By Balford Henry,
Staff Reporter
DR. PETER Phillips, Minister of Transport and Works, said yesterday that the controversial segment one of the Northern Jamaica Development Project (North Coast Highway) will be completed by next March at a cost of US$45 million ($2 billion).
This is US$20 million (J$900 million) more than the original contract with the South Korean firm Bosung Engineering and Construction Company (BECCL), which is being financed by the Japanese Bank for International Co-operation (JBIC).
But Dr. Phillips indicated that the additional sum would be financed out of a $3-billion provision under the Government's Deferred Financing Rehabili-tation Programme (DFRP) for road repairs this year.
Dr. Phillips made the disclosures as he responded to questions raised by Audley Shaw, JLP spokesman on Finance, during the final session of the Standing Finance Committee of the House of Representatives. The SFC had been studying the 2001/2002 Estimates of Expenditure since Tuesday, as a prelude to the Budget Debate which starts on Wednesday.
Dr. Phillips admitted that although the contract has been taken away from Bosung, which was accused of under-bidding and eventually failing to fulfil its requirements, the South Korean company is still being retained and paid as "attendants".
"Bosung is being paid a fee in order for us not to have to enter into new contractual arrangements particularly with the funding agency," Dr. Phillips explained.
He admitted, under questioning from Mr. Shaw, that Bosung was being paid "in effect a management fee" although the work was now shared out among several sub-contractors. But he said he preferred to describe it as "an attendance fee."
Asked whether Bosung was supervising the sub-contractors, Dr. Phillips said that was being done by his ministry.
He said the agreement for this segment of the NJD project, which involves the construction of a Negril-Montego Bay highway, was really between Bosung and the Japanese Bank for International Co-operation: "If you remove Bosung, then you will cause a situation where you will bring a close to that arrangement." He said that in that situation, the country could stand to lose the investment.
He said the Government had decided to modify the contract to keep Bosung on the job. It would provide the equipment and perform any other task required by his Ministry.
Mr. Shaw asked whether there had been a performance bond in the contract with Bosung.
Dr. Phillips said there was a bond, but admitted that there had been no attempt to invoke it because Bosung had not terminated the agreement, which would have been the basis for invoking it.
He said that the Government had to make a choice between a speedy conclusion of the project, or lengthy litigation which would tie up the highway for a long time. The highway should be substantially completed by December and completed by the end of the current financial year.
