Friday, May 30, 2014

On the social position of beggars

An excerpt from George Orwell's "Down and Out in Paris and London".

It is worth saying something about the social position of beggars, for when one has consorted with them, and found that they are ordinary human beings, one cannot help being struck by the curious attitude that society takes towards them. People seem to feel that there is some essential difference between beggars and ordinary 'working' men. They are a race apart--outcasts, like criminals and prostitutes. Working men 'work', beggars do not 'work'; they are parasites, worthless in their very nature. It is taken for granted that a beggar does not 'earn' his living, as a bricklayer or a literary critic 'earns' his. He is a mere social excrescence, tolerated because we live in a humane age, but essentially despicable. 
Yet if one looks closely one sees that there is no essential difference between a beggar's livelihood and that of numberless respectable people. Beggars do not work, it is said; but, then, what is work? A navvy works by swinging a pick. An accountant works by adding up figures. A beggar works by standing out of doors in all weathers and getting varicose veins, chronic bronchitis, etc. It is a trade like any other; quite useless, of course--but, then, many reputable trades are quite useless. And as a social type a beggar compares well with scores of others. He is honest compared with the sellers of most patent medicines, high-minded compared with a Sunday newspaper proprietor, amiable compared with a hire-purchase tout--in short, a parasite, but a fairly harmless parasite. He seldom extracts more than a bare living from the community, and, what should justify him according to our ethical ideas, he pays for it over and over in suffering. I do not think there is anything about a beggar that sets him in a different class from other people, or gives most modern men the right to despise him. 
Then the question arises, Why are beggars despised?--for they are despised, universally. I believe it is for the simple reason that they fail to earn a decent living. In practice nobody cares whether work is useful or useless, productive or parasitic; the sole thing demanded is that it shall be profitable. In all the modern talk about energy, efficiency, social service and the rest of it, what meaning is there except 'Get money, get it legally, and get a lot of it'? Money has become the grand test of virtue. By this test beggars fail, and for this they are despised. If one could earn even ten pounds a week at begging, it would become a respectable profession immediately. A beggar, looked at realistically, is simply a businessman, getting his living, like other businessmen, in the way that comes to hand. He has not, more than most modern people, sold his honour; he has merely made the mistake of choosing a trade at which it is impossible to grow rich.

Tuesday, May 13, 2014

Some documents relating to the Humber Valley Paving scandal

I have collected below some documents related to the Humber Valley Paving scandal for the convenience of those following the controversy.

Updated:  An ATIPP request outlining communications between Gene Coleman and Nick McGrath around the time of the deal.

The paving contract. (pdf)

The bond contracts and tender book. (pdf)  One tidbit that hasn't been reported in the media is that the bonding company was the Guarantee Company of North America.

The letter from Transportation and Works  (T&W) releasing HVP from the bonds. (pdf)

A list of all tenders since 1996 that were awarded to HVP. (link)

Here is a email sent to me from the director of comms at T&W in response to my request for all information sent to the Telegram about HVP in recent weeks.


Attached/enclosed is the requested information.

1) History of Relationship with Humber Valley Paving
The Department of Transportation and Works has had a long-standing relationship with Humber Valley Paving that dates back to 1996. In 2007, the company changed ownership and was purchased by a number of investors, which included Mr. Frank Coleman.  It is our understanding that Mr. Coleman has recently sold his shares and is no longer a shareholder.

Attached is a complete listing of all projects where Humber Valley Paving was the successful proponent.  In all cases a public tendering process was used and the company was the lowest compliant bidder.

For your reference, there has been approximately $1.2 billion invested in highway/road improvement initiatives since 2007.

2) Background Information
Enclosed is additional information on the scope of work completed by Humber Valley Paving, as well as background information on the bond.

Under the contract to construct and pave 80 kilometers of highway between Happy Valley-Goose Bay and Churchill Falls, 60 per cent of the work was completed.  The company was only paid for the work completed.  They were not paid for work remaining to be done.

Included in the $11.8 million paid to Humber Valley Paving is the following:
- 106,000 tonnes of “Class A” gravel out of a total of 146,000 tonnes
- 30,000 tonnes of “Class  A” was manufactured and ready to place
- 444,000 tonnes of “Class B” gravel out of a total of 508,000 tonnes
- 40,000 tonnes of “Class B” was manufactured and ready to place
- 15,900 tonnes of asphalt out of a total of 73,700 tonnes
- 935 tonnes of liquid asphalt out of a total of 4500 tonnes
- 3500 meters of guide rail, which exceeded the estimated 3300 meters
- 5,000 flag person hours out of a total of 10,000 hours
- 12,800 meters of guide rail adjustment out of 14,000 meters


There was no money to refund.   Bonds are in essence an insurance policy and are called when a contractor fails to meet the requirements of the contract – most often due to a bankruptcy.  In order to call on a bond, the contractor would have to be declared in default of the contract. That said, there is no guarantee that the Provincial Government would recover the entire amount of the bonds that are in place.  Also, the Provincial Government is still responsible for all costs up to the value of the original contract.

The Provincial Government could have called the bonds.  If we had, project timelines and the viability of the company may have been jeopardized.  It would have also likely led to the loss of direct and indirect jobs and potentially contribute to weakening industry and taking a competitor out of the provincial marketplace.

