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Grantley Adams International Airport Going PPP

With Christmas approaching how many Barbadians have registered the news that Grantley Adams Airport (GAIA) is going the route of a Public Private Partnership (PPP) to fund the running of the airport? This is an interesting move by the government; a new transaction for Barbados concerning one of our main ports of entry. As civic…

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With Christmas approaching how many Barbadians have registered the news that Grantley Adams Airport (GAIA) is going the route of a Public Private Partnership (PPP) to fund the running of the airport? This is an interesting move by the government; a new transaction for Barbados concerning one of our main ports of entry.

As civic minded Barbadians we must insist on transparency. Government has teamed up with the International Finance Corporation (World Bank) to help oversee the bidding process.

Reports indicate the government has received several offers from investors to invest $300 million in the PPP. This week we also learned that government granted a 5 year contract to a US-based firm to ramp up marketing of the island’s products and services at the Grantley Adams International Airport (GAIA).

The upside is that a good PPP will be a win win for Barbados by providing access to the investment to maintain a world class airport therefore relieving government of the ‘responsibility of allocating scare resources and/or attract more debt in times of austerity. The downside is that there must be transparency and Barbados has struggled in this area of governance.

 

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139 responses to “Grantley Adams International Airport Going PPP”

  1. peterlawrencethompson Avatar
    peterlawrencethompson

    @John A
    “It’s those magic words the IMF love.”
    +++++++++++++
    Exactly! In other words no benefits at all for any traveller or tourist or for the tourism industry.

  2. john2 Avatar
    john2

    Miller

    Where/when/what ever the efficient PPP come about, I hope it remember that the people in these areas pay taxes like everyone else and got to get to work, shopping and their personal business like the people on the short haul routes.

  3. John A Avatar
    John A

    @PLT

    What worries me is when we sell all we have and we don’t put the money we get to productive uses, what do we do then?

  4. Piece the Legend Avatar
    Piece the Legend

    @ Mr Vincent Codrington

    Earlier you posed what was a requoted question which was to Peter Lawrence Thompson

    “…@ PLT at 8:51 PM

    Good question. What are the benefits of this PPP ?…”

    $300 MILLION makes a minister a multimillionaire overnight AND WE ARE NOT EVEN CONSIDERING THE RESIDUALS!

    But I already know that the two of you gents are extremely bright and understand this rape of state funding really well.

    At 6.11 p.m. look how Peter Lawrence Thompson hinted at this augmentation of wealth to persons who oblongish features are singular!

    He says AND I QUOTE

    “…(2) The Private partner will get contractual terms which guarantee them a positive return on their investment over the term of the contract.

    This means that THEY will control the fee structures for both airline and passenger use of the facility even if the Government has significant board representation…”

    We have replaced one lot of thieves WITH ANOTHER MORE DEVIOUS SET but this set is lead by a RH DICTATOR!!!

  5. Hants Avatar
    Hants

    The Back up PM hard at work.lol

    ” Prime Minister Mia Amor Mottley kept him “very, very busy” helping Government on several matters, including the development of a new industrial policy, and the arrangements for next year’s United Nations Conference on Trade and Development (UNCTAD 15) quadrennial meeting here, October 15 to 23, 2020″

    https://www.nationnews.com/nationnews/news/242975/arthur

  6. Mariposa Avatar
    Mariposa

    A smart move by Mia with all intent and purpose to keep Arthur mout closed
    A nice hevy duty zipper Mia placed across his mouth at taxpayers expense
    Now he comes crawling out fuh a little breathing room to see what is happening to the economy
    Just wait till Mia get “wind” of what Arthur is saying
    Mia would figure a way to push his liitle short backside into a box until she feels it is necessary to let him go
    There is an old saying keep yuh friends close but yuh enemies closer
    The last i heard about Mia and Arthur there was no love lost between them two
    Arthur muh boy Alzheimer’s must be kicking in cause u seem to have forgotten those not so kind words you said about Mia
    My guess is Mia has not forgotten

  7. Miller Avatar
    Miller

    @ Mariposa December 5, 2019 1:52 AM

    That should teach you your final lesson in the lowlife class for yard-fowls like you.

