Hundreds of Skeldon workers get dreaded severance letters

Hundreds of workers at the Skeldon sugar estate have begun receiving letters terminating their service as of December 29, 2017.

The factory, commissioned at a cost of US$181 million in August 2009 by then President Bharrat Jagdeo, stood as the most expensive project ever undertaken in the country’s history.

The elaborate plan for Skeldon involved expanding cane cultivation and establishing a refinery to take sugar production to 450, 000 tonnes annually and ensure the survival of the industry. But the estate has been plagued by problems one after the other, and millions more were dumped into fixing defects. The Guyana Sugar Corporation (GuySuCo) failed to get the factory running to expectations.

The current government has decided to close Skeldon and send home 1, 600 workers by the end of the year, a senior official told the News Room this week.  On Monday, hundreds of workers, mainly those considered “junior staff” were given their letters and hundreds more will follow before December 29.

“The Corporation has given consideration to the option of you continuing in a similar job within the organization. However, there is no suitable vacancy to accommodate you,” the letter to workers state.

It added: “The Corporation can no longer provide the employees with regular employment at the Estate and therefore, in accordance with Section 12, subsection (2) (a), (b) and (c) of the Termination of Employment and Severance Pay Act 1997, the corporation wishes to inform you that your job is being made redundant.”

Skeldon is one of two Berbice estates being closed by the end of the year. The other, Rose Hall, will put 800 workers out of a job. Estates at Albion and Blairmont will remain open. Operations in Demerara will be concentrated at Uitvlugt with Enmore and Wales estates being shut down.

The government projects that the three estates will be able to produce 150, 000 tonnes of sugar annually by 2020 and this would satisfy local and export markets. That would leave the Corporation with 10, 000 workers.

GuySuCo has been propped up by government subsidies over the years since most of it goes towards wages and salaries.  At the end of this year, GuySuCo’s revenue would amount to about 17.4 billion dollars; all of that, and an extra 1.1 billion dollars would account for salaries alone, minus the billions needed to cover other expenses.

A staggering $32 billion in State subsidies have been given to GuySuCo over the last three years. Another $6 billion in subsidy is budgeted for the Corporation for 2018. For the workers who are being made redundant, GuySuCo is trying to interest them in taking off some of its jobs, such as transportation, for which it currently spends over $1 billion.

It has lands also available to sell to farmers to get involved in various agricultural projects. The Corporation is also re-training workers in various skills to pursue other jobs.

The government will this month select a leading financial services firm to evaluate the assets of GuySuCo as the government looks to diversify the troubled industry and keep jobs.  The government has set up a Special Purpose Unit (SPU) to manage the divestment of GuySuCo.

The valuation of the assets and the preparation of a prospectus is expected to be completed by the end of January 2018. The plan includes selling off some of GuySuCo’s assets and using what remains to get into other profitable enterprises.  The Corporation is already engaged in the cultivation of rice on lands once used by the Wales Estate, where production has ceased.

Companies that are engaged in rum production, other beverage manufacturing, and food processing, would be ideal as potential operators of some of the current GuySuCo assets. While factories could be sold to potential operators and investors, lands will not be sold but could be leased so that they remain the property of the State.