It is more than a week since Juliet Holnesse’s Member of Parliament (MP) for St Andrew East Rural, publicly revealed that under the People’s National Party (PNP) Operation PRIDE (Programme for Resettlement and Integrated Development Enterprise) titles of mortgages were used as collateral to secure loans from National Housing Trust (NHT), yet there is a stony silence from the PNP.

More than seven days have passed since she said: “$16 billion was spent by the PNP on Operation PRIDE, and less half it was accounted for because that is all that went to the people.” There is a death-like silence from 89 Old Hope Road.

Among other things, Holness is a noted housing developer, a very able political tactician, and deputy speaker of our House of Representatives. She is also the wife of Prime Minister Andrew Holness, and, therefore, she occupies a powerful political perch. If she had fibbed, the PNP would have shouted repudiations from the high and low. They have not! Why?

I think I know why. The late prime minister of Britain, Winston Churchill, famously said: “Truth is incontrovertible. Panic may resent it, ignorance may deride it, malice may distort it, but there it is.”

Truth is the reason.

What was Operation PRIDE?

Former Prime Minister P J Patterson launched Operation PRIDE in May 1994. He said three major challenges necessitated its establishment:

(i) social strains and pressures of the previous two decades;

(ii) absence of an adequate settlement policy; and

(iii) indiscriminate squatting and capturing of government and privately owned land. (The Gleaner, June 18, 1997)

Many in the PNP sold Operation PRIDE as the panacea to squatting and related worries.

Researcher Jimmy Tindigarukayo, in a paper entitled ‘A programme for housing the poor in Jamaica’, said, among other things: “The Government of Jamaica initiated Operation PRIDE as a unique method of making land legally accessible to low-income groups at affordable prices through some government subsidies. The beneficiaries, on their part, are required to save and to deposit their money in their respective building societies, commonly known as provident societies. These savings are then utilised to pay legal costs and to develop the required infrastructure.”

Like the ill-fated Land Lease and Nyerere Farms programmes in the 1970s under former Prime Minister Michael Manley, Operation PRIDE — some took to calling it Operation SHAME — turned out to be an extremely costly disaster for hundreds of ordinary Jamaicans. A great lesson we need to learn from the rank failure of Operation PRIDE is that we should always judge success based on measurable actions and not mere intent and announcements.

Where did it all go awfully wrong? The Angus Report is veritably open sesame on the question: “Patterson named Erwin Angus, a retired civil servant, to head the probe because of the public relations battering his Administration was taking after the leaking of an internal document indicating that overruns on [Operation] PRIDE projects could top $5 billion, and suggesting that favoured contractors got most of the jobs.” (Jamaica Observer, April 12, 2002)

Key findings

At the time of the appointment Patterson said, among other things: “I [am] instructing that a report be made available to me in accordance with the terms and reference within six weeks. Then let the chips fall where they may.” (Jamaica Observer, February 18, 2002)

The commission said it received several corroborating statements during the period of consultation and interviews from varying stakeholders in the Operation PRIDE process.

• All projects were transferred to the National Housing Development Corporation (NHDC) in 1998. The NHDC realised that it did not have the financial and technical capacity to deal simultaneously with all of them, so a proposal was made, which the Cabinet approved, not to pursue all of them. Cabinet approved a focus on a priority of 20 projects; the remaining 91 to be deferred for completion over a four-year period.

However, if the relevant Independent Provident Societies (IPS) made sufficient contributions, the NHDC would help, through financial contributions, to cover the costs of planning and designs, but not construction. No NHDC-funded construction took place on those projects during the period 1998 to early 2000.

• Contract sums are based on anticipated expenditure. Deposits are not taken into account in determining loan sum. Deposits are treated as advances against payback to the NHDC for loans granted.

• The NHDC Accounts Department did not believe that the checking for regulatory approvals, meeting loan agreement conditions, etc, was part of its function. The department looked for payments in excess of contract sums, missing signatures, etc, and flagged those things for follow-up with requests for explanation and/or rectification prior to disbursement.

• Although on the face of it the NHDC is in charge of Operation PRIDE, most decisions were externalised to the Ministry of Water and Housing. Caribbean Engineering Corporation Limited (CECL) “directed traffic” in a major way and Evon Robinson usually decided who got what work, when it started, etc. At any given moment the NHDC may be presented with bills for payment. The programme seemed to have used the “rapid response” mode as an excuse to begin work without proper documentation and controls.

• If payments exceeded contract sum, CECL simply instructed the Legal Department to revise upwards the contract sum and the loan agreement without any of the proper controls, checks and balances. On one of the St Ann projects (Belle Air), CECL said it instructed a change in contract sum/loan agreement because the Ministry of Water and Housing needed water to get to a particular community, and so it used this project to get it done.

• At handover time, the NHDC looked at the full cost of the project and realised that lots were two to three times more costly than comparable NHT developments, and that prices were out of reach of target markets. This realisation usually ended in a ministerial subsidy to bring the selling price back down to reasonable levels, and the NHDC suffered that loss. Subsidies flow from the minister’s removal of land, administrative, water and/or sewerage costs from the total project costs to come up with a final selling price. In 2001, subsidies were in excess of $800 million.

• Payments were made on the Barrett Hall project in the absence of required contractual agreements.

• Bills of quantities are blank or incomplete on many projects, and contracts undervalued.

