VZCZCXYZ0006
RR RUEHWEB

DE RUEHKG #0343/01 0712001
ZNR UUUUU ZZH
R 122001Z MAR 07 ZDK
FM AMEMBASSY KINGSTON
TO RUEHC/SECSTATE WASHDC 4462
INFO RUEATRS/DEPT OF TREASURY WASHDC
RUEAWJA/DEPT OF JUSTICE WASHDC

UNCLAS KINGSTON 000343 
 
SIPDIS 
 
SIPDIS 
 
STATE FOR INL/C, INL/LP (BOZZOLO) AND WHA/CAR (BUDDEN) 
JUSTICE FOR OPDAT (ROBERT LIPMAN) 
TREASURY FOR OTA (FRED BORAKOVE) 
 
E.O. 12958: N/A 
TAGS: JM KCOR KCRM KJUS PGOV
SUBJECT: ANTI-CORRUPTION STRATEGY: CONTRACTOR GENERAL OF 
JAMAICA 
 
 
¶1.  Summary:  Please see the action request in paragraph 12. 
Currently, the Mission is exploring mechanisms for 
encouraging the Government of Jamaica (GOJ) to curb 
corruption.  In keeping with the Mission's evolving strategy 
plan on anti-corruption, we are meeting with heads of 
Jamaican government entities that can play key transparency 
roles in promoting better governance. Most of these 
government offices are empowered to expose violations of 
laws/regulations and can refer violations by public officials 
to the Director of Public Prosecutions (DPP).  In pursuit of 
our quest for better understanding of these key players and 
possible avenues for improving their performance, the Acting 
Director of the Narcotics Affairs Section (NASDIR) met with 
Contractor General Greg Christie on March 1.  Although his 
powers are limited, Christie demonstrates courage in exposing 
irregularities and violations with respect to government 
contracts.  End Summary. 
 
BACKGROUND 
 
¶2. Established in 1986 by the Contractor General Act of 1983, 
the Office of the Contractor General (OCG) is an independent 
commission of parliament.  The Contractor General (CG) is 
appointed by the Jamaica's Governor General after 
consultation with the Prime Minister and the Leader of the 
Opposition and serves a renewable term of 7 years. The CG's 
primary functions are to a) monitor the award and 
implementation of government contracts; b) monitor the grant, 
issuance, suspension or revocation of government licenses; 
and c) conduct investigations into registration of 
contractors, tender procedures, award and implementation of 
government contracts, circumstances of granting or revoking 
prescribed licenses. While the monitoring functions are 
mandated by law, the investigative function is discretionary. 
 In order to carry out these functions, the CG has a) the 
right to be advised of the award of all Government contracts 
by a pubic body; b) powers of inquiry, inspection and 
discovery that allow his access to premises, documents, 
records or information relating to contracts or licenses; and 
c) the power to require any public officer or any person to 
provide him with information regarding the award of any 
government contract or the suspension or revocation of any 
government license.  Contracts are reviewed to determine 
compliance with Government Procurement Guidelines. 
 
¶3. The CG's secondary function deals with the National 
Contracts Commission (NCC). He is responsible for obtaining 
the budget for the NCC, as well as providing administrative 
and technical assistance required for the operation of the 
NCC.  Like, the OCG, the NCC is an independent commission of 
parliament with its own powers.  It was established through 
an amendment to the Contractor General Act, in 1999, and 
became fully operational in 2001. Its eight members are 
appointed by the Governor General (Christie is one of them), 
who serve a seven-year term.  The primary functions of the 
NCC are to promote efficiency in the process of awarding and 
implementing government contracts and to ensure transparency 
and equity in the awarding of contracts.  The NCC examines 
and approves recommendations to award government contracts 
valued at JA dollars 4 million and above.  It makes 
recommendations to Cabinet regarding award of contracts 
valued at JA dollars 15 million or above.  It registers and 
classifies contractors who wish to bid on Government 
contracts and constantly assesses their capacity to perform, 
as well as their actual performance.  The NCC can make 
recommendations to Cabinet to improve the efficiency of 
procedures for granting and implementing contracts.  NCC 
oversees the activities of the seven sectoral committees 
through which contract award recommendations must be routed 
by the sponsoring government procurement agency.  Finally, 
the NCC is empowered to make regulations prescribing the 
registration and classification requirements for contractors, 
the procedure for submission of tenders for contracts, 
requirements for contractors to enter into performance bonds, 
competitive bidding on government contracts, and the 
circumstances under which a contractor's registration may be 
canceled. 
 
