Fijileaks Archive: Attack on Qorvis role in Fiji
By GRAHAM DAVIS The 'Ageing Drama Queen' Presses On, 26 September 2020
There’s nothing like a Prime Ministerial attack to boost one’s readership and I am indebted to Frank Bainimarama for propelling Grubsheet Feejee – within a month of its resumption – into the frontline of the national debate in Fiji. In one grumpy outburst written for him by Qorvis and the Attorney General, Aiyaz Sayed-Khaiyum, the Prime Minister made me more relevant than I deserve. His comments were on the front page of the two daily newspapers and led the main television news programs and every radio bulletin. So that if anyone hadn’t heard of Graham Davis or Grubsheet before, they do now and that has been reflected in a huge increase in the number of “hits” on this website.
34,348 people visited Grubsheet in the week from Friday September 18 to Friday September 25 (yesterday), with a big spike in the wake of the PM’s comments. So to him I say vinaka vakalevu and to all of you – Dear Readers – an even bigger vinaka for your interest, whether you live in Fiji or the diaspora. This 34,000 doesn’t take into account those who have read my articles when they are republished on Victor Lal’s Fijileaks or cited on social media. So that figure will be even higher.
As I’ve said before, it was astonishing to me that the Prime Minister recorded a formal statement for the cameras accusing me of trading in gossip, of having a predilection for drama when I worked for him and citing my age as a reason for him to wish me best wishes in my retirement. We are the same age – 66. So if I was being cast as “retired” when I’m not, why wouldn’t the Prime Minister also be contemplating retirement instead of insisting on contesting the next election? It was all very weird. And because I know how the government works, a sign of abject panic on the part of the AG, who always uses the PM’s authority in such instances to make a point without any thought of the potential of making him look stupid.
There’s nothing like a Prime Ministerial attack to boost one’s readership and I am indebted to Frank Bainimarama for propelling Grubsheet Feejee – within a month of its resumption – into the frontline of the national debate in Fiji. In one grumpy outburst written for him by Qorvis and the Attorney General, Aiyaz Sayed-Khaiyum, the Prime Minister made me more relevant than I deserve. His comments were on the front page of the two daily newspapers and led the main television news programs and every radio bulletin. So that if anyone hadn’t heard of Graham Davis or Grubsheet before, they do now and that has been reflected in a huge increase in the number of “hits” on this website.
34,348 people visited Grubsheet in the week from Friday September 18 to Friday September 25 (yesterday), with a big spike in the wake of the PM’s comments. So to him I say vinaka vakalevu and to all of you – Dear Readers – an even bigger vinaka for your interest, whether you live in Fiji or the diaspora. This 34,000 doesn’t take into account those who have read my articles when they are republished on Victor Lal’s Fijileaks or cited on social media. So that figure will be even higher.
As I’ve said before, it was astonishing to me that the Prime Minister recorded a formal statement for the cameras accusing me of trading in gossip, of having a predilection for drama when I worked for him and citing my age as a reason for him to wish me best wishes in my retirement. We are the same age – 66. So if I was being cast as “retired” when I’m not, why wouldn’t the Prime Minister also be contemplating retirement instead of insisting on contesting the next election? It was all very weird. And because I know how the government works, a sign of abject panic on the part of the AG, who always uses the PM’s authority in such instances to make a point without any thought of the potential of making him look stupid.
Above all, nothing that I have written in these columns was disputed by the Prime Minister on the basis of fact. Not a single word. He dismissed it as gossip but didn’t say it was wrong. So that what I said is true: The Military Council has asked for reform of the government and the removal of the AG. The cabinet is divided over the issue of the AG’s control of the government. And the PM has nominated Inia Seruiratu as his successor.
The Fiji Times front page today ( September 26) picks up the story and next to a photo of Seruiratu asks: “Will he be next”. Well, yes, if what the Prime Minister told the Military Council in the 2018 election aftermath still applies. The paper says it asked the PM and the AG on Tuesday whether what I’d reported on Grubsheet is correct. Four days later, the Fiji Times says it has still had no response.
I know that some of those closest to the Prime Minister were appalled by his attack on me, and especially his attempt to demean me as some sort of bit player who he knew but wasn’t really important, which merely raised the question of why on earth he’d be attacking me in the first place if that was the case. He knows and everyone around him knows that I was at the centre of government and played a significant role in bolstering its fortunes and those of the Prime Minister.
For years before I joined Qorvis in 2012, I was a Bainimarama supporter – regularly explaining his agenda in articles in the regional media -and especially The Australian newspaper – and from 2011, in the columns of Grubsheet Feejee. For a long time – as many readers will remember – these articles were republished in the Fiji Sun and had considerable impact on wider public opinion. For obvious reasons, The AG-controlled Sun has not displayed quite the same alacrity since the relaunch of Grubsheet last month to resume that arrangement. But those articles – from 2011 to 2014 – are still available for any reader interested in looking back over the Grubsheet archive. And they demonstrate beyond question my support for Frank Bainimarama’s principal agenda of levelling the playing field in Fiji and guaranteeing the rights of every Fijian, irrespective of ethnicity and religious affiliation.
Engaged by Qorvis in Suva on the basis of my writings, I crafted the government’s winning narrative during the tumultuous period leading up to the return to parliamentary rule in September 2014. There was a particular emphasis on service delivery and inclusiveness. “We deliver”, was a line devised by my Qorvis colleague, Sol Levine. To that I added “We serve.” Along with a repeated emphasis on Fiji as a caring society in which the Bainimarama government was giving people equal opportunity and a leg-up, not a handout, to help them help themselves to improve their lives and those of their families.
