Author Topic: Terry Le Sueur wastes £10m through incompetence  (Read 11518 times)

Offline danrok

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Terry Le Sueur wastes £10m through incompetence
« on: March 20, 2009, 03:20:46 PM »
Bad management could have cost £10 million

Bad management at the States of Jersey treasury could have cost the Island up to £10 million.

The failure of the department to buy Euros for the incinerator project has meant an increase in costs because of the collapse of the pound.

An official report by the Auditor General into the failings was published this morning - to huge embarrassment for the Chief Minister - who was chancellor when the deal was signed.

Story continues:
http://www.channelonline.tv/channelonline_jerseynews/displayarticle.asp?id=401653

What a fat head!

Offline rico sorda

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Re: Terry Le Sueur wastes £10m through incompetence
« Reply #1 on: March 20, 2009, 03:56:24 PM »
Not only that but our great leader cant even handle jimmy perchard according to chief le suer the matter is closed...

You know sometimes you just have too sit back and marvel how pants our government is ,yes im sure they do good stuff but you have to dig deep to find it.

And what about Dick Turpin down at web 260,000 a year bloody hell.

this coming year be afraid be very afraid..

We need to find strong leadership from somewhere but we just don't have it

rs
one ban away from oblivion rsx

Offline Goreyman

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Re: Terry Le Sueur wastes £10m through incompetence
« Reply #2 on: March 20, 2009, 04:35:37 PM »
And we all know what will happen to the people who made the cock-up.
They will be suspended on full pay until an investigation has been completed in say 2-3 years!!

I like so many people complain about the amount of money that is spent on consultants.
So why were the consultants not listened to? Do the civil-servants just take from any consultants reports the bits they want or support their views. (well I think that is a whole new topic!!!)

I accept on large projects like the incinerator external consultants will be required as Jersey would not necessarily have the required expertise but surely on the financial side any business would fix the exchange rate - even I with limited experience see the benefit of fixing. Its better to know what you must pay for the project from the outset and not "hope" to gain a few £'s when you could lose a few (or in this case MANY) £'s

Offline danrok

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Re: Terry Le Sueur wastes £10m through incompetence
« Reply #3 on: March 20, 2009, 04:45:59 PM »
Well exactly, you don't need to be that smart to work this one out.

I doubt that the contractors would have been up for fixing a price in Sterling, or at a fixed exchange rate.  But, it matters not, because the money was already set aside, and should have been converted to Euros a long time ago.  Even if the rate had gone the other way, it would have not been so bad, because at least the cost was fixed at the level budgeted for.

Offline Shiva

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Re: Terry Le Sueur wastes £10m through incompetence
« Reply #4 on: March 20, 2009, 05:06:01 PM »
Where is the accountability here?
Surely if the department needed to hedge the Euro amount, the Minister would need to sign off on it? It is not good enough for Ozouf to now state, he thought it had been done. He is ultimately the person responsible and he should accept responsibility for the failure. How many more times do we have to listen to the COM state that they are responsible for all of the major decision made in this Island until they go wrong, at which point it is always somebody else's fault and never theirs. This pitfall was pointed out to the States months ago and Ozouf's response was that they had it covered. He should resign!

Offline moot

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Re: Terry Le Sueur wastes £10m through incompetence
« Reply #5 on: March 20, 2009, 05:48:46 PM »
Ozouf in the JEP today
Treasury Minister Philip Ozouf issued a statement saying that disciplinary action was being taken against some staff. It is understood that three or four Treasury employees, both senior and junior, are facing action over the mistakes.
When the States approved the proposition to build the incinerator last July they were told that the rate would be fixed when the contract was signed, eliminating any risk due to currency fluctuations.
But that did not happen, and the changes in exchange rates since the contract was signed in November have made the euro portion of the contract — which represents more than half the total cost — more expensive

Two people signed the insanerator contract : Lord de Faye of Bel Royal and the then treasurer Terry Le Sueur. BEFORE you sign a contract spending £106 million of public money you make sure that the main points are correct. In this case the setting of the exchange rate was one of them
De Faye is gone and Terry is hiding behind Ozouf who in turn blames some treasury employees. It is called PASSING THE BUCK  !
Channel news reported this morning that the carbuncle could now cost as much as £120 million but somehow this has been reduced to £106 + £3 = £109 million
What we ought to know is a) what was the exchange rate when the contract was signed b) what percentage has sterling lost between then and now.  We know that "more" than half of the £106 million was in euros but we don't know how much "MORE". Once we know this we can work it out ourselves
As usual it is difficult to the facts . Anyone know ?

Online boatyboy

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Re: Terry Le Sueur wastes £10m through incompetence
« Reply #6 on: March 20, 2009, 06:24:44 PM »
I have no idea how Terry Le Suer or Phillip Ozouf can be blamed for the shambles over the failure to lock in to an exchange rate, when they were apparently told that this would be done by the Treasury at the time the states voted for the incinerator. I would go further, as a sometimes heavy critic of  States members who in my opinion have let us down, I see no evidence in this situation. Whether you were for or against the monster incinerator is another issue, it was democratically voted  "pour".

So does that mean, that Minister Reed votes heritage funds for maintenance for a castle, he then has to put on a hard hat and go around and check that the building work is up to scratch? If  Stuart Syvret and others vote for a census, do they have to knock on doors around Jersey to make sure everyone has received a form, absolutely not complete rubbish, that is the job of  the departments and the people employed by those departments.

The Treasury has enough well trained well paid, staff to carry out the wishes of the house , and look after the pennies or so we thought. Big Chris Swinson the powerful auditor general, concludes in his report that the department is not up to the job. Phillip Ozouf who on this occasion and through no fault of his own, finds himself joined with Minister Jim Perchard.

