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The MDC collapse

The collapse began before it started

by Bennette Roach

Little Bay (bottom left -Davy HIll)

Little Bay (bottom left -Davy HIll)

On ‘Holy Thursday‘, a holiday for many Catholics around the world, April 2, 2015, the Premier in a press release announced that, “The Task Force recently completed its work…reported wide-ranging concerns with corporate governance and management arrangements at MDC…MDC never provided value for money…The Government has therefore decided to close the MDC…”

For the past week most of the comments, in fact, all willing to speak on the Montserrat Development Corporation(MDC) closure by the Government (GoM) and UK Government Department for International Development (DFID) have denounced the scarcity of the hard evidence given to support the drastic action in the Task Force’s Summary Report.

They suggest that in the absence of information regarding the irregularities alluded to and some mentioned from time to time in the Summary Report, there should be some means to get such evidence and information, which may well be in the full report. See “Governments complete abandonment of MDC” – produced in full elsewhere in this issue.

The Summary report set out the background from the 2007 inception of the MDC, but did not state that the MDC was in the making from 1998 and began in earnest from 2004.

It was still in David Brandt’s stint as Chief Minister that he responded to the question about what was going on with the plans for developing Little Bay, “Please go and ask the Governor what is holding that up.” At the time there were different proposals before the UK Govt.

The task force concluded the background (up to 2011) noting, (see Clause 11, “…. However, it was said that the single most important factor for the failure was the “lack of consistency and continuity in executive leadership”.

They continued, “12. The Final Report raised serious concerns regarding MDC, namely, “MDC’s impact and reputation is so low that extending its life and funding poses a big credibility problem”. Despite these concerns the report concluded that re-launching MDC was the best option, but stated that a number of conditions needed to be fulfilled as a pre-requisite to the re-launch, these included recruiting a CEO and senior employees, re-constituting the Board and improving governance.”

They then found whereas the relaunch of the MDC took place: “… improvements in governance arrangements upon the re-launch of MDC following the report were minimal.”

TMR had published criticism of the prologue to the Terms of Reference of the Task Force creation. (see: http://www.themontserratreporter.com/review-of-mdc-due-in-4-weeks/) There we said: “Experts in this area have discounted much of the information set out as irrelevant to the MDC and its creation.”

There already, the writer who was obviously an important member of the task force which was chaired by the interim chairman, referencing UK statutory corporations etc, said: “The MDC bylaws follow the format of a private company and as such they do not outline the mandate of the MDC, which an enabling Act would have done.”

True about the format, but according to legal advice, the company laws (which guide the bylaws are laws of the country, which are firmer than “the enabling laws” would be, created to suit the enabler’s fancies.

Observers then find in the Task Force report, conclusions that they set out to do. As noted later the UK Government and local Attorney General’s office after deciding in 2004 the way forward, did not spend three years after the previous six, to come up with a document which while may not be perfect, unsuitable for the purpose.

The Statutory report did note in what one might consider their findings, such as: “. In such cases MDC ought to have been working with all the key sectors in the economy, not just tourism. Martin Dawson’s predecessor Kato Kimbugwe had repeatedly at Governor’s press conferences pointed that out. The Summary report was very critical of the merger of the MTB into the MDC. (see clause 16-17 of the Report).

The Report goes on the make references to the irregularities in the operations functioning of the MDC and what is nothing less than misappropriations (see: www.themontserratreporter.com or issues of TMR particularly on matters dealing with MDC where we even called for the firing of the CEO).

Much of what is stated deal with procurement, funds, problems of to some extent incompetence, especially at the top, breaking of rules, or not following the laws, (reported by in some small degree, but very important.

Finally the Summary Report spoke to the Leadership and Management of the MDC. In part it said: “It was found that the corporate governance style of MDC Boards have generally been reported to be of two categories: micromanagement, or autocratic with heavy political influence…sources, reflect that Boards have been overly involved in the daily affairs of the corporation and of individual employees, even leading to some CEOs expressing frustration in trying to perform their duties without constant Board interference.” It goes on to speak to that which we have also been critical of, the appointment or functioning of Chairman/CEO.

“So should there have been in the interim period a CEO/Chairman?”, eager observers had pointed out.

TMR readers may ask whether in the absence of showing that the articles and bylaws were inadequate, but simply not followed, that the Review should call for the abandonment of the MDC instead of the shakeup necessary to do what it was created for in the first place.

At the Governor’s press conference upon enquiry as to whether there were plans to investigate the irregularities, the Governor responded supported by DFID rep Dawson, “I think that there is nothing planned, it was not part of the action plan, I think the winding up of the MDC is a sufficient and dramatic action.”

At that press conference the DFiD rep Dawson who was one of the members of the Task Force and perhaps the lea person there, put the MDC debacle in perspective. “…rather than trying to change it again and maybe make a few improvements (more …… expenses further money, just stop it and start again and design something that is now appropriate to Montserrat’s future needs and efficiency of a new government,” he said.

He added that, “being an implementing body (DFID) and having policy with government and consider also the make of the organization and types of skill sets you need in order to deliver what Montserrat needs in 2020 and beyond.”

He then explained what should have guided them to a better (change) option. “There were documents written setting out very clearly the roles of certain positions in the organization and the roles of particularly the board, and how they should administer the organization (Articles and bylaws, and ‘business case’, Logframes etc.) but i think as I said if they existed they weren’t followed and then people aren’t held accountable!” he concluded, saying, that you then get “to situations where people generally feel they could do whatever they want.”