I wrote the Prime Minister’s speeches that propelled him to national, regional and global status as a statesman and did so as a true believer, not a hired gun. I was especially emotional the night I wrote his announcement of free education as I recalled the many times that underprivileged parents had come to our family home when I was a child asking for assistance with their children’s school fees. I still think it’s the proudest achievement of the Bainimarama era – a leg-up without parallel in Fijian history.
Over the years, I had also grown close to both the PM and AG, peppering them with suggestions and advice and even ironing out differences between them. But I now think they have lost their way and am saying so. As I’ve already reported, I did what I could before I went public in these columns to persuade Frank Bainimarama to change course and especially in the wake of the disastrous 2018 election campaign. He has chosen not to do so. But it is a mistake and I am going to continue to say so.
It often seems that the PM is spooked by the prospect of change. But there is still time for him to reinvent the government, to remove the AG – who has become increasingly erratic and mercurial – and put Fiji on a different course. He has the people there to do it. Mere Vuniwaqa would make a great deputy prime minister and attorney general and the team of Frank Bainimarama and Mere Vuniwaqa has the capacity to beat Sitiveni Rabuka and Lynda Tabuya in 2022, whereas the team of Frank Bainimarama and Aiyaz Sayed-Khaiyum will not. And Jone Usamate easily has the intellectual firepower to take over as minister of economy, especially assisted by economic heavy hitters already on the government payroll such as Arif Ali, Makareta Konrote, Filimone Waqabaca and Jitoko Tikolevu, and those who could make up an external advisory panel of such luminaries as Savenaca Narube and Biman Prasad.
It can be done and must be done or FijiFirst faces almost certain defeat at the next election and the destruction of Frank Bainimarama’s reputation and legacy. It was never likely, given my personal commitment to his revolution, that the “ageing drama queen” would be deterred by what the Aussies would call some half-arsed attack, even by someone of the statue of the Prime Minister. So, Dear Reader, we press on.
The Fiji Times front page today ( September 26) picks up the story and next to a photo of Seruiratu asks: “Will he be next”. Well, yes, if what the Prime Minister told the Military Council in the 2018 election aftermath still applies. The paper says it asked the PM and the AG on Tuesday whether what I’d reported on Grubsheet is correct. Four days later, the Fiji Times says it has still had no response.
I know that some of those closest to the Prime Minister were appalled by his attack on me, and especially his attempt to demean me as some sort of bit player who he knew but wasn’t really important, which merely raised the question of why on earth he’d be attacking me in the first place if that was the case. He knows and everyone around him knows that I was at the centre of government and played a significant role in bolstering its fortunes and those of the Prime Minister.
For years before I joined Qorvis in 2012, I was a Bainimarama supporter – regularly explaining his agenda in articles in the regional media -and especially The Australian newspaper – and from 2011, in the columns of Grubsheet Feejee. For a long time – as many readers will remember – these articles were republished in the Fiji Sun and had considerable impact on wider public opinion. For obvious reasons, The AG-controlled Sun has not displayed quite the same alacrity since the relaunch of Grubsheet last month to resume that arrangement. But those articles – from 2011 to 2014 – are still available for any reader interested in looking back over the Grubsheet archive. And they demonstrate beyond question my support for Frank Bainimarama’s principal agenda of levelling the playing field in Fiji and guaranteeing the rights of every Fijian, irrespective of ethnicity and religious affiliation.
Engaged by Qorvis in Suva on the basis of my writings, I crafted the government’s winning narrative during the tumultuous period leading up to the return to parliamentary rule in September 2014. There was a particular emphasis on service delivery and inclusiveness. “We deliver”, was a line devised by my Qorvis colleague, Sol Levine. To that I added “We serve.” Along with a repeated emphasis on Fiji as a caring society in which the Bainimarama government was giving people equal opportunity and a leg-up, not a handout, to help them help themselves to improve their lives and those of their families.
I wrote the Prime Minister’s speeches that propelled him to national, regional and global status as a statesman and did so as a true believer, not a hired gun. I was especially emotional the night I wrote his announcement of free education as I recalled the many times that underprivileged parents had come to our family home when I was a child asking for assistance with their children’s school fees. I still think it’s the proudest achievement of the Bainimarama era – a leg-up without parallel in Fijian history.
Over the years, I had also grown close to both the PM and AG, peppering them with suggestions and advice and even ironing out differences between them. But I now think they have lost their way and am saying so. As I’ve already reported, I did what I could before I went public in these columns to persuade Frank Bainimarama to change course and especially in the wake of the disastrous 2018 election campaign. He has chosen not to do so. But it is a mistake and I am going to continue to say so.
It often seems that the PM is spooked by the prospect of change. But there is still time for him to reinvent the government, to remove the AG – who has become increasingly erratic and mercurial – and put Fiji on a different course. He has the people there to do it. Mere Vuniwaqa would make a great deputy prime minister and attorney general and the team of Frank Bainimarama and Mere Vuniwaqa has the capacity to beat Sitiveni Rabuka and Lynda Tabuya in 2022, whereas the team of Frank Bainimarama and Aiyaz Sayed-Khaiyum will not. And Jone Usamate easily has the intellectual firepower to take over as minister of economy, especially assisted by economic heavy hitters already on the government payroll such as Arif Ali, Makareta Konrote, Filimone Waqabaca and Jitoko Tikolevu, and those who could make up an external advisory panel of such luminaries as Savenaca Narube and Biman Prasad.
