NESol slush fund
FOR THE record, I was the board chairman of the Rural Electrification Programme (REP) between 2012 and 2016. During the 2015-16 financial year, the REP broadened its mandate and changed its name to National Energy Solutions Limited (NESol).
As I indicated in a previous article, titled ‘Petroscam’, NESol is a tiny project-management company with a broad mandate to provide electricity to those far removed from the national electricity grid by utilising renewable sources of energy, especially solar, wind, and biomass.
The REP was set up in the heady days of the 1970s as a programme of the JPS to extend the national electricity grid. When I became its chairman in 2011, the board ordered a study that found that the mandate had been largely fulfilled by 97.5 per cent of the island now connected to the national electricity grid. In general, it was also determined that the cost to connect the remaining 2.5 per cent of the island to the grid would be approximately J$9b, which was thought to be unavoidable, using traditional methods.
It was, therefore, thought necessary to expand the mandate of the agency in order to achieve 100 per cent coverage of the island (as access to electricity had risen to the level of a human right). With NESol, two additional goals could be achieved.
The first mandate would be the domestication (at the level of households) of the use of non-fossil fuel energy sources. This would have the effect, over time, of reducing Jamaica’s carbon footprint. The second mandate of NESOL was to target certain low-income communities with energy solutions.
During the four years under my watch, the Ministry of Finance barely allocated more than J$110m, which was essential for recurrent expenses. Much of what was spent by REP-NESol was what was earned as a result of its leveraging of its cadre of engineers and the project-management facility of NESol to carry out various projects at a modest profit.
I recently discovered that all of this changed in the 2017-18 fiscal year when there was a massive increase in the allocation of funds to NESol by the Ministry of Finance. The budgetary allocations for 2017-18 and 2018-19 were J$486m and J$514m, respectively. There has been project funding from the TEF; special street lighting; USF for community access points and from the Energy Efficiency Fund, through the JPS, in a project called Street Lighting, Loss Reduction and Community Renewal. It, therefore, meant that the funding available to NESol has jumped to more than J$1b in just two fiscal years.
DETERIORATION IN TRANSPARENCY
What is also apparent is that the same period has been marked by the removal of key staff members and the promotion of others in areas beyond their training or experience. There has been, as well, a deterioration of the transparency and governance administration in the hiring of staff, the selection of subcontractors, and in the general probity and accountability in the processing of expenditures and disbursements. If ever there was a need to follow the money, this is it – at NESol.
It has been painful to see good work at NESol go up in smoke.
This is the rub. A new post was created for a certain gentleman who, if the allegations against him are to be believed, has no engineering qualifications, has only now distinguished himself, having been made to function in a post created for him, complete with signing authority. The best that could have been said of him is that he is an also-ran. He did not distinguish himself for good or for bad. As Tony Brown said in his testimony at the PAAC when he was asked, “I am working and he is working.”
Before the chief engineer was sent on leave in March of 2017, the new operations engineer was appointed and given authority to sign cheques. The letter appointing him indicates that he was responsible for all engineering projects and that he reported directly to the managing director.
During the same 12-month period in which the energy ministry declined to support the upgrade of the position, it had a change of heart and allowed for the new HR manager, who has since become the managing director. A certain media house has provided not just key staff members in the new administration of NESol – connected parties to that company have more than J$60m worth of NESol contracts.
The question is, was all of this by accident or design? Why quadruple the budget of the REP? What about the many new appointments? With one staff member of NESol and one subcontractor charged for money laundering of J$85m, do we know what mechanism was in place to prevent that money from being siphoned off from NESol, or has NESol become another of what Dirk Harrison once called a “corruption-enabling mechanism”?