Auditor General’s Overview

The Urban Development Corporation (UDC) is Jamaica’s principal public sector entity responsible for planning and designing urban environments in designated areas. UDC’s core business objective is “making development happen through the planning and implementation of comprehensive development projects and programmes”. In November 2012, I submitted a performance audit report, which identified deficiencies in UDC’s management of its investments. In addition, the report highlighted financial challenges and several corporate governance failures that impaired UDC’s ability to manage effectively and efficiently, the resources under its control. In March 2017, a special audit of the UDC identified various breaches of divestment procedures in disposal of Oceana Hotel Complex, including UDC’s failure to adhere to its Estate Management Policy.

This performance audit revealed that UDC made efforts to implement many of the recommendations from the 2012 audit, including strengthening its Enterprise Risk Management (ERM) framework and recovering some of the long outstanding rent receivables. However, there was no significant progress in delivering on its core mandate to comprehensively plan and design urban environments by designating development areas and preparing the related developments plans. In June 2015, Cabinet approved the transfer of lands for the development of hotels, housing and other facilities as a condition of the 50-year Concession Agreement between the Government of Jamaica (GOJ) and NROCC. Ministry of Finance and the Public Service (MoFPS) subsequently paid 22 per cent ($2.13 billion) of the amount owed to UDC as compensation for lands transferred to NROCC in January 2018. As at March 2022, the outstanding balance stood at $7.23 billion.