It can be done and must be done or FijiFirst faces almost certain defeat at the next election and the destruction of Frank Bainimarama’s reputation and legacy. It was never likely, given my personal commitment to his revolution, that the “ageing drama queen” would be deterred by what the Aussies would call some half-arsed attack, even by someone of the statue of the Prime Minister. So, Dear Reader, we press on.
Graham Davis: A Tangled Web of Secrets and Control (Part One)
Few Fijians realise the tentacles of influence that the FijiFirst government has established to control a range of state-owned institutions and enterprises through a network of business associates of the Attorney General, Aiyaz Sayed-Khaiyum, and trusted members of the civil service. It is a complex web of high-level relationships with the AG at the centre. These business figures and civil servants are effectively agents of influence acting on his behalf to manage these institutions and enterprises, reporting directly to him and implementing his strategic directions.
It is all the result of 14 years of the AG acting as puppet master in the government, the civil service, state enterprises and to a large extent, the business community. Yet serious questions are now being asked about the propriety of some of those arrangements and whether they serve the public interest. And by figures of stature in the community such as Savenaca Narube – the former Governor of the Reserve Bank, former Permanent Secretary for Finance and leader of the Unity Party.
Narube enjoys a solid reputation across the political spectrum for his economic prowess and experience, as well as his ability to articulate complex issues in the media with more clarity than most of the Fijian commentariat. In this week’s Fiji Sun/Western Force poll on preferred prime minister, Narube came in fifth place after Frank Bainimarama, Sitiveni Rabuka, Aseri Radrodro and Mahendra Chaudhry but ahead of Biman Prasad, which shows that his writing is producing a valuable political dividend.
Opposition politicians such as Biman Prasad and Mahendra Chaudhry have long called into question some of these arrangements and relationships. Yet Narube went in hard in a Fiji Times article last Saturday (September 19) , not only on the startling level of debt the country is accruing to survive the Covid-19 crisis – which he put at more than $10-billion, $2-billion above the official account- but the propriety of some of the appointments that have been made to state-owned institutions and the conduct of some of these institutions.
Narube particularly targeted the governance of the FNPF, which he said was still financially strong but was heavily exposed because the AG had “permitted the FNPF to lend to Fiji Airways, allowed members to withdraw (funds) because of the crisis, and reduced the contribution from both employers and employees”. “What worries me the most is the political interference in the policies of the Fund, the lack of independence of some members of the board and the apparent omission to apply the ‘fit and proper’ standards to some board members by the regulator, which is the Reserve Bank of Fiji”, Narube wrote.
Before we examine the governance of the FNPF in detail, the issue of board appointments warrants some context: It’s axiomatic that small countries like Fiji generally have much smaller pools of expertise to call on to run their enterprises. Yet even so, it’s astonishing that this clique now is so relatively small, reflecting the AG’s obsession with control and the fact that he trusts so few people. Equally astonishing is the lack of transparency and accountability about how these people are appointed and the manner in which they preside over these businesses, that are ultimately owned by the Fijian people, employ many of them and affect their lives on a daily basis.
When Frank Bainimarama seized power in 2006, much was made about the need for a “clean-up campaign” to address the alleged corruption and cronyism of the Qarase government. Yet having got rid of Laisenia Qarase’s cronies, Aiyaz Sayed-Khaiyum has merely installed his own. There is no independent process to select board members. It is entirely at the AG’s discretion. Which means that he exercises an extraordinary degree of control over the FNPF, state-owned enterprises and statutory authorities and the Fijian economy generally through the people he chooses and the appointments he makes.
From time to time, the Fijian media will be summoned to a photo call or news conference at which new board appointments are paraded. Yet there is virtually no media questioning, let alone genuine scrutiny, of those being appointed, the overlap between their private and public interests in Fiji and some of the inherent conflicts of interest across this network. The Fijian people generally have no idea how these businesses operate. Yet there’s little doubt that practices have developed that would not meet governance standards in other democracies and, indeed, some that would attract the scrutiny of their regulatory authorities.
What the AG wants, the AG generally gets, though not always. Yet when he doesn’t, the record shows that he generally does what he can to get around the obstacles in his way. When chairs of boards don’t yield to his demands, they are generally replaced with people who are more compliant. And as with everything else in the conduct of government, personal loyalty to the AG is more important than loyalty to the government as a whole or the interests of the Fijian people – the ultimate shareholders of these institutions.
Among other things, the AG has engineered a situation in which a close associate who he made chair of Energy Fiji Limited has presided over the sale of 20 per cent of EFL to the national superannuation fund – the FNPF – to benefit the AG’s budgetary position. And then after the FNPF baulked at buying as much of EFL as the AG wanted, he appointed the EFL chair – the seller – to also chair the FNPF – the buyer. At the same time, he put two other associates onto the FNPF Board. Making it much more likely that the FNPF will bend to the AG’s will in future – as the Covid crisis accelerates – to be able to access the piggy bank that constitutes the retirement savings of the Fijian people.
Anywhere else in the world, this would trigger a political storm yet passes with relatively little criticism in Fiji. As does the inherent conflict of interest of the CEO of Fiji Airways receiving a loan for the airline through the Fiji Development Bank and soon afterwards being appointed chair of the FDB – the institution that funnelled money to the airline from the Reserve Bank. By global standards, these occurrences are highly irregular – the AG as puppet master installing loyalists on the boards of publicly owned enterprises and through them, directing and controlling these institutions. This control benefits the FijiFirst government but whether these arrangements are in the public interest is another question altogether.
