Kamla: Govt doesn't owe one cent for OPVsPRIME MINISTER Kamla Persad-Bissessar said yesterday the Government does not owe a cent to BAE Systems, the United Kingdom company contracted to build three multi-billion-dollar offshore patrol vessels (OPVs).
In fact, Persad-Bissessar says BAE owes this country $61 million in damages and will have to repay every cent the Government invested in the project over the past few years.
She was responding to a statement by head of external communication at BAE Kristina Crowe last week, which indicated cost overruns on the deal would mean Government would have to pay an additional £150 million, before tax, on the deal. This, she said, meant the Government was owning BAE £300 million before it terminated the contract.
Contacted yesterday for further comment, Crowe issued the following statement and referred us back to the regulatory announcement issued on Septem- ber 21 on the London Stock Exchange website.
"We have received written notice from the Government of the Republic of Trinidad and Tobago (GORTT) that it wishes to cancel the programme under which BAE Systems is providing three offshore patrol vessels and support to the Trinidad and Tobago Coast Guard. We are seeking to engage in commercial discussions with GORTT and hope to reach an equitable settlement," the statement read.
Speaking to the media at Piarco after returning from her trip to the United States yesterday, Persad-Bissessar said after careful analysis of the project and the substantial breaches in contract by BAE, a decision was taken to cancel the contract since the OPVs could not assist the country in its fight against crime.
The former People's National Movement (PNM) government signed a £150 million contract in April 2007 with VT Shipbuilding to build and commission the vessels. In October last year, BAE acquired full control of VT.
A few months ago, an interministerial committee, which included National Security Minister Brigadier John Sandy and Attorney General Anand Ramlogan, was set up to review the purchase of the OPVs.
Sandy subsequently said he hoped to convince the committee to purchase the vessels since he believed they would be needed in the current fight against crime.
Persad-Bissessar's statement yesterday was the first from any Government official since BAE announced Government had cancelled the purchase of the assets. She said before BAE's statement, her Government could not make public their decision to terminate the contract because of a particular non-disclosure clause in the contract that preven- ted Government from doing so. Government, she said, would meet with officials from BAE but remains firm in its decision to terminate the contract.
"There are stories that I have been reading that we owe BAE money and we breached the contract. No, that is not the case at all. I am advised that BAE is in breach of the contract because of two reasons.
"They (BAE) are in breach because of delay, which was the most substantial cause we have to termination of the contract, but they are also in breach because they have not been able to comply with the specs that had been contracted for," she said.
She said the Government was of the opinion such assets would not assist in making any dent in the crime situation and was also not in a position to fund the vessels.
Steps have already been taken to bring back home more than 60 sailors in the UK, who are training there to operate the OPVs, she said.
Such money, Persad-Bissessar said, could be utilised in ensuring law enforcement officers are adequately compensated for their services.
"There are several things that we had to consider. Do we need three OPVs? The country is not at war out in the seas; the country is at war on the ground, in our streets and in the towns within Trinidad and Tobago. The cost to maintain the vessels would have cost taxpayers in excess of $500 million annually. Our country cannot sustain that at this time," she said.
Persad-Bissessar said the Government had an option to waiver the breach in contracts by BAE, but it would not be in the best interest of the citizenry to do so since "there were better things" the money could be put to.
"We feel that we could better spend that money right here on the ground to fight crime, to pay police officers more money, pay the Defence Force more money, to pay the prisons officers more. To get equipment and, of course, food and hospitals beds," the PM said.
"There is the view that these huge OPVs will not assist in the fight against crime because first, they are slow and are visible from way off. You could see them from far off, so these narco (narcotic) traffickers who may be coming and illegal gun-runners (who) may be coming, what may be more useful is the smaller, faster cutters."
She, however, made it clear the Government will not abandon the needs of its naval and air support units. Government, she said, still intends to proceed with the purchase of four Agusta Westland AW139 twin-turbine helicopters at a cost of $2.3 billion for the T&T Air Guard, to be used for search-and-rescue, surface surveillance, law enforcement, drug interdiction and disaster relief operations.
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