Madam President
“Because I believe that Bahamians ought to own the majority in Batelco, I shall never never ever sell the majority holdings to anyone other than Bahamians.” These are the words of Hubert Ingraham in 1997. The betrayal I spoke about in this place less than 2 weeks ago is in its final stages.
“And when they had come to the place called Calvary, there they crucified Him and the criminals, one on the right hand and the other on the left. Then Jesus said ‘Father, forgive them, for they do not know what they do.’ ” Luke 23:33
Madam President
And so it has come to pass that with this betrayal the spirit, dreams and aspirations of many Bahamians has been crucified. Unfortunately for the Prime Minister and the FNM, some Bahamian people will not be as forgiving as our Lord and Father and those who do forgive certainly will not forget the extent of this betrayal.
Madam President
Many Bahamians, including myself believe that this debate on the sale of BTC is more than just the sale of a state asset. The manner in which the FNM government has handled it has invoked deep rooted questions and concerns; Is the Bahamas really for Bahamians ?, what happened to Bahamianization ?, Has Bahamianization really been a failure as some members opposite would like for us to believe ?. Why is this government saying “Bahamians need not apply”?
Madam President
I must state my horror when I heard the member for Pinewood in that other place say that Bahamianization was a failure. How could he say such a thing? Maybe it did not fulfill its’ complete mandate, maybe our forefathers realized that there was a balance to strike, but a failure ...No.
Madam President
I am a product of the Bahamianization policy. My father was able to become a successful businessman through this policy. That success paid for my education and gave me a fertile field in which to learn and harvest my business skills. I know many many Bahamian families both white and black who would not be where they were today had it not been for a PLP government that had the foresight and faith in its people to put them first.
Madam President
This is where this Prime Minister and his government has made a terrible miscalculation. They have underestimated the dreams of the Bahamian people; they have discounted the aspirations of the Bahamian people and they have diminished the spirit of the Bahamian people. Through all this they believe the people still trust them.. “No one is blinder than he who will not see” John 9:40
Forgive them Father for they know not what they do...
Madam President
I want to take this opportunity to commend the member for Bamboo Town, Mr. Branville McCartney for his display of courage and conviction when he voted “No” to the Resolution to transfer 51% of BTC to Cable and Wireless. I thought it was unfortunate that he felt sufficiently alienated by his party, a party he says that he has supported for 25 years, that he was moved to resign from the FNM. What was interesting I thought, was the fact that Mr. McCartney has been a member of the FNM longer than Hubert Ingraham. Today he is a man who has been forced out of a party that has lost its way and forgotten the democratic pillars upon which it was built.
Madam President
I asked myself if Sir Cecil would have voted “yes” for this sale of BTC to Cable and Wireless. From what I am told he would HAVE VOTED NO. I am told he was more “militant” than Sir Lynden and his equal when it came to his views of nationalism and Bahaminization. We know Sir Lynden would HAVE VOTED NO. So what has gone wrong. How could the FNM get it so wrong. How could so many sit idly by on that side and say nothing against this transaction. Although madam president, some would not openly state their opposition, they were cowardly expressing their indifference in other circles. Yes Madam President there are those on the other side who lacked the courage and testicular fortitude to say NO in that other place and there may be some in this place.
Madam President
They have been put it a catch 22 position. Damned if they do, damned if they don’t. You see, I understand that the Prime Minister got wind that some of his members were contemplating voting No and decided he would threaten them with calling an election if they voted “No”.
Madam President
The flip side of this is that when an election is called later this year the Bahamian people will reject all who voted in favour of this BTC sale to Cable and Wireless. Damned if they do damned if they don’t. The pied piper has lead them to certain ruin. You know there are some who will tell you that Mr. Ingraham has promised to “leave the FNM Party the way he met it... it shambles”
Madam President
I smiled to myself when I heard the member for Sea Breeze in that other place try to rationalize that a no vote by sufficient government MP’s on the BTC Resolution was equivalent to a Constitutional vote of no confidence in the Prime Minister whereby Parliament must dissolve and an election called within 90 days. What hog wash..
