via a contract that violates the city’s procurement laws and contains other indignities.
The installation of parking meters in the city should not proceed without an adequate feasibility study and a financial analysis.
