Ganga points to sources of GuySuCo financial problems
CHAIRMAN of the Arbitration Tribunal for the just concluded wages and salaries dispute in the sugar industry, Dr. Gobin Ganga, has said there were significant work stoppages and man days lost this year.

He made the disclosure at a recent media briefing, after adjudicating on the disagreement between the Guyana Sugar Corporation (GuySuCo) and Guyana Agricultural and General Workers Union (GAWU).

Ganga was speaking at the Bank of Guyana, Avenue of the Republic, Georgetown, where he recommended a three per cent across the board 2009 pay increase for sugar workers.

He said that, from January to October, there were 210 strikes and 77,252 man days were lost of which 40,891 related to wage disputes.

“Undoubtedly, this impacted unfavourably on production, productivity and the corporation’s financial performance, as well as on workers’ wages and salaries,” Ganga observed.

He noted that, the financial performance of GuySuCo is associated directly with receipts from the levels of sugar output and the export price, and indirectly with expenditure.

Ganga said, between 2005 and 2008, GuySuCo made a profit in 2006 and a small deficit in 2007, when both output and export prices were higher.

The 2007 deficit was due, primarily, to greater expenditure on fuel, freight and fertiliser during the second half of that year, he explained.

Ganga said, in 2005 and 2008 GuySuCo suffered huge losses, on account of lower receipts from declined output and higher expenditure.

In 2009, he said GuySuCo is projecting an accumulated debt of $13 billion, of which about $4 billion will be owed to local banks, $6.4 billion to creditors and $2.5 billion to the Government, in the form of taxes.

Ganga disclosed that the amount owed to local banks is due to last year’s deficit of $3.2 billion and this year’s estimated deficit of approximately $800M, the latter attributable to a decline in earnings from the lower output of 235,000 tonnes as well as a lower average export prices and relatively higher expenditure.

He also revealed that, in 2010, GuySuCo’s financial outturn is uncertain because it is targeting an output level of 280,000 tonnes, a downward revision from 321,000 tonnes projected in its Turnaround Plan.

“This output level is also uncertain because it depends on the corporation achieving its targeted level of tillage and planting for 2009, which is only approximately 67 per cent of the target for the year,” Ganga said.

He said, undoubtedly, lower output levels will have an adverse impact on the corporation’s financial performance, because potential receipts would not have been realised while fixed costs of approximately 70 per cent of total, would have to be met.