 
¶4. There are 200 public bodies that are subject to the CG's 
scrutiny. They include ministries, departments, and agencies 
of the Government, as well as statutory bodies, statutory 
authorities and companies registered under the Companies Act, 
in which government or any agency of government holds shares 
or, through other financial input, is in a position to 
influence the policy of the company.  However, the CG's power 
is restricted with respect to contracts/licenses involving 
the security forces.  The CG can monitor these documents, but 
cannot conduct investigations without express authorization 
of Cabinet. 
 
¶5. Following an investigation, the CG must inform the 
principal officer of the public body and the appropriate 
Minister of the results of the investigation and make 
recommendations for resolving any problem.  He may, at any 
time, submit a report to Parliament regarding a matter that 
he has investigated, which he believes requires the special 
attention of Parliament. After reports are presented to 
Parliament, the CG can publish any that are in the public 
interest. 
 
RECENT EXAMPLES OF THE CG'S WORK 
 
¶6. Corruption takes many forms.  Over the years, it has been 
openly speculated that the awarding of government contracts 
was a major avenue of public corruption.  The party in power 
would make an effort to reward loyal supporters (campaign 
contributors) with government contracts.  That problem is 
compounded when loyal party supporters sit on public bodies 
that award contracts to private companies owned by the same 
person.  Such things might be considered a conflict of 
interest, bQ maybe not, in Jamaica.  In any case, since the 
beginning of the year, CG Christie has been exchanging salvos 
with Barbara Clarke, Chairperson of the Petroleum Company of 
Jamaica (PETCOM) over what appears to be a conflict of 
interest.  Ms. Clarke apparently is the principal owner of 
companies that have benefited from government contracts by 
PETCOM since 1998. Clarke claims she has done nothing 
unlawful because she declared her holdings when she assumed 
the position with PETCOM and her company's initial contract 
with PETCOM predated taking the chairmanship of PQCOM.  On 
March 1, the CG was quoted in the press as saying that he 
will look into the possibility of referring the case to the 
Director of Public Prosecutions.  Comment:  On March 5, 
Jamaica's Auditor General Adrian Stachan mentioned to NASDIR 
that Jamaica needs a law that clearly spells out a code of 
ethics (including conflict of interest) and provides serious 
penalties for violations.  Stachan was probably signaling 
that there may be little that the CG or the DPP can legally 
do in the Clarke case. But, if nothing else, Christie is not 
adverse to highlighting the need for conflict of interest 
laws.  From another source, NASDIR was told it might be 
difficult to have a strong conflict of interest law in 
Jamaica.  The reason is that Jamaica's business community is 
relatively small.  To attract competent managers for public 
bodies, government must draw on executives from the private 
sector.  If such a person were forced to relinquish control 
over his/her private business in order to chair a public 
body, that person would probably refuse the job.  End comment. 
 
¶7. The Contractor General does have the monitoring authority 
to require that all public bodies submit to him quarterly 
reports on the status of their government contracts. 
However, non-compliance was common and previous CG's did 
nothing about it.  Christie (who was appointed in November 
2005) announced in early 2007 there would be zero tolerance 
of non-compliance, which is a criminal offense.  After giving 
fair warning to public bodies who failed to provide their 
last 2006 quarterly report (due midnight of January 31, 
2007), he decided to refer these cases to the DPP.  Christie 
told NASDIR there are 54 such cases.  His intent is to send a 
message that public bodies must comply with his instructions. 
 He knows the penalty will not be tough (maximum penalty is 
JA$5000/US$77 or up to one year in prison).  But, unless 
reports are filed with him, he has no way to identify and 
investigate irregularities.  Christie said he asked the DPP 
(Ken Pantry) to help him put the cases together, carefully 
documenting the fact that public bodies had received the CG's 
timely warning about compliance. The DPP's office assisted, 
and the cases should be presented formally to the DPP around 
March 15. 
 
