EFCL's problems won't just go away

The EFCL Unpaid Contractors and Consultants Action Committee – an alliance of unpaid contractors and consultants seeking settlement of unpaid invoices submitted to the Education Facilities Company Ltd (EFCL) – announced in an advertisement on Friday that it would "pursue payment by all means necessary."

In February 2022, NH International (Caribbean) Ltd won a $17 million judgment against the EFCL for work done on the Parvati Girls’ Hindu College in 2013. The school is in the final phase of construction but remains incomplete.

Anthony Garcia, then Education Minister, said in July 2018 that the government inherited an EFCL that was billions in debt, with contractors unpaid and schools unfinished.

In 2019, the government settled almost $2 billion in debt, legal costs and claims by contractors against the company.

The company has also been levied on several times. After it pleaded off the threat of a levy by Advance Commercial Equipment in June 2018, Prudecon Ltd showed up a month later to take a truckload of office furniture from its Port of Spain office.

Other creditors, like the National Maintenance Training and Security Company (MTS), are statute-barred from acting against the EFCL or the Education Ministry, which owes MTS $300 million.

The PNM government created the EFCL in 2005, but has challenged some of the invoices it has been asked to pay since returning to office in 2015.

The State has acknowledged that other, legitimate, uncontested claims also remain unsettled.

Former EFCL chairman Arnold Piggott quit in 2016 after just 17 months, claiming uncontrollable corruption and mismanagement. Mr Piggott was in turn accused – in statements made before the JSC on State Enterprises in 2017 – of leading a board that exceeded its scope in intervening in the company's operations.

In February, the EFCL effectively ceased operations, and MTS has handled school repair projects for the Education Ministry since 2018.

By that time, EFCL was effectively a zombie company, operating in name only while carrying $2 billion in debt.

This isn't a good look for the State, particularly since the PNM government has been publicly and quite vocally aware since 2015 of EFCL's problems.

The State cannot simply pass the burden of its compounding of EFCL's expensive mistakes over seven years onto the small and medium-sized businesses that dealt with the agency in good faith.

These businesses were contracting with the EFCL, but also with the Education Ministry and, by extension, the government, with an expectation of care and due diligence in the use of the public purse.

Instead, the State appears to be engaging in avoiding debts, including payments ordered by the courts, as it seeks to shirk the responsibility of paying a staggering more than $600 million owed to contractors and consultants. Revenues may be tight, but the State must honour its debts while clarifying how and why the EFCL got into such an unacceptable position in the first place before it was stopped in its tracks.