APNU+AFC’s Volda Lawrence, VP Jagdeo trade words on NIS bankruptcy

Last Updated on Thursday, 28 April 2022, 22:18 by Denis Chabrol

     Mr. Bharrat Jagdeo                                                               Ms. Volda Lawrence

A Partnership for National Unity+Alliance For Change (APNU+AFC) Shadow Finance Minister Volda Lawrence on Thursday promised to salvage the cash-strapped National Insurance Scheme (NIS) with 1 percent of current oil revenues, even as she and Vice President Bharrat Jagdeo traded words about which administration was responsible for the state of that social security entity.

Ms. Lawrence, in a statement issued Thursday night, Ms. Lawrence objected to Mr. Jagdeo’s assertion at an interactive Cabinet outreach with residents of Region Five (Mahaica-West Berbice) on Wednesday that “you know the NIS bankrupt basically, that when APNU reduced the 7,000 sugar workers is 7,000 people less were contributing to the NIS.” Mr. Jagdeo also attributed the NIS’ financial woes to the a loss of 35,000 jobs.

She accused Mr. Jagdeo 0f destroying the NIS by ignoring the advice of that entity’s Board of Directors and invested contributors’ funds amounting to GY$2.5 billion in ordinary shares of the Berbice River Bridge, another GY$810 million in the Bridge Company to cover non-performing assets, GY$5 billion in Colonial Life Insurance Company (CLICO), and additional sums in La Parkan among others. “Vice President Jagdeo, who destroyed the NIS,  attempted to sweep under the carpet his abuse of power generally and more directly his abuse of the resources of the NIS. Mr. Jagdeo must be reminded that under his watch the plundering of the NIS resources was done,” she said.

But Mr. Jagdeo challenged the accuracy of Ms. Lawrence’s figures. “PNC has always been financially illiterate . The latest press release is a confirmation of that fact . They claimed NIS invested $2.5 bln in common shares of the Bridge . From information already in the public domain any Guyanese can verify that total common shares is only $400mln . Another lie in the press release is that the NIS invested $810 to cover the non performing assets of the Bridge,” he told Demerara Waves Online News.

CLICO which was placed under judicial management in 2009 and liquidated in September 2010.

The APNU+AFC frontbencher took credit for her administration’s issuance of 20 non-negotiable debentures to be redeemed annually over 20 years at a fixed interest rate of 1.5 percent, after the previous People’s Progressive Party (PPP) administration had failed to live up to its commitment.

If her People’s National Congress Reform (PNCR)-led coalition wins the next  general election, Ms. Lawrence  some of the oil revenues would be injected into the NIS. “Let me inform the public at large that a coalition government would seek to utilize monies from the Natural Resources Fund by providing an annual subvention to NIS of approximately 15 million US dollars just 1% of the present amount in the fund, in order to wipe out this deficit caused by Mr. Jagdeo’s administration in the first place,” she said.

Jagdeo on current approach to NIS

Meanwhile, the Vice President ruled out an increase in NIS pensions at this time and instead said that focus was on keeping that social sector institution afloat and ensuring that pensioners are paid. “We have to put in money ultimately into the NIS to keep it floating  so people who retire can get their benefits for the next 100 years,” he said. “Right now, our focus is not on increasing benefits but on keeping the current people receiving their benefits,” he said.

The resident told Mr. Jagdeo that if the NIS was bankrupt , government could go to the Consolidated Fund but the Vice President cautioned that could not be done so easily due to the scarcity of funds.