But who are some of these people? And what are their relationship with the AG and FijiFirst that have earned them his patronage and their positions? In this two part series over the next week, Grubsheet turns the spotlight on some of the principal individuals who run our institutions and exposes some of the conflicts of interests inherent in their appointments and their conduct.
THE FNPF: YOUR MONEY IN THEIR HANDS:
Among the most glaring perceived conflicts of interest is that of Daksesh Patel – who since January, has been Chair of one of Fiji’s most important institutions – the Fiji National Provident Fund, which the AG is using as the principal vehicle to get the country through the financial challenges of the Covid-19 crisis. This includes allowing the Fijian people to access some of their retirement savings to live on – which the AG shamelessly describes as “assistance” when it is their own money – and providing FNPF loans to Fiji Airways to keep it afloat, while reducing employer contributions to the FNPF.
Daksesh Patel is a Fijian businessman with a global reputation. In Fiji, he is Executive Chairman of the Vinod Patel group – the family hardware company established by his father, Vinod, in Ba in 1962. But in Australia and the United States, he is President of the Liberty Steel Group, whose Executive Chairman and CEO is Sanjeev Gupta, the steel magnate who is one of the biggest names in global steel, with interests around the world. Daksesh Patel is also CEO of the Liberty subsidiary, Infrabuild – Australia’s largest manufacturer and supplier of steel products – and lives in Sydney, all of which makes him a very big corporate player indeed.
Daksesh Patel is a close associate of the Attorney General and a donor for Fiji First. But it is his dual role as Chair of Energy Fiji Limited as well as the FNPF that gives rise to the greatest concern. Last year, while Chair of EFL, Daksesh Patel presided over the sale of 20 per cent of EFL worth $220-million to the FNPF to help the AG meet a half billion dollar pre-Covid budget shortfall. The AG had wanted the FNPF to buy double that – 40 per cent or $440-million dollars worth of EFL shares. But the FNPF board – led at that time by Ajith Kodagoda – resisted this purchase and insisted that it be capped at $220-million. This left the AG with a bigger budget shortfall than he expected and he was not happy. Far from it. Because it did much to expose him politically by demonstrating his lack of prowess in managing the economy. And as it turned out, made Fiji far more vulnerable when Covid-19 struck because the cupboard was bare.
The AG had only been able to sell off half of the family silver at EFL that he wanted to sell to the people who arguably already owned it and the resulting shortfall shattered his well-crafted image of being a sound economic manager. As Economy Minister, he had overspent to try to secure votes in the 2018 election lead-up and had overestimated government revenue. Which meant that Fiji was already overextended even before the Covid-19 crisis began and is now so burdened by debt that those loan repayments will extend to future generations.
It became imperative to get control of the FNPF Board. So in January this year, when Ajith Kodagoda reached the end of his statutory term, he was replaced as FNPF chair by Daksesh Patel and two other AG loyalists – Sanjay Kaba and Mukhtar Ali also joined the FNPF board. So Daksesh Patel – the person who presided over the sale of EFL shares to the FNPF at the AG’s behest – and according to the government directory remains the Chair of EFL – is now chair of the purchaser of those shares, the FNPF.
Daksesh Patel insists that he has done nothing illegal and Grubsheet is not suggesting that he has. Yet in corporate governance terms, simultaneously wearing the two hats of chair of the FNPF and of EFL when $220-million has recently passed between them does not pass the credibility test in Fiji and would undoubtedly fail any test of probity in Australia and the US. Because he now has the power as Chair of the FNPF – with his fellow board members – to approve the further use of FNPF funds to benefit the AG’s budgetary position and whatever else the government might want to do with the retirement savings of the Fijian people. A classic conflict of interest by someone who has been a long-time friend of the AG and a FijiFirst donor. Victor Lal’s Fijileaks is reporting this week – having gained access to the records of the Fiji Elections Office – that Daksesh Patel donated $10,000 to FijiFirst on 14 October 2015 (Receipt Number 457).
Eyebrows were also raised when Daksesh Patel hired Qorvis – the government’s Washington-based communications consultants – to advise Energy Fiji Limited . This was also evidently at the behest of the AG, for whom Qorvis has become essential to his control of the government in that, among other things, it writes his narrative for the Prime Minister’s public utterances. Yet securing a contract with EFL in addition to its long-standing arrangement to provide the government with communications services is highly problematic. Here is a wholly-owned government statutory authority employing a foreign company to carry out work for it without a tender because of the personal relationship between the AG and Daksesh Patel. All of which raises further questions about corporate governance standards at the state-owned electricity provider.
The aforementioned Sanjay Kaba – who has joined Daksesh Patel on the board of the FNPF – is also a close personal associate of the AG, with strong tentacles in the business community in Fiji. He is said to have been FijiFirst’s principal fundraiser for the 2018 election campaign and as Grubsheet has previously reported, made up the two-man panel, with the AG, that interviewed prospective FijiFirst candidates for the election. Readers will recall that the AG and Sajay Kaba rejected the candidacy of Brigadier General (ret’d) Ioane Naivalurua, the Secretary of the Military Council that now wants changes to the government, including the removal of the AG and his power to make appointments to government boards.
Sanjay Kaba is a civil engineer who is Managing Director, Principal Structural Engineer and Projects Director at Houng Lee Jacob Kaba Ltd. As well as now being on the FNPF board, he is a former member of the Constitutional Offices Commission. And he is someone whose influence reaches through the business community, doing the bidding of his patron, the AG, who he has assisted not only with FijiFirst fundraising but in organising the rebuilding effort after Cyclone Winston. As we’ll see, many of the companies that benefited from this rebuilding by supplying the materials needed also have their senior executives on government boards. Which is problematic in itself.
