Minister: OBA Govt ‘Destroyed’ Housing Project

November 24, 2018

“The former OBA government has completely and unequivocally destroyed a project that was to bring housing relief to 100 families in this country,” Minister of Public Works Lt/Col David Burch said.

Speaking in the House of Assembly, the Minister said that the project started in 2012, and after the OBA won the 2012 election they reduced the number of homes from 100 to 20, which “resulted in the construction of 20 homes for the incredible amount of $25 million” and the “wastage of a further $2.2 million in unused materials.”

Minister Burch said, “In 2011 Wedco was requested by the former PLP Administration to assist in addressing the housing challenges by way of a new housing development in the Dockyard.

“By early 2012, the Ministry and Wedco had signed off on the final design for them to construct a new 100 home development within the lands around the existing Victoria Row.

The Minister said the development was to be constructed in two phases, with the first phase the construction of 48 units to be immediately followed by the construction of the remaining 52, with a plan to provide 8 one-bedroom units, 46 two-bedroom units and 46 three-bedroom units.

“The cost of the project was estimated at $36 million or an average of $360,000 per unit, Minister Burch said, adding that “the project commenced in the 4th quarter of 2012.”

Minister Burch said following the change in Government after the 2012 election, the new OBA government reduced the number of homes from “100 to a mere 20 homes.”

“Housing fabrication was already well underway and when production was halted – 28 units or 7 buildings had been completed. Wedco subsequently were directed to erect only 5 of the buildings containing 20 units,” Minister Burch said.

“Needless to say the change required a complete redesign of the infrastructure for sewage collection, flushing water as well as fresh water supplies. The final cost for production, infrastructure and erection of 20 units was an astonishing $25 million. The remaining 2 buildings [8 units] were not erected and remained on the South Basin Dock for 3 years.

“The directive to reduce the project size and scope dramatically impacted the cost and originally projected cash flow. The government had agreed to provide annual grants in the amount of $2 million until the finance loan was paid in full – $22 million remain outstanding.

“The advent of the Americas Cup event forced the removal of the left over prefab units from the South Basin to a location just over the hill below Moresby House,” Minister Burch said, adding that several months later “additional Americas Cup requirements then required the units to be relocated again,” so they were transported to the Sallyport.

“The units remain in the Sallyport and went through 2 hurricanes suffering significant erosion and many panels as well as roof sections were undermined, shifted and damaged,” the Minister said.

“The book value of the panels was $300,000 but they have already been written off. There are still many panels in Sallyport but without an extensive review and an engineering sign off – no one is confident that there remains a complete functional structure. These structures have been exposed to the elements and moved several times during the 5+ years since their arrival.

“Upon learning of this saga several weeks ago I requested the General Manager to ascertain their current status. Last month he met with engineers on site to look at the remaining prefab pieces. Without a major effort and cost to ensure each panels integrity the recommendation is to be very cautious about trying to use them now.

“The engineers ‘unofficial’ position is that they would not recommend using them for a host of reasons: cost of transport and erection, unknown condition of each piece, missing metal welding plates, lifting eyes and windows have all been exposed to salt for extended periods.

“The best fit previously was the National Stadium as they have central infrastructure already in place and were looking for housing. The previous Government would not fund the erection of the units when they were in better condition.

“The summary recommendation based on limited research would be that using these structures at this stage comes with significant cost and risk. A full assessment will require moving each part by crane, counting, and then verifying that all the required pieces are in good condition.

“With the current situation, Mr. Speaker, I have instructed Wedco to not invest any more money but to write off the remaining pieces and proceed to dispose of them,” the Minister said.

“So the reality of what we have here is – the former OBA government has completely and unequivocally destroyed a project that was to bring housing relief to 100 families in this country at a reasonable cost of $360,000 per unit.

“The fact that there has not been a whisper of concern at the total financial irresponsibility of these actions that has resulted in the construction of 20 homes for the incredible amount of $25,000,000 – or an astounding $1.25 million dollars per unit, coupled with the wastage of a further $2.2 million in unused materials.

“The level of sheer incompetence in this regard by the former OBA minister and government is simply breath taking,” the Minister added.

The Minister’s full statement follows below:

Good Morning Mr. Speaker.

We have heard an interminable amount of lectures on the financial deficiencies of this government since assuming office in July 2017 – sadly coming from self appointed experts who are attempting to rewrite modern history – in the hope we have no historical memory.

