Sunil Bholah, minister of business, enterprise and cooperatives, is facing allegations that his ministry is interfering in a land sale being considered by the Vacoas Multipurpose Cooperative Society (VMCS). The minister has become a lightning rod for the opposition in parliament. This week, we sit with Bholah to get his version and why he feels the attacks against him are unwarranted. So, has the minister been guilty of poking his nose in the VMCS?
There is an affidavit lodged against you by the former chairman of the Vacoas Multipurpose Cooperative Society (VMCS) that strongly alleges that you have been interfering in its affairs and attempting to influence a land deal, 37 acres in Flic-en-Flac, it is considering. What do you have to say about that?
There are a lot of allegations being made that are unfounded and untrue. Jhugroo’s affidavit was sworn in December but it states that I had been poking my nose in that deal since September, so why was the former chairman quiet about it for four months? Is it because the board decided to rescind the contract of SB Proconcult? Or that the deal with Fontanel does not seem to be materialising?
Now that you mention SB Proconsult, there are allegations that you pushed for their contract to be terminated. So what did happen at that meeting between you and Sunil Jhugroo on 29 November?
There were complaints from a majority of the board members of the VMCS about the behaviour of SB Proconsult as the manager and these were laid down in the minutes of the board meetings. For example, the sale of a car, lack of progress on the salvage plan, asking for more money, not giving financial accounts on time, posting only one permanent staff there instead of five and vacating the office on two occasions. These complaints made their way to me. So, I called the former chairman and he tried defending SB Proconsult saying that there was progress being made under their management and he did not listen to the complaints of the board members. I said no, there was a big financial mess and this was something for the board to resolve. Jhugroo told me he would see if SB Proconsult would leave on its own, but then told the rest of the board that no way would SB Proconsult go.
That was in November…
That was before in an informal meeting. We met several times since he was chairman. He agreed to put it on the agenda of the board. But when it was being drawn up, some members of the board came to me and said that Jhugroo did not want to include it on the agenda, so they contacted my adviser, Rajiv Koonjbeeharry, who has also been on the VMCS board since 2015. I told Mr. Koonjbeeharry to tell them to put it to the debate and discuss terminating SB Proconsult’s contract to the board.
We will come to that, but first, if the board was so unhappy, why did they not fire SB Proconsult themselves?
This society is under strict control; it has been put under the control of the registrar of cooperatives since 2015 according to section 47 of the Cooperatives Act, which removed the elected board and replaced it with a caretaker board, with the registrar empowered to direct the affairs of the VMCS.
So why did they not go to the registrar as they are supposed to?
That you will have to ask them. But let me just say that out of nine board members, five have money invested in this society. I don’t have a rupee there. Do you think they will let me just come and dictate to them?
In parliament, you admitted that there was no documentary evidence of such complaints from the VMCS board. There was no formal document stating these grievances. And then these supposed grievances go straight to a minister, circumventing the registrar where they are supposed to go! And suddenly the ministry decides that the question of getting rid of SB Proconsult must be raised. And you don’t see why others see this as abnormal?
No, it is not abnormal.
None of it seems very normal either: why didn’t you tell these board members to follow the law and go to the registrar as they are supposed to?
Why not? We have been helping this cooperative society come out of financial turmoil. What’s wrong in talking to them? Many cooperatives ask for my intervention. In many of these societies, my ministry has brought in the Financial Intelligence Unit (FIU), the Independent Commission Against Corruption (ICAC) and the Bank of Mauritius (BoM) to show them good governance. I am always accessible.
That still does not answer the question. Why did they come to you and not the registrar?
Each time I meet them, the registrar is there and some officials from my ministry. I do not master all the nitty-gritty and technicalities involved and need guidance at times.
Again, it’s one thing for the registrar to get involved, but quite another for the ministry to directly involve itself like this at the VMCS.
It’s not direct; it’s through my officers, not directly through me.
What difference does that make whether you do it on your own, or through your officials?