It was on Sanjay Kaba’s advice as a civil engineer that work was interrupted on Fiji’s tallest building, the controversial 28-story WG Friendship Plaza on McGregor Road in Suva. Sanjay Kaba and a group of Australian engineers questioned the quality of the steel being used on the building on the basis that it was a potential fire hazard. But the decision to halt the project incensed the Chinese developers, who maintain that the structure is safe. And Grubsheet understands that over the objections of the AG and Sanjay Kaba, the Prime Minister ordered the suspension lifted and work on the complex is now proceeding.
This is an astonishing saga in itself – the erection of a building that now dominates the Suva skyline, and especially the state precinct around Albert Park, with no public consultation and, according to government sources, no reference to the cabinet. The Friendship Tower evidently went ahead on the sole say-so of the Prime Minister and Parveen Bala, the then minister for Local Government, Housing and Environment. Many regard it as a blight on the landscape that should never have been built. It has arguably scarred the city irreparably. But worse, the questions about whether the building is safe have never been adequately answered.
The third of the AG’s new appointments to the FNPF Board in January was that of Mukhtar Ali – a Californian banker. Ali is Chief Operating Officer of the Community Bank of the Bay in Oakland, California and is former President and CEO of the Mission National Bank in San Francisco. Again, according to Fijileaks, Mukhtar Ali donated $5000 to FijiFirst on June 25 2014 (receipt no 420).
So all three of these new appointments to the FNPF Board in January are heavily weighted with close associates of the AG in one way or another, and two of the others, as civil servants, patently owe their jobs to the AG’s continuing patronage. They are Makareta Konrote, the Permanent Secretary of Economy who is also on the board of the Reserve Bank. And Joel Abraham, the CEO of the Fijian Competition and Consumer Commission, who is also on the Fiji Meat Industry Board. All this leaves just one person out of six on the FNPF Board with no obvious ties to the AG – Kalpana Lal, Head of Administration and Finance for the German government aid agency, GIZ. All of the others are either close associates or work for him at close quarters.
So by any internationally accepted standard, the FNPF Board is not in the least bit independent. It is controlled by the AG through his appointed Board members. And he now has the power to access FNPF funds with none of the impediments that existed when Ajith Kodagoda was chair of the FNPF and blocked his access to half of what he wanted to sell to it in EFL shares. Stripped to its bare essentials, the fox now controls the chook house and its eggs. And that should be of immense concern to FNPF members and the Fijian people as a whole.
FIJI AIRWAYS: WHEN THE BORROWER CHAIRS THE BOARD OF THE LENDER
Andre Viljoen is a respected airline executive and notable tough guy, as Grubsheet detailed in its story last month recounting how Viljoen had a gun put to his head when confronting an aircraft spare parts racket in a previous job. But this ability to get out of a tight spot hasn’t prevented the Fiji Airways chief from being dragged into the middle of a political firefight in Fiji and for another perceived conflict of interest.
At the directive of the AG, the Fiji Development Bank lent Fiji Airways more than $70-million with a government guarantee to help keep it afloat. But then he appointed Viljoen – the CEO of Fiji Airways – as chair of the board of the FDB – a breathtaking move in that the conflict of interest is again so obvious. As Savenaca Narube observed: “The government is caught in its own dangerous web of being the majority shareholder of both entities, a financier to one and guarantor to the other. This incestuous relationship heavily compromises the governance integrity of FDB and Fiji Airways”, he wrote.
The resulting taint drags Fiji Airways into controversy just when public and parliamentary support is essential to back the government’s effort to keep the national airline going. And it has not only damaged Andre Viljoen but also engulfed the reputation of the Chair of Fiji Airways, Rajesh Punja, the Director of the Punjas Group of companies.
Together, they are also responsible for what appears to be one of the most cynical exercises in the whole sorry saga of the Covid-19 fallout in Fiji and its impact on ordinary Fijian workers. According to insiders at Fiji Airways, the retrenchment of the entire 400-strong force of cabin attendants was driven less by financial considerations than a determination to end the perceived stranglehold of the Flight Attendants Union on the airline’s operations.
If this is true, 400 Fijians who were the face of the airline and its point of contact with Fiji Airways passengers have been forced onto the street during an economic crisis in a naked exercise in union busting. Recent advertisements recruiting new cabin staff certainly lend weight to this suggestion, otherwise those existing staff laid off would have first call on these positions. It doesn’t get much shabbier and because Aiyaz Sayed-Khaiyum controls Fiji Airways, he is more likely than not to be the hand behind this move – FijiFirst waging war on ordinary workers during the biggest economic downturn in the nation’s history.
Rajesh Punja – the head of one of the South Pacific’s largest privately-owned enterprises – is only one of a host of local business figures on the boards of public instrumentalities. Some of these have patent conflicts of interest in serving on the boards of government enterprises that buy their goods and services. And, of course, their willingness to serve on these boards inevitably puts them in good stead with the FijiFirst government and especially Aiyaz Sayed-Khaiyum.
There’s generally an expectation that they will benefit from the government’s largesse and equally, when the call comes, apprehension about what might happen if they decline. The level of fear in the business community generally these days is intense, especially about the punitive nature of the taxman – the Fiji Revenue and Customs Services (FRCS) – along with the fear of coming to the attention of FICAC or the FCCC, the Fijian Competition Consumer Commission.
Next week, we turn the spotlight on some of these individuals and ask: Private interests, public responsibilities. Which comes first? And we also examine some of the senior civil servants who have been delegated to sit on government boards. These are invariably favourites of the AG, who do his bidding and are his eyes and ears around the table. But what qualifies these civil servants for their board positions? And what comes first? Public duty or pleasing “the boss”?