Instead, the Provincial Government opted to relieve Humber Valley Paving of its remaining obligations and re-tender the work as part of another major tender involving 80 kilometers of paving between Happy Valley-Goose Bay and Cartwright Junction.  By taking this approach, we are ensuring a competitive bid process and the project being completed on time and on budget.

The original tender scheduled for the completion of this road work for July 31, 2014 and that target is now August 31, 2014.


Tuesday, May 6, 2014

HVP deal may have violated the Lobbyist Registration Act

Brad Cabana made an important observation on Twitter today.  It appears that Gene Coleman and Nick McGrath were in violation of the "Lobbyist Registration Act" when the controversial deal with Humber Valley Paving was being negotiated.  Here are the relevant parts of the Act:

 2. (c) (xvi) In this Act, "lobby " means to communicate with a public-office holder for remuneration or other gain, reward or benefit, in an attempt to influence public-office holders relating to the terms of a contract, the choice of a contractor, or the administration, implementation or enforcement of a contract.

2. (f) (i) "public-office holder" includes a member or an officer of the House of Assembly
6. (1)  In this section, 
(a)  "employee " includes an officer who is compensated for the performance of his or her duties; 
(b)  "in-house lobbyist" means a person who is employed by an organization   
(ii)  a part of whose duties as an employee is to lobby on behalf of that organization if the employee's duties to lobby together with the duties of other employees to lobby would constitute 20 % of time at work of one full time employee, assessed in a 3 month period, were those duties to lobby to be performed by only one employee; 
19. A consultant lobbyist or in-house lobbyist shall not lobby a public-office holder unless that person is registered in the registry of lobbyists with respect to those lobbying activities. 

Since McGrath has publicly admitted to verbally discussing the termination of the contract with Coleman, this clearly fits the definition of "lobbying".  I guess it is possible that HVP does so little lobbying that it wouldn't count as 20% of the time of one employee, but that seems unlikely.  I have not been able to check the registry of lobbyists myself (my browser is incompatible) but I am told that Coleman does not appear.

Here are the penalties.  It looks as though HVP might be forced to pay their bond penalty after all (see (6)).
31.  (1)  Every person who fails to comply with a provision of this Act is guilty of an offence. 
(5)  A person who is guilty of an offence under this section is liable on summary conviction, for a first offence, to a fine of not more than $25,000 and, for a second or subsequent offence, to a fine of not more than $100,000. 
(6)  In addition to the penalty referred to in subsection (5), the court may, where a person is guilty of an offence under this section, confiscate the proceeds of lobbying which were improperly obtained and direct that those proceeds be paid into the Consolidated Revenue Fund.

Friday, May 2, 2014

The Frank Coleman/Humber Valley Paving scandal - a timeline of events.

A few days ago, Peter Cowan of CBC broke a story about how Humber Valley Paving - a company closely linked to future Premier Frank Coleman - was allowed to cancel a multi-million dollar contract to pave a section of the Trans-Labrador Highway without paying any penalty.  I have prepared below a timeline of events linked to this story. We will continue to update as more details of this story emerge.

January 22: Dunderdale steps down as Premier.

February 10: Danny Williams publicly opposes Bill Barry for PC leader and mischaracterises the contents of letter Barry sent to caucus. (link).

February 14: Rumours circulate that Coleman is being courted by Williams to become PC leader. (link)

February 14: Coleman sells HVP, steps down as CEO (link, link).

March 10: Coleman steps down as a director of HVP (link).

March 13: HVP requests the termination of a $19M paving contract in Labrador (link).  ( it has now emerged that Gene Coleman - Frank's son - negotiated the deal, and that negotiations were done verbally and left no paper trail.  (link, link)).  This appears to be in violation of the Lobbyist Registration Act

March 13 evening (the same day!): Coleman announces he will enter the PC leadership race. Shortly after this announcement, both Steve Kent and Shawn Skinner announce they will not run.  (link)

March 14 noon: Nominations close for PC leadership race. Commentators widely agree that Coleman is almost certain to win the leadership and hence to become the next Premier.

March 21: The request to cancel the contract is granted. HVP gets paid $12M for road preparations and paving only 20km out of the 80km of what was required and have both their $9.5M performance bond and $9.5M labour/materials bond returned without any penalty. At this time three members of Coleman family, including his son Gene, were directors of the company and had an ownership stake in the company. (link, link). It was later revealed the Frank Coleman would have been personally liable to the bonding agency if the bonds had been pulled (link). This contradicts earlier statements by Coleman:

"No, I did not benefit personally from this whatsoever. It is incomprehensible to me that somebody could infer that I benefitted personally from this."(link)

April 20:  The 30 day period for sub-contractors to file a "mechanics lien" against HVP expires. Sub-contractors owed money who failed to file a lien will henceforth be forced to sue HVP in court. (link)

April 25: HVP shareholders release letter saying that "Mr. Frank Coleman and/ or members of his immediate family have no further interest in the ownership structure of Humber Group." (link)

As of April 31: Frank's relatives (grand children, nephews?), Michael and Robert Coleman are the sole directors of HVP. His son, Gene Coleman, is rumoured to have stepped down on April 28th. (link)

June 11: McGrath holds a press conference announcing the result of the retendering of the HVP contract.  McGrath claims that accounting for changes in project specs, cost to the taxpayers have risen by $1.5M. Ignoring specs, the cost has risen more than $2.5M. (link)

June 16: Frank Coleman quits the leadership "race" due to unspecified family issues. (link)