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The collapse began before it started

by Bennette Roach

Little Bay (bottom left -Davy HIll)

Little Bay (bottom left -Davy HIll)

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On ‘Holy Thursday‘, a holiday for many Catholics around the world, April 2, 2015, the Premier in a press release announced that, “The Task Force recently completed its work…reported wide-ranging concerns with corporate governance and management arrangements at MDC…MDC never provided value for money…The Government has therefore decided to close the MDC…”

For the past week most of the comments, in fact, all willing to speak on the Montserrat Development Corporation(MDC) closure by the Government (GoM) and UK Government Department for International Development (DFID) have denounced the scarcity of the hard evidence given to support the drastic action in the Task Force’s Summary Report.

They suggest that in the absence of information regarding the irregularities alluded to and some mentioned from time to time in the Summary Report, there should be some means to get such evidence and information, which may well be in the full report. See “Governments complete abandonment of MDC” – produced in full elsewhere in this issue.

The Summary report set out the background from the 2007 inception of the MDC, but did not state that the MDC was in the making from 1998 and began in earnest from 2004.

It was still in David Brandt’s stint as Chief Minister that he responded to the question about what was going on with the plans for developing Little Bay, “Please go and ask the Governor what is holding that up.” At the time there were different proposals before the UK Govt.

The task force concluded the background (up to 2011) noting, (see Clause 11, “…. However, it was said that the single most important factor for the failure was the “lack of consistency and continuity in executive leadership”.

They continued, “12. The Final Report raised serious concerns regarding MDC, namely, “MDC’s impact and reputation is so low that extending its life and funding poses a big credibility problem”. Despite these concerns the report concluded that re-launching MDC was the best option, but stated that a number of conditions needed to be fulfilled as a pre-requisite to the re-launch, these included recruiting a CEO and senior employees, re-constituting the Board and improving governance.”

They then found whereas the relaunch of the MDC took place: “… improvements in governance arrangements upon the re-launch of MDC following the report were minimal.”

TMR had published criticism of the prologue to the Terms of Reference of the Task Force creation. (see: http://www.themontserratreporter.com/review-of-mdc-due-in-4-weeks/) There we said: “Experts in this area have discounted much of the information set out as irrelevant to the MDC and its creation.”

There already, the writer who was obviously an important member of the task force which was chaired by the interim chairman, referencing UK statutory corporations etc, said: “The MDC bylaws follow the format of a private company and as such they do not outline the mandate of the MDC, which an enabling Act would have done.”

True about the format, but according to legal advice, the company laws (which guide the bylaws are laws of the country, which are firmer than “the enabling laws” would be, created to suit the enabler’s fancies.

Observers then find in the Task Force report, conclusions that they set out to do. As noted later the UK Government and local Attorney General’s office after deciding in 2004 the way forward, did not spend three years after the previous six, to come up with a document which while may not be perfect, unsuitable for the purpose.

The Statutory report did note in what one might consider their findings, such as: “. In such cases MDC ought to have been working with all the key sectors in the economy, not just tourism. Martin Dawson’s predecessor Kato Kimbugwe had repeatedly at Governor’s press conferences pointed that out. The Summary report was very critical of the merger of the MTB into the MDC. (see clause 16-17 of the Report).

The Report goes on the make references to the irregularities in the operations functioning of the MDC and what is nothing less than misappropriations (see: www.themontserratreporter.com or issues of TMR particularly on matters dealing with MDC where we even called for the firing of the CEO).

Much of what is stated deal with procurement, funds, problems of to some extent incompetence, especially at the top, breaking of rules, or not following the laws, (reported by in some small degree, but very important.

Finally the Summary Report spoke to the Leadership and Management of the MDC. In part it said: “It was found that the corporate governance style of MDC Boards have generally been reported to be of two categories: micromanagement, or autocratic with heavy political influence…sources, reflect that Boards have been overly involved in the daily affairs of the corporation and of individual employees, even leading to some CEOs expressing frustration in trying to perform their duties without constant Board interference.” It goes on to speak to that which we have also been critical of, the appointment or functioning of Chairman/CEO.

“So should there have been in the interim period a CEO/Chairman?”, eager observers had pointed out.

TMR readers may ask whether in the absence of showing that the articles and bylaws were inadequate, but simply not followed, that the Review should call for the abandonment of the MDC instead of the shakeup necessary to do what it was created for in the first place.

At the Governor’s press conference upon enquiry as to whether there were plans to investigate the irregularities, the Governor responded supported by DFID rep Dawson, “I think that there is nothing planned, it was not part of the action plan, I think the winding up of the MDC is a sufficient and dramatic action.”

At that press conference the DFiD rep Dawson who was one of the members of the Task Force and perhaps the lea person there, put the MDC debacle in perspective. “…rather than trying to change it again and maybe make a few improvements (more …… expenses further money, just stop it and start again and design something that is now appropriate to Montserrat’s future needs and efficiency of a new government,” he said.

He added that, “being an implementing body (DFID) and having policy with government and consider also the make of the organization and types of skill sets you need in order to deliver what Montserrat needs in 2020 and beyond.”

He then explained what should have guided them to a better (change) option. “There were documents written setting out very clearly the roles of certain positions in the organization and the roles of particularly the board, and how they should administer the organization (Articles and bylaws, and ‘business case’, Logframes etc.) but i think as I said if they existed they weren’t followed and then people aren’t held accountable!” he concluded, saying, that you then get “to situations where people generally feel they could do whatever they want.”