HDC asks OPR to review $17.5M insurance contract renewals

Derek Achong

Se­nior Re­porter

[email protected]

The Of­fice of Pro­cure­ment Reg­u­la­tion (OPR) has been asked to look in­to pos­si­ble breach­es of pro­cure­ment re­quire­ments with the re­new­al of in­sur­ance con­tracts by the Hous­ing De­vel­op­ment Cor­po­ra­tion (HDC) be­tween 2023 and 2025. 

In a brief in­ter­view with Guardian Me­dia yes­ter­day, cur­rent HDC Chair­man Fer­oze Khan con­firmed that the State com­pa­ny had sought the OPR’s ad­vice on the process that was used by the for­mer board and man­age­ment to re­new its in­sur­ance ser­vices with Nor­man Gabriel Lim­it­ed (NGL). 

“What we have done is sought the ad­vice of the OPR to de­ter­mine whether con­tracts that were sim­ply ex­tend­ed were valid or not,” Khan said. 

Khan not­ed that the OPR’s stance on the is­sue would be in­struc­tive as nu­mer­ous oth­er un­con­nect­ed con­tracts with oth­er com­pa­nies were ex­tend­ed in a sim­i­lar man­ner. 

“So there were con­tracts for grass cut­ting and garbage and oth­er stuff that were sim­ply ex­tend­ed from year to year,” Khan said. 

NGL is an in­sur­ance bro­ker­age which is ma­jor­i­ty owned by busi­ness­man An­drew Gabriel. Gabriel briefly served as a Gov­ern­ment Sen­a­tor un­der a Unit­ed Na­tion­al Con­gress (UNC) gov­ern­ment in 1995 be­fore switch­ing al­le­giance to the Peo­ple’s Na­tion­al Move­ment (PNM). 

Khan au­then­ti­cat­ed a re­port on pur­port­ed OPR ir­reg­u­lar­i­ties be­tween the HDC and NGL that was re­ceived by Guardian Me­dia. 

In the re­port, it was not­ed that the NGL had been pro­vid­ing in­sur­ance ser­vices for the HDC since 2012. 

While it men­tioned that there was no ev­i­dence of ten­ders for ser­vices pro­vid­ed since 2015, it took aim at prop­er­ty all-risk, work­men’s com­pen­sa­tion, and group life port­fo­lios that were re­newed with NGL be­tween 2023 and 2024. 

The to­tal cost of the ser­vices was $17,575,921.33. 

The re­port stat­ed that af­ter the Pub­lic Pro­cure­ment and Dis­pos­al of Pub­lic Prop­er­ty Act 2015 was pro­claimed in 2023, the HDC was re­quired to is­sue a pub­lic in­vi­ta­tion for bids, ver­i­fy NGL’s sta­tus on the Pro­cure­ment De­pos­i­to­ry, and con­duct a form re­quest for in­for­ma­tion to test mar­ket rates, but failed to do so. 

“Any ex­ten­sion grant­ed post-April 2023 with­out a com­pet­i­tive process is not mere­ly a pro­ce­dur­al er­ror; it is a breach of the Act that trig­gers the “void and il­le­gal” sta­tus un­der Sec­tion 6(1),” the re­port said. 

Khan not­ed that dur­ing his tenure, the HDC had fol­lowed the prop­er pro­cure­ment process to se­lect a new in­sur­ance ser­vice provider to re­place NGL. 

The re­port al­so ref­er­enced the cur­rent ser­vice provider. 

“Dur­ing the pre­vi­ous 10 years, Nor­man Gabriel In­sur­ance Bro­kers was giv­en the con­tract with­out ten­der at a price much high­er than the HDC is cur­rent­ly pay­ing,” it said. 

Con­tact­ed yes­ter­day, Gabriel de­clined to com­ment on the re­newals that his com­pa­ny ben­e­fit­ed from. 

“That has noth­ing to do with me. That has to do with the man­age­ment and the board,” Gabriel said. 

Guardian Me­dia at­tempt­ed to con­tact for­mer HDC Chair­man New­man George, un­der whose tenure the re­newals took place. How­ev­er, he did not an­swer a call made to his cell­phone. 

A le­gal source with ex­ten­sive knowl­edge of the pro­cure­ment leg­is­la­tion and reg­u­la­tions raised ques­tions over the HDC’s en­quiry when con­tact­ed yes­ter­day. 

He sug­gest­ed that the re­newals may have been done un­der Sec­tion 12 of the Pub­lic Pro­cure­ment and Dis­pos­al of Pub­lic Prop­er­ty (Pro­cure­ment Meth­ods and Pro­ce­dures) Reg­u­la­tions 2021. 

The sec­tion pro­vides for sin­gle-source se­lec­tion as a non-com­pet­i­tive method of pro­cure­ment even when oth­er sup­pli­ers or con­trac­tors are avail­able. 

It can be utilised where pro­cure­ment rep­re­sents a nat­ur­al con­tin­u­a­tion of pre­vi­ous pro­cure­ment through a com­pet­i­tive process, and the work is be­ing car­ried out with­in 12 months im­me­di­ate­ly pre­ced­ing the de­ci­sion to en­gage in a pro­cure­ment. 

The sup­pli­er must have per­formed sat­is­fac­to­ri­ly un­der the pre­vi­ous pro­cure­ment, the con­tract price must be rea­son­able and there should not be any ad­van­tage from en­gag­ing in a com­pet­i­tive process. 

The source claimed that the reg­u­la­tion was utilised while the OPR was be­ing op­er­a­tionalised to en­sure con­ti­nu­ity while the de­pos­i­to­ry was be­ing com­piled to al­low for com­pet­i­tive ten­der­ing.

In a state­ment is­sued late yes­ter­day, for­mer hous­ing min­is­ter and cur­rent MP Camille Robin­son-Reg­is sug­gest­ed that the re­new­al fell un­der the reg­u­la­tion ref­er­enced by the source.

“The UNC needs to go back and re­fresh it­self as to the state­ments made by the OPR, the cau­tions of­fered by the Ju­di­cia­ry, and the amend­ments made in Par­lia­ment due to the non-pop­u­la­tion of the Pro­cure­ment De­pos­i­to­ry,” she said.

She claimed that NGL was giv­en the re­newals af­ter it pro­vid­ed the HDC with mar­ket sur­veys.

“This da­ta was in­deed pro­vid­ed and con­sid­ered,” she said.

She not­ed that dur­ing HDC’s deal­ings with NGL there were is­sues with late pay­ments and the ef­fect on pre­mi­um oblig­a­tions.

“This late pay­ment al­so cre­at­ed the sit­u­a­tion with po­ten­tial pro­po­nents be­ing dis­in­ter­est­ed in con­duct­ing busi­ness with the HDC and/or charg­ing high­er rates for all the ser­vices the HDC re­quired,” Robin­son-Reg­is said.

She point­ed out that NGL was first en­gaged dur­ing the UNC’s last stint in of­fice be­tween 2010 and 2015.

“The HDC had no is­sues with the ser­vices pro­vid­ed up to the en­act­ment of the leg­is­la­tion,” Robin­son-Reg­is said.

She claimed that the HDC sought to raise the is­sue with NGL af­ter she raised con­cerns over the HDC award­ing a con­tract for in­sur­ance ser­vices to a com­pa­ny with pur­port­ed links to UNC of­fi­cials.