Cayman News Agency: CIG lays out shocking list of mistakes in $1 billion waste project

(CNS): From the moment government began exploring options for a new waste management system, it failed the people of the Cayman Islands by making a series of shocking mistakes in the most expensive infrastructure project ever undertaken on the island. A damning report leaked from the Auditor General’s Office shows that the public-private partnership with Dart, known as ReGen, got off to a bad start and got worse, even before the PPM-led government signed an initial agreement worth more than Cayman dollars 1 billion with the island’s wealthiest landowner.

Auditor General Sue Winspear used the errors to conclude that the waste-to-energy facility and related elements of the project were far from value for money.

OAG report, Cayman Islands Integrated Solid Waste Management SystemIn the report, released last week shortly after Sustainability Minister Katherine Ebanks-Wilkes announced the government was withdrawing from the agreement, Winspear details what went wrong and why CIG is facing a fresh start more than 12 years after its founding. Violation of the awarded tender Transferred to a traditional contractor in 2011.

The government’s historical management of this project has proven disastrous.

The attorney general’s office detailed the latest failure of the modern waste management program, largely because from the outset, the data used to develop the process was either missing, inaccurate or based on faulty assumptions. At nearly every turn, officials made mistakes or failed to conduct the necessary reviews, calculations and assessments to protect public finances.

The government made fundamental mistakes throughout. It failed to set clear targets even at the start of the project and miscalculated how much waste the islands actually generated. The government also wasted millions of dollars hiring consultants during the project preparation process, the auditor general’s office found.

A major early flaw was that CIG failed to understand that a public-private partnership was still a loan and, worse, failed to properly assess whether a PPP was more expensive than a traditional contract.

However, even without certain information that the relevant ministries failed to provide, the Attorney General’s Office was able to calculate that the PPP would end up costing much more than a traditional public contract between the government and waste management experts. The decision to proceed with the PPP rather than a direct tender with the relevant contractors (where the government would have borrowed directly or used its own funds) would have increased the bill by about $200 million.

While many of the project’s flaws, failures and problems were related to the upfront contracts to build the waste-to-energy facility and establish reuse, recycling and composting facilities on site, the report also lists a range of problems during the life of the contract and in day-to-day operations.

The Attorney General’s Office found that the government had borne the majority of the risk throughout the project lifecycle, which undermined the decision to enter into the PPP agreement. CIG also completely failed to ensure that the facility could be properly regulated and inspected.

in a Press release Last week, the OAG said it had released the report to Parliament on Tuesday, July 30. The office had originally planned to release the report but not before redacting it because it contained some commercially sensitive information. However, the report was leaked on August 1.

The Auditor General explained in a press release that her office conducted an audit report on the ReGen project at the request of the PACT government shortly after it took office in August 2021. The Auditor General’s office provided a draft report to the Premier, Prime Minister, Deputy Prime Minister and senior civil servants in December 2021. However, she noted that the government did not provide a management response to confirm accuracy or clarify content.

Nonetheless, the Attorney General’s Office agreed that the government could use the report to assist in renegotiating the contract prior to financial settlement, and therefore would not release the report at that time.

“Over the past several years, OAG has repeatedly recommended that we release the original report and updates once the ReGen contract has reached financial close,” Winspear said in the release.

The Attorney General’s Office submitted the report to Parliament after the government announced its withdrawal from the agreement and initially planned to release it to the public at the same time, but the CIA requested a delay because the report contained commercially sensitive information.

“The Attorney General’s Office does not publish reports that contain commercially sensitive information and will usually redact such information before releasing it to Parliament and publishing it,” the office said, adding that the government has now committed to providing a response to the Attorney General’s Office by mid-August. The office said it would then publish the report after assessing and redacting commercially sensitive information and updating any factual errors.

However, because the report was in the possession of dozens of civil servants and all 19 MPs, it was leaked in its entirety, giving the public its first detailed look at a catalogue of errors in at least three government departments.

See also CNS Library.