Leonardo Blair, Staff Reporter
AS THE debt crisis crippling the construction sector deepens and with Govern-ment's massive debt to firms running at more than half a billion dollars, at least one company is reporting it may be forced out of business.
George Lechler, director of Explosive Sales and Services, said that his 32-year-old company was sub-contracted to work on the North Coast Highway Improvement Programme.
His employers, Argentinian firm Jose Cartellone Construcciones Civiles, S.A. have been lagging behind with payments in excess of $4 million.
"We have not been paid by the main contractors. They tell us they cannot pay us because the Government has not paid them. As a consequence, we cannot pay our statutory deductions to Government. As we are delinquent in our payments to Government, our Tax Compliance Certificate has expired and we can no longer import the materials to do our work. "We are faced with voluntary liquidation or bankruptcy," said Mr. Lechler.Project manager at Jose Cartellone, Gerardo Adaro, was unavailable for comment last week however information from the Ministry of Transport and Works' website indicate that the Highway project was estimated to cost some US$85 million and 70 per cent of that amount was being funded from an Inter-American Development Bank (IDB) loan.
An IDB representative told The Sunday Gleaner that the agency was monitoring how the loan funds were being spent but declined to comment on its findings.
Albert Nakash, one of the directors at Nakash Construction and Equipment Limited, said motorists travelling along the Sandy Gully Bridge along Spanish Town Road will have to wait until Government pays up before the work is completed.
When The Sunday Gleaner visited the site on the weekend, one side of the bridge was completely stripped exposing only steel beams while traffic was forced into single lanes in opposing directions.
Government's $10 million debt to Nakash's company has left him puzzled as, he said, he was told that the project was being funded from already earmarked funds.
"They have been telling us that they don't have any money. We started one contract in October and up to now, not one penny. It's very tight right now. We haven't paid our creditors. I would say my business will be in trouble if we are not paid in another month. They told me that my contract was safe and it would not be affected by the debt. Why sign new contracts when you don't have the money?" said Mr. Nakash who claimed that all Government contracts have been stalled for more than a month now.
Another contractor who did not wish to be named for this story, admitted that the situation was tough at the moment but said they would ride the waves as, "Government's money is sure, no matter how long it takes."
The debt owed to Government-paid contractors stretches over two years, says Don Mullings, president of the Incorporated Masterbuilders Association of Jamaica (IMAJ).
"Everything they (the contractors) are saying is true. I am so disappointed. I think our country is going through a rough time but the contractors are under pressure," he said.
At a meeting last Tuesday involving the Incorporated Masterbuilders Association of Jamaica (IMAJ), the Ministry of Transport and Works and the National Works Agency, the concerns of the contractors were raised by the IMAJ regarding the prolonged delays in the payment of the substantially high sums owed to the contractors.
The Ministry of Transport and Works and the NWA are to meet with the Ministry of Finance within the next two weeks to work out a schedule for the payment of outstanding monies owed to contractors for work carried out on government projects islandwide.
Government admitted last November that it owed contractors undertaking road work across the island nearly half-a-billion dollars with interest. As a result, contractors in six parishes stopped working.
The NWA was still unable to provide The Sunday Gleaner with the outstanding amounts currently owed to contractors after some two weeks of asking for information.
"I am still waiting on the accountants," said Havenol Douglas of the NWA's Communication Department.