    This is the same OSA who called the same woman a despot (in white) whose Daddy was not aboveboard in arranging his tax affairs.

    Politicians from both sides of the imaginary party divide are, at the end of the electoral day, like peas in the same tarnished pod of self-interest and corruption.

    Don’t be surprised if Freundel Stuart is given a knighthood, shortly, to add to his Muttley collection.

    It’s time, Ms Many Pussies, that you fire the ‘wuk’ as chief fowl and news carrier in that dilapidated backyard on George Street and put your faith in God instead of men and women of lies feeding from the cesspool of corruption.

  8. Jean Avatar
    Jean

    Good idea. How it is operationalize remains to be seen.

  9. Mariposa Avatar
    Mariposa

    Miller your comments true also make for good political satire u ought to stop wasting yuh talent on BU and run with the hounds

  10. John A Avatar
    John A

    Folks let be honest with ourselves and recognise the plan.

    Inflow of FX from agreement = IMF happy.

    Shedding of wages from AP and consolidation of civil service= IMF happy.

    If user fees etc are controlled hence their ROI is not excessive = Bajans happy

    If this doesn’t happen and they can charge what they like = IMF still happy but Bajans vexx as ass!

  11. Tee White Avatar
    Tee White

    Only people who are unfamiliar with the operation of PPPs any longer believe that they represent a cheap way of delivering services that have historically been provided by government. As Hal pointed out, the use of PPPs was pioneered in the UK. There they have now become discredited and recognised as a ‘pay the rich’ scheme which ends up transferring tax payers monies into the hands of private corporations with little value in return for citizens. When, as has happened in a number of high profile cases, the private company collapses, the government still has to step in and pick up the cost of clearing up the mess since the service that is being delivered is essential. For a detailed review of the UK’s PPP experience, google ‘The UK’s PPPs Disaster: Lessons on private finance for the rest of the world’.

    PLT’s opinion on how the PPP is likely to affect GAIA is very realistic. The other issue is that often the private companies will insist on a clause in the PPP contract which commits the government to making up any shortfall in the company’s revenue over the life of the contract. Without seeing the full PPP contract and being confident that there are no secret clauses, there will be no way for Bajans to know exactly what has been agreed for GAIA.

    There is a myth out there that services delivered by the state by definition have to be inefficient. This is quite simply not the case. On a recent visit to Barcelona, I was very impressed by the local government run transport system, which integrated clean air-conditioned buses, metro and cable cars and which ran efficiently. Nearer to home, the airport in Antigua, which in my opinion, is the most modern in the eastern Caribbean is run by the state in the form of the Antigua and Barbuda Airport Authority. One of the big problems we have with state administered services in the Caribbean is that these fall victim to the system of ‘representative democracy’. The winning party see them as spoils of war to be handed out to their supporters on the basis of yardfowlism. This leads to a culture of corruption and lack of accountability which rot these organisations from within. Handing them over to private companies so they can gouge more money out of them is a solution as bad as the problem.

  12. Vincent Codrington Avatar
    Vincent Codrington

    @ Tee White

    Very true.
    I do not understand why with all these examples of failed PPPs that Barbados, at this stage of our development, would seek to go this route. These contradictory ,counterproductive policies indicate a high level of confusion and indecisiveness about the national vision.

  13. Vincent Codrington Avatar
    Vincent Codrington

    @ Hants at 12:42 AM

    Behave yourself nuh! Every Sheriff has a Deputy. There is only one Barbados. Do you expect us to cut off our noses to spoil our features? When you are good , you are good.

  14. Vincent Codrington Avatar
    Vincent Codrington

    @ Hants

    I preferred OSA used the term Economic Transformation Process. I do not see industries complementing a low carbon foot- print strategy. Unless the latter is just another “Buzz”word.
    @ John
    In passing how many acres of land,using photo voltaic panels, would it take to generate the amount of KWH we currently use?

