I wish to present in this article a summary of my main points on the proposed ‘revitalisation’ of the Nelson Mandela Park (formerly King George V Park or, before that, Pompeii Savannah) in west Port of Spain.
Some spaces are of such significance that they should be altered only after the greatest care and consideration—no hustle, no bustle! Nelson Mandela Park is certainly such a space.
Privatisation and PPP can have the effect of limiting or ending access to public facilities for poorer citizens, so we would need to have solid guarantees of right to access, regardless of income. Of course, that kind of approach is contrary to a model which relies on paying customers or groups.
Let us now take a closer look at the actual proposal.
Capital Sport Facility Ltd (CSF) made an 18-page unsolicited proposal to the POS City Corporation for this ‘Public Private Partnership (PPP) solution providing sporting and public health benefit for a wide cross-section of the Port Spain Public’.
In the procurement arena, unsolicited proposals are regarded with high suspicion. Our public learned that expensive lesson in the Eden Gardens land purchase, as well as the PPPs at Tobago Sandals and THA BOLT/MILSHIRV, all of which were unsolicited.
This PPP proposal can be summarised as the overlay of artificial grass onto most of the surface of the NMP at an estimated cost of TTD$20m, with an estimate of TTD$500,000 for annual maintenance costs. Users would have to book via Capital Sport and the costs were to be recovered by user fees, with an estimated 500% increase in usage.
On 16 July 2021, the POSCC invited selected stakeholders to a 90-minute online consultation on the evening of Monday 26 July 2021. On 22 July 2021, the public was invited to attend via the POSCC’s Facebook page. The stated goal was to make NMP ‘…the Public Health and Sports Tourism hub for the city…’
I am reliably informed that the Minister of Planning and Development, together with POS MPs Stuart Young and Keith Scotland, was also in attendance at that stakeholder consultation.
The public was then invited to submit comments to the POSCC by the Emancipation Holiday, 1 August 2021—even though no copies of the proposal were distributed.
It is impossible for the public to comment on proposals which remain secret, so we are witness to yet another fake consultation. A straight case of public officials playing smart with foolishness and treating citizens with no proper regard.
Did the Capital Sport Facility Limited submission include any confidentiality or non-disclosure clauses? Has the POSCC agreed to withhold these proposal details? Is this yet another case of commercial confidentiality being given priority over the public interest?
Those proposals must be seen by the public before decisions are taken. Such a step would be necessary but not sufficient. PPP proposals cannot be understood, much less assessed, without reviewing the underlying commercial arrangements, hence the next section.
We shall get to those arrangements in a moment. First, however, let me just briefly call attention to an issue that is, I think, of some real relevance.
FPIC—Free, Prior and Informed Consent—is the acronym summarising the rights of Indigenous Peoples to proper consultation before development is approved in their territories. It is very interesting to compare those international standards with the modern reality of development in this Republic of ours.
This fake consultation issue is a long-term and valid concern which was especially noted as the 17th recommendation of the Uff Report (2009):
“…User groups and other interest groups should be properly consulted on decisions regarding public building projects, to ensure that relevant views can be expressed at the appropriate time and taken into account before decisions are made…” (my emphasis)
Now for a look at the aforementioned underlying commercial arrangements. It is important to take some space to outline how these PPPs are marketed and how they actually work.
In this proposed PPP, Capital Sport Facility Ltd were to be the investors and that investment was to be recovered from user fees —in other words, people and groups/clubs would have had to pay to use the new facility. In a time of perennial budget deficits, the strong attraction of this type of proposal is that new facilities can be created with no investment of public money.
So what is the target rate of return for this TTD$20m investment? That figure would tell us what the investors had set as their minimum net revenue from this PPP. That figure would have to be added to the annual maintenance and the lease rent payable to the POSCC. That total figure would be the ‘break even’ revenue which the project would have to achieve for success.
If the project exceeded its revenue estimates, those profits would usually be for the investor’s account. The decisive question, though, is what happens if the actual revenue does not achieve the estimated levels?
The recurring issue with PPPs is the question of risk-transfer—in other words, does the private sector actually take any commercial risk, or is the arrangement one in which the state (in this case, the POSCC) guarantees the rate of return for the capital invested by the private sector partner?
In simple terms, if the project fails to meet its revenue targets, who pays for the shortfall? Will the state guarantee the investors’ rate of return?
If that is not the plan, what’s the problem with telling us so? That would be a big improvement over the PPPs we have had in the past here, many of which are essentially ‘take-or-pay’ models. If the state guarantees the private investors’ target rate of return, what risk have those investors actually taken, apart from the political gamble?
Was it only an 18-page proposal submitted from Capital Sport Facility Limited, or are there other elements? Were any revenue projections or sensitivity tests submitted?
The proposal gave no details on the use of the installed floodlights at the Nelson Mandela Park, so we have no idea how those maintenance costs or electricity charges were to be shared or paid.
Apart from the obvious fake consultation and the ‘shelving’ of the proposal after the PM’s intervention, there are also moral and ethical considerations.
The POS mayor is a well-known and accomplished agency manager with the respected insurance giant, SAGICOR. The insurance industry espouses, as one of its fundamentals, the principle of uberrimae fidei, which translates as ‘utmost good faith’.
According to Investopedia, ‘An uberrimae fidei contract is a legal agreement, common to the insurance industry, requiring the highest standard of good faith during disclosure of all material facts that could influence the decision of the other party. A failure to adhere to uberrimae fidei is grounds for voiding the agreement. Uberrimae fidei is also known as utmost good faith and is simply the Latin translation of this phrase.’ (my italics)
So the mayor was seeking to get a decision on this PPP proposal while at the same time not releasing the proposal document. Of course, the mayor got his reply and it seemed to comprise strong objections, but the inescapable point is that this sort of tactic would be impermissible under the uberrimae fidei approach.
It is entirely unacceptable for the mayor of our capital city to host these fake consultations and then complain of ‘negativity’ when the public makes its strong objections known. What is more, the mayor and any other public official for that matter cannot credibly observe lower standards when discharging their public duties.
This entire episode seemed to me to be an attempt to privatise our commons, which is something we have to avoid and be alert against.
Moral turpitude is a type of behaviour which gravely violates the sentiment or accepted standard of the community. As the first step in restoring the ‘respect for the mayor’s office’ which he recently invoked, the mayor needs to publish that proposal now.
We are being encouraged to believe that the PM and the Cabinet knew nothing about this project; they have now reacted with disapproval once the negative results of that public consultation became clear.
Of course, the only thing more ridiculous than that is the mayor’s suppressing the NMP proposal at the very same time as stating his strong support for the digitisation of the POSCC.
Editor’s Note: This discussion is hosted at afraraymond.net.