Madam President
I have told you before that they make things up as they go. They make policy and they make law from their feet. Now they are adding Articles to the Constitution. Let me explain how absurd this is. Everyone of us in this place knows that a vote of “No Confidence” requires a particular procedure and is only used in the most extreme of circumstances. In fact I believe the rules only allow for it to be used once in every sitting of the House.
Madam President
If members in the other place had voted against the BTC sale it was not a constitutional vote of no Confidence in the Prime Minister. It would have simply been a difference of opinion with their Leader. That’s it, a difference of opinion. But so shallow have the FNM now become than any difference of opinion with their leader is seen as a vote of no confidence.
Madam President
If I am not mistaken, isn’t it this type of behaviour that weighed heavily on Sir Cecil’s heart and soul when he uttered those famous words when resigning from the PLP “ Free at last, Free at last, Good God almighty Free at last”. Although those words did not come out of Branville McCartney’s mouth in that other place, we could all read between the lines.... He was free at last! Free at last from a leader who has sucked democracy out of the FNM party. I found it all very ironic when one considers from whence the FNM came.
Madam President
You see, Branville McCartney understood full well what this debate was about. He quoted Sir Lynden from an address on January 30th 1997 where Sir Lynden said:
“ The future Bahamas should be “a nation
where the people are the most precious resource
over and above all natural and material
resources, and the national prosperity is
measured by the quality of the health, education,
and social environment and self esteem of its
people;
He says it should be “a nation where the
individual and corporate productivity are
synonymous with self-worth and where the love
for work is esteemed as a national obligation;”
16
But most importantly, he says that the Bahamas
should be “a nation where economic diversity
creates a broad spectrum of opportunities to
challenge all the rich, creative talents, gifts,
abilities, and ingenuity of the people, thus
producing an atmosphere of variety, healthy
competition, and entrepreneurship.”
Madam President
I believe for a brief moment the Prime Minster understood when he voted “No” to the sale of BTC to Cable and Wireless in that other place. I also know that as I said before Papa’s dote sometimes, they get mixed up, forget where they are, what they are to do and yes sometimes what they are to say. But believing in the good in all people as I do, I would like to believe his conscience pricked him, he knew what he was doing was wrong. It raised another interesting point which Dr. Nottage, the member for Bains and Grants Town mentioned in that other place. What would have happened if when I came time to vote the Prime Minister changed his mind and told them to vote NO.... Things that make you go hmmmmm. Do you think they could really be that void on conviction and courage to stand for what they believe. So if you will not stand for something you will fall for anything.
Madam President
This debate is more than just the sale of a national asset. It has touched the conscience of who we are as a people, where we have come from and what is our destiny as a people. The government is not addressing these burning issues which consume the minds and hearts of Bahamians every day. What are we doing?
Madam President
I intend to make a case against the sale of BTC to Cable and Wireless as is presently presented by the FNM on five grounds;
I have intentionally listed my objections and the objections of this side in this fashion as I intend to address the facts and challenge those on the other side to refute anything I state that is not true and bring their own facts to contradict what we on this side say which may assist right thinking Bahamians in rationalizing this transaction. In the end the Bahamian people will be the ultimate jurors. I must say though that talking with Bahamians of all socio and economic backgrounds they have a pretty good grasp of the issues.
The price is too low
The London Financial Times acknowledges that:
“The deal prices BTC, the exclusive mobile operator in the Bahamas, at a below sector-average multiple of more than four times earnings before interest, tax, depreciation and amortisation for 2009.”
Cable and Wireless has just sold its assets in Bermuda and what is troubling about the sale of their Bermuda assets is when you compare the amount of land lines and cellular customers Cable and Wireless had in Bermuda to BTC’s you find that Cable and Wireless sold the company in Bermuda for more dollars per fixed line and cellular customer than what they are buying BTC for. In fact when the comparison is done you find that Cable and Wireless sold for about one third more than what they are paying for at BTC. No wonder the London Financial Times said it was being sold at below “industry average”.
