Trotman justifies severance shortfall in Budget 2018
By Devina Samaroo
Leader of the Alliance For Change (AFC), Raphael Trotman on Monday, January 15, defended the billions of dollars of the shortfall in the 2018 budget for severance payments to sugar workers.
Some 4,000 sugar workers were made redundant at the end of last year as the Government moves to shut down the industry. With thousands of sugar workers jobless, the Government had underestimated the cost of severance by several billion, budgeting only $500M.
“It is not that we were unaware that severance had to be paid … the $500M was indicative of that recognition … we knew that $500M would not be the full amount that was needed but we sought to keep some money in reserve, put it in the 2018 budget but we needed to get a sense at the end of the year of what was necessary,” Trotman, who is also the Minister of Natural Resources, said.
He further noted: “It is not that we were unaware of unmindful.”
He noted that billions were expended in 2017 in emergency expenses.
“It is what our balance sheet look like at the end of the year. We have to build a whole prison, we had to divert billions to readying both Lusignan and Camp Street,” he stated.
The Camp Street Jail was destroyed by fire during a jailbreak in July 2017, resulting in the relocation of prisoners at facilities which were constructed at Lusignan and Camp Street.
Meanwhile, Trotman reminded that it is the Guyana Sugar Corporation that should be paying the severance but the Government has taken up the responsibility to make the payments.
Minister of Agriculture and AFC Member, Noel Holder noted too that the Government has other expenses to cater for in the budget.
“Fining the $4.5 billion to pay in severance is a difficult thing to do and serious decisions have to be made with regards to what other areas of the economy will be denied funding to do this,” Holder stated.
He noted too that, “We do have other areas of the economy that we have to address. We have education, we have health, we have a number of areas, we have a lot of infrastructural work, we have communities in the hinterland. So it’s not a question of just taking funds and easily budgeting, it’s difficult.”
Holder also expressed that the sugar workers may prefer to receive their severance in installments so that they will not be tempted to spend it all out at once.
President David Granger had announced that 50% of the severance will be paid by the end of the month and the other half will be paid within the second half of the year.
Holder disclosed that he has already signed an order to release $1.7B towards the severance payments.
The Government estimates that the three estates that will be left in operation will produce the 147, 000 tonnes of sugar needed to meet local and overseas markets.
The Government decided to close the sugar estates, saying it could not continue to bail out the industry; they have been subsidising the industry with $1 billion every month for the past two and half years.