$340M revival of Caroni Ltd
By Andre Bagoo Friday, September 28 2012
THE ESTATE Management Business Development Corporation (EMBDC) has been dropped as the project manager overseeing the process by which former Caroni workers get their promised land in favour of the revival of Caroni (1975) Limited, which will be injected with $340 million in funds over the next three years, mainly to carry out unspecified “infrastructure development”.
The move, approved by Cabinet yesterday, came as Government unveiled a series of pre-Budget “goodies” arguably meant to bolster its support in the wake of the Section 34 scandal, ahead of 2013 when Local Government and the Tobago House of Assembly elections are due.
Cabinet sources yesterday confirmed Cabinet took a decision to drop the EMBDC in favour of use of the limited liability company Caroni (1975) Ltd which still remains an active company on Companies Registry records, notwithstanding the divestment of its sugar-producing business under the PNM administration.
Food Production Minister Devant Maharaj announced at the post-Cabinet briefing that the State would inject more funds in order to hand out leases.
He said the process would see, “the issuing by the Commissioner of State Lands of standard agriculture leases to legitimate tenants who are cultivating sugar-cane on lands formerly owned by Caroni (1975) Ltd and by the State, provided that the cane-farmers continue to undertake agricultural activity.”
He confirmed Caroni (1975) Ltd was appointed project manager for the regularisation project “to put in place a comprehensive implementation plan for the regularisation of the project with the provision of sums in the total of $340 million.”
The next phase of the process, Maharaj said, will see, “the processing and delivery of leases to squatters who were cultivating sugar-cane on the former lands of Caroni”. He said this “will be subject to a separate submission to Cabinet.”
Maharaj also noted the Ministry of Food Production, “has identified approximately 4,111 acres of un-utilised former lands of Caroni which are suitable for agricultural purposes which could be allocated for farming communities in accordance with the distribution framework for the under-utilised lands approved by a Cabinet Minute of 2011.
He said the State has already spent $247.7 million of an European Union grant and can draw a further $157.23 million. This money, he said, was used to fund “exit strategies” and a “procedural framework for regularising” land.
Of the $340 million, Newsday understands $300 million will be used for “infrastructure works: access roads”, according to a Cabinet note.
The specific nature of this work was not made clear by the minister yesterday. Questioned by Newsday he said it would be for roads and surveys that have to be done.“There is a lot of land and it is just a large mass that needs to be divided,” he said. He said any contracts would be handled by the Central Tenders Board, pending the assignment of another state agency to the project management.
The PNM administration — through the EMBDC — spent $458 million on preparing housing lots for distribution. The current PP administration, as at June, had spent $200 million.
In June, the then Food Production Minister Vasant Bharath said work was complete in relation to 4,000 residential lots. “The only thing we have to do is the preparation, but the actual, physical infrastructural work has been completed by the EMBDC and the ministry. We have almost completed that exercise,” Bharath said at a meeting at Rienzi Complex, Couva.
Caroni (1975)’s registered address is Lightpole 11, Brechin Castle, Couva, and its directors are currently public servants including: chairman Jerry Hospedales (Divestment Secretariat, Ministry of Finance); Edwina Leacock (Permanent Secretary, Ministry of Food Production); Marlene Juman (Permanent Secretary, Ministry of Finance) and Sharon Mohammed (business analyst, Ministry of Finance).
The company is nearly fully-owned by the Ministry of Finance (202, 787, 763 shares) with one share in the name of accountant Jaggernauth Soom.
Back in May 2002, a Government committee chaired by Hospedales recommended the restructuring of Caroni which resulted in the setting up of the EMBDC, with a mandate to manage 77,000 acres of Caroni land.
It also resulted in the retrenchment of Caroni workers who were given Voluntary Separation Employment Programme (VSEP) packages. On October 29, 2002, then Agriculture Minister John Rahael announced that those who were willing to continue in agriculture would have the first option to lease the lands.
Another promise, in September 2003, was made to the former sugar workers, informing them that they would be given agricultural plots and residential lots in the context of thier acceptance of VSEP.
By 2007, High Court judge Justice Lennox Deyalsingh ruled that the then Government was in breach of promises to give ex-workers land. That matter was taken to the Court of Appeal, at a cost of millions, and then reportedly discontinued.
In December 2010, Prime Minister Kamla Persad-Bissessar handed out 610 leases to former Caroni workers. The leases for two-and-a-half acre plots each were allotted across ten Caroni sites: La Fortune, 25; Cedar Hill, five; Jerningham, 19; Felicity, 47; Caroni, 31; La Gloria, 73; Waterloo, 63; Orange Grove, 31; Reform, 62; Edinburgh, 115; EMBDC administered plots, 140.