Opposition Leader Ralph Thorne challenged Minister of Housing, Lands and Maintenance Dwight Sutherland over a $4 million repayment made by the controversial HOPE housing programme.
As the Estimates debate continued in the House of Assembly on Tuesday with the focus on the housing ministry, Thorne again slammed the Home Ownership Providing Energy, known as HOPE, describing it as “disaster”.
Thorne raised the matter of a $4 million payment to the Housing Credit Fund – a state fund that provided $60 million to HOPE to undertake several housing solutions across the country including on lands formerly owned by the collapsed insurance company CLICO International Life.
In a session that featured constant interruptions and friction between Sutherland and Thorne as well as several attempts by House Chairman Peter Phillips to control the proceedings, it was HOPE Chairman Colin Scaife who disclosed that the $4 million payment came from the sale of HOPE houses at Vespera Gardens in St James.
“I said this morning; HOPE is on a sustainable path indeed to utilise the liquidity within the banking system to allow it to create funding to repair the Housing Credit Fund from the mortgage monies received from clients. And that is the process that we have engaged in at HOPE. But I’m going to allow the chairman of HOPE because I know you want the chairman of HOPE to speak,” Sutherland told the House.
However, Thorne shot back “I don’t know who is the chairman. . . Oh, that’s the chairman?”
As Sutherland told the Chamber that the HOPE chairman would explain “the industrial process that is revolutionary”, Thorne insisted, “I asked about a repayment. I’m not interested in any industrial process or any innovation. I just want to know where the $4 million came from.”
Following several cautions issued to the opposition leader from the House chairman, Scaife who sat in the well of Parliament with other senior officials of the Ministry of Housing, Lands and Maintenance, stated: “To answer the question that was raised; sales revenues from the sale of the 72 houses at Vespera Gardens were used. The revenues were used to repay the loan. So, $4 million was paid from there.”
The contentious session however continued with Thorne then seeking a response from the minister on whether the HOPE houses were sold below cost or at a profit to the institution.
Stressing that a yes or no answer could not be provided, the housing minister explained “The houses are being sold at a cost below at which the market value them so that the homeowners can indeed achieve some equity in the homes. We sell houses and not infrastructure and land. That is why I’m saying that the PV, the photovoltaic on the roof that will come into play, will pay back over a 15 or 20-year period for the infrastructure and the cost of the land.”
Sutherland also outlined: “So clearly this model that we have articulated, and we have engaged in and we have revolutionised the housing market is geared towards poor people. The houses are being sold at the cost of which they are constructed.”
In response, the opposition leader told the Chamber: “We have the minister of housing in Barbados saying to the people of Barbados that the houses have been sold at cost. . . .Yet the honourable minister is telling the people of this country that [HOPE] realised the profit and that the $4 million has been paid out of profit. It’s not making a lot of sense.”
To this, the housing minster remarked that when a housing applicant qualifies for a mortgage the financial institution releases the funding.
He added: “But the money goes to HOPE. That is the model that all private sector companies are engaging in the joint ventures with NHC for years. It is a model that utilises the liquidity in the banking system.
“No one is disadvantaged. And so NHC is paid for lands that they would have invested into the joint venture partnerships at Atlantic Breeze, what will happen at Vineyard, what has happened years ago in West Terrace. The land is put in as collateral.” (IMC1)
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