All this in Part Two of A Tangled Web of Secrets and Control. Next week.
In the meantime, you can browse through the names of board members at directory.digital.gov.fj Just follow the links to the various enterprises. (Grubsheet Feejee, 24 Septeber 2020)
It is all the result of 14 years of the AG acting as puppet master in the government, the civil service, state enterprises and to a large extent, the business community. Yet serious questions are now being asked about the propriety of some of those arrangements and whether they serve the public interest. And by figures of stature in the community such as Savenaca Narube – the former Governor of the Reserve Bank, former Permanent Secretary for Finance and leader of the Unity Party.
Narube enjoys a solid reputation across the political spectrum for his economic prowess and experience, as well as his ability to articulate complex issues in the media with more clarity than most of the Fijian commentariat. In this week’s Fiji Sun/Western Force poll on preferred prime minister, Narube came in fifth place after Frank Bainimarama, Sitiveni Rabuka, Aseri Radrodro and Mahendra Chaudhry but ahead of Biman Prasad, which shows that his writing is producing a valuable political dividend.
Opposition politicians such as Biman Prasad and Mahendra Chaudhry have long called into question some of these arrangements and relationships. Yet Narube went in hard in a Fiji Times article last Saturday (September 19) , not only on the startling level of debt the country is accruing to survive the Covid-19 crisis – which he put at more than $10-billion, $2-billion above the official account- but the propriety of some of the appointments that have been made to state-owned institutions and the conduct of some of these institutions.
Narube particularly targeted the governance of the FNPF, which he said was still financially strong but was heavily exposed because the AG had “permitted the FNPF to lend to Fiji Airways, allowed members to withdraw (funds) because of the crisis, and reduced the contribution from both employers and employees”. “What worries me the most is the political interference in the policies of the Fund, the lack of independence of some members of the board and the apparent omission to apply the ‘fit and proper’ standards to some board members by the regulator, which is the Reserve Bank of Fiji”, Narube wrote.
Before we examine the governance of the FNPF in detail, the issue of board appointments warrants some context: It’s axiomatic that small countries like Fiji generally have much smaller pools of expertise to call on to run their enterprises. Yet even so, it’s astonishing that this clique now is so relatively small, reflecting the AG’s obsession with control and the fact that he trusts so few people. Equally astonishing is the lack of transparency and accountability about how these people are appointed and the manner in which they preside over these businesses, that are ultimately owned by the Fijian people, employ many of them and affect their lives on a daily basis.
When Frank Bainimarama seized power in 2006, much was made about the need for a “clean-up campaign” to address the alleged corruption and cronyism of the Qarase government. Yet having got rid of Laisenia Qarase’s cronies, Aiyaz Sayed-Khaiyum has merely installed his own. There is no independent process to select board members. It is entirely at the AG’s discretion. Which means that he exercises an extraordinary degree of control over the FNPF, state-owned enterprises and statutory authorities and the Fijian economy generally through the people he chooses and the appointments he makes.
From time to time, the Fijian media will be summoned to a photo call or news conference at which new board appointments are paraded. Yet there is virtually no media questioning, let alone genuine scrutiny, of those being appointed, the overlap between their private and public interests in Fiji and some of the inherent conflicts of interest across this network. The Fijian people generally have no idea how these businesses operate. Yet there’s little doubt that practices have developed that would not meet governance standards in other democracies and, indeed, some that would attract the scrutiny of their regulatory authorities.
What the AG wants, the AG generally gets, though not always. Yet when he doesn’t, the record shows that he generally does what he can to get around the obstacles in his way. When chairs of boards don’t yield to his demands, they are generally replaced with people who are more compliant. And as with everything else in the conduct of government, personal loyalty to the AG is more important than loyalty to the government as a whole or the interests of the Fijian people – the ultimate shareholders of these institutions.
Among other things, the AG has engineered a situation in which a close associate who he made chair of Energy Fiji Limited has presided over the sale of 20 per cent of EFL to the national superannuation fund – the FNPF – to benefit the AG’s budgetary position. And then after the FNPF baulked at buying as much of EFL as the AG wanted, he appointed the EFL chair – the seller – to also chair the FNPF – the buyer. At the same time, he put two other associates onto the FNPF Board. Making it much more likely that the FNPF will bend to the AG’s will in future – as the Covid crisis accelerates – to be able to access the piggy bank that constitutes the retirement savings of the Fijian people.
Anywhere else in the world, this would trigger a political storm yet passes with relatively little criticism in Fiji. As does the inherent conflict of interest of the CEO of Fiji Airways receiving a loan for the airline through the Fiji Development Bank and soon afterwards being appointed chair of the FDB – the institution that funnelled money to the airline from the Reserve Bank. By global standards, these occurrences are highly irregular – the AG as puppet master installing loyalists on the boards of publicly owned enterprises and through them, directing and controlling these institutions. This control benefits the FijiFirst government but whether these arrangements are in the public interest is another question altogether.
But who are some of these people? And what are their relationship with the AG and FijiFirst that have earned them his patronage and their positions? In this two part series over the next week, Grubsheet turns the spotlight on some of the principal individuals who run our institutions and exposes some of the conflicts of interests inherent in their appointments and their conduct.
