Improving the health of a fat nation is a better option.

“Prevention is better than the cure”.

What about the economic injection, the jobs, the boost to the economy? That’s obviously a big part of the reason for it. Or, if you really don’t want the things we “don’t need”, that would mean you’re ok with implementing all the SAGE recommendations, if you’re point is that we can’t afford the things we don’t need.

A New Airport Terminal for Bermuda – Just the Facts:

The OBA and Opposition agree Bermuda needs a new airport as the existing facility is aging and increasingly costly to maintain. A new airport will support Bermuda’s image as an upmarket tourism destination and international business centre.

The OBA committed to building a new airport to create jobs for Bermudians and support economic growth without adding to Government debt. The Opposition had plans, when in Government, to build a new airport but were unable to finance the project.

Past projects that used the Request For Proposal (RFP) model have not provided value for money. Projects including the new Berkeley Institute, Heritage Wharf, Port Royal Golf Course and the Dame Louis Browne Evans Building, which all went out for RFP, came in over budget, costing tax payers tens of millions of dollars.

A Memorandum of Understanding (MOU) has been signed with the Canadian Commercial Corporation (CCC) without issuing an RFP, saving tax payers potentially millions of dollars in consultancy fees. ($10 million was spent on consultancy fees for the new Hospital wing.)

Under the terms of the MOU, which is the first step in a Public Private Partnership that will govern all aspects of the project, the Government will ensure:

• The Canadian infrastructure contractor maximizes Bermudian job creation.
• An independent, internationally recognized construction firm will be hired by Bermuda to conduct an examination of all aspects of the project to determine whether Bermuda is getting value for money, which is the main point of an RFP. This is a standard practice, known as a ‘fairness opinion’, done all the time for infrastructure projects.
• This is not privatization as the ownership of the airport and all its assets will continue to belong to the people of Bermuda.

By using CCC, the project will benefit from:

• Significantly reduced procurement time, meaning a fast start for the project and job creation. Construction could begin by the end of 2015.
• Guarantee that the project will be delivered on time and on budget.
• CCC is a QUANGO like entity 100% owned by the Canadian Government.

Airport revenues will pay for the project over time while also being used to maintain the airport facility and operations.

The P3 contract may be with a new Bermuda Airport Authority, a QUANGO-like entity the Government is considering forming.

The Opposition claim that Bermuda will lose out on $1 billion in revenue under this agreement appears to be incorrect. The plan will be based on a yet to be determined estimate of cash flows over 30 years and those earnings will determine what can be built.

This agreement is good for Bermuda as we will have a new airport that will support our economy at no cost to taxpayers and without increasing our debt, while providing jobs for Bermudians both in construction and operating the facility.

I think the PLP are quite right at the lack of tranparency and concerns over the process. Whether or not it is the right decision the OBA are acting like the PLP in the past when everyone was up in arms about transparency.

very depressing – seems neither party can learn its lessons.

So if you want widgets, they find the best widget supplier for you.

They’ve been in business for, I think I read, 80 years, so they have lots of experience, lots of knowledge about who makes the best widgets. And by extension who can do the best job at the airport.

It’s a creative and inexpensive alternative to the consultant who’s going to vet the bids for you…and charge you a whole bundle of money for doing it.

The PLP seem to have an issue with gov’t missing out on those revenues, over whatever time period it will be, whether that’s 10, 15 or 20 years.

Last time I checked Bermuda Gov’t has no money to generate 200m to fund the project ourselves

How do you know you could not have got a better deal at less cost than with CCC?

(2) It really means the BDA government has outsourced the “task of selecting the developer” to CCC, as the BDA government does not have the technical expertise for it.

You have signed a deal not knowing who the actual developer/builder will be.

If no one in BDA government is capable of evaluating competing bids, how do they know they got the best deal from CCC?

For the Finance Minister to say that he knows CCC from financial services industry and they “ticked all the boxes” and so they were the chosen one is not a rational/logical way of selecting the winner of the largest capital project in recent times.

It clearly appears that the BDA government were not really looking for any other developer/builder, thereby casting suspicions on the deal itself.

“No money upfront” does not automatically mean that we, the Bermuda taxpayers, are getting the best deal.

I suggest Jeff attend the Public meeting tomorrow night about the Airport and bring the OBA viewpoint.

The company actually building the airport will not be CCC, but rather a company with direct experience in such projects.

1) An informed customer, one who does the things you say they should be doing (thorough research, open communications), will ensure that he gets the product he wants. That is why you write a meaningful, directed, and clear RFP. You outline exactly what you want and you evaluate proposals based on their adherence and achievement of the requirements you set.

2) If the advertised condition are too onerous, that company should not be bidding. That is the whole reason for getting proposals. If you tell a company what you want and they say it is too onerous, then they are not the right company for your job. If I was looking for a company to build an office building, Sousa’s garden center wouldn’t be able to do that job and they shouldn’t be proposing for it. That’s a good thing.

Additionally, a company focusing on high quality will deliver high quality and they will quote the best price to deliver that quality. That price may very well be higher than other bidders, but that doesn’t mean you can’t choose them. They should sell you their quality and prove that it is worth the extra cost.

3) You can easily tell when a supplier is employing that kind of strategy. When 4 supplier quote $100 and the 5th quotes $35, you know what happening. The easy solution is, don’t hire that supplier. Again use the research, communications, and the other key principles you talk about to choose the best supplier.

4) Again, good governance and monitoring of safety requirements will solve this problem. As has been said so often this project will create jobs for Bermudians. Is this the cheap labour you are talking about? This point doesn’t add up here. Additionally, the government sets immigration policies and can control who is granted work permits, just in case foreign workers were needed.

5) Is it really a bad thing to spend a little time finding the right bidder in the islands biggest ever capital project? I know, personally, I’d rather wait a little while to pick the right person than make a hasty choice that backfires. Maybe the real issue here is that the OBA is worried they won’t be in power in a few years and this will turn into the success of another government or another minister. I hope this isn’t the case, and I don’t think it is, but not a good reason to forgo an RFP anyway.

6) Again, is it a bad thing to hire the best people to perform the overseeing job for Bermuda’s largest ever capital project? Additionally, would this not be a problem under either proposal: CCC or another bidder? Or is the government planning to allow CCC to lord over the airport project without any oversight? I’d say this point made by Mr. Sousa is about as well thought out as this CCC contract to begin with.

Creativity isn’t always the best thing, just ask the guys at Enron.

(1) Competitive bidding seldom allows the customer to get the product he knows is best for the job, because it is underbid by suppliers of products of lesser quality.
(2) One way a supplier can reduce his costs in the fierce competition to get a contract is by using cheap labour or materials, or by cutting corners and creating safety risks, meaning the customer may end up with an inferior product that costs more in the long run.

(Following is the assurance we,(Bermuda) require and will receive by dealing with Canadian Commercial Corporation.)

The agency oversees all contracts from start to finish. C.C.C. also provides Procurement Agent services, sourcing and delivering goods and services from trusted companies.
It is an agency that can be depended upon to remove all the disadvantages of competitive tendering, and is capable of saving the Bermuda Government millions of dollars in the cost overruns which have come to be expected on this kind of project.
Far from a slap in the face to good governance, it is a creative method of making sure Bermuda gets the best value for money.