Their focus is to deal with two departments who are clearly not giving the islanders a decent and professional level of service.   

Boatyboy.


Views explained and modified see later post.
« Last Edit: April 21, 2009, 08:50:21 AM by boatyboy »

Offline danrok

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Re: Terry Le Sueur wastes £10m through incompetence
« Reply #7 on: March 20, 2009, 06:52:59 PM »
So, when their dept. fails, and not over a trivial matter, we're talking about a large project worth well over £100m, they can simply wash their hands of it?

Where have they been, have they not noticed that you cannot take the word of Civil Servants, in Jersey, at face value?

When you're in overall command, some things are of such importance that you need to confirm what's going on yourself.

Forget the contract, the Treasury should have put the cash in to a Euro account, and Le Sueur would have been fully aware of the fact that those funds were in a sterling account.  That was the only certain way to put a stop loss on the costs.

Should have gone to Spec Savers Terry!

Offline moot

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Re: Terry Le Sueur wastes £10m through incompetence
« Reply #8 on: March 20, 2009, 07:03:31 PM »
I have no idea how Terry Le Suer or Phillip Ozouf can be blamed for the shambles over the failure to lock in to an exchange rate, when they were apparently told that this would be done by the Treasury at the time the states voted for the incinerator. I would go further, as a sometimes heavy critic of  States members who in my opinion have let us down, I see no evidence in this situation. 

Boatyboy.


I disagree BB. The States agreed on the incinerator in July 2008 and that's when the price of £106 m was quoted and the euro at 1.30 / 1.40
It is now at 1.02. That is a more than 20% drop
More than half of the price was in euros which means about £60 million. Therefore the extra cost is £12.000.000 . Taking the average salary at £30.000 pa this means over 400 people's annual salaries
Surely the price and conditions were in the contract. The problem is that they were so eager to sign one week for the elections that they cocked it up ! Also it wasn't their money !!! If it had been they would have been more careful
The bucks stops with Terry LS and he should take responsabilty.  Clowns wouldn't be the right word as they make you laugh. This almighty cock-up doesn't. Incompetence is the correct word ! It makes my blood boil !!!

Offline moot

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Re: Terry Le Sueur wastes £10m through incompetence
« Reply #9 on: March 20, 2009, 07:07:13 PM »
Where have they been, have they not noticed that you cannot take the word of Civil Servants, in Jersey, at face value?
When you're in overall command, some things are of such importance that you need to confirm what's going on yourself.

In a nutshell... Well said !

Offline danrok

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Re: Terry Le Sueur wastes £10m through incompetence
« Reply #10 on: March 20, 2009, 07:11:53 PM »
I see we've had Philip Ozouf apportioning the blame on TV.  Where is Terry?  He isn't showing much in the way of leadership, by hiding under a desk.

Online boatyboy

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Re: Terry Le Sueur wastes £10m through incompetence
« Reply #11 on: March 20, 2009, 07:48:20 PM »

The point is, should Jersey have, after signing up to the French company installing the £106 million pound incinerator, taken out Euro's when they  were high, as an insurance policy against the pound falling.

Lets put it this way, a Jersey couple wish to buy a house in France for completion in three months, the euro is weak against the pound. It makes sense to buy at least 50% of the euros.

As history shows that the rate was very good at the time the assembly passed the £106 million pound incinerator.

Of course when it's not your own money why bother. ? Just add another £30 to £47 million to the cost paid for by the taxpayer. The word Muppets comes to mind.

BB

http://planetjersey.co.uk/forum/index.php?topic=1559.msg23546#msg23546

Payment is to be made over 3 years at 1/3, 2/3 and completion of the contracts I understand. If the pound continues to rise against the Euro then I think there may be a rethink on hedging. I know there was a lot of thinking as to whether it was better to borrow or to use cash - but again the policy can be reviewed since we are looking at a three year period. May be a quick topic for scrutiny.

Sarah Ferguson

http://planetjersey.co.uk/forum/index.php?topic=1559.msg23609#msg23609

Maybe a quick topic for scrutiny or the Attorney General which in fact happened.

Offline danrok

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Re: Terry Le Sueur wastes £10m through incompetence
« Reply #12 on: March 20, 2009, 08:36:26 PM »
As far as hedging goes, i.e. buying £60m Euros, it would have been the best course of action at the time.

Sure, they will not benefit, profit if you like, if the Pound goes up a lot, but they were never meant to be.  Fixing the cost at £106m, and living with it, would have been the most sensible thing to do.

Online boatyboy

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Re: Terry Le Sueur wastes £10m through incompetence
« Reply #13 on: March 20, 2009, 08:44:10 PM »

I concur Danrock, it was still not the politicians job to organise this, what are the treasury there for ?

BB

Offline moot

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Re: Terry Le Sueur wastes £10m through incompetence
« Reply #14 on: March 21, 2009, 12:11:34 AM »
I see we've had Philip Ozouf apportioning the blame on TV.  Where is Terry?  He isn't showing much in the way of leadership, by hiding under a desk.


Where is Terry ? - He was on Channel TV for a few seconds tonight mumbling something I could not understand:
http://www.channelonline.tv/channelonline_jerseynews/displayarticle.asp?id=401653

What I found puzzling : It has been reported that over half of the money is paid in Euros. The States is buying a product from a French company which includes materials, labour, etc. How much are we actually paying in Euros ? Do we pay them in euros for salaries which they then convert back in sterling to pay local labour ?
I just don't get the calculations which are bandied about in the various media