Endless lectures about the servicing of our debt and if only we let 3,000 more people descend off British Airways – all our troubles would be over – well that isn’t going to happen until hundreds of Bermudians without a job – get at least one. And might I remind those naysayers and their media mouthpiece that it was the former Minister of Finance, Bob Richards, who in 2013 doubled our national debt to over $2 Billion with nigh a whisper from those lining up now to instruct the present government on fiscal responsibility.

Mr. Speaker, when there is a change in government – it is natural that certain items will be inherited by the next administration – what is not natural is that there is a mountain of issues simply left unaddressed. Since assuming this assignment last year, Mr. Speaker, I have spent an inordinate amount of time sorting through items simply ignored by the former administration and so I report today another occasion in what is becoming a regular occurrence.

Mr. Speaker, you may recall that in 2011 Wedco was requested by the former PLP Administration to assist in addressing the housing challenges by way of a new housing development in the Dockyard.

By early 2012, the Ministry and Wedco had signed off on the final design for them to construct a new 100 home development within the lands around the existing Victoria Row. The development was to be constructed in 2 phases so as not to displace any existing tenants. The first phase was the construction of 48 units to be immediately followed by the construction of the remaining 52.

Mr. Speaker, the project was to be carried out by Atlanta based Clark Construction International by building pre-engineered units, shipping them to Dockyard and then transporting them directly to the site. These units were to look and feel like traditional Bermuda housing and it was expected that they would have a very high efficiency value as they would be constructed of foam and concrete.

The plan was to provide 8 one-bedroom units, 46 two-bedroom units and 46 three-bedroom units.

The cost of the project was estimated at $36 million or an average of $360,000 per unit inclusive of all infrastructure that would extend from Boaz Island Village to the Dockyard Waste treatment facility. Mr. Speaker, the project commenced in the 4th quarter of 2012.

Of course there was also an election in December 2012 and the resultant change of Government saw the new OBA government reduce the number of homes from 100 to a mere 20 homes. Mr. Speaker, housing fabrication was already well underway and when production was halted – 28 units or 7 buildings had been completed. Wedco subsequently were directed to erect only 5 of the buildings containing 20 units.

Mr. Speaker, needless to say the change required a complete redesign of the infrastructure for sewage collection, flushing water as well as fresh water supplies. The final cost for production, infrastructure and erection of 20 units was an astonishing $25 million. The remaining 2 buildings [8 units] were not erected and remained on the South Basin Dock for 3 years.

The directive to reduce the project size and scope dramatically impacted the cost and originally projected cash flow. The government had agreed to provide annual grants in the amount of $ 2 million until the finance loan was paid in full – $22 million remain outstanding.

Mr. Speaker, Wedco were further instructed that they could erect the remaining units in Dockyard – this was impractical so efforts were made to offer these units to other sectors of Government. [Ministry of Works, National Stadium, Ministry of Health and others] – all to no avail.

It should be noted that the panel and roof size was specifically designed for delivery and transport to Dockyard. [They are large and extremely heavy sections]. This made it more challenging for them to be transported to other parts of the island [not impossible but both costly and risky to transport piece by piece.]

Mr. Speaker, the advent of the Americas Cup event forced the removal of the left over prefab units from the South Basin to a location just over the hill below Moresby House.

Several months later additional Americas Cup requirements then required the units to be relocated again. This time they were transported to the Sallyport as it was not anticipated they would need to be moved again.

Mr. Speaker, the units remain in the Sallyport and went through 2 hurricanes suffering significant erosion and many panels as well as roof sections were undermined, shifted and damaged.

The book value of the panels was $300,000 but they have already been written off. There are still many panels in Sallyport but without an extensive review and an engineering sign off – no one is confident that there remains a complete functional structure. These structures have been exposed to the elements and moved several times during the 5+ years since their arrival.

Mr. Speaker, upon learning of this saga several weeks ago I requested the General Manager to ascertain their current status. Last month he met with engineers on site to look at the remaining prefab pieces. Without a major effort and cost to ensure each panels integrity the recommendation is to be very cautious about trying to use them now. What is in the Sallyport is only the wall and roof pieces, there are no interior fittings or fixtures, therefore any site that does not have existing sewage and water supply / collection will require the added expense of foundation slabs, water tanks and sewage pits. Additionally the electrical panels, which were formed into the walls, will need to be replaced in every unit. The engineers ‘’unofficial’’ position is that they would not recommend using them for a host of reasons: cost of transport and erection, unknown condition of each piece, missing metal welding plates, lifting eyes and windows have all been exposed to salt for extended periods.

