GPL pension fund facing $600M deficit

Mar 03, 2013 News

Even as, Guyana Power and Light Company’s employees represented by National Association of Agricultural, Commercial and Industrial Employees (NAACIE) are striking to have an eight percent across the board salary increase, the company is facing a $600M pension fund deficit.
This deficit is expected to increase significantly if the recommendation by the actuary is adopted. The actuary has said that the company should increase its contribution to 22 percent.
GPL’s Chief Executive Officer, Bharat Dindyal, said that the pension fund was inherited from the Guyana Electricity Company.
Expounding on the pension fund, Dindyal said that on a monthly basis the state-owned power company pays seven percent while the employee pays five percent of his/her salary into a pension fund held by Hand In Hand Trust Company.
The fund’s investment has a large portfolio and is managed by a committee. No member of the executive management team is on the committee. The investment is not a lucrative one. He added that GPL receives three percent returns from the investments, even as the employees get four per cent on their savings.
Dindyal noted that last year a Trinidadian Company did an actuarial review of GPL and recommended that the company increase its contributions to the pension fund to 22 percent. Taking into consideration the current deficit if the company were to pay an additional 15 percent this deficit would increase significantly, he explained.
This sum plus the cost of any increased wage package would surely hurt the company which is already dependent on Government subsidies.
The CEO opined that NAACIE should take into consideration this pension package and other benefits. He believes that the Union does not have the ability to understand the effects of this benefit scheme.
The employees guided by the Union downed tools on Wednesday and protested the CEO’s Duke Street Kingston Office rejecting a five percent all inclusive package being offered by the power company.
Labour Minister, Dr. Nanda Gopaul on Friday invited both parties to a meeting. If the Union and GPL cannot arrive at a decision tomorrow the matter will be sent to arbitration.
According to Dindyal, the company just cannot afford to pay the eight percent being requested by the Union, which seems unshakeable from its demands.

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