AFC calls for $150 million subsidy for Govt-run Berbice River Bridge

Jun 13, 2013 News

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The fact that the Government, through the National Insurance Scheme (NIS) and the National Investment and Commercial Industrial Limited (NICIL), owns $1,030 million or 76.3 per cent of the total share capital of the Berbice River Bridge Company it clearly suggests that the entity is not a private one.
This is the view of the Alliance for Change (AFC), which through its Vice Chairman, Moses Nagamootoo, stated it is imperative that Government reduce or subsidize the toll.

According to him Section 344 of the Companies Act defines a “Government company” as “any company in which not less than 51 per cent of the paid up share capital is held by the Government and includes a company which is a subsidiary of a Government company”.
And since NICIL is a wholly-owned Government company which, together with NIS, owns over three-quarters of the Berbice bridge company capital, Nagamootoo noted that there is evidence to back condemnations leveled at Government for claiming that the company is privately operated.
His disclosures were forthcoming yesterday at the AFC weekly press briefing at the Middle Street, Georgetown, Side Walk Cafe.
Nagamootoo questioned, “Why is this company being deemed a private company?”
He explained that a look at the company’s records shows that it is made up of $400 million in ordinary shares and $950 million in preference shares.  This, according to Nagamootoo, translates to Government owning $80 million in ordinary shares and $950 million in Preference shares.
And given the fact that the Berbice River Bridge Company is not one that can be regarded a private operation, the AFC Vice Chairman yesterday reiterated the party’s demand for a reduction of tolls to permit passage.
He referred to the fact that ordinary vehicles crossing the Government-owned and controlled Demerara Harbour Bridge pay a nominal toll of $100 per crossing, while crossing of the Berbice River Bridge attracts a whopping $2,200 toll.
“Tax payers have been given a state subsidy to the Demerara Bridge which amounts to between $300 million and $500 million annually,” disclosed Nagamootoo.
Moreover, he said that the AFC is fully committed to supporting a subsidy whether from Central Government’s funds or by way of dividends accrued to the state own business arm, NICIL.
NICIL, he noted, is dominated by Government players with its Chairman being the Finance Minister, Dr Ashni Singh, with Cabinet Secretary, Dr Roger Luncheon, and Minister of Natural Resources and the Environment, Robert Persaud, being Directors.
The Chief Executive Officer is Winston Brassington, who according to Nagamootoo, “is at the centre of every controversial financial transaction involving use of the people’s money.”
The AFC Vice Chair disclosed that it is the view of the party that Brassington has stripped the Government of voting rights in the Berbice bridge company, and has waived dividends to which the government is entitled on those Preference shares.”
Dividends are waived on an annual basis. According to Nagamootoo in 2010 those dividends were worth $104,5 million, as it was in 2008 and 2009. He said that during the life of the Bridge Concession, the waiver would be worth more than $2 Billion.
“Now, of course, Brassington could not do this on his own. He must have had the blessings of NICIL’s powerful Cabinet directors, the Cabinet itself and/or the President. Knowing now that the Government has its hands fully in the Berbice Bridge pie, AFC says: Reduce or subsidize the Toll NOW!” exclaimed Nagamootoo.
But although the AFC has before vocalised this proposal, President Donald Ramotar had, on at least two public occasions, rejected it, Nagamootoo said. He alluded to an initial rejection during the 2011 elections campaign and later in a Berbice declaration in February of this year.
He said that during the debate of the 2013 Budget, he had sought to amplify that the Demerara Harbour Bridge is another state-run business. He said, too, that between 2011 and2013, the Government diverted $1.1 billion to maintain the bridge, of which $300 million will be spent this year.
And in the interest of justice, he had recommended that Government at least allocate $150 million in subsidy for the Berbice Bridge tolls.
According to Nagamootoo, “President Ramotar has refused to budge and, instead, has sheltered behind an excuse that the Berbice Bridge is privately owned.”
The questions that we ask are, whether the President has mis-spoken, badly informed or advised, or is simply ducking from the demand to ease the burden of commuters on the Berbice crossing?”
The AFC is currently of the view that the high toll is a penalty especially for school children and small cash-crop farmers who use the facility daily.
 

 

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