According to the Audited Consolidated Financial Report by PricewaterhouseCoopers of 2009, the Book Value of BTC as of 31st December 2009 was $537 Million. On first glance one would think that 51% was worth in the region of $290 million. But everyone know that buying controls comes at a premium of around 20-25 percent. So there is no way on this basis that BTC should have been sold at below $350 million. When one uses the average market price earnings multiple it comes to around the same $350 million for 51% control of BTC.
Against the Sale of 51%
Madam President
I think that had the government agreed to sell only 49% as was its position prior to 2008, it would have reduced its opposition to the sale by 50%. That’s because Bahamians are not against the privatization of BTC and they are not against the liberalization of the telecommunications market. In the majority they are against the sale of 51% to a foreign entity.
Madam President
The first question Bahamians want answered is why did the Prime Minister change his mind and decide to sell 51% back in 2008. You will recall that earlier this year I stated that the reason why the government was selling 51% was because Cable and Wireless would not buy less than 51%. The leader of Government business disputed this. I know this was cable and Wireless position because this is what they told the PLP when they met with us earlier this year. Then last week in parliament the Prime minster finally revealed that no bidder would take less than 51%. This of course is not true, but he had already dug himself into a hole and as usual when he finds no reasonable and honest way out he makes stuff up.
Prime Minister Dean Barrow made the following remarks to the Belize Parliament in August 2009
And I quote:
“Mr. Speaker, Belize Telecommunications Limited was incorporated in 1987 during the first UDP administration. At that time the purpose was to Belizeanize telecommunications, replacing the control of the foreign entity Cable and Wireless with a national company.
Telecommunications uses the airwaves as its medium. But these airwaves constitute a God-given natural resource of Belize, just like our sun, our sea, our rivers, our forests. These things together help to make up the patrimony of the Belizean people and the exploitation of that patrimony must always be consistent with the interests of Belizeans.”
Washington Journal in an article dated July 6, 2007.
“Governments from Canada to China have imposed or are considering restrictions on foreign purchases of companies, factories and real estate in their countries — moves U.S. officials fear could harm global economic growth if they proliferate.
And in Italy, Telefónica SA of Spain had to team up with three Italian financial institutions to buy Telecom Italia after Italy’s Prime Minister declared that the telecom company should “remain in Italian hands.”,
responding to national-security concerns about foreign, government-owned entities buying Canadian natural resources and other assets. “We may have to give special attention when we see situations where, directly or indirectly, state-owned Canadian leaders, like their counterparts elsewhere, say they are enterprises or agencies of state-owned enterprises are proposing to make substantial foreign investment in Canada,” Canadian Finance Minister James Flaherty said in an interview.
Sale to Cable and Wireless
The Communications Act, 2009, at section 5, provides that all regulatory measures shall be guided by market forces, “and shall be efficient and proportionate to their purpose and introduced in a manner that is transparent, fair and non-discriminatory;”. Similarly, the Utilities Regulation and Competition Authority, 2009, at section 8 (1), provides that “All regulatory and other measures by URCA shall be proportionate to their purpose and introduced in a manner that is transparent, fair and non-discriminatory.”
Madam President
URCA, as the telecommunications regulator has a constitutional and statutory duty under the Communications Act and the URCA Act as well as a common law duty, by virtue of the fact that it is acting in a quasi judicial capacity as a regulator, to carry out its regulatory measures in a manner that is impartial, transparent, fair and non-discriminatory.
Madam President
There are so many questions which the government has either ignored or refused to answer which place a dark cloud of self dealing, conflict of interest and even corruption.
No one in the government or on the privatization committee can say how Cable and Wireless bypassed the bid process and entered into a contract with the government to buy BTC at “below industry average”.