¶8. The CG emphasized to NASDIR that his investigative power 
was discretionary.  His point was that his predecessors did 
not exercise that power.  Christie is changing that, although 
he is hampered by an insufficient number of investigators. 
The CG said that, before he took over, there had been only 
one investigation into irregularies. Last year, he submitted 
over 20 reports on investigations.  So far this year, he has 
opened 18 investigations. Comment:  It will be interesting to 
see what comes from these investigations.  Christie's 
willingness to pursue his responsibilities energetically 
contrasts with his predecessors.  He has the power to keep 
specific corruption issues before the public for longer 
periods of time.  In the past, irregularies were sometimes 
exposed and then, after a couple of days of play in the 
media, they were quietly forgotten.  Of course, public 
exposure also embarrasses the party that governs.  During an 
election year, public exposure can inflict more damage to the 
ruling party than would otherwise be the case. However, 
Christie insists convincingly that he is non-political.  End 
comment. 
 
STRENGTHENING THE OFFICE OF THE CONTRACTOR GENERAL 
 
¶9. NASDIR expressed support for the work being done by 
Christie and explained the embassy's interest in engaging 
more pro-actively in anti-corruption efforts.  Christie was 
grateful for the recognition.  NASDIR mentioned that we would 
be working with other donors, particularly the British and 
Canadians, to identify ways in which we can be of assistance. 
 According to the CG, there has been a long-standing problem 
of insufficient budget support to his office.  Of a staff 
complement of 57, authorized in 1999, they never have had 
more than 45.  This year Christie requested authorization to 
fund 66 positions.  Of the 45 people, 12 inspectors work on 
investigations and only two of these are skilled 
investigators.  The OCG staff is divided into five 
directorates:  Technical Services, Construction Contracts, 
Licenses and Permits, Information Systems and Administration 
and Finance. His staff also supports the NCC, which does not 
have a staff of its own. 
 
¶10. Christie also pointed out that insufficient budget 
support impacts negatively on his information technology 
capability.  He has devised an electronic form for public 
bodies to complete and submit regarding contracts.  He also 
believes his office should be totally transparent and puts a 
great deal of information on a website (www.ocg.gov.jm).  Due 
to the funding shortfall, he has to use his own laptop as his 
office pc.  He constantly updates the website, also monitors 
e-forms. 
 
¶11. As a follow up to our meeting, Christie sent NASDIR a 
letter dated March 7.  He explained that he had attempted to 
address resource shortfalls through a restructuring 
assessment conducted last year by the Public Sector Reform 
Unit of the Office of the Cabinet.  Resulting proposals were 
approved by the Ministry of Finance and Planning for 
implementation during the 2007/2008 fiscal year, "subject to 
budgetary considerations."  To have a clearer view of needs 
for possible outside assistance to his office, Christie 
indicated that he must wait until April to learn of Cabinet's 
decision on the budget request.  His operating and capital 
budget request is for JA$185 million, compared to the current 
JA$85 million.  In the meantime, Christie made an urgent 
request for training in the following fields: 
anti-corruption management and governance; conduct of 
investigations (techniques, interviews, analyses, report 
writing); forensic auditing and auditing techniques; fraud 
detection; procurement, contracts and contractor monitoring 
management; information technology; utility of information 
technology and systems in procurement monitoring and 
anti-corruption management; strategic management/strategic 
plan development and implementation; and general management. 
 
¶12. Action Request:  The embassy would welcome Washington's 
advice about possible sources to provide elements of the 
requested training and availability timeframes (if possible). 
We would like to help OCG strengthen its investigative 
skills.  Some NAS funds could be make available for that 
purpose.  We should consider providing the same training to 
more than one Jamaican government entity when U.S. trainers 
are here.  The embassy also would appreciate being informed 
of the US legal regime (how does our government go about 
making investigations and processing suspected contract 
irregularies and what are the criminal penalties for 
violations).  In terms of strategy, the mission recognizes 
that anti-corruption also must focus on the upper levels of 
the GOJ.  Christie's is one of a few offices that can do 
that.  Probably future attention must be given to addressing 
the problem of weak penalties for violators.  Nonetheless, 
the CG already is exercising his power to keep the issue of 
official corruption in the public eye, which may translate 
into pressure for reform. End Action Request. 

HEG