Thursday, July 04, 2013

The Consortium For Building And Knocking Down

Mallorca loves consortiums. The Balearics tourism ministry has various consortiums and one of these is the Consortium for the Tourist Accommodation Fund, a somewhat misleading title as accommodation is not its main reason for being, unless one counts accommodation it is planning on paying for in order for it to be demolished.

This particular consortium, in addition to the tourism ministry itself, comprises representatives of Sa Nostra bank, the Mallorcan hoteliers federation and the Mallorcan hotel chains group, two unions and the Council of Mallorca. It is a consortium which, unlike some other parts of the tourism ministry, for instance that which deals with promotion, has a reasonable amount of money at its disposal. It has recently announced a budget into next year of 7.5 million euros.

Not everyone in the consortium is happy with the way that the budget will be divvied up. Thirteen projects are envisaged, five of which, representing around 30% of the budget, will involve investments in one municipality: Calvia, whose former mayor, Carlos Delgado, is now the tourism minister.

This might seem as though investment is somewhat skewed in favour of Carlos's old patch and, up to a point, it is. In August 2011, as an example, Calvia registered almost 1.6 million overnight stays. The total for the whole of Mallorca for that month was 7.8 million, meaning that Calvia accounted for only a fifth of the island's tourism. But, it would be a 10% quibble to suggest that Calvia shouldn't demand a greater percentage slice of the investment cake; the municipality also happened to be, in that month of August, among the top three destinations in the whole of Spain in terms of overnight stays. The other two? Barcelona and Madrid.

When you place Calvia's tourist volume in context, you realise just how important the town is not just for Mallorca's tourism but also Spain's. This is a place with little more than 50,000 permanent residents vying for top tourism spot with the might of the El Clasico cities. So, if Calvia is awarded greater investment than anywhere else by the Consortium, this seems perfectly reasonable.

However, this is not how some members of the Consortium see things. There should be more of an even distribution across the island, suggests the hotel chains' group representative. Well, possibly so, but there is one hotel chain that may beg to differ, and Delgado has argued that investment the Consortium is making should take account of investment activities by the private sector, i.e. the hotels, and especially Meliá. One of the Calvia projects will be the boulevard in Magalluf to connect the various Meliá complexes which the company has been upgrading.

While criticisms of the level of investment heading Calvia's way seem a little churlish, there have been wider criticisms for the one project to do with accommodation - the demolition one. And this is the abandoned Rocamar hostel in Port de Soller.

The controversy surrounding this hostel took a further turn last summer when it emerged that the Consortium had come to an agreement to acquire and demolish it. At the heart of this turn in the controversy was who would in fact end up with the money: not the owner, but Jaume Ensenyat, a local businessman and the father of the head of inspection at the tourism ministry. He had loaned the owner almost a million euros in 2005 in return for a mortgage guarantee. The valuation placed on the acquisition and demolition was some 19,000 euros lower than this loan.

In itself, and despite the obvious connection to the head of inspection, the fact that the payment would go to someone else other than the owner also doesn't seem unreasonable. The problem is, and hence the wider criticisms, that an official valuation made by an architect (contracted by the tourism ministry) in February 2012 set the valuation at under 300,000 euros. Two months later, two reports emanated from ministry technical experts which disputed this and placed a valuation 241% higher - not far short of a million.

The socialist PSOE party intends to press for a commission of inquiry to be established to look into what it has said is the lack of a "plausible explanation" from Carlos Delgado as to why there has been an agreement to pay this higher valuation. It might note, though, that members of the Consortium were apparently unanimous in agreeing the budget for the Rocamar. Maybe they were right to be, but while there has been disagreement about the level of investment that is going to Calvia, the silence as to a spend way over the valuation given by the ministry's own architect is ever so slightly deafening. 

Any comments to please.

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