How is it that a member of the board of BTC became the front person for Cable and Wireless in their discussions with the government.
How is it that Mr. Usman Saadat, a former CEO of Cable and Wireless become the drafter of the legislation, regulation and policy of URCA the governing regulatory body is a former employee of Cable and Wireless.
How did Mr. Saadat get here in the first place. Who hired him and where was the job advertised. Did anyone else apply?
How is it that the human resources firm for URCA which was hired by this same man, is headed not only by a former employee of Cable and Wireless but she is also married to an executive of Cable and Wireless.
How is it that Mr. Saadat became CEO of URCA.
Madam President
Article 20 (8) of the Constitution of The Bahamas provides that:
Any court or other adjudicating authority prescribed by law for the determination of the existence or extent of any civil right or obligation shall be established by law and shall be independent and impartial . . .”.
Madam President
URCA is an adjudicating authority prescribed by law. Therefore it is charged with a constitutional obligation of impartiality.
The concept of “impartiality” was defined by Lord Hope in the case Porter v. Magill:
“As to the question of ‘impartiality’, there are two aspects to this requirement. First, the tribunal must be subjectively free from personal prejudice or bias. Secondly, it must be impartial from an objective viewpoint, that is, it must offer sufficient guarantees to exclude any legitimate doubt in this respect. In both cases the concept requires not only that the tribunal must be truly independent and free from actual bias, proof of which is likely to be very difficult, but also that it must not appear in the objective sense to lack these essential qualities.”
Madam President
This objective test of reasonable apprehension of bias and the apparent conflict of interest of the leaders of URCA can only lead the fair-minded and informed observer, having considered all of the facts, to conclude that there is a real possibility that URCA was biased in favour of Cable & Wireless.
Madam President
On this ground alone we should reject this proposed sale because the process lacks transparency and is not impartial: Quite frankly it stinks. If these questions are not satisfactorily answered, many Bahamians have called for a Commission of Inquiry and possibly criminal prosecutions flowing from these events. I must agree with them as I have heard nothing from the other side in this place or that other place to address these very serious questions and allegations.
No Faith in the Bahamian People
Madam President
There is no clearer example of the difference between the FNM and the PLP on this matter than a review of the recent history of how both parties dealt with BTC and the management and employees of the Corporation. The leader of the PLP, Perry Christie summed it up perfectly in that other place when he said the following:
“When the PLP became the government in May 2002, the Audited Financial Statements showed that there was $4.47 Million in BaTelCo accounts.
For all intents and purposes, BTC was essentially broke.
By contrast, when the FNM came to power in May 2007, they met $135 plus Million in BTC's accounts. $135 plus million dollars versus the $4.47 Million they left in place in 2002. Imagine that!
The PLP started with $4.47 Million, the FNM will allow Cable & Wireless to start with $15 Million in the Bank.
When the PLP became the Government in 2002 the cost of International Long Distance Calls was $1.09 per minute. When the FNM came back to office in 2007 they met International Long Distance calls reduced by 70% and Domestic Long Distance calls reduced by 55%.
Now all of a sudden I hear we want to sell BTC because Cellular Rates will go down?
When we were in office and we thought the rates were too high, BTC reduced them. We did not wait for someone foreign to come and reduce rates.
Mr. Speaker
All this happened at BTC in five years under the PLP and I will tell you why:
Firstly, because the PLP consulted with the Bahamians at BTC and asked them what they needed to fix BTC.
Secondly, we provided the staff at BTC with the tools and resources they needed.
Thirdly, we did not interfere. We empowered them to do the job they were ably qualified to do.
Fourthly, we believed that Bahamians could run a profitable Telecommunications Organization in a competitive space.
Fifthly, it was because of our love, faith in and respect for the Bahamian People.
In 2001 BaTelCo Management presented to the FNM Government, a plan to build a fiber optic submarine cable to connect six islands of The Bahamas.
The FNM said No!!