• In most cases, when the first indication of pricing occurred, drawings, surveys, and designs are not yet complete. As a result project costs will exceed contract sums.

• Lot pricing strategies include a standard price of $460,000 per lot, irrespective of considerations, such as terrain, which can cause significant price increases. In many instances, pressure to make payment to contractors came directly from the minister of water and housing.

• The mortgage department was primarily idle, while NHDC paid Daly, Thwaites and Company to do the work. In one instance, when it became clear to NHDC that Daly, Thwaites and Company was collecting monies from the IPS and NHDC for the same work, the accounts department was instructed to withhold payment. However, payment was subsequently released on the instruction of the chairman of the board. In another instance, Daly, Thwaites and Co was reportedly found to have submitted in error invoices for work for which the company had previously been paid. However, this was discovered after duplicate payment had been effected, and Daly, Thwaites and Co agreed to work without payment in respect of the repayment owed to NHDC.

Daly, Thwaites and Co was reportedly terminated by NHDC, but subsequently exonerated and reinstated at the instruction of the chairman of the board.

• There is a “brotherhood” or on-the-ground network of communication among the IPS that facilitates the PRIDE operation. The NHDC’s Technical Service Department was not accepted as part of the communication network, but Evon Robinson’s group — having become familiar through on-site representation — was part of that network and gained the trust of the IPS. The Government must have that kind of foothold on the ground or the programme will not work.

• Direction came from the ministry as to who should get paid, how much, and when.

• “Beneficiaries” got no benefit when they could not afford the high selling prices, even after subsidy. Therefore, the lots went to the open market for sale. Even if full recovery were to be made on the open market, this was not the purpose of Operation PRIDE.

• Contractors gave money to provident societies to ensure that they used their services. (Adapted from the Angus Report, pp 57-59).

“Higgins, why dig up all this stuff,” I can hear some bellow. Again I draw on Churchill, who said, “The farther back you look, the farther forward you are likely to see.” I think Mark Golding, president of the PNP, would do well to break his silence with a fervent apology to Jamaicans for Operation PRIDE.

Whose/which chips?

Karl Blythe, the then responsible minister, said his hands were clean. He responded to the criticism, saying that, “while there were some shortcomings in the financial management of the NHDC, there was no widespread corruption at the State agency”. (Jamaica Observer, February 16, 2002)

Blythe resigned as the water and housing minister in April 2002. He maintained that his hands were clean and that the Angus report was flawed.

Ronald Thwaites publicly stated that what the Angus Report said about Daly, Thwaites and Co was incorrect.

Patterson remained resolute in his defence of Operation PRIDE. According to him, “However they try to discredit Operation PRIDE, however they try to conceal its successes, however they try to destroy it purposely, no one can deny that Operation PRIDE has altered, for the better, the landscape of our entire nation and has provided the opportunity for residential development and landownership to the landless people in Jamaica.” (Jamaica Observer, February 24, 2006)

Patterson also defended Dr Karl Blythe’s stewardship of the Operation PRIDE, which had resulted in Blythe’s departure from his Cabinet in 2002: “Whether it has anything to do with Saturday or not with Saturday, I think that I owe it, once again, to say that the minister who was responsible for water and housing, and particularly for Operation PRIDE, was guilty of no act of corruption.” (Jamaica Observer, February 24, 2006)

By any objective measurement Operation PRIDE was a grand fiasco. A Gleaner editorial made these among other comments: “Dr Blythe, the former minister, had always insisted that the provident societies were independent, autonomous bodies which selected the contractors that they wished to do the construction on their Operation PRIDE projects. We now learn from the Angus Commission that this much-vaunted independence was a sham, as the contractors paid the provident societies to ensure their selection. So much went wrong in Operation PRIDE, and there was such wholesale corruption of processes that not only must everything be done to get to the bottom of what happened, but those who are culpable must be brought to book and safeguards put in place to ensure that it will never happen again.” (The Gleaner, April 20, 2012, ‘And now, what next?’)

Recall that prior to the appointment of the Angus Commission Patterson said: “Let the chip fall where they may.” I do not see any evidence where that happened. What did take place was an interrogation (report of the report) of the Angus Report, which was conducted by then Ambassador Dr Kenneth Rattray. It accused the Angus team of:

• failing to carry out a rigorous and in-depth examination of the facts, including documents, before arriving at its conclusions;

• basing its conclusions on assertions which amounted to hearsay;

• arriving at conclusions without providing Blythe with an opportunity to challenge those conclusions;

• failing to adequately identify and separate the periods during which alleged deficiencies existed, particularly in arriving at findings and conclusions relating to Blythe; and

• failing to recognise the special position of the minister responsible for housing under the Housing Act as a corporation sole in relation to Operation PRIDE.

After the release of the Rattray Report in December 2002 Blythe demanded an apology from the Angus team and said he would sue them if they didn’t.

Housing Agency of Jamaica (HAJ) Chairman Norman Brown corroborated Juliet Holness’s assertions on radio last Tuesday. Brown also said that, to date, more than 100 Operation PRIDE sites are still incomplete — “no formal electricity, water, drainage, and no proper road network”. Operation PRIDE was a débâcle. It must never be repeated.

Garfield Higgins is an educator, journalist and a senior advisor to the minister of education & youth. Send comments to the Jamaica Observer or higgins160@yahoo.com.