  15. Sargeant Avatar
    Sargeant

    There is no need for me to add to the previous comments regarding increases in costs to the traveler as increased landing fees etc. are passed on to travelers. Upgrades will include jet bridges and I can see Red Caps becoming an endangered species. Wasn’t there some issue about Barbados’ ranking as an airport vis a vis others in the hemisphere? The Gov’t doesn’t have the funds to tackle many upgrades so we can expect it to farm out to others the only consideration is whether it will obtain a good deal and as they say “the proof of the pudding is in the eating”

  16. Piece the Legend Avatar
    Piece the Legend

    @ Mr Vincent Codrington

    As usual you are kind with your words when you say

    “… These contradictory, counterproductive policies indicate a high level of confusion and indecisiveness about the national vision…”

    There is nothing here that is based on confusion and indecisiveness

    These people who we have consistently elected ARE THIEVES!!!

    Therefore, with every change in administration, they think of a process to “get theirs”

    Politics IS THE NATIONAL LOTTERY FOR 30 POLITICIANS, THEIR FAMILY AND FRIENDS!!!

    let me see if de ole man can design a new model for the People’s Party for Democracy and Development

    Every year, in order to serve x hundred thousand travellers the GoB spends y dollars.

    Y will be all direct and Z will be indirect costs. INDIRECT COSTS REFER TO THINGS LIKE COSTS INCURRED WHEN PEOPLE CANT GET TRANSPORTATION TO GET WORK etc.

    So Minister Drakes who is going to be the PdPs Minister of transportation will be paid a salary based on her ability to control Y and Z.

    She has to perform!

    So you, with your sharp wits will say “Piece that performance based compensation contract sounds good BUT DRAKES IS NOT IN POWER therefore I cant test her competencies”

    To which I will respond.

    You will be able to because Drakes, under the PdP model de ole man is insisting on HAS TO SHOW HOW SHE, as shadow minister, was able to run a small transportation project in some community in Barbados THAT CAUSED SAVINGS IN THE TRANSPORT SECTOR.

    And we have to see verifiable evidence, de ole man back to DELIVERABLES and if Drakes or any one of the PdP shadow ministers CANNOT PRESENT THESE, we dont want them either!!!

  17. Piece the Legend Avatar
    Piece the Legend

    @ the Honourable Blogmaster your assistance please with an item here thank you

  18. Hal Austin Avatar
    Hal Austin

    @ Tee White

    You have hit upon the corrupt narrative of the ideologically biased – public sector management, bad; private sector management, good. I worked for a FTSE 100 company and it had some of the worst management I had ever experienced.
    Incompetence is incompetence, it is not right or left, private or public. Nearly all the top executives responsible for the 2008 financial crisis had MBAs.
    We must train our managers and the institution to be in the forefront of that training must be the UWI. This is one of the failures of our state. No excuses.
    I must add, have a look at Carillion for how a PPI can go bell up and how the much despised state had to pick up the pieces. Whatever happened to Dodds?

  19. NorthernObserver Avatar
    NorthernObserver

    Merely a convoluted way to keep Debt off of the Government’s books. Improves the Debt-GDP ratio on both sides. A large number of services offered are already private. And many public ones, will remain public, Customs, Immigration, Health Inspection etc etc A method of attracting private funds for investment, by giving up various revenue sources. Happens when monetary and cranial challenges collide.

  20. David Avatar
    David

    @Northern Observer

    As usual you make a beeline for the heart of the matter.

  21. John A Avatar
    John A

    @ Hal

    While your concern over the PPSs is a genuine one that doesn’t mean it has to be the rule. After all everytime you fly out of the UK don’t you fly out a PPP run airport?

    How much money does our SOEs cost the tax payers collectively in a financial year? As the old people say if you don’t pay one way you pay another. We need to shed these money pits as they come back every budget to bite us in the form of new taxes.