Mr. Speaker, the best fit previously was the National Stadium as they have central infrastructure already in place and were looking for housing. The previous Government would not fund the erection of the units when they were in better condition.

The summary recommendation based on limited research would be that using these structures at this stage comes with significant cost and risk. A full assessment will require moving each part by crane, counting, and then verifying that all the required pieces are in good condition.

With the current situation, Mr. Speaker, I have instructed Wedco to not invest any more money but to write off the remaining pieces and proceed to dispose of them.

So the reality of what we have here is – the former OBA government has completely and unequivocally destroyed a project that was to bring housing relief to 100 families in this country at a reasonable cost of $360,000 per unit. By any measure – cries from all quarters for the immediate dismissal of the minister responsible would have resulted – if it were a PLP Government. The fact that there has not been a whisper of concern at the total financial irresponsibility of these actions that has resulted in the construction of 20 homes for the incredible amount of $25,000,000 – or an astounding $1.25 million dollars per unit, coupled with the wastage of a further $2.2 million in unused materials. The level of sheer incompetence in this regard by the former OBA minister and government is simply breath taking.

What is equally astounding though, Mr. Speaker, but no surprise to me – is that the Auditor General has not seen fit to launch an investigation into this wanton waste of taxpayer’s money – again history would record had it been a PLP Government – the report would have already been completed and released to the media.

Mr. Speaker, I will not speculate on the reasons for this complete demonstration of incompetence – that’s not necessary as the then Minister continues to sit in this place and I invite him to explain his actions and culpability in this incredible waste of tax payer funds.

Mr. Speaker, of greater concern to me in my current assignment is that we are faced with an ever increasing challenge in providing adequate housing for the people of this country who are in the greatest need. We will continue to work hard every day to address this significant challenge and the people of this country can be assured that we will not stop until we have success.

Thank you, Mr. Speaker.

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Comments (52)

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  1. Vote no more says:

    Imagine that load of stuff. Plp saying someone else destroyed a project.
    LLLMMAAAAAOOOOOOOOOO

    • Black Soil says:

      Sadly many Bermudians will believe these PLP lies. That’s why the PLP spread them.

      • Wow says:

        The OBA was evil pure and simple! Had no money but found $100 million for a boat race. Another example of mismanagement by the OBA! Go PLP – PLP all the way!

        • sandgrownan says:

          Evil? Really.

          I suspect you don’t understand economics. At all.

  2. Toodle-oo says:

    This project came after the Grand Atlantic . Remember , the $60 mil disaster that sold one unit ?
    The OBA did the right thing .
    But this will be held in limbo until the run-up to the next election where ,amongst other things , it’ll be rolled out again to smear the OBA.

    • Hair says:

      Really Burch? When you still have the Atlantic housing empty!!!! Take stock.

      • Khalid A Wasi says:

        Sadly, the OBA were hell-bent on reversing everything the PLP seemed to have supported, they overreached at times to achieve their ends. The waterfront is another example. Now I am not going to argue there may have things that needed to be addressed, just that how they went about it was Trumpian and the people saw it. The beneficiaries will never see it

  3. Question says:

    “. And might I remind those naysayers and their media mouthpiece that it was the former Minister of Finance, Bob Richards, who in 2013 doubled our national debt to over $2 Billion with nigh a whisper from those lining up now to instruct the present government on fiscal responsibility.”

    If it started at $1.6bn where you left it, it wasn’t “doubled” when it went to $2bn was it.

    • Really? says:

      You alls lies keep getting better and better, where did you get 1.6 billion from. It was at 1.2 billion not 1.6. You all keep trying to rise that number because you know full well that OBA govt DOUBLED the debt in less than 5 years. I heard another one of you say 1.4 billion. Why dont you all get your LIES straight before you comment. And the Minister is right, where is the COI, auditor generals report, or inquisition from you all about this? This is clearly a need to look at further as to why it cost 1.2 million for 20 UNITS!!!! And you talk about the PlP supposedly pocketing money when you have a former OBA premier excepting 300 thousand dollar? And now this. Where did that money go? Crickets from the other side just more oba lies and deflections…carry on

      • Anbu says:

        Ya ok. Sheep. Do us all a favor and fo some research before regurgitating plp bull. God u blind sheep are so ignorant. The bottom line of our whole debt problem whether any of you want to admit it or not is that it is entirely your fault. The plp were incompitent since before they ever won in 1998 and they blatantly prroved it over and over again but for some reason all you kept sticking em back in. It serves you all right. Stupid is as stupid does and you all are getting your just rewards for said incompitence. And there is LOTS more to come lmao. Enjoy.

