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Thursday, September 19 2019 @ 08:50 am EDT

Panama's Housing Minister Denounces Irregularities

CorruptionBy Yessika Valdés for the Panama America - Panamas Minister of Housing (MIVI), Carlos Duhau, reported today that more than 90 housing projects were not completed in the last three years, initiated by the previous administration. "During an audit we realized that within MIVI there are are many irregularities in housing projects nationwide," said Duhau. The Housing Minister said the projects only have been advanced 38%. "We are evaluating quick and direct solution for the citizens of the provinces of Cocle, Darien and Los Santos" among others. He added they are studying the various sanctions which will be applied to the building contractors who have not completed the contracts. These housing projects have a total value of more than $17 million dollars. (See Comments)

Editor's Comment: During the administration of Martin Torrijos, the government wrote contacts worth more than $17 million dollars for contractors to build small houses in the interior. They call these "solutions" for poor people. Usually there is a selection process in which social workers get involved, and they identify the most needy people who are living in the worst conditions with the least amount of income, and then they set out to build them a small house. Great plan and idea. However, what actually happens on the ground is the following. Let's say a contractor is awarded a contract to build 20 small little houses in a particular village in the interior for a total of $250,000 dollars. Doing the math that means he is getting paid $12,500 per house. In reality these house are very simple structures, usually just a cement slab floor, walls, two little bedrooms in the back, one bathroom for the whole house, a small living room/dining room, and a kitchen area, with a roof. The walls are usually "repello" (stucco), the roof is "zinc", and all of the finishes and things like sinks and toilets are very basic and inexpensive. In reality there is usually about a 15% profit margin, and if done right the builder should be able to easily build the houses for that much money and walk away with about $37,500 or so in profit. But here is what has been happening on the ground. The contractors already know they are going to make about 15% profit on the job, so what they do is ask the government for some start up money that's supposedly going for materials, equipment rentals, and payroll. As soon as the contractor is in a position where he can pocket $37,500 or so, he just walks away from the project. The entity that is then "stuck" with the contract is the insurance companies that issued the performance bond. What was really happening is that corrupt and unscrupulous people were forming "triangles" or groups of three individuals in order to pull off these heists. They needed one person inside the insurance company to issue the performance bond, one person inside of the Ministry who controlled the issuance of contacts, and the contractor himself. Once they had those three linked together, they could do just about whatever they wanted. So, they steal the 15% from one contract, then the next, then the next, etc., until they can't take any more money. When it all started coming to an end everyone scatters. The construction contractors simply shut down one company and start a new one. The guys who were working for the insurance companies get a new job somewhere else. The guys who were working for the various ministries are now out of a job anyway. And, it's left to the administration of Ricardo Martinelli to clean up the mess. And this was happening in every Ministry - MOP, Education, Housing, Health, you name it - any place the government was letting contracts to have things built. Millions upon millions of dollars was being stolen, and no one has been held responsible. Surprised? Oh, and the poor people in the interior who were waiting for their housing "solution"? They are still waiting. The PRD screws the poor guys, again. Say one thing, do another, and all they really care about is the money. In other words, business as usual. And it's such a complicated web of contracts and companies that it going to be practically impossible for the Public Ministry to unravel the whole thing and whole the right people accountable. And what is the end result? Right now it's practically impossible for the government to let a construction contract to anyone, because the insurance companies who have been burned won't write performance bonds for anyone. Period. They are going to use this issue as leverage to get the government to recognize them as victims as they lobby to be relieved from their contractual obligations. Oh, and who ran MIVI for Martin Torrijos? Balbina Herrera.

[03 Ago] El Ministro de Vivienda (MIVI), Carlos Duhau, denunció hoy que más de 90 proyectos habitacionales no se culminaron en los últimos tres años, iniciados por la pasada administración.

"Durante una auditoría nos dimos cuenta que dentro de la entidad hay muchas irregularidades en los proyectos habitacionales a nivel nacional", indicó Duhau.

El titular de Vivienda dijo que los proyectos solo tienen un avance del 38%. "Estamos evaluando una solución rápida y directa para los ciudadanos de la provincia de Coclé, Darién, y Los Santos entre otros.

Agregó que estudian las devidas sanciones que se le interpondrán a los contratistas que no han cumplido con los contratos.

Los proyectos habitacionales tienen un monto de B/ 17 millones.

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