AFTER hours of scrutiny at the level of the Committee of Supply, the National Assembly approved supplementary funding to the tune of $130M for the establishment of a “Special Purpose Unit” to manage the divestment of the Skeldon Factory and other Guyana Sugar Corporation (GuySuCo) assets.
Responding to a string of questions posed by People’s Progressive Party (PPP) Member of Parliament, Komal Chand, Finance Minister Winston Jordan explained that the unit, which will fall under the National Industrial and Commercial Investment Limited (NICIL), is specifically responsible for the privatisation of certain parts of the Guyana Sugar Corporation (GuYSuCo).

In the initial stage, its primary function would be to lead the privatisation and divestment process for the Skeldon Factory, Finance Minister Winston Jordan disclosed, while noting that the unit would be required to hire an established accounting firm to assist with the process.
The functions of the unit would also include the process of valuation, marketing, advertising and the drafting of legal framework. As time progresses, the unit would assist GuySuCo in the identification of other properties to be privatised.

Given the fact that the “Special Purpose Unit” falls under NICIL, PPP Member of Parliament, Bishop Juan Edghill questioned why funds are not being drawn from NICIL – an extra budgetary agency – to assist with the establishment of the unit. The answer, Minister Jordan said was simple, “NICIL does not have the money.” It was explained that while the unit’s primary function is aimed at GuySuCo and more so Skeldon Estate, in the future, its functions would be expanded to include other entities.
Not satisfied with the response given, Edghill sought to clarify the reason behind the shift in policy, explaining that NICIL was not given a subvention in the past. In response, Minister Jordan explained that the $130M will be used solely for the establishment and operations of the unit and as such would not benefit other parts of NICIL. Approval for its establishment had been acquired from Cabinet.

PPP frontbencher, Irfaan Ali sought to have a greater understanding of the impacts, whether social or economic ,such transition would have not only on GuySuCo’s operation but the thousands of workers that would be affected.
In response, Minister Jordan told the House that such questions should be posed to the Agriculture Minister, Noel Holder, noting that he was merely trying to “get the money.” In addition to the setting up of the unit, the $130M will be used for the payment of salaries, utilities, professional and legal fees, advertisements, office space, and operating supplies, furniture and equipment.

The $130M in supplementary funding forms part of a larger supplementary financial paper which was subsequently approved to the tune of $6.395B. Of the sum, $143.5M accounted for current projects while the bulk – $6.252B accounted for capital projects in the areas of infrastructure, education and agriculture. In April, President David Granger announced that the Blairmont, Uitvlugt and Albion estates are likely to remain when government makes a decision to restructure the Guyana Sugar Corporation.

“We have to produce our commodities more cheaply, otherwise we will not be able to compete, whoever is in the Government. We will not be able to compete if your commodities are too expensive. We want to save the sugar industry, but it must be efficient and competitive,” he had told the opening of the West Berbice Trade Fair and Exposition held at Bath Settlement.

Government is expected to present a White Paper in the National Assembly soon, pertaining to the future of GuySuCo, the Cabinet Secretary announced back in March. The issue was discussed extensively at the ministerial conference held on February 28, at State House, when Minister of Agriculture, Noel Holder, made his presentation. The conclusion of consultations among government, the unions and the opposition on GuySuCo’s future, along with the options advanced by the government and the proposal made by the Guyana Agricultural and General Workers Union (GAWU), will form the basis of the White Paper, Harmon had told a news briefing.

When asked if any sugar estates will be closed, Harmon had said that proposals were made to that effect, along with diversification of several estates. He, however, emphasised that the welfare of sugar workers and their families is the top priority of the APNU+AFC government. “The welfare of the workers and their families is of primary concern. The other economic concerns and so on will of course be dealt with, but the workers’ interest is at the forefront of whatever policy we’re going to embrace with respect to the sugar industry,” Harmon said.

The White Paper is expected to deal with the Commission of Inquiry (CoI) into the sugar industry, the proposals by GuySuCo, the consultations held with stakeholders and GAWU’s presentation, the decisions facing government relating to the recovery of drainage and irrigation charges of the National Drainage and Irrigation Authority (NDIA), diversification of the Skeldon factory and the leased lands.

In a report which was presented to the Parliamentary Economic Services Committee in January by GuySuCo’s Chairman, Dr. Clive Thomas and Chief Executive Officer (CEO), Errol Hanoman, it stated that the outlook for Guyana’s sugar industry continues to be grim as the officials declared that funds injected into sugar industry at this time will be funds “wasted.” If the situation remains the same, some $21B would be required in 2018 keep GuySuCo afloat.