Govt. mulls reducing ministerial budgets to pay severances to sugar workers

DPI, GUYANA, Wednesday, January 10, 2018

Minister of Finance, Winston Jordan, speaking on the sidelines today at the 83rd Sitting of the National Assembly, said despite efforts in the form of enormous financial transfers by this Government, the sugar industry continued to slip further into depression, hence the decision to downsize.

As it relates to the payment of severance to the sugar workers, the Minister disclosed that Government may have to resort to reducing ministerial budgets to ensure these payments are made.

“It was a sudden and large amount and we had to find creative ways to do this…we will have to re-examine our 2018 budget which will very well result in cuts to programmes so as to release money to pay the severances,” the Minister said.

His comments follow a statement by President David Granger earlier today regarding the payment of severance to sugar workers and the unsustainability of the industry. “This Government cannot sustain the sugar industry in its current state. It has had to make difficult choices in order to ensure the industry’s viability,” the Head of State said.

He reminded of his administration’s earlier measures to salvage the ailing industry, such as the convening of a Commission of Inquiry into the state of the industry in October 2015; the publishing of a State Paper on the future of the industry in May 2017 and the creation of the Special Purpose Unit to manage the reform of the industry in June 2017.

Minister Jordan, in response to opposition naysayers, assured that severance will be paid to workers, reiterating the Government’s commitment to ensuring the best interests of the sugar workers are protected.

He explained that this is the reason for the severance being paid in two parts; $2B at the end of January and the other $2B by the end of the year.

Agriculture Minister, Noel Holder weighing in on the matter, noted that the situation in the sugar industry has prevailed far too long, reminding that in 1992 when the previous administration took office, there were some 28,000 sugar workers across 11 sugar estates, however, there has been tremendous downsizing over those years.

Minister Holder said that the Guyana Sugar Corporation (GuySuCo) began to suffer financial losses since the latter part of the 1990s and has attracted Government subsidies since 2009.

“When this Government got into power in 2015, it was the first time we understood the magnitude of the problem and in that year had to find $16B to bail the industry out. It obviously had to be rationalised, we couldn’t continue this way.”

In rationalising the industry, the Agriculture Minister said this Government was successful in retaining some 11, 000 workers and find alternatives for many others through absorption within the National Drainage and Irrigation Authority (NDIA) and other agencies.

He further highlighted, “We think we got it to the right size, we think the markets we’ve got, the 147,000 tonnes will largely be supplied to the CARICOM market, which is a high price market and we think with further improvements as we go along with co-generation and going back to ‘plantation white sugar’ the sugar industry will rebound much stronger than before.”

Meanwhile, Minister of Business, Dominic Gaskin said that the Government has a responsibility to spend public money for the good of the public, therefore, given the circumstances, it was a tough but responsible decision to downsize.

“It (the administration) cannot afford to, year after year, subsidise an entity that is not profitable and that is making increasingly growing demands for Government support,” he emphasised.

Minister Gaskin rubbished claims that the Government is uncaring, highlighting that there are numerous agencies engaging the workers, including the Small Business Bureau (SBB), which since the latter part of 2017 began training workers of GuySuCo, with a view to supporting them in the move towards entrepreneurship.

The Government will not shy away from tough decisions, but will, at the same time consider the welfare of the workers while assuring that similar support for the sugar workers is forthcoming, Minister Gaskin added.


By: Stacy Carmichael


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