THE FNPF: YOUR MONEY IN THEIR HANDS:
Among the most glaring perceived conflicts of interest is that of Daksesh Patel – who since January, has been Chair of one of Fiji’s most important institutions – the Fiji National Provident Fund, which the AG is using as the principal vehicle to get the country through the financial challenges of the Covid-19 crisis. This includes allowing the Fijian people to access some of their retirement savings to live on – which the AG shamelessly describes as “assistance” when it is their own money – and providing FNPF loans to Fiji Airways to keep it afloat, while reducing employer contributions to the FNPF.
Daksesh Patel is a Fijian businessman with a global reputation. In Fiji, he is Executive Chairman of the Vinod Patel group – the family hardware company established by his father, Vinod, in Ba in 1962. But in Australia and the United States, he is President of the Liberty Steel Group, whose Executive Chairman and CEO is Sanjeev Gupta, the steel magnate who is one of the biggest names in global steel, with interests around the world. Daksesh Patel is also CEO of the Liberty subsidiary, Infrabuild – Australia’s largest manufacturer and supplier of steel products – and lives in Sydney, all of which makes him a very big corporate player indeed.
Daksesh Patel is a close associate of the Attorney General and a donor for Fiji First. But it is his dual role as Chair of Energy Fiji Limited as well as the FNPF that gives rise to the greatest concern. Last year, while Chair of EFL, Daksesh Patel presided over the sale of 20 per cent of EFL worth $220-million to the FNPF to help the AG meet a half billion dollar pre-Covid budget shortfall. The AG had wanted the FNPF to buy double that – 40 per cent or $440-million dollars worth of EFL shares. But the FNPF board – led at that time by Ajith Kodagoda – resisted this purchase and insisted that it be capped at $220-million. This left the AG with a bigger budget shortfall than he expected and he was not happy. Far from it. Because it did much to expose him politically by demonstrating his lack of prowess in managing the economy. And as it turned out, made Fiji far more vulnerable when Covid-19 struck because the cupboard was bare.
The AG had only been able to sell off half of the family silver at EFL that he wanted to sell to the people who arguably already owned it and the resulting shortfall shattered his well-crafted image of being a sound economic manager. As Economy Minister, he had overspent to try to secure votes in the 2018 election lead-up and had overestimated government revenue. Which meant that Fiji was already overextended even before the Covid-19 crisis began and is now so burdened by debt that those loan repayments will extend to future generations.
It became imperative to get control of the FNPF Board. So in January this year, when Ajith Kodagoda reached the end of his statutory term, he was replaced as FNPF chair by Daksesh Patel and two other AG loyalists – Sanjay Kaba and Mukhtar Ali also joined the FNPF board. So Daksesh Patel – the person who presided over the sale of EFL shares to the FNPF at the AG’s behest – and according to the government directory remains the Chair of EFL – is now chair of the purchaser of those shares, the FNPF.
Daksesh Patel insists that he has done nothing illegal and Grubsheet is not suggesting that he has. Yet in corporate governance terms, simultaneously wearing the two hats of chair of the FNPF and of EFL when $220-million has recently passed between them does not pass the credibility test in Fiji and would undoubtedly fail any test of probity in Australia and the US. Because he now has the power as Chair of the FNPF – with his fellow board members – to approve the further use of FNPF funds to benefit the AG’s budgetary position and whatever else the government might want to do with the retirement savings of the Fijian people. A classic conflict of interest by someone who has been a long-time friend of the AG and a FijiFirst donor. Victor Lal’s Fijileaks is reporting this week – having gained access to the records of the Fiji Elections Office – that Daksesh Patel donated $10,000 to FijiFirst on 14 October 2015 (Receipt Number 457).
Eyebrows were also raised when Daksesh Patel hired Qorvis – the government’s Washington-based communications consultants – to advise Energy Fiji Limited . This was also evidently at the behest of the AG, for whom Qorvis has become essential to his control of the government in that, among other things, it writes his narrative for the Prime Minister’s public utterances. Yet securing a contract with EFL in addition to its long-standing arrangement to provide the government with communications services is highly problematic. Here is a wholly-owned government statutory authority employing a foreign company to carry out work for it without a tender because of the personal relationship between the AG and Daksesh Patel. All of which raises further questions about corporate governance standards at the state-owned electricity provider.
The aforementioned Sanjay Kaba – who has joined Daksesh Patel on the board of the FNPF – is also a close personal associate of the AG, with strong tentacles in the business community in Fiji. He is said to have been FijiFirst’s principal fundraiser for the 2018 election campaign and as Grubsheet has previously reported, made up the two-man panel, with the AG, that interviewed prospective FijiFirst candidates for the election. Readers will recall that the AG and Sajay Kaba rejected the candidacy of Brigadier General (ret’d) Ioane Naivalurua, the Secretary of the Military Council that now wants changes to the government, including the removal of the AG and his power to make appointments to government boards.
Sanjay Kaba is a civil engineer who is Managing Director, Principal Structural Engineer and Projects Director at Houng Lee Jacob Kaba Ltd. As well as now being on the FNPF board, he is a former member of the Constitutional Offices Commission. And he is someone whose influence reaches through the business community, doing the bidding of his patron, the AG, who he has assisted not only with FijiFirst fundraising but in organising the rebuilding effort after Cyclone Winston. As we’ll see, many of the companies that benefited from this rebuilding by supplying the materials needed also have their senior executives on government boards. Which is problematic in itself.
It was on Sanjay Kaba’s advice as a civil engineer that work was interrupted on Fiji’s tallest building, the controversial 28-story WG Friendship Plaza on McGregor Road in Suva. Sanjay Kaba and a group of Australian engineers questioned the quality of the steel being used on the building on the basis that it was a potential fire hazard. But the decision to halt the project incensed the Chinese developers, who maintain that the structure is safe. And Grubsheet understands that over the objections of the AG and Sanjay Kaba, the Prime Minister ordered the suspension lifted and work on the complex is now proceeding.