If I had told the board to throw SB Proconsult out, that would have been interference. What I asked was for them to debate the issue. What did Jhugroo try to do? He tried to prevent the other board members from bringing an issue up for a debate and the minister says bring it up, and you call that intereference? That is your interpretation and I don’t agree with you.
It’s not an interpretation; it’s what happened. The fact that they were voting on that question at all is evidence of your interference, isn’t it?
We cannot live with the situation when the manager was being questioned. If I did nothing then people would say that I saw that there was a big problem and just folded my arms and sat down!
Let’s come to another question: on 27 March, you told parliament that SB Proconsult had vacated office on its own in December but, on 24 April, you said that the board had terminated SB proconsult by a 7-2 decision. They both cannot be true. So which is which?
On 6 December, the board deliberated and decided to oust Proconsult. But, according to the terms of the contract, they had to stay for another three months after the decision. But what did they do? On 20 December, they vacated the office. That’s all I can say.
And is the board planning to do something about that?
The board is suing them for not respecting the contract.
And it is suing you for Rs50 million for reputational damage.
Yes I have been served, but this matter is already in court so I cannot comment on it.
You can see his point. Did you expect the board to act any different after your insistence that it discuss firing him?
Don’t give the impression that I just sat up one day and decided to do that and anyway, did I tell the board how to vote?
Did you have to? You and your adviser insist that firing SB Proconsult be discussed. It would be clear to the board that you were not fans.
That is your interpretation.
The registrar in December sent a letter to the VMCS board saying that he had no objection to sell the land to Claridges. Given that as late as the end of November, the VMCS was calling for a financial study into Claridges’ ability to buy the property, on what basis did the registrar give his no-objection?
On 28 September, the board decided to go with Claridges and said that they had stopped talks with Fontanel. They had already put Claridges’ name into a contract and it was sent to the registrar for vetting. An agreement now has to go to the general meeting of the VMCS’ 5,000 or so members for approval. But if the registrar does object to the deal, it cannot even be presented. So this is just a document stating that there is no objection to the plan being considered.
Did the board then show that it had information about the financial capacity of Claridges to pay before sending it on to the registrar?
These details I don’t know. The board has to answer for that.
So as far as we know, we have no idea which of these is the better deal as yet given that there has been no real financial analysis as yet. For all we know, both could be equally unrealistic.
The board will have to decide on that, but they will have to come up with the details and only after it has been approved by the general meeting that the registrar will then give his approval too. But for that, they will have to submit all these details.
There is a lot of confusion about the Claridges and Fontanel proposals. We have heard two different sets of figures, Rs650 million and Rs750 million, and you say it’s actually Rs650 million and Rs670.4 million. Which one is it?
Where did Jhugroo get that Rs750 million figure from? There are no board minutes proposing that figure. But what Fontanel is proposing is Rs670.4 million with a 6 per cent brokers’ fee attached to it.
Now your willingness to reveal these figures is also interesting. On 27 March, you refused to divulge them in parliament calling them ‘very confidential’, and here you are now willing to come up with numbers. What has changed?
The figures were thrown about by Mr. Duval (the leader of the opposition, Xavier Luc Duval –ed).
Not the figures that you have come up with.
I had to stop him. He gave the impression that there was an offer of Rs750 million. There is a Rs388 million deficit in the VMCS. Tomorrow, whether they sell it or not, at least I did not mention the identities of the offerors because I did not want to frustrate the transaction.
But you have frustrated it, haven’t you? You have mentioned the terms, the prices that were being negotiated. What was left to divulge?
That’s because Duval came up with those figures and so I told him.
But Duval is not the minister and two wrongs don’t make a right.
That is your interpretation.
Has anything been decided about when this deal will be presented to the VMCS?
It has not been decided yet when to hold the meetings. First, since the exit of SB Proconsult, the accounts have to be finalised and submitted to external auditors and then it will be put to the general meeting.
For more views and in-depth analysis of current issues, Weekly magazine (Price: Rs 25) or subscribe to Weekly for Rs110 a month. (Free delivery to your doorstep). Email us on: [email protected]