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PLP to blast Sea-Land bail-out

For Opposition Sen. Terry Lister will bring up the controversial $2 million bail-out of the firm which built Westgate Prison.Progressive Labour Party Sen.

roasting today.

For Opposition Sen. Terry Lister will bring up the controversial $2 million bail-out of the firm which built Westgate Prison.

Progressive Labour Party Sen. Lister was yesterday keeping his powder dry and declined to go into details of his plan of attack.

But he warned: "Government has said it can manage and, of course, that the PLP can't manage.

"We're going to deal with what management is all about -- having screwed up the contract.'' The massive cash handout was revealed by the Government Auditor in 1995.

But Sen. Lister claimed Government blocked motions on the order paper, which meant they did not come up for debate until the original row had died down.

Sea Land got the $2 million from Government -- which was then disguised as part of the construction costs -- after the firm pleaded poverty during the $40 million contract.

And a late completion penalty was slashed from $1.3 million to just $205,000.

The report by independent financial watchdog Larry Dennis, released in 1995, said: "The concern in this instance is that the payment of $2 million was wrongly classified as a construction cost and information appropriate to the Legislature was not disclosed.'' The Auditor's report added that Government waived a $7.5 million "insurance policy '' designed to make sure the contract was completed.

And the report pointed out Government could also have claimed up to seven percent of the contract sum a year for late completion.

Westgate opened in September, 1994 -- nearly a year behind schedule after being plagued with construction problems.

But the Ministry of Works & Engineering failed to claim the full amount due and asked for only a fraction of the full sum, although the report noted the Attorney General's Chambers had been consulted and had given the view that a percentage-based penalty was unenforceable.

Then-Works & Engineering Minister Leonard Gibbons, however, said that -- even with the $2 million payment -- the total cost of the prison was $1 million less than the official $40.5 million laid aside.

He added that Parliament would only have had to be consulted if the contract went over the maximum price set.

But he admitted that "it may have been appropriate'' to go back to other bidders after Sea Land said it could not come up with the $7.5 million performance bond.

He added that a host of subcontractors and suppliers depended on the Sea Land work and the collapse of the main contractor would have had devastating effects on employment figures.

A hard-hitting motion slamming Senate President Alf Oughton's handling of Senate procedure tabled by the Senate Opposition Leader Milton Scott will not be debated as the PLP Senator is off the Island.

The motion -- which will be carried over to the new session -- asks the Upper House "to register its disapproval of the decisions relating to procedure made by the President of the Senate.. .'' Four decisions are singled out -- a June decision to halt debate on the lease between the Bermuda Land Development Company and Destination Villages, which wants to build a back-to-nature tourist development at the old Canadian base at Daniel's Head in Sandys.

Two later decisions -- one to allow a Private Member's Bill to go forward and be passed on the same day, even though "the majority of members had only seen it for the first time'' and a ruling refusing to allow the Daniel's Head debate to continue because the House of Assembly had not dealt were also listed as grievances.

And taking the motion to approve the lease with Destination Villages away from Sen. Lister and giving it to Government Sen. Angelita Fox is also listed.