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Burgess claims PAC report was ‘political plot’ to denigrate him

Former Deputy Premier Derrick Burgess yesterday strongly hit out at a PAC report that he claims was a 'political plot' to denigrate him and the Progressive Labour Party.

MP Derrick Burgess yesterday stated all of Bermuda should be alarmed at a parliamentary committee’s efforts to “score political points” against him over the Bermuda Land Development Company affair.The former Deputy Premier issued an angry attack on the Public Accounts Committee and Auditor General Heather Matthews as he maintained he did nothing wrong in the matter which sparked controversy earlier this year.Mr Burgess came under fire in January, when Mrs Matthews said the publicly funded BLDC — which he was responsible for as Works Minister — paid $160,000 in consultancy fees to the chairman and deputy of its own board, despite being warned of a potential conflict of interest.The PAC later concluded he was wrong to direct cash to Edward Saunders and Pastor Leroy Bean without the consent of Premier and Finance Minister Paula Cox.Reacting in an official reply to the House of Assembly yesterday, Mr Burgess reiterated his stance that public accounting firm KPMG and lawyers Trott and Duncan had determined the board’s actions were entirely legal.He added that the PAC had erred by detailing information in its report that went outside the scope of the Auditor General’s document.And he claimed the PAC — chaired by Shadow Finance Minister Bob Richards, and also comprising One Bermuda Alliance MPs Cole Simons and Patricia Gordon-Pamplin and Progressive Labour Party MPs Lovitta Foggo and Terry Lister — had attempted to smear his and the PLP’s reputation.“The requirement as stated by the PAC and the Auditor that the Minister needed to inform the Minister of Finance and lay all directives before the House of Assembly is ludicrous,” wrote Mr Burgess.“In particular, the board has the power to spend hundreds of thousands of dollars without seeking prior approval from any Minister.“In the past the BLDC board set their own salaries and those salaries were higher than those of any other public servant. And when setting their salaries they did not seek the permission of the Minister or lay anything before Parliament.“There is no evidence to suggest that there was a misuse of public funds.”Saying there was also no evidence of breaches of by-laws or the 1981 Companies Act, he continued: “I believe that the PAC by including matters in there that were not included in the Auditor General’s report, especially in light of the fact that I was not questioned on these matters when I gave evidence to the Committee, the inclusion insinuates that I used my power to influence is unacceptable, contemptible and malicious. The report makes assertions that are without merit and unsubstantiated. No doubt this inclusion was to discredit me and the Progressive Labour Party.“In closing, it is my contention that the writing of the report is nothing more than a political ploy to score points and to denigrate me and the Bermuda Progressive Labour Party.“I am a hard-working Member of Parliament who is committed to my constituents and to the peoples of Bermuda.“For my integrity to be questioned should be alarming to all of Bermuda, especially in light of my many years of service to the Bermuda community as both a trade union leader and a Member of Parliament.”After she learned about Mrs Matthews’ findings, Ms Cox recommended Mr Saunders and Mr Bean repay their fees to the quango, which manages Bermuda’s baselands.But the pair refused to return the funds or step down and, according to Mrs Matthews, Mr Burgess took no action.Mrs Matthews revealed Ms Cox then removed BLDC from Mr Burgess’ control, disbanded the entire board and delegated responsibility to the Environment Minister.Mr Burgess, a former Bermuda Industrial Union president, was later made Transport Minister, seen by many as a demotion, before resigning from Cabinet in June when it was revealed he had a physical altercation with Estates Minister Michael Scott.He appeared before a public PAC meeting in July, telling Mr Richards he should not take literally the law specifying “every directive has to be in writing and put before the House of Assembly”.In his reply yesterday, Mr Burgess also took issue with Mrs Matthews’ assertion he directed Mr Saunders and Mr Bean be paid consultancy fees.“At no time did I suggest that these two members of the board should act as consultants,” he said.He quoted from KPMG’s report: “The BLDC’s by-laws allow directors to provide professional services to the company and to be remunerated for those services.”Mr Burgess reflected: “As such, the demand by the Ministry of Finance that the chairman and deputy chairman repay any monies earned during their investigation is unreasonable and without merit. Neither of these gentlemen violated any of their fiduciary duties.”He added that the work done by Mr Saunders and Mr Bean — to assess the operations of the BLDC — resulted in “the recovery of hundreds of thousands of dollars in receivables that otherwise would have remained uncollected”.