This is an astonishing saga in itself – the erection of a building that now dominates the Suva skyline, and especially the state precinct around Albert Park, with no public consultation and, according to government sources, no reference to the cabinet. The Friendship Tower evidently went ahead on the sole say-so of the Prime Minister and Parveen Bala, the then minister for Local Government, Housing and Environment. Many regard it as a blight on the landscape that should never have been built. It has arguably scarred the city irreparably. But worse, the questions about whether the building is safe have never been adequately answered.
The third of the AG’s new appointments to the FNPF Board in January was that of Mukhtar Ali – a Californian banker. Ali is Chief Operating Officer of the Community Bank of the Bay in Oakland, California and is former President and CEO of the Mission National Bank in San Francisco. Again, according to Fijileaks, Mukhtar Ali donated $5000 to FijiFirst on June 25 2014 (receipt no 420).
So all three of these new appointments to the FNPF Board in January are heavily weighted with close associates of the AG in one way or another, and two of the others, as civil servants, patently owe their jobs to the AG’s continuing patronage. They are Makareta Konrote, the Permanent Secretary of Economy who is also on the board of the Reserve Bank. And Joel Abraham, the CEO of the Fijian Competition and Consumer Commission, who is also on the Fiji Meat Industry Board. All this leaves just one person out of six on the FNPF Board with no obvious ties to the AG – Kalpana Lal, Head of Administration and Finance for the German government aid agency, GIZ. All of the others are either close associates or work for him at close quarters.
So by any internationally accepted standard, the FNPF Board is not in the least bit independent. It is controlled by the AG through his appointed Board members. And he now has the power to access FNPF funds with none of the impediments that existed when Ajith Kodagoda was chair of the FNPF and blocked his access to half of what he wanted to sell to it in EFL shares. Stripped to its bare essentials, the fox now controls the chook house and its eggs. And that should be of immense concern to FNPF members and the Fijian people as a whole.
FIJI AIRWAYS: WHEN THE BORROWER CHAIRS THE BOARD OF THE LENDER
Andre Viljoen is a respected airline executive and notable tough guy, as Grubsheet detailed in its story last month recounting how Viljoen had a gun put to his head when confronting an aircraft spare parts racket in a previous job. But this ability to get out of a tight spot hasn’t prevented the Fiji Airways chief from being dragged into the middle of a political firefight in Fiji and for another perceived conflict of interest.
At the directive of the AG, the Fiji Development Bank lent Fiji Airways more than $70-million with a government guarantee to help keep it afloat. But then he appointed Viljoen – the CEO of Fiji Airways – as chair of the board of the FDB – a breathtaking move in that the conflict of interest is again so obvious. As Savenaca Narube observed: “The government is caught in its own dangerous web of being the majority shareholder of both entities, a financier to one and guarantor to the other. This incestuous relationship heavily compromises the governance integrity of FDB and Fiji Airways”, he wrote.
The resulting taint drags Fiji Airways into controversy just when public and parliamentary support is essential to back the government’s effort to keep the national airline going. And it has not only damaged Andre Viljoen but also engulfed the reputation of the Chair of Fiji Airways, Rajesh Punja, the Director of the Punjas Group of companies.
Together, they are also responsible for what appears to be one of the most cynical exercises in the whole sorry saga of the Covid-19 fallout in Fiji and its impact on ordinary Fijian workers. According to insiders at Fiji Airways, the retrenchment of the entire 400-strong force of cabin attendants was driven less by financial considerations than a determination to end the perceived stranglehold of the Flight Attendants Union on the airline’s operations.
If this is true, 400 Fijians who were the face of the airline and its point of contact with Fiji Airways passengers have been forced onto the street during an economic crisis in a naked exercise in union busting. Recent advertisements recruiting new cabin staff certainly lend weight to this suggestion, otherwise those existing staff laid off would have first call on these positions. It doesn’t get much shabbier and because Aiyaz Sayed-Khaiyum controls Fiji Airways, he is more likely than not to be the hand behind this move – FijiFirst waging war on ordinary workers during the biggest economic downturn in the nation’s history.
Rajesh Punja – the head of one of the South Pacific’s largest privately-owned enterprises – is only one of a host of local business figures on the boards of public instrumentalities. Some of these have patent conflicts of interest in serving on the boards of government enterprises that buy their goods and services. And, of course, their willingness to serve on these boards inevitably puts them in good stead with the FijiFirst government and especially Aiyaz Sayed-Khaiyum.
There’s generally an expectation that they will benefit from the government’s largesse and equally, when the call comes, apprehension about what might happen if they decline. The level of fear in the business community generally these days is intense, especially about the punitive nature of the taxman – the Fiji Revenue and Customs Services (FRCS) – along with the fear of coming to the attention of FICAC or the FCCC, the Fijian Competition Consumer Commission.
Next week, we turn the spotlight on some of these individuals and ask: Private interests, public responsibilities. Which comes first? And we also examine some of the senior civil servants who have been delegated to sit on government boards. These are invariably favourites of the AG, who do his bidding and are his eyes and ears around the table. But what qualifies these civil servants for their board positions? And what comes first? Public duty or pleasing “the boss”?
All this in Part Two of A Tangled Web of Secrets and Control. Next week.
In the meantime, you can browse through the names of board members at directory.digital.gov.fj Just follow the links to the various enterprises. (Grubsheet Feejee, 24 Septeber 2020)