    If we leave it as is what will magically change to stop the money pits from draining us? Will their financials magically be all brought up to date? Under both the Ds and Bs the SOEs have proven to be dismal failures. Dont you think it’s time to try another approach?

  22. Hal Austin Avatar
    Hal Austin

    @John A

    No. We need competent government, not foreign gangster capitalists.

  23. peterlawrencethompson Avatar
    peterlawrencethompson

    @John A
    “…the SOEs have proven to be dismal failures. Dont you think it’s time to try another approach?”
    ++++++++++++++
    Our public transport system is also a type of PPP and that is also a dismal failure. Most of the private sector in Barbados, with record low levels of R&D and no innovation, can also be described as dismal failures.

    We need to examine the specific needs of the airport and match them to specific strategies for progress, not chase after this ill conceived PPP panacea.

  24. John A Avatar
    John A

    @Hal
    @ PLT

    Ok so let’s say we need competent governance. If over the last 25 years and both parties these entities under the SOEs have show steady decline and massive losses, where is this governance going to magically come from now?

    Secondly this will happen because of our need for hard currency as well. Remember we are under the IMF hammer now. You fellows need to realise the environment we are in and understand we have no wriggle room on issues like these.

    Don’t get me wrong I am not saying this is the best solution, what i am saying though is that in our current situation it is our only solution that will be acceptable to all involved.

  25. Hal Austin Avatar
    Hal Austin

    @ John A

    You clearly do not understand how PPIs operate. There is no foreign currency, no improved management, it is simply legalised mugging of Barbadian taxpayers. Plse read the Carillion report. Stop trying to re-invent the wheel.
    It was the Tony Blair government who gave PPIs currency and we have had a lot of experience of them. That is why they have failed in the UK, the laboratory for the experiment. Of course, Bajans can always work magic and prove them a success.
    When are Bajans going to learn from the experiences of others? NO TO PPIs. They are fraudulent.

  26. peterlawrencethompson Avatar
    peterlawrencethompson

    @John A
    You are sure that PPP is the solution but you don’t even know what the problem is. The runway is already long enough for any aircraft in the world. What is the specific problem that the PPP is intended to fix? I can tell you… the only problem that it will fix is that the Minister or PM will get their name on a plaque on some overpriced but totally unnecessary capital infrastructure.

  27. WURA-War-on-U Avatar
    WURA-War-on-U

    Your leaders are WICKED and EVIL…

    Did they tell you who owns a company called Prison Construction Services in Barbados, did they tell you it is owned by Bizzy “gimme’ the crook, did they tell you who sits on the board….well ICIJ could tell you what’s going on…no wonder your dirty leaders are creating a society of black criminals to enrich minority criminals….look at the date the company was registered then compare it to when the Glendairy PRISON BURNED DOWN….when Mia was attorney general…for years i have been hearing it was deliberate…NOW WE KNOW..

    Get rid of these dirty skunks…you are being SET UP…AGAIN..your children and grandchildren are being set up to be criminals rotting away in prison to enrich dirty minority thieves.

    https://dl-mail.ymail.com/ws/download/mailboxes/@.id==VjN-kAjT35lQ76G4Hq7yerhZdOH2-TCkJT4Kq1yp6F9rXEG67zX20BrVF6AwMaFv1Djp6F676llwJijNHGM9Rx73ng/messages/@.id==AI0UU7Yb_S5mXelPDAZ4QMfGoOc/content/parts/@.id==2/raw?appid=YMailMini&ymreqid=e200d60b-fbe9-eb54-1c49-5a000001d000&token=zitEzqOML3j84e6ealFTT5U7-km5qEQF52lp7AcCuBYSwfVcpvcpAQqKQzR1DPTvynTuP00JH-oKGhSlHWVKRee9vg65KgTk307MJeCvRWUGYHG5zZROOYeWZBW-NzAx

  28. WURA-WAR-on-U Avatar
    WURA-WAR-on-U

    Prison Construction Services was registered in Barbados on May 5, 2005..

    your black leaders continue to SET YOU UP.

