Premier McKeeva Bush yesterday accused the Auditor-General of acting like a hitman – guilty of bureaucratic interference and harassment.

The astounding comments came after Alastair Swarbrick blamed the country’s leader for dodging financial regulations and costing the public purse almost half a million dollars.

He said the Government paid nearly half-a-million dollars in extra fees for a loan, while routinely violating regulations governing tendering and procurement, also affecting creation of a CCTV network and the 2009 Cayman Jazz Fest.

In his latest report, released to the public yesterday, Auditor-General Alastair Swarbrick blamed Premier McKeeva Bush for dodging financial regulations and negotiating an ultimately failed $155 million loan in 2010 from New York-based Cohen and Company, costing the public
purse $450,000.

In the same report, Mr Swarbrick also criticised procurement of government’s closed-circuit television system, saying the business case for the $2 million network had been weak, relying solely on an analysis of implementation and operations by the Royal Cayman Islands Police, but not cost options.

The process was further compromised by a $344,000 advance payment to The Security Centre contractor, the report said. Mr Swarbrick criticised change orders implemented by the contractor, but not properly specified in the contract; and the questionable division of the agreement into three separate documents of just less than $50,000, thereby skirting legal requirements that the Central Tenders Committee (CTC) scrutinise contracts worth $50,000 or more.

Finally, the report found the $1.2 million Department of Tourism contract for 2009’s Cayman Jazz Fest was neither tendered nor reviewed by the CTC; that work started before the contract was signed; that the department paid in advance for a number of services; and that the BET Event Productions contractor did not gain written approval for expenditures on hotels, artists and other suppliers.

“The premier said that he would save $24 million with the Cohen loan,” Mr Swarbrick said, noting that Mr Bush disregarded Ministry of Finance and CTC recommendations that government accept bids by First Caribbean International Bank (FBIC) and the Royal Bank of Canada (RBC).

Overriding that advice, Mr Bush paid legal and arrangement fees to Cohen that were $147,000 more than those charged by FBIC, which ultimately provided government’s long-term loan.

“The contract with Cohen and Company did not provide a loan as the original tender requested,” Mr Swarbrick wrote. “The contract was awarded without going through an open tendering process while disregarding the advice of officials.”

Mr Bush hit back yesterday afternoon, however, saying Mr Swarbrick was “biased” and that his 33-page report was “coming from an individual who is partially informed, spiteful and guilty of bureaucratic interference and harassment”.

“He has not considered the total cost of the matter, and is trying to make me look bad, going at length to say ‘’me’ and not mentioning ‘Cabinet’,” he said.

Had Cohen fulfilled its contract, Mr Bush said, “I steadfastly maintain that the 4.5% interest rate cap, at a cost of $4.8 million, would have saved $24 million and would have justified not taking the offer by First
Caribbean and RBC.

“I never interfered with the CTC and always worked through [Financial Secretary] Ken Jefferson. I made no decisions on my own and have not tried to hide anything. I went to the Cabinet and to the public via the media and the Legislative Assembly. I was trying to get the best costs we could get for the people of this country,” he said.

The Auditor-General was “being used as a hitman,” Mr Bush said, promising, “they will be exposed soon” in a forthcoming statement.

Saying it was ”not my decision” — and that his 11 recommendations to remedy loopholes in procurement processes had only “just been referred to the LA at this point” — Mr Swarbrick said he was not contemplating legal action, but would wait for his office’s oversight body, the Public Accounts Committee (PAC).

Chairman of the committee, Sister Islands MLA Moses Kirkconnell, said the PAC and Mr Swarbrick would meet on 6 September, but were unlikely to consider the new report in any detail.

“We are backed up six months with reports, so our objective is to get through all the work we have not had a chance to look at.” Mr Kirkconnell said. “It’s up to the members to decide, and while this report will be discussed a bit because of the public interest in it, we will be setting up a schedule of meetings. We have a whole process to go through.”