Editorial | Beyond Edward Gabbidon
Jamaica
It is not clear if Edward Gabbidon jumped or was pushed. Only a week ago, Prime Minister Andrew Holness was insisting that he had full confidence in Mr Gabbidon’s chairmanship of the Government’s cash-rich vocational training agency, HEART/NSTA Trust.
Mr Gabbidon’s resignation this week underlined not only a significant error of judgement by the prime minister when he made the appointment four years ago, but the need for greater transparency, sometimes beyond what is specifically required by law, when people are asked to become governors of public institutions, especially ones with which they do substantial business.
Further, the Gabbidon matter deepens the case for a hard look at the management and operation of HEART, which, Mr Holness conceded, is not performing in accordance with its mandate. It insists, too, on the urgent promulgation and implementation of the regulations, recently approved by Parliament, governing who, and how, appointments should be made to the boards of public entities. In other words, the 10-month delay in bringing the rules into effect should be substantially shortened and, where possible, made immediate. Indeed, Mr Holness should perhaps consider instructing his ministers to dissolve all existing boards within their portfolios and name new ones, in accordance with the requirements of the new regulations.
Mr Gabbidon, apparently, is a successful businessman. He is CEO of an IT company named SynCon Technologies. SynCon was doing business with HEART for more than a decade before Mr Gabbidon became the latter agency’s chairman in 2017. Indeed, between 2006 and earlier this year, according to information accessed by this newspaper from HEART, SynCon won $303 million worth of business from the institution from 196 contracts. Many were on the basis of limited tender.
With respect to the current imbroglio, 44 per cent of the business, by value ($136.4 million), which SynCon received from HEART came during the period of Mr Gabbidon’s tenure of chairmanship – the past four years. No one, though, has claimed that HEART did not get value for the money it spent. Mr Gabbidon insists that he always acted with integrity.
However, it emerged earlier this year, through reporting by this newspaper, that in 2019, HEART’s internal procurement committee raised concerns about a limited tender contract for which SynCon was the recommended supplier. There were conflict of interest considerations with respect to Mr Gabbidon, the committee felt, for them to raise a red flag.
The committee’s request for advice/direction from HEART’s internal lawyer, Desrine Pearson, largely elicited a treatise on whether Mr Gabbidon had adhered (which Mr Gabbidon says he did) to the agency’s policy of presenting a declaration of interests and affiliation, notwithstanding what the committee members felt about the details of information that was captured in the established format. The lawyer also suggested that in the specific case, the central question was whether SynCon had received an “unfair competitive advantage”, which required evidence that there was “some collusion between the person with responsibility for the process and the winner of the bid”.
Having concluded that, on the basis of the information presented, there was no case of a conflict of interest, Ms Pearson nonetheless quoted what HEART defines in its handbook as a conflict of interest: “A conflict of interest is where a public officer has a private or personal interest sufficient to influence, or appear to be capable of influencing, the objective exercise of his office duty.” In the event that such a situation arose, it is to be reported to the agency’s directors, via the chairman.
Appointment would have been better not made
This definition could not be intended for selective application; that is, to be adhered to by staff but not board members. In which event, judging from the number of contracts SynCon received from HEART, the interpretation of HEART’s definition of a conflict would have frequently pertained to Mr Gabbidon – at least among HEART’s staff members. Both Mr Holness and Mr Gabbidon should have been attuned to this likelihood at the time of Mr Gabbidon’s appointment to the HEART board. In the circumstances, it is one that would have been better not made or accepted. An administration heavily tainted by the perception of corruption would be expected to avoid further presumptions of cronyism.
Conversely, in a small country where talent and skills are scarce, when appointments are being made to public boards of people who do business with the agencies or enterprises of which they are being made governors, it might be useful if those relationships (and those of connected parties) are disclosed upfront. Additionally, it would also make sense for public bodies to consider establishing registries, available on their websites, of contracts entered into with board members and connected parties. This would make information more easily available to which the public is entitled and can get, though generally after enduring the bureaucratic and delaying hoops of an access to information request.
It is, however, not only the overarching governance of HEART that needs attention. What the agency stands for, what it does and how it spends taxpayers’ money needs an in-depth probe. HEART also requires a cultural overhaul.
Unlike most public institutions that depend on the finance minister for their financial well-being, HEART, financed via a three per cent payroll tax, has access to large amounts of money. It collects over $12 billion a year. Its managers, seemingly giddy with cash, do not spend it well. No one seems particularly accountable. For instance, over five fiscal years to 2018-19, HEART spent $30.5 billion training over 232,000 young people in various skills. Only 44 per cent of the cohort ‘graduated’.
There is also no clarity of where the agency stands in the government education and training systems. And frankly, after its many add-ons of recent years, the agency appears to be a mishmash without vision or direction. That needs fixing.
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