The Special Purpose Company that was set up by the Administration in order to sell off assets belonging to the beleaguered Guyana Sugar Corporation (GuySuCo) is nothing but a ‘vehicle for corruption’ that completely bypasses the established privatisation procedures.
This is according to Opposition Leader Dr Bharrat Jagdeo who, during a press conference held at his Church Street Office, berated the move on the part of the Administration to create a special outfit to bypass established procedures for the sale of State assets.
According to Jagdeo, with the Government’s establishment of a special purpose company, transactions will no longer be dealt with by a board that “involves the private sector, the labour movement and consumer affairs anymore, it will go from a unit directly to a couple of ministers…Deals will be made there with no valuation of the assets and one day we wake up and all of it is gone.”
This publication reported on Wednesday last that the Special Purpose Unit set up under the National Industrial and Commercial Investments Limited has begun the process of selling off GuySuCo’s assets including a number of estates.
Conducted under the ‘Sugar Industry Privatisation and Diversification’ the outfit is currently soliciting proposals from companies or persons either individually or as part of a joint venture or consortium “with an interest in the privatisation and/or diversification of Skeldon, Rose Hall, Wales and East Demerara ‘Enmore’ factories.”
The request for letters of interest by the Special Purpose Unit is identified as the first step in the process of finding and shortlisting buyers or investors.
The entity has noted too that in order to increase transparency, it is partnering with a suitably qualified international financial services firm ‘to provide technical and financial advisory support in the process leading to a successful privatisation and diversification of the sugar industry.’
Jagdeo however, observed that the special purpose company was moving ahead with sale of the assets and drew reference to the special purpose company that was established to construct the $1.4B Durban park project – a project for which the Auditor General is now unable to find its records.
He recalled that when the People’s Progressive Party (PPP) took office there was a conscious decision taken to revamp the privatisation process at the time.
The former President noted that in the privatisation white paper that was prepared and taken to the National Assembly, “we created a structure for privatisation of State assets.”
He said “in the past you had several entities doing it (privatising State assets), Public Corporation Secretariat, the Office of the President privatised some rice mills in Cane Grove, the Ministry of Finance was doing some, State Planning Secretariat was doing the telecoms privatisation, all was being done at different places.”
The Opposition leader was speaking to the privatisation embarked on by the then PNC Government.
Jagdeo told reporters that the PPP administration decided and presented publicly in its white paper the structure including a technical unit along with its procedures to be adhered to.
He was speaking to the formation of the Privatization Unit, later merged with the National Industrial and Commercial Investments Limited in Barrack Street, Kingston.
It was pointed out that the Privatization Unit’s Board was made up of three government Ministers, a representative from Private Sector, another from Labour (Union) and another from the consumer bodies.
According to Jagdeo, it is this group of persons which would ultimately make recommendations to the Cabinet – chaired by the President.
Turning his attention to the Special Purpose Company established to deal with the sale and diversification of the assets to GuySuCo, Jagdeo opined that established structures and procedures are being circumvented.
“Like they did for the Durban Park $1.4B fiasco that the Auditor General can’t find the records for that special purpose company, so we now can’t audit the spendings there,” he quipped.
The former President cautioned again that by establishing another such special purpose company “for doing privatisation, you don’t have to follow the established procedures.”
Expanding on fears over the company created to sell off the GuySuCo factories and lands, the President said “they are moving to sell without valuation of the assets so how do you know if you are getting a good deal.”
Confronted on the monies that have already been allocated – voted and approved by both government and opposition, Jagdeo told reporters while this is the case, the opposition is unaware as to what if any company or services have been contracted to do the evaluation of the assets before any sale.
“So it will not go to a board that involves the private sector, the labour movement and consumer affairs anymore, it will go from a unit directly to a couple of ministers…”
At the time of announcing the creation of the Special Unit, Finance Minister Winston Jordan had indicated that some $60M had been set aside to hire an accounting firm in order to lead the divestment process, including updated valuations of the assets.
The Opposition leader used the opportunity to draw reference too, to Privatisation in Tables which were prepared by then Executive Secretary and Head of the Privatization Unit, Winston Brassington, which had documented each sale of State asset undertaken by the PPP administration since taking office up until 2011.
“A document was published, prepared by Brassington showing every privatisation under the PPP between 1992 and 2011, every single privatisation, every single one of them”, the former President remarked, pointing to a track record under the previous Administration.
Speaking to the special purpose company established for the sale of the GuySuCo Assets, the former President said it “is a vehicle for corruption, they don’t have to follow any procedures, established procedures.”
As part of the ongoing divestment of the assets belonging to the beleaguered GuySuCo, Minister of State, Joseph Harmon, recently announced that Colvin Keith-London has been appointed head of that SPU.
That Unit has been tasked with the divestment of GuySuCo’s assets, inclusive of its lands; and according to Harmon, Keith-London will be based at the Kingston Headquarters of the National Industrial and Commercial Investments Limited (NICIL).
That Unit was first announced by the Agriculture Minister when, in recent months, he presented to the National Assembly a policy paper on the future of the sugar industry.