October 24, 2020

OBA giving Bermuda airport away to Canadians [Comparison to Cayman Islands]

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chris_famousBy Christopher Famous From Caribbean News Now

On November 10, 2014, MP Bob Richards announced that a memorandum of understanding (MOU) was signed with the Canadian Commercial Corporation (CCC) for the re-development of the LF Wade International Airport in Bermuda.

Who is CCC?

CCC is a federal Crown corporation established by the Canadian government for the sole purpose of facilitating international trade for Canadian companies. In other words, CCC is working in the best interest of Canada.

Recently, CCC was embroiled in a controversy over its selection of SNC-Lavalin as one of its sub-contractors, a company which has been blacklisted for ten years from World Bank contracts for “a conspiracy to pay bribes”. This brings into question CCC’s ability to adequately assess the suitability of sub-contractors.

Backdoor Privatization

Despite the One Bermuda Alliance (OBA) promising to put the Public Bodies Reform Act on hold, this deal is privatization, as it will grant operational control of our airport to a foreign company for 30 years.

In fact, the 43 persons currently employed with Department of Airport Operations were told that their jobs cannot be guaranteed once this deal is finalized.

Accountability and Transparency

While this project will be one of Bermuda’s largest capital projects, the OBA have opted not to put it out to tender.

Ironically, in 2013 CCC made a similar proposal for the Owen Roberts International Airport in the Cayman Islands but was ultimately vetoed by Cayman’s UK governor because it failed to follow a competitive tendering process.

Sound familiar?

The Cayman Islands has subsequently opted for a smaller redevelopment project for $67 million using an airport authority similar to the one proposed by the Progressive Labour Party (PLP) in Bermuda.

Strange Bedfellows

During the recent standoff between the OBA and the UK government over the issue of the letter of entrustment (LoE), OBA took legal advice from Bennett Jones. Coincidently, Bennett Jones was the firm that had represented CCC in respect of its recent SNC-Lavalin scandal.

The Connections

While the public has been told that this agreement won’t be finalized until March 31, 2015, CCC has already selected a sub-contractor – Aecon, a Canadian company.

Recently it was revealed that sitting on the board of Aecon is Michael Butt, who is the chairman/CEO of Somers Construction, a local firm.

The Numbers

In November, MP Bob Richards told the taxpayers that the estimated cost for the project was $200 million. Fast forward three months to the reading of the 2015/16 Budget and MP Bob Richards announced that the cost had ballooned to $255 million!

Ironically the ‘Minister of Austerity’ gave zero explanation as to why or how this increase would impact the estimated 30-year timeline. An increase of over 25 percent with no explanation? Go figure.

Currently, the airport annually generates $25.2 million in revenues and $20.6 million in expenses with a surplus $4.6 million. While MP Richards said that the development would be financed through “future revenue streams from the new airport itself”, the current surplus will not be enough to fund this project.

So the question remains, exactly where will this additional revenue stream come from?
With the 2015/16 budget, the OBA increased the airport departure tax per passenger from $35 to $50. This extra $5.5 million in revenue will not be used to pay down our debt or support our schools. It will most likely be handed over to the Canadians.

Return on Investment

How much does CCC look to profit off of our airport?

Well, according MP Bob Richards: “This foreign entity is borrowing the money to build that airport and whatever money goes to that project, most of it for the first half of the 30 years, most of that money is going to pay off the debt.” House of Assembly – March 4, 2015

It appears that CCC will have at least 15 years to bank the profits generated from OUR airport.

Key concerns:

• potential loss of jobs
• failure to tender
• loss of direct government revenue
• loss of control over a key strategic asset
• loss of the profits generated by the airport

At this point two questions are in most Bermudians minds:

A: Is the OBA working this airport deal the best interest of the Bermudian people?

B: Is the OBA working this airport deal in the best interests of the Canadians?

IMAGE: Chris Famous.jpg Christopher Famous is a Caribbean real estate developer and business owner. Raised in various Caribbean islands such as; Bermuda, Jamaica, St Eustatius and St Kitts and Tortola. He has a weekly social and political column in The Royal Gazette. Feedback to: [email protected]

For more on this story go to: http://www.caribbeannewsnow.com/headline-Commentary%3A-OBA-giving-Bermuda-airport-away-to-Canadians-25283.html

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