  29. John A Avatar
    John A

    @Hal

    You say the PPPs are fraudulent so what are the SOES?

    6 buses missing. Double billings being paid for the same repair job, Water tanks being rented for as much monthly as some houses, are these not examples of fraud? Or are these examples of management we wish to duplicate?

    So tell me how would you restructure these SOEs to suddenly make them function after 25 years of failure under both parties?

    If the PPP type plan is wrong please tell me how you plan to make the SOE plan right! You object to an alternative when what we have is a dismal failure and a drain on the tax payers wallet.

  30. David Avatar
    David

    @John A

    There are decisions and approaches that will have to be taken based on the state of play. What has to be done is to ensure the solution is structured properly. Whole sale positions will never wash.

  31. John A Avatar
    John A

    @ David.

    I agree with you but we all know the SOE approach has proved useless. Were their financials up to date it would not surprise me if their combined losses didn’t top $200M a year. How in God’s name can we afford to even consider carrying on with this farce, while at the same time taxing the bajan to the grave so as to keep these leaches going?

    An alternative must be found and not tomorrow but today.

  32. David Avatar
    David

    @John A

    Are you referencing the GAIA? Are the financials not up to date?

  33. Tee White Avatar
    Tee White

    @ John A
    I sense the exasperation you are feeling with the current situation and sympathise with it. A couple of weeks ago when we had neither electricity (private company) nor water (state operated enterprise) I remember feeling can this be Barbados in 2019. But I think your exasperation is leading you to clutch at straws. PLT, Hal and others have clearly explained why the proposed PPP for GAIA is not rational and cannot serve the interest of Barbados. But the points you make about the dysfunctional state of governance in the country are also valid. The thing is that there are no easy fixes. Only when a sufficient number of Bajans decide that we need something different and commit to bringing it about will we see the change we need. In my opinion, this day is approaching and the wiping out of the DLP at the last election is a sign of what is coming.

  34. John A Avatar
    John A

    @ David.

    No i am speaking about SOEs in general. Name one that functions like a business, has up to date financials and is is self sufficient in that it does not require inputs annually from central government.
    Just one!

  35. David Avatar
    David

    NPC

  36. John A Avatar
    John A

    @ Tee

    I am not saying that the PPP is the perfect answer, but I am saying the SOE based on historic performances over 2 parties and 2 decades isn’t either.

    Let us agree there is a cost to providing a service. If the entity is inefficient and can’t carry its weight who ends up carrying it? Central government but where does Central governments funding come from? You and me and every other tax payer.

    Let’s take one example of a market where private and public sector worked for the same return in the same economy and that is public transport. At $2 bds the old fare, PSV owners were not only making money without any subsidy but expanding their fleets. At the same time according to the last MOF, the transport board was losing $5million a month. So you and me along with thousands of others were paying $5M more in taxes than we needed to each and every month.

    So that brings us to where we are today and it’s the reality that the SOE approach is a failure, yet we want to oppose other approaches which would remove liability from governments books. Remembering of course that government has no cheque book other than our taxes.

    What I am saying is we are holding onto a dinosaur here and in the process ever single Bajan is being overtaxed as a result.

    As for looking at the UK ask the critics from there why every single Airport up there is run under a PPP arrangement?

    The reality is we tried the SOE style it failed and over the years have costs the taxpayers billions. How much more we need to lose before we accept it and move on.

  37. John A Avatar
    John A

    @ David

    And why does NPC claim to make money? Oh yes we pay more for gas than any other Caribbean islands. Again the foolish taxpayer carries the burden.

  38. Hal Austin Avatar
    Hal Austin

    @ John A

    Two wrongs do not make a right. The answer to incompetent management is not crooked investors. Let me explain: PPI are a blank cheque book for crooks.
    This government is caught between a rock and a hard place. Its ill-advised default has removed it from global capital markets; if it needs to carry out big capital projects the obvious way is by PPIs, in that way it gets the work done, gets the debt off the government’s balance sheet, and the liability then becomes the responsibility of future generations. They are not fools. They have their advisers.
    But for the ordinary taxpayers of Barbados PPIs are scams for all the reasons explained.