BaTelCo Management in 2001 presented to this FNM Government who has no respect for Bahamian talent, a plan to build a GSM cellular network.
The FNM said no!!!
It would seem to me when it comes to Bahamians, the FNM is a party of “No!”
Mr. Speaker
I know what I am talking about because the BTC Management presented the same plans to the PLP government in 2002 and the same Privatization Consultants (Deutsch Bank) that advised the FNM to say No also advised the PLP to say No!
But we disregarded the advice of No from the foreign consultants in the same manner in which we disregarded their Valuation of BTC 49% Share at $130 Million.
The PLP listened to the Bahamian experts at BTC and said “Yes you can.”
Mr. Speaker:
During the five year term of the PLP, BTC spent over $353 Million to improve Telecommunications in this little country of ours. That is 50% of the $600 Million that Cable & Wireless CEO stated last year they will spend in the Caribbean over the next five years on Capital Development.
While students in Nassau are using the Internet to study for their BGCSE Exams, the students in Red Bays Andros who are sitting the same exams have no access to the Internet for research. That cannot be right.
We therefore instructed BTC to “fiberize” the islands. We cared about people and honestly felt that our citizens should not be marginalized by geography when it came to accessing the full range of telecommunications services.
We knew we had a nation to build that included all Bahamians from all walks of life and from every settlement, cay and island of this archipelagic nation.
Mr. Speaker:
When the PLP left office in 2007, the work of replacing the digital Telephone Network with a NGN Next Generation Network the latest in technology had already started.
BTC had already submitted plans for IPTV. BTC had already made provisions for revenues from IPTV for as early as 2008.
Building a submarine cable to Haiti was in the works by companies such as AT&T and TCCN for more than 20 years. There was a bet in the industry, I am advised, that BTC could never build the cable to Haiti. But the skillful negotiations of Bahamians got the job done on time and in budget.
When Tyco (the Company) contracted to build the cable to Haiti had difficulties going to Haiti to complete the Cable, a BTC Team led by Mr. Charles Rolle and Engineers like James Woodside went to Haiti and completed the Cable.
When the PLP was the government, BTC was engaged in favorable negotiations with ETECSA the Cuban Government owned Telecom provider to build a Fiber Optic submarine cable from Cuba to The Bahamas. Cuba has a population of 12 Million and cellular subscribers of over one million but at the time had no fiber optic connecting it to the outside world. Cuba was still connecting via satellite.
Sadly, however, the Plans that BTC had that were approved under the PLP all became victims of the diseased "Stop Review and Cancel" Policy of this FNM Government.”
Madam President
These are the facts. This is the truth and I challenge those on the other side to state otherwise. All this nonsense about reduced rates and Bahamians not being able to do the work is ridiculous. BTC just needs a government to believe in them and support them and then stay out of the way as the PLP did. They have the power today to reduce rates as the PLP did. What they need to tell the Bahamian people is why the regulatory body has in recent past denied further reduction of phone rates.
Madam President
While I support privatization, I cannot support these bills. They are fruit from the poison tree. The lawyers among us know what I mean.
The Christians know that Matthew 7:18-20 tells us that:
“A good tree cannot bear bad fruit, nor can a bad tree bear good fruit. Every tree that does not bear good fruit is cut down and thrown into the fire.”
And so it is that this sale to Cable and Wireless, stinks. It is steeped in self dealing, conflict of interest and possibly corruption. It is rotten to its core and cannot bear good fruit and must be cut down and thrown into the FNM fire where it belongs.
Madam President
The FNM is on the wrong side of history again. They have a history of being out of touch with the Bahamian people. They were wrong on Independence, Wrong on National Insurance, Wrong on the Defence Force, wrong on the Mortgage Corporation, wrong on the Development Bank and now they are wrong on the 51% sale of BTC to Cable and Wireless.
So for those on the other side, I will end where I began and ask forgiveness for them for obviously they know not what they do.
Thank You and God bless the Commonwealth of the Bahamas.