OPINION: MDCs Closure is Nothing to Smile About
In the interest of full disclosure I’ve done work with the MDC and been turned down for projects with the same organisation. However, today’s announcement doesn’t fill me with glee that they have received their comeuppance. Rather I am sad it has come to this. It is a wake up call to the fact that we are not any closer to building a thriving private sector than we were five or even 20 years ago.
According to the just released review the original intent for the Montserrat Development Corporation was to “stimulate Montserrat’s economic growth by creating a more supportive environment for private sector investment and infrastructure development on the island”.
In my five years on island, the MDC has never made it easy for entrepreneurs to ask for help and receive it. I’ve sent clients to the company only to have them return dejected not because they were turned down for money but they were literally talked out of pursuing their idea or supported to make it happen. Of course, they’ve had successes but they have been so few and far between that we’re not able to use it as green light and a sign to “keep trying so you can make it too”.
The initial recommendation was for MDC to function like a private firm using government money. Without thinking too hard about this you will know it wouldn’t be an easy work around in an environment where most of the funds used in government comes from other governments. Prior to September 2014, having a former premier, a DFID rep and a Chairman of the Board who were steeped in private sector thinking and understood that red tape and business don’t go well together, it is understandable why the report revealed what it did.
I believe what we are seeing is a very sanitised version of events. MDC was a DFID brainchild. How else do we explain the constant reorganisation and consultations to fix something that was clearly broken from the beginning? While the report focuses on issues with governance and transparency, the bottom line is that the MDC and the creators of it don’t seem to understand what it needs to do to help people start a business and succeed at it.
Not even with all of the best practices available within the UK, have there been any systems implemented to launch small businesses and care for them as they grow. The disconnect just continued to grow the bigger the offices and the salaries got.
The 2012 charette and new branding was seen as a chance to generate local support for the vision of a new town which could drive the island’s growth. However, the energy seemed to all be about Little Bay and residents were never able to find out how much land would cost to build there or whether they would be able to rent the new fangled condos and shops as conceptualised. We never saw the manifestation of the investment fund which would have given regular citizens the chance to see their money combined and used to build the new town. (I understand the paperwork is languishing in the Financial Services Commission offices.)
The word “disconnect” comes up several times in the latter part of the review as it looks at the hurried way the tourism division was integrated into the MDC. There were hirings of executives with even larger salaries which put those of senior civil servants to shame. The report points to people on salary who didn’t have the right set of skills to deliver the results. Walking into the offices didn’t fill one with hope but trepidition as you felt like the intruder, the outsider looking for a handout rather than a hand up.
The business case for the MDC as it is now had a primary focus on inward investment as the key to unlocking our economic future. In that respect, the MDC did much work to create interest and although we do not yet see any fruits of this, it put us back on the radar. They did focus on the big spenders who were going to fly in and save us but what about the residents who are essential to making any economy thrive? We didn’t need millions but small loans to purchase equipment, access training, explore and experiment on new products and markets. A space to fail and try again. A place where the staff really want to help you make real money so you can take care of your family. The strategy to find investors excluded a plan to ensure locals and even the Diaspora had a stake in Montserrat’s development.
The plan is to shut it down, revamp it and try again.
Do we have time for a revamp and another try?
Do we have a choice but to wait for it?
We’ve been through more than four acting and/or full-time CEO’s in the seven years of the organisation’s existence. A DFID report notes the MDC had three CEOs in the space of 18 months. No wonder the report points to “lack of consistency and continuity in executive leadership.”
The task force’s report found the mandate of the MDC was still relevant but that its remit was too broad, had “over ambitious targets and expectations, lack of clarity on how much independence and authority MDC was to be given, poor governance arrangements, a micro-managing Board of Directors and inadequate performance from the original implementing consultants.”
They chose Plan C: Immediate closure, followed by the creation of a new entity with clear separation between the entity and government and temporarily subsume any on-going activities into government or outsource (as necessary).
Can the mandate get a bit more specific and include a goal to establish incubators, loans and grant schemes which regular people can access? Can we forget this hogwash of sending applicants to be turned down by the bank before they can even begin a discussion to apply for a loan?
Six to eight weeks before it is shut down. How long before it is revamped and reopened? When will a new business case be completed, funding approved and projects launched?
We don’t know and we are out of time.
Entrepreneurs must do what they’ve always done, which is to find a way to get started rather than wait for the government to figure out how to help them. There have been enough success stories around the Caribbean to pattern a business development programme after. We don’t need to implement a European model which doesn’t understand the complexities of how we think about money, wealth, business and self-promotion. Any new iterations of the MDC can’t be so heavily shrouded in bureacracy that it isn’t able to shift without writing new business cases and money wasting consultations. We don’t have time for that.
We need to get people working now.
Nerissa Golden is the Editor of Discover Montserrat, an author, media strategist and business coach. Follow her on Twitter at @trulynerissa.