  39. WURA-WAR-on-U Avatar
    WURA-WAR-on-U

    If you were’nt able to open the link before because i got it opened on two devices but not the third, this one opens just fine.

    https://offshoreleaks.icij.org/nodes/100325273?fbclid=IwAR1iPPdFSoSYTwBm7MSK16u2UZuMvlOKHl5RgEYdnnXJVwAB125BDO2FkNM

  40. WURA-WAR-on-U Avatar
    WURA-WAR-on-U

    All the minority thieves WHO SHOULD BE IN PRISON THEMSELVES…helped built a prison to lock up Black Bajans so they can line their pockets with their wicked house negros..

  41. John A Avatar
    John A

    @ Hal

    The problem is our back is to the wall for all the reasons you and I mentioned. Plus don’t forget the PPP also makes the IMF happy.

    I am not saying that the PPP is ideal but In our position with 20 defaults and new masters serving, what option is there right now?

    It’s a case of dam if you do and dam if you don’t.

  42. David Avatar
    David

    Before the SD Barbados was at junk status and therefore unable to play in the capital market except to accept usurious terms so what is the point?

  43. Hal Austin Avatar
    Hal Austin

    @ John

    Simple. Cancel the so-called airport concession. Long haul tourism is history, we are wasting money. Bajans in the Diaspora only travel to Barbados to see friends sand relatives, not for the island’s beauty.
    Remember climate change? Ignore the economic illiterates.

  44. peterlawrencethompson Avatar
    peterlawrencethompson

    The theoretical discussion of the trade-offs between incompetent public companies vs corrupt private companies is fascinating, but entirely beside the point.

    The point is GAIA: what are the problems and what are the solutions?

    I believe GAIA is profitable. The most recent annual report I can find is 2013… although I haven’t made time to study it yet. https://www.barbadosparliament.com/uploads/sittings/attachments/f0afe822bbf42ed600570d0e2a44079e.pdf

    Why would it be good for Bajans to give that cash flow away to foreign crooks?… no matter how efficient they are their primary role will be to fleece us.

  45. peterlawrencethompson Avatar
    peterlawrencethompson

    Here is the GAIA 2015 Annual Report; still profitable here.
    https://www.barbadosparliament.com/uploads/sittings/attachments/Grantley%20Adams%20International%20Airport%20Inc%20Annual%20Report%202015.pdf

  46. John2 Avatar
    John2

    Make the workers profit sharing partners.
    Raises and bonuses according to profit/productivity and attendance

  47. peterlawrencethompson Avatar
    peterlawrencethompson

    @John2
    But what are we trying to fix by making workers profit sharing partners?

  48. David Avatar
    David

    According to the minister the airport needs investment to make it world class or the buzz phrase- fit for purpose. Northern Observer made the good point that farming out GAIA under PPP relieves government from booking the debt. Respond to the proposed objective of the exercise. Bear in mind the government is broke.

  49. John2 Avatar
    John2

    productivity for one

    And that wasn’t mean for the airport alone but for the other SOEs

  50. Chris Halsall Avatar
    Chris Halsall

    @All…

    Not all public companies are incompetent, nor are all private companies crooks.

    There are some /very/ well run companies (both public and private), who actually take ethics into consideration during their decision-making processes.

    I know this won’t go over well, but in my opinion, BL&P is an example of a well-run company providing an essential service while only being allowed to earn 10.48% ROR. Before people bite my head off, how much do LIME and Digicel make? The latter two are both also “regulated”, and in some contexts also provide an essential service.

    It would be good if the public understood the terms of the PPP agreement with regards to GAIA, including the deliverables (and the reasons for the same). Again, another excellent opportunity for transparency.

    My apologies if this comes across as sanctimonious.

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