Having inherited a sugar industry shackled on a “death bed” by $85 billion in debt, a bailout became necessary to keep sugar workers employed despite the strain on other sectors and the treasury, Prime Minister Moses Nagamootoo said yesterday, as he rubbished claims by the opposition PPP/C that government was ‘killing sugar.’
Nagamootoo, who was the penultimate speaker in the budget debate, went all out to justify government’s decision to give the industry bailouts totalling $23 billion and its intention to hand over a further $9 billion next year.
The state of the industry has been a sore issue for years and many have questioned why it was receiving bailouts when it was not economically viable and was continuing to show declining production.
“When government inherited the sugar industry it was already placed by [Opposition Leader Bharrat] Jagdeo …on the death bed… [The] sugar industry was mismanaged, brought to a stage of bankruptcy to the point where even the then president Jagdeo said that he had to find $40 billion to invest in a modern sugar factory, which was the Skeldon sugar factory,” Nagamootoo told the National Assembly.
A chunk of his almost two-hour long presentation was dedicated to that sore issue and even though he made his address looking at empty opposition chairs, his fellow MPs showed their support by banging on the tables, mouthing agreement and in many instances, laughing.
Nagamootoo said the $40 billion was injected into the factory but it “couldn’t breathe. So they injected another $10 billion. The factory still was huffing and puffing and not performing…”
Nagamootoo said that even while in opposition, the current government committed itself to helping in the bailing out of the ailing industry and questioned how government can kill the industry when it had injected $12 billion just a few months after it went into office.
He questioned how government could be accused of committing economic genocide against the industry when an $11 billion injection followed a few months after the $12 billion so as to keep the sugar workers employed.
He asked whether the $50 billion should be allowed go to waste. He said that if the government chose the path of diversification or any other mixture and allowed all those in the sugar industry to benefit from that industry, then “it is in the interest of the people that we should do so.”
To shouts of “that’s right” from fellow MP Khemraj Ramjattan, Nagamootoo told the House that the sooner this was the done, the better it would be for all involved.
He said the solution to the woes facing the sugar industry would be the “diversification of our land to be able to ensure that our people have food security.”
He said that while the country may be exploring extracting oil in commercial quantities, “we can never give up the focus on making …Guyana the agricultural basin of the Caribbean.” He explained that in the Caribbean there was an acute food shortage and countries were looking for places like Guyana to rectify this situation.
‘Slipped up’
Nagamootoo used the occasion to inform the House that in October dozens of workers attached to the Wales Sugar Estate received severance pay totalling over $80 million.
He said government was aware that the closure of that factory was made without consultations. “I must admit that we slipped up. We should have gone earlier and engaged the workers and we should have placed the cards on the table but they know that something had to be done because that factory was going and it was going fast,” he said.
He explained that when the decision was made to merge factory operations with Uitvlugt, GuySuCo communicated this to the workers and gave them an option; that severance pay was available.
He said GuySuCo committed itself to paying severance which would allow the workers to “divorce themselves from sugar as a full occupation and go into some other business that they choose… farming, dairying, aquaculture, apiculture. They could do anything they want but they needed support.” He said when GuySuCo announced that the payments would be made on May 13, 2016, the unions representing the workers filed a court action which resulted in a granting of an injunction preventing the payout. He then took a jab at the unions pointing out that they live on union dues and that a payment would mean that such an arrangement will cease as those workers would venture into other fields of work.
“As long as the sugar industry remains, whether it makes profit or not, the dues are paid to the sugar union, the aristocrats up in High Street, they draw down and so they were against the workers accepting the severance,” he stressed, while adding that the workers visited his office over the situation. The aggrieved workers who wanted the severance were advised to draft and sign a petition asking that the court action be withdrawn and take it to the union.
He said that in September the injunction was withdrawn and the 93 workers from Wales Sugar Estate received $80,155,000 on October 14. Thereafter, the union went into a state of silence.
This government, he said, has a heart and all that has been done for the sugar industry did not come easy. “I know the pain that comes from other sections… particularly the public servants,” he said, before adding that it hurts when the opposition goes to Parliament and accuses the government of bringing a “pickpocket budget” when in fact billions of dollars are being pumped into the pockets of disadvantaged and threatened workers. “How can we be pickpockets? How could we be picking the pockets of public sector employees when this year for the very first time in perhaps many, many years of five per cent imposition, ….those with $100, 000 or less per month they got 10% wage increase?” he asked.
Minutes into his presentation, Nagamootoo said that Jagdeo’s started his presentation with Naga and ended with Naga. He later joked that maybe a song could be made about this situation with a rhythm of “naga naga naga naga.” This sent his fellow MPs into a frenzy and those seated in the audience also laughed though not as loudly.
Nagamootoo praised Finance Minister Winston Jordan for taking three budgets before the National Assembly in an 18-month time period.
He accused the PPP/C of going to the Parliament with “venom, with elements of vindictiveness,” while pointing out that after listening to Jagdeo he sensed jealousy over Jordan’s ability to produce a budget to meet some of the difficulties which the PPP/C government had inflicted on the Guyanese people.
Stating that the opposition attempted to use diversions and distractions when it was realised that the government side of the House was winning the debate, he said that he listened to almost two hours of “ranting and raving” by Jagdeo. Jagdeo spoke before him and at the conclusion of his presentation he and the other opposition MPs left.
“He cuss up, he buse down, he cut and he ran,” he said. This synopsis was met with applause from his fellow MPs, though not all of them sat through his presentation.
“In as much as the leader of the opposition would in his own inimitable, vulgar way describe the budget as cockanomics—Guyanese people understand that word—the Guyanese people have made a judgement and pronounced on his administration and ousted it from office because like a rodent, like a rat corruption had eaten into …our society and under Mr Jagdeo and his administration …there was excess in ratanomics,” he said to bellowing laughter and the thumping of desks.
He questioned why one would want to condemn the administration that has introduced so many measures “to safeguard and protect our people”.
He said that Jagdeo became the father of VAT when he assented to the legislation that was passed in the National Assembly. Holding up a copy of what Jagdeo had signed, he said that this occurred on the eve of the elections, something that should not be done. “He dropped the hammer $165B! He drop the hammer, one lash on the Guyanese people. So how could you be picking anybody’s pocket if government decided to reduce the VAT by 2% and deny the treasury of about $500 billion?”
He also dismissed the opposition’s “fatter cat” description of the government. He said that had he been a former president he would indeed be a “fatter cat” as he would have been earning between 2012 and October 2015 a presidential pension of approximately $1.6 million per month.
He reminded all that the APNU+AFC administration has delivered on its campaign promises, including the reduction of VAT and the lowering of the Berbice Bridge toll.
Towards the end of his presentation he addressed ministerial salaries, the pending VAT on water and electricity, among other matters.
