Public Report on the mismanagement of the tender sale of ten deportees’ properties by the Former Minister of Lands, Mr. Paul Telukluk - May 28, 1999 - Emalus Campus



Public Report on the mismanagement of he tender sale of ten deportees’ properties by the Former Minister of Lands, Mr. Paul Telukluk - May 28, 1999

99-09

The long term lease of land in Vanuatu falls under the Land Leases Act and is within the authority of the Ministry of Lands.  On August 18, 1994, the Council of Ministers approved the sale (lease) of 10 properties previously belonging to deportees.  The Ministry of Lands proceeded with the sale of the properties.  In 1995 the Department of Finance complained to the Ombudsman concerning the sale of the lands by the Ministry of Lands.  The Ombudsman’s investigation and report arose from this complaint.

The investigation revealed that the Minister of Lands, Paul Telukluk proceeded with the sale of the properties in question by means of a tender process.   However, none of the procedures for tender and sale of Government properties were followed.  The investigation revealed that in relation to the tender and sale of the properties:

    The Minister appointed members of the tender board without the knowledge of the proper authorities and without the power to do so.
    The members of the tender board appointed by the Minister were political appointees.
    The tender board, without authority to do so voted themselves, as a first item of business, a sitting allowance of a set fee plus 1% of the proceeds of the sale.
    One of the members of the tender board, Mr. Francois-Luc Baba submitted a tender for one of the properties in question and, in clear conflict of interest, considered his own tender (which was successful) as a member of the tender board.
    The tenders were opened before their consideration by the tender board.
    The tender board reduced the bids for some of the properties below the amount set out in the tenders.

Further, the tender board imposed criteria for the evaluation of competing tenders for the properties.  These criteria were:

    Only one property to each tenderer
    Indigenous ni-Vanuatu be given first priority
    Merit

The tender board had no authority to impose these criteria which were irrelevant and breached the equality provisions (article 5) of the Constitution.  Further, “merit” was undefined by the board but, in view of the results of the tender process, amounted to no more than political or family favouritism.

The 10 properties were disposed of by the Tender Board for far less than their market value.  The Department of Finance, on becoming aware of the procedure for leasing he properties, issued instructions to the Department of Lands, Department of Land Records and the Ministry of Lands that the leases were null and void for improper procedures and to cease processing the leases.  However, these instructions were ignored and three of the leases were registered by the Department of Land Records.

Some of the successful tenderers did not fully pay for the leases in accordance with their tenders but were registered as owners of the leases nonetheless.

A second tender board was instituted to review the leases.  It was determined that the first tender board had sold the 10 properties for a total of 14,858,940 vatu.  The second tender board operating in accordance with proper procedures accepted tenders amounting to 45,573,893 vatu.

The Minister of Lands, Paul Telukluk in proceeding with the sale of the properties in an improper manner and contrary to the advice of Department of Finance and the Solicitor General was in breach of the Leadership Code.

The investigation concluded that Mr. Roger Tari, Mr. Seven Tahi, Mr. Bernard Sorineals and Mrs. Lloyd Russel, all of whom were involved in the registration of the leases after the Department of Finance had advised of their invalidity, appear to have committed offences under the Public Service Act.
Recommendations

·       That a comprehensive policy and mandatory procedures be put in place to ensure that Government lands are leased fairly and at fair market value.

·       That Paul Telukluk should not be considered for a ministerial portfolio in any future Government

·       That Mr. Tary, former Director of Lands not be considered for any position in any future Government.

·       That certain members of the initial Tenders Board not participate in any tenders board in the future and that the secretary of the Board, Peter Tulangi, be considered for disciplinary action.

·       That Mr. Steven Tahi and Mr. Bernard Soroneala (who have left the public service) have the Ombudsman’s report placed on their file for consideration should they reapply for a Government position.

·       That the Director of the Department of Land Records take steps to reverse the improper lease transactions.

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Written by Edward R. Hill
UNDP Governance and Accountability Project
January, 2001
Van/97/001
© Ombudsman of Vanuatu
Published here by University of the South Pacific, School of Law Web Site - www.vanuatu.usp.ac.fj






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