How a $60-million UN scandal impacted a housing project in Goa

A Singapore-based firm, owned by businessman Kendrick was responsible for building 50,000 houses in Goa for $2.5 million

A $60-million scandal involving loans and grants by a United Nation's operational arm sheds light on how a $2.5-million affordable housing project in Goa remains on paper three years since the fund was granted.

The United Nations Office for Project Services (UNOPS) in 2019 granted $2.5 million to British businessman David Kendrick, who owns a Singapore-based firm Sustainable Housing Solutions (SHS) Holdings Pvt Ltd, to build 50,000 affordable houses in Goa, none of which has materialised so far.

As a result, the UNOPS now faces $22-million in bad debts, as per a report by The New York Times.

In 2018, the firm launched the Sustainable Infrastructure Impact Investments (S3I) initiative, under which the housing project was listed. The company registered zero revenue and Rs 27,289 in losses in 2020-21, according to report by The Indian Express.

The project is now being probed by the UN for allocating funding to companies linked to Kendrick.

The head of UNOPS, Grete Faremo, stepped down earlier this month after the issue came to light. In 2019, the former chief said that 50,000 affordable houses would be built in India, but an internal UN audit document showed the number to be 100,000.

A senior Goa government official told the publication that SHS officials made a presentation for the construction of the proposed housing units in Goa. However, the officials had various questions regarding supporting infrastructure like power and roads for these housing projects. They also had reservations about awarding a large housing project to a private developer without tenders, the official added.

“No land was identified for the project. In fact, the discussions did not even reach the stage where the fund-sharing pattern for the project was discussed,” the official said.

On the contrary, one of the directors of the firm, Amit Gupta, claimed that the Goa government approached the UNOPS.

“There was an agreement with the Goa government in February 2019 and then there was a supplementary agreement signed in March 2019. We sent some follow-up mails after that because the state was supposed to allot land to us. We followed up till August-September 2019. When we did not get a response, we were told by UNOPS that it was Goa that wanted these houses to be built and that if they don’t want to follow up, we don’t have to either. Whenever they want to come in, they can. We left it there at that point in time,” Gupta told the publication.

Gupta claimed that all information regarding expenditure for the UNOPS projects is shared with the agency “on a monthly basis”, and that the UN investigation regarding the loans “has not come to him”.

He further explained that owing to pending matters related to compliances, all the expenditure of SHS India has been taken care of by its holding company. "No expense has been done through SHS Projects so far… because the compliance wasn’t complete on this company," he added.

According to the report, the UNOPS gave $60 million to Kendrick and his daughter Daisy Kendrick for wind farms, sustainable housing project and to make a video for the agency.

An internal investigation into the transactions was completed on May 10.