Sugar in dire straits… GuySuCo must account for billions given by EU – GTUC

Jul 21, 2014 News

---

– Evident that Government cannot be left singularly to make decisions on this vital industry

 

The process of transparency and accountability in the Guyana Sugar Corporation (GuySuCo) must start now by having this company submit its years of outstanding annual reports to the National Assembly.

Additionally, the absence of accountability for over $20B given to the industry by the European Union for reform is also of concern.

This is according to the Guyana Trade Union Congress (GTUC) which expressed its worry over the fact that sugar is in the news again but not for the right reasons.

The Union said that the uphill task being encountered in the sugar industry requires mature and reasoned discussions and solutions. It strongly holds the view that Parliament, the nation’s supreme decision making forum, is capable of establishing a committee to review the industry and point to a way forward. The Union contends that what the industry needs is a National Plan.

It insisted that political grandstanding on the part of the government and GuySuCo’s recourse to setting lower targets unrelated to capacity would not address the ailing industry which is not only now heavily reliant on tax payers’ bailout, but also poses dire consequences for the nation.

GuySuCo is not performing at a competitive level on the world stage, but the Union found that sugar workers remain the nation’s highest industrial causalities.

“Non-payment of contributions to the National Insurance Scheme affects the Scheme’s performance and workers’ benefits…and the nation is still left in the dark about how their monies are being spent and what will be the plan to make sugar profitable,” the Union said.

It said too that administrative overheads are not self-sustaining.

“These are all indicators that the government cannot be left singularly to make decisions on this vital industry. Changes have to be made to sustain the industry and the workers (direct and indirect) whose wellbeing is affected by it.”

As it relates to the admission that it was a mistake to give GuySuCo the $6B bailout money in the 2014 Budget without demanding accountability, the Union is of the belief that this anomaly should be fixed through pro-active approaches in the National Assembly.

GTUC reiterated its call for an end to the bleeding and mismanagement of the sugar industry and for the elected leaders to retreat to the National Assembly to address this issue.

“This nation cannot continue to ignore the inevitable. GuySuCo is in a crisis and will collapse and consume us all if we continue the dillydallying and political grandstanding. Our elected leaders must lead, now,” it concluded.

Former Member of Parliament for the People’s National Congress Reform (PNCR), Anthony Vieira had blamed government for sugar’s downward slide over the years. He contended that billions of dollars of Europe’s assistance money never even reached the coffers of the Guyana Sugar Corporation (GuySuCo) which was actually the purpose of the money.
Vieira, who has vast experience in the sugar industry, had explained that GuySuCo lost its preferential price and together with a labour shortage, saw production plummeting to lows despite attempts to jumpstart the industry.
Vieira explained that “beginning in 2006 the European Union [EU] had started paying the development fund to Guyana which was our compensation for the loss of the preferential price for sugar in the EU markets.”
He argued that the money was supposed to be used to make the industry more efficient and competitive and that a substantial part of it should have been used to start the expensive process of converting the land for mechanical harvesting, on all estates, to offset the loss of workers.

This money was never released to GuySuCo and its board, in its 2008 summary, had warned that “this starvation of funds will significantly restrict management’s ability to achieve their objectives outlined in the GuySuCo strategy plans.”
According to Vieira, starting from 2006, the total amount paid was $24.7 billion but GuySuCo got none of it.
“In 2012 GuySuCo finally got a subvention of around $5 billion from the annual budget but today we have a poorly functioning sugar industry which had never received any of the $24.7 billion released to the Government to rehabilitate and make competitive the Guyana sugar industry.”
Vieira had called on former Agriculture Minister, Robert Persaud, to explain what was done with this money, but got no response.
The politician believes that the money was wasted on extravagant projects “that cannot bring wealth to the nation or its people.”

Vieira told this publication that he firmly maintains his position that had the money been used when it was given to the government to support the sugar industry, it may not have been in the crisis it is in today. “Hence they say a stitch in time saves nine,” the former parliamentarian added as he commented on and gave support for the Trade Union’s position.

It was reportedly said however by head of the Presidential Secretariat, Dr. Roger Luncheon in 2013 that the money was never intended support a specific project or industry. In fact, the Cabinet Secretary noted that it comes as “budgetary support”

Luncheon had explained that over the years the financing template for projects by the donor community had been changing from direct financing to budget support. Budget support he explained does not mean that funds ploughed into the budget exclusively for a specific area. The budget support is used to ensure that developmental goals of the organization are met.

However, Vieira contends that while the money was held by central government and used in other areas, the government must still give an account of where this money was used. “They never said what they will do with the money or what they did with it. “It is accountability”, the politician pointed that remains the crux of the matter and it is in that light that he supports the position of the Guyana Trade Union Congress.

---

---