NICIL not “totally” bankrupt – Minister Jordan

first_imgGovernment has come to the defence of the National Industrial and Commercial Investments Limited (NICIL), stating that although the entity may be performing poorly financially, it is not bankrupt per say, because there are a number of factors influencing its overall performance.This comment was made by Finance Minister Winston Jordan after the CEO of NICIL, Horace James, stated that the entity is now owed millions of dollars by various companies and State agencies and that it was too broke to even go after all of its debtors.“They (NICIL) are not bankrupt, bankrupt but they (NICIL) don’t control the level of resources that allowed them to recklessly invest in places like Marriott and BerbiceFinance Minister Winston JordanIn providing a background to NICIL, the Minister said the entity was originally established to manage Government investment and when it first started, it had a very small staff.Jordan recalled that back in 1994, a bill was tabled in Parliament by former People’s Progressive Party (PPP) Member of Parliament, Asgar Alli, paving the way for the establishment of the Privatisation Unit within NICIL. He claimed that the Unit was not legal but a department of the Finance Ministry. “And if you check back old estimates, you would see transfers from Ministry of Finance to the Privatisation Unit to cover its cost because privatisation should not be generating anything, if they sold something and privatised it, the net revenues should come to the Consolidated Fund.”The Minister explained that the Unit’s financial expenses were therefore funded from the treasury but all of that changed post 1992. “And I believe at the time when they had ran out of privatisation, some merger took place between Privatisation Unit and NICL,” he stated.This merger took place through a Cabinet memorandum and under the Company Act, since NICIL had a legal structure and some management agreement was made between NICIL and the Privatisation Unit for which NICIL then took over all the other assets that the Government owned.Given the fact that the form and structure of NICIL was changed then, Jordan said NICIL is supposedly bankrupt for two broad reasons. “One they had changed the scenario because not too many people giving you dividends these days. In fact, the only major dividends we are getting is from Guyoil and theirs is substantial and they can give anywhere between $2 billion in any one year.”He said those monies instead of becoming part of NICIL’s revenue, is now part of the Consolidated Fund. “The second part is they are the guarantors of Marriott and nothing is coming in Berbice Bridge and a range of other places… Look, for example, we had to take Guyana National Industrial Company Inc (GNIC) and others to court, because nothing is coming in from the other places.”Earlier this month, the Opposition PPP/Civic criticised Government, saying the agency’s performance is reflective of two years of mismanagement. The PPP/C said under its leadership, the Privatisation Unit of NICIL contributed tens of billions of dollars to the Treasury from dividends and privatisation receipts.However, under the coalition Government, NICIL’s finances have been allowed to dwindle due to grave mismanagement and neglect. It was also noted that legal proceedings involving billions of dollars against the A Partnership for National Unity/Alliance For Change (APNU/AFC) are not being actively pursued.The party said given the billions of dollars NICIL contributed to the Treasury, it is still to be known, “How much has been transferred under APNU and where the audited accounts are.”NICIL produced and laid in Parliament clean audit reports, for both NICIL and its subsidiaries, up to the time that the PPP left Government. As such, the Party is now questioning what APNU/AFC has done.Under the PPP the party said, NICIL made economic contributions and investments and loss-making entities were restructured, privatised or improved and NICIL found ways to ensure that its assets were properly managed and contributing financial and economic returns.The Opposition party said if NICIL’s investments in the Berbice Bridge, Marriott or Skeldon Energy have not performed in accordance with its feasibilities, there is a clear connection with how the APNU/AFC policy decisions, incompetence, or action, have directly contributed to any sub-par performance.last_img read more