Govt. retains minimal shares in New GPC, Hand In Hand Trust

…and gives them billion$$$ in contracts

Government may have been in a serious conflict of interest situation when it retained shares in two companies it privatized and afterwards doled out contracts to them to the tune of billions of dollars.

New GPC boss Dr. Ranjisinghi Ramroop

Former President Bharrat Jagdeo

Former Health Minister, Dr. Leslie Ramsammy

The two companies are Hand In Hand Trust Corporation Inc. and New GPC Inc.
In the case of New GPC, a company that has been under scrutiny over the billions of dollars it received to deliver pharmaceuticals and other related supplies to the Georgetown Public Hospital Corporation (GPHC) and Ministry of Health, Government retained 10 per cent of the company…shares that were worth $76M.

In Hand In Hand Trust, the 10 per cent shares were worth $25M, according to the 2010 report of the National Industrial and Commercial Investments Inc. (NICIL), a state-owned company that manages Government assets and which has been under fire for some questionable deals.
Several senior government officials, including the Minister of Finance, Dr. Ashni Singh, and Head of the Presidential Secretariat, Dr. Roger Luncheon, sit on NICIL’s board.

Both are also part of the Cabinet of Ministers which approves government contracts.
The fact that government in 2010 gave its no objections for New GPC to supply over $1B in drugs and other supplies knowing it has shares in that company without allowing suppliers a chance to tender bids is a serious matter as government officials clearly were in a conflict of interest situation, said official sources.

The drugs contracts of which New GPC has been

benefiting have been blasted by other suppliers who felt that they were deliberately sidelined from getting any of the lucrative business and by Members of Parliament from the Opposition side who said that the entire situation begs for a full investigation.
Government has been insisting that the contracts are all above board when they were first approved, in the first instance, by the National Procurement and Tender Administration Board (NPTAB), the body that oversees state contracts.
However, even on the NPTAB, there are government officials from the Ministry that sit in a special sub-committee to analyse the bids.
In the Ministry of Health, which would order the drugs, it would not be unusual for the Permanent Secretary, who handles payments, to sit on the NPTAB.

In the case of Hand in Hand Trust, the company was privatized and a significant portion was sold to the brother of NICIL’s head, Winston Brassington, under still questionable circumstances.
Brassington had handled the sale for his brother.
NICIL, on behalf of Government, later purchased 10 per cent of the insurance company which has overtime been granted a number of government contracts too.
It will be recalled that one of the major issues involving Hand In Hand Insurance Company, the parent company of the Trust company, was for a bond to Synergy Inc, the company that was granted the US$15M contract for the access roads to the Amaila Falls hydro project.
Government last year terminated the Synergy contract but Hand In Hand has reportedly refused to pay the cost of the bond and the matter is now engaging legal attention. In this case, it was ironic that government owned shares in a company that it was now fighting to pay a claim.

There have been accusations that New GPC and a number of companies closely aligned to the government have been snapping most of the lucrative contracts without other players being given a fair chance.
Earlier this year, Ministry of Health officials testified that in 2010 the Ministry paid hundreds of millions of dollars in full and in advance to New GPC for deliveries. They even continued the same arrangement in 2011.
This was despite the fact that New GPC, a company which is close to former President Bharrat Jagdeo, may not have delivered $222M in drugs ordered in 2010.

In early 2010, the Cabinet under the Jagdeo administration decided that New GPC would be the sole supplier of drugs.

In 2011, in controversial circumstances also, a number of companies were pre-qualified to become suppliers, including New GPC.

Drug purchases have accounted for a large chunk of the Ministry of Health with New GPC in 2011 being awarded almost 80 per cent of the $13B expended.

The Opposition parties in the National Assembly have expressed alarm over the developments with members of its Public Accounts Committee arm clashing this year during examinations of the 2010 Auditor General’s report.