NATURAL Resources Minister Raphael Trotman has made a payment to the National Insurance Scheme (NIS), after meeting on Friday morning with a representative of the scheme to clarify the matter of his liability thereto.One section of the media had reported that the minister owes the scheme some $554,850., and the minister subsequently issued a statement explaining that he had not been aware he had been in default.

That statement said Minister Trotman was advised that his liability to the scheme has nothing to do with his failing to remit NIS contributions for any of his staff members, but pertain to his personal contributions while he was in law practice.

“Further verifications are to be conducted. However, Minister Trotman immediately made a payment, and upon completion of the verification, there is expected to be an offset”, the statement clarified.

“Minister Trotman has always complied with the legal requirements (in relation to remittance of NIS contributions) and ensured that contributions for his staff at his legal practice have been duly paid”, that statement continued.

“Minister Trotman thanks the media for their vigilance in reportage, and encourages journalists and editors, in the interest of right of reply and balance, to seek clarification on matters such as this, prior to publication.
Minister Trotman and his office continue to make themselves available to the media for information and clarification on any issue relating to the minister and the Ministry,” the statement said.

The NIS has noted that former Attorney General Anil Nandlall and former Amerindian Affairs Minister Pauline Sukhai also owe the scheme $4.4 million and $1.6 million respectively. It is not clear if these former Government ministers have also settled with NIS, or have made attempts to do so.

Other persons also owe the scheme. There is outstanding a cumulative amount in excess of $2.5 billion.
The Guyana Sugar Corporation (GuySuCo) is the largest defaulter, with an indebtedness of more than $1.5 billion.

According to a recent forensic audit of the operations of the NIS, the scheme’s current system is not designed to determine the actual or near actual contributions from employers/self-employed/employees that are not registered.

During discussions with the operations manager and visits to branches across the country, it was reported that the scheme has limited human resources to cover the areas that fall within the jurisdiction of each office. The inspectors are tasked with, among other responsibilities, ensuring that those on the dormant list are in existence, taking defaulters to court, checking on those not submitting returns, and looking for employers/self-employed persons who have not registered.

LIMITATION
The audit report noted that with those responsibilities, inspectors cannot effectively discharge their functions and simultaneously cover the areas assigned to them.

Contributors that have not been effectively targeted include micro businesses, miners, farmers, construction workers, minibus and hire cars operators, and freelance workers/consultants, among others.

“The Board of Directors (BoDs) is now tasked with finding solutions to capture those sectors/categories of employers/workers who have not been complying with the NIS Act and at the same time pursuing all defaulters. The 8th Actuarial Review reported that 40 per cent of the informal sector workforce is not contributing to the scheme. The operations manager informed us that no report was ever done on the potential loss of contributions from self-employed and employees not contributing to the scheme.

“The BoDs need to address these matters urgently, and to ensure that the Debt Management Unit is staffed and trained to document those categories of self-employed and employees not registered,” the report said.

It added that management has never been able to maintain an accurate or comprehensive listing of receivables from the inception of the scheme. The operations manager presented a list of receivables totalling one billion and ninety-one million, one hundred and seventy-two thousand, seven hundred and five dollars ($1,091,172,705) as at August 2015, which did not include GuySuCo’s indebtedness, which stood at one billion, five hundred and seventy-four million, two hundred and eighty-three thousand, eight hundred and eighty-nine dollars ($1,574,283,889) for the period September 2014 to April 2015.

Included in the listing are several companies, many of which have ceased operations and/or are no longer in existence. In addition, there are some companies/businesses/individuals who, for various reasons, have not been paying their contributions. Some of these balances date back to 1970.

“Extracted from the receivables listing are 42 debtors whose individual liability to the scheme is in excess of four million dollars ($4,000,000) totalling six hundred and eighty-six million, seven hundred and eighty-one thousand, four hundred and twenty-two dollars ($686,781,422).

There are also several debtors with payment plans who have defaulted on their payments. They are as extracted from the BoDs’ minutes. A perusal of the scheme’s audited financial statements for 2013 revealed that sundry receivables were $168 million, part of which dates back to 2001. Included in this amount is a balance of $116 million owed by Ministry of Finance, and an amount of $38 million which represents dishonoured cheques from contributors.

Further, over $20 million of the $38 million are (due) in excess of five years. Management has advised that these balances were referred to the Guyana Police Force, but were sent back to the scheme to be dealt with under their debt recovery policy,” the audit report said.