      • Johnt says:

        do you understand what a budget deficit is? The PLP were running close onto a 400m deficit by the time the OBA were voted in in 2012. That is they were spending $400m more than they were making in revenue. The OBA had little choice but to continue running the deficit whilst trying to manage it down which they did. Unfortunately this means the debt continued to run up but anyone not blinded by PLP spin understands who is to blame for this!!

      • Question says:

        The OBA did not double the debt. Repeating it does not make it true. The PLP increased it by 6x in their seven years though, increasing debt at a rate of $400m a year. Spending $100m a year on foreign consultants,

      • watching says:

        The $1.2 billion number cited by the PLP came from the end of financial year 2012 (31 March of that year). The $1.6 billion comes from end of financial year 2013 (31 March of the year after), which is a better number to judge the OBA against since the PLP continued as the Government until December 2012.

        When Burt and others say that the OBA doubled the national debt, they conveniently omit 8-9 months of PLP government from that discussion.

        But even accepting the $1.2 billion figure as you say, it’s still dishonest to say that the OBA doubled debt, implying that they were culpable. The OBA inherited a financial mess, and running government finances is like turning an oil tanker – you don’t just snap your fingers and expect the job to be done.

        Anyone managing a household budget and dealing with credit card debt knows that once you get past a certain point, no matter what you do, credit card payments just seem to run away with themselves. If you’re making minimum monthly payments, you still see the overall bottom line figure increase. PLP obligations were falling due under the OBA. The OBA were paying interest on top of interest accrued under the PLP, and they still had deferred obligations to pay (salary of civil servants, pension payments, HIP and GEHI health insurance pay outs, etc).

        The argument about the OBA is that they didn’t do enough fast enough to fix the country’s financial situation. The fact that the OBA managed to cut unsustainable spending, steer us towards a balanced budget and still saw rising debt levels is a testament to just how financial reckless the PLP were before 2012.

    • Toodle-oo says:

      * And might I remind those naysayers and their media mouthpiece *

      And the diehards still can’t see the Trumpian similarities .

    • DeOnion says:

      Of course the oba added to the debt – they had to in order to cover the massive budget deficits left by the plp! The plp would also have doubled the debt – probably more than doubled it!

  4. Wahoo says:

    Why would a prudent OBA government spend money on an uneccessary project started by plp? The kernel embarrasses the plp every time he opens his mouth, plp were trying to buy votes by building homes that were not even required Grand Atlantic fiasco is a case in point.

    • Really? says:

      Why it took 1.2 million to make units that were estimated to be 360 thousand each? What lie I mean excuse you gonna come up with now?

      • Question says:

        Because most of the money wasted on the development had already been spent by the PLP.

    • Kathy says:

      Just like the OBA were trying to buy votes with the airport and St. Regis. What an incredible waste of taxpayer money that we will never be able to recoup! Shame on both parties for not working harder to ensure our money is not wasted!!! Disgusted!

  5. J Austen says:

    And guess who single handedly pushed the economy over the edge six years ago with his big mouth?

  6. Burch, that type of oba behaviour is MOST typical.
    You will NEVER get THEM to own that problem.
    They always deliberately put blame on P.L.P.All of THEM are the same. Any slight wrong they observe from “people of colour”, it is always “our fault’!

    They clearly own tons of social ills on this small island
    Perhaps, there could beownership of most social ills here in Bermuda!!
    Failing that, force them to pay attention.
    P.L.P. IS THE POWER!!

  7. Ringmaster says:

    Sounds like the OBA saved Bermuda millions of dollars.

  8. This is Island is Corrupt says:

    Unreal…this government can’t even take responsibility.

  9. DeOnion says:

    Still behaving like they are in opposition! What has the minister done with these for the last 18 months?!

  10. Mark says:

    Knock it down and make it an ATV park. That’s about all Corney Major General could dream up.

  11. Rocky5 says:

    Trying to re-write history. The Colonel built the Grand Atlantic as thousands were leaving Bermuda and Bermudian homeowners had thousands of empty apartments & homes. He also completely went against all the advice of ALL his Civil Servants. OBA were trying to make lemonade from his lemons and he has the gall to complain. This PLP Govt is only interested in destroying Bermuda.

  12. mumbojumbo says:

    In east and west …hamilton too.

