Rent row retreat

PRIME Minister Dr Andrew Holness has announced that the Government will initially limit the National Reconstruction and Resilience Authority (NaRRA) to one floor of the Digicel building, cutting the amount of office space originally planned for the agency following public outrage over the roughly $115-million annual rental cost of its headquarters. But in an immediate response to the Jamaica Observer on Wednesday, Opposition spokesman on finance Julian Robinson rejected the Government’s decision, saying it did not go far enough. “My view is that it’s not good enough. I think the lease must be cancelled fully and the Government must find existing office space. The Government has hundreds of thousands of square feet of office space around the country. A lot of it is not being fully utilised and they must use space that exists instead of renting space. There’s no justification for that in this climate,” Robinson said. He also dismissed the Government’s argument that NaRRA needs a disaster-resilient building to carry out its work, questioning whether that requirement falls within the authority’s mandate. “Jamaica is in the worst fiscal position we have been in for about 10 years. We are $31 billion below budget. Our borrowing is almost $70 billion more than projected. There are people who are living in Westmoreland, St Elizabeth, and St James and they’re under tarpaulin, and we’re going to spend their money to lease an office and we don’t even reach the cost of NaRRA in terms of staff and all of that. Madness!” he said. Holness, on Wednesday, said the move is intended to reduce the immediate cost of establishing NaRRA, while allowing the authority to begin its work with a smaller operation. “Instead of doing the two floors where you would roll out the organisation as quickly as you can, we’ll start with one floor, and people there will have to double up and work fast and earn the credit of the trust,” Holness said during an Office of the Prime Minister retreat at Terra Nova hotel in St Andrew. The decision follows public backlash over the cost of the five-year lease for NaRRA’s proposed headquarters at 14 Ocean Boulevard in downtown Kingston. The authority announced on Monday that the lease was based on a rate of US$26 per square foot, with an annual cost of US$725,972, equivalent to about $115 million. The controversy has unfolded as thousands of Jamaicans remain in need of assistance following Hurricane Melissa — which demolished large sections of western Jamaica last October — including people awaiting roof grants and others still without shelter. Holness said he understood why the cost of the lease had caused concern, particularly when placed alongside the outstanding needs of hurricane victims. “The announcement of the lease is understandably met with concern. Because it could appear as if the Government is giving expenditure priority to the establishment of NaRRA versus paying the grants and taking care of persons who have not yet received any benefits from the Government or are now currently without shelter,” he said. Holness maintained, however, that the decision to use the Digicel building was not based on comfort or luxury, but on the need for NaRRA to continue functioning during a disaster. He said the authority, which is responsible for supporting Jamaica’s reconstruction and resilience efforts, needs headquarters that can withstand hurricanes and earthquakes, remain operational after a disaster, and accommodate its various functions in one location. He said the Digicel building was originally designed for a utility company and was therefore built to support a high level of operational continuity. Holness also defended the cost of the lease. “The price of the building, you know, that is a market reality. When you look at where it fell in terms of the range, it’s average. In fact, before NaRRA could have engaged in the lease, my understanding is that it would have had to be reviewed by the National Land Agency,” he said. He added that while he believed there could have been further negotiations, the Government ultimately had to reach an agreement because NaRRA needed to begin operating. The prime minister said the greater concern now was not simply the rental cost, but the effect the controversy could have on public confidence in the new authority. “I spent a lot of time this morning going through it with [NaRRA CEO] Ambassador [Antony] Anderson and the team, and we have decided to seek a review of the lease with the leasing company to revise the lease, and to also scale the staging of NaRRA,” Holness said. He shared the Government had initially intended to move quickly with a full launch so that NaRRA could begin delivering projects as soon as possible. However, he said the controversy over the cost of the headquarters could become a distraction and weaken public support for the authority. Meanwhile, Information Minister Senator Dr Dana Morris Dixon, speaking at the post-Cabinet press briefing, also on Wednesday, confirmed that the Government had instructed NaRRA to reduce the amount of space it will use. She said the change could also mean that the authority hires fewer people at the start and takes longer to reach its intended level of operations. “Having listened to the sentiments of Jamaicans, there would have been meetings between yesterday and this morning in terms of how to move forward. So the plan is wherever NaRRA is, it will be using less space. Right now it’s looking like it will still be in that same building, but scaling down the scope and the size of space that will be used,” she said. Morris Dixon also addressed questions about why NaRRA could not use other Government space, including the building previously occupied by the Ministry of Legal and Constitutional Affairs on Fairway Avenue in St Andrew. She said that the ministry had since been merged with the Ministry of Justice and that the former office space was no longer being used because of problems with the building. “They had to come out of the lease for that specific space that you’re speaking to, and from my checks this morning, it had to do with issues of leaking in the building, and also significant electrical problems in the building,” Morris Dixon explained. “So that staff is actually now being housed in a gym in the offices of the Ministry of Justice. So I always say you have to get your information from credible sources. This morning, I had to reach out to the Ministry of Justice to get an understanding of that because I saw that on social media. But that team is no longer in that building because that building was not suitable, even for the team that was there,” she added. Morris Dixon also said original space requirements for NaRRA were based on an expected workforce of between 100 and 120 employees, along with engineers and consultants who would periodically come to Jamaica as part of reconstruction efforts. For now, Holness said the Government’s priority was to reduce the immediate cost while ensuring that NaRRA could still begin its work. “So the public can be assured that we are not wasting your funds. We hear what you say. We will cut it back. It will have an impact on how we will be able to deliver the things you actually want. But we understand that,” he said.