June 15, 2017
Response to the Auditor General’s Report on Government Property
The Government is no longer paying for unoccupied buildings and to date has secured a savings of over $90 million by ensuring property management is a priority focus.
In response to the Auditor General’s comments made at a recently held Public Account Committee, the Honourable Maxie Cuffie, Minister of Public Administration and Communications said the situation identified occurred under the previous administration and has since been rectified.
“Government’s monthly rental bill as at September 2015 was approximately $45,360,830 VAT exclusive. Since then we have vacated a number of properties where the rent was being paid without properties being occupied, resulting in a monthly savings of $3,216,259 VAT exclusive in rentals as at 31 May 2017.
“We handed back the keys to a building being rented by the Personnel Department at over $1 million plus VAT per month for the period December 10, 2012 to August 31, 2016,” said Minister Cuffie.
Delays in outfitting the building were partly the cause for non-occupation of the Personnel Department rental. However, Minster Cuffie stated that the Property and Real Estate Services Division (PRESD) of the Ministry of Public Administration and Communications has introduced measures to ensure that all Ministries have the available funding to undertake outfitting prior to any rental agreement.
“I have mandated PRESD to closely monitor the use of buildings once rented to ensure that it is occupied at the shortest possible time, inclusive of outfitting works,” he said.
One of the first rental issues Minister Cuffie addressed when given responsibility for property management which falls under the Ministry’s purview, was the previously unoccupied One Alexandra Place which costs the Government over $50 million in rent between the period December 2012 and July 2016. The building is now fully occupied under the same terms that had been previously negotiated.
“This information from the Auditor General is old news and relates to the previous administration. We have given up over 20 leases on unoccupied buildings to date.
There have also been immediate steps to undertake space audits which will provide greater efficiency and optimal use of office spaces thereby ensuring the Government receives the best value on property rental matters,” said Minister Cuffie.
Additional rentals will be vacated with the newly opened Government Plaza which is expected to house over 4000 public servants when fully occupied.