  13. Infidelguy says:

    Is this man serious? How can he say that the OBA destroyed a housing project and wasted money? There was no justification for the project. Does Colonel Burch think people have forgotten about Grand Atlantic fiasco? No responsible government would have embarked on a project of this magnitude, after millions of taxpayers dollars had just been wasted developing the Grand Atlantic? The OBA reduced the size of the project because the justification for it was not there.

    What a joker this guy is!

    LMFAO!

    • Paul says:

      The sad thing is Col Burch, believes this crap he is spewing….

  14. Mother Theresa says:

    A Hahahahahahahahahahahah! Funny Burch, very funny!

  15. Button Head says:

    ” in the hope we have no historical memory” Dear Colonel closed eyes and mind . I for one remember ergo historical a certain party spending 800Mil but won’t admit it.

  16. Colonel Clunk says:

    Does the good Colonel and his followers honestly believe this flow of Mia truths.

    What a good waste of air time.

    My good fellow please let’s remember the havoc that you and your colleagues in the previous administration brought to a healthy BERMUDA economy when you first won the government.

    As much as you would like folks to forget it, we simply can’t and we watch the same stuff happening again.

    Give OBA bashing a rest…they area weak party…you and your colleagues look the fool when you bash them while doing nothing to improve the current situation in our country.

    Truth. You guys don’t know how to do it. Say it.

  17. Status Bermudian says:

    Anyone else tired of Political banter! These politicians are all so wrapped up in themselves to do anything! Both sides-
    Stop Reminding everyone of what has happened!

    All of them including the OBA have to pull their heads out of each other’s rumps and concentrate on all of us and our crumbling economy!!! Sick of this!!! He said he said BS!!

    • J Austen says:

      Your status just went way up Mate, well said about these self-centered primadonnas.

    • Real Deal says:

      Transparency my boi be tend to forget unless they are reminded. he will put out a fix to this and it will be Transparent as-well.

  18. SayItAintSo says:

    Why didn’t the PLP raise this when it was happening and they were in opposition? Instead they were too wrapped up trying to divide us all.

  19. Well spoken, Burch.
    Hold those horrors accountable for their MESS!!

  20. TO Status Bermudian:
    Yes!!!
    Burch is CORRECT in holding those horrible political villains responsible!!
    Good for Burch!!
    Yahoo!!

    • Question says:

      The PLP spent $25m on a $4m golf course returf and $25m on an $8m swimming pool. I don’t recall Burch saying anything about those things.

      The PLP love spending other people’s money don’t they.

      • aceboy says:

        We also spent $15 million on a completely unnecessary testing facility at TCD and the whole testing procedure was privatized to a friend of the PLP. They then put a sign up glorifying the person who thought of the idea too.

    • Anbu says:

      God you are stupid. Ugh whats the point. No matter how your own screw you, you just cant help but love them for it. Hahahaha. Bermudians have to be the slowest people on the planet. We prove it daily. Lmao

    • Anbu says:

      Hey guess what?! Burch is a “political villian” and that is the only accurate description of him. You think hes actually a colonel?! Hahaha

  21. kevin says:

    Simply put
    They haven’t discovered a cure for Stupid
    but the faithful blind ones will suck this up and actually believe he makes sense
    and wouldn’t deceive them ….heard that before haven’t we

    • Anbu says:

      They love to be led kevin. They need to have someone tell them what to do

  22. Hey says:

    Burch, you destroyed this island with your behavior, you were rude to our IB and you caused many Bermudians to lose their jobs and houses. The PLP must be really desperate to let you have your way.

  23. John E. Thorne says:

    And the PLP ruined BERMUDA in their reign of terror for 14 years.

  24. aceboy says:

    Is it election time already?

  25. Yikes says:

    What happens to a business that loses money consistently year after year? Ding, ding, ding . . . the answer is it goes bankrupt. The PLP has bankrupted Bermuda. When it came to power, there was a surplus. So, I find it hard to believe that any PLP member can criticize the other party when they have acted in an abysmal way. When there is money in the public purse, the most disadvantaged people in society can be easily helped, but if there is no money – where is the funding going to come from? It seems that a portion of the voting population seem to have amnesia when they are voting for a party that does not know how to balance the books. How can we continue on this way? Every so often we hear about the need to go independent which makes me really giggle. Britain might just say good riddance to a bankrupt state. 60,000 people with no back up trying to pay down an enormous debt – where the logic? Bermuda has historically been very prosperous, but it is government policy that makes the difference. Rational thinking and vision needs to take precedence in this country if we are going to see a turn around. When we have strong leadership, we will see confidence in the country and economy return.