Monday, April 22, 2024

WHAT MATTERS MOST: Real picture!


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Minister of Finance Chris Sinckler stated that the Government is looking for the “fastest and best solution” for the policyholders of CLICO. He further stated that “since becoming the Minister of Finance I have deliberately tried not to engage in excessive public discourse on this matter”.
I do recall a public picture but certainly not any public course by any member of the current administration.
I do recall a statement by the previous Minister of Finance to the effect that CLICO (Barbados) was not in any financial difficulty.
Recent evidence does suggests that the previous Minister of Finance was privy to much more, having witnessed the signing of a whopping $10 million gratuity by the company.
It is therefore for us in the interest of the policyholders to “analyze if we will” and “probe if we must”. Is it not worth probing that the previous Minister of Finance witnessed the signing of an agreement but the special Oversight Committee, which the same minister appointed, was unable to find any evidence of the CEO’s job contract?
What is worth analyzing is the coincidence of the date on which the gratuity payment was to be made.
The payment was to be made exactly three years after the signing of the agreement which happened to be the month in which the general election was constitutionally due in 2008.
A gratuity is a “gift, especially of money, usually in return for services rendered . . .  at discretion of giver without stipulation”. This definition implies no requirement for the giver
to make a stipulation. In the case where the gratuity is for a service rendered as happens in a restaurant then the amount given reflects it, but a $10 million gratuity bestowed on a CEO must be for exemplary performance.
But to grant such a whopping gratuity three years in advance is certainly worthy of probing. Furthermore, at a time when 15 000 policyholders have been asked to hold strain,  it is only reasonable that the CEO who was being rewarded for exemplary service, which is now questionable, be asked to hold even more strain.
The current Minister of Finance remarked boldly last Monday during his speech in Parliament that he knows “exactly what is going on”. If he knows that the CLICO affair could cause “major disruption in Barbados”, then he has a responsibility to let the public understand the implications of the affair for the country and certainly for the policyholders.
The notion that parties, including the media, are whipping up a frenzy, only because they are malicious, is itself irresponsible. There is a very human dimension to this affair that speaks to a fundamental policy that encouraged Barbadians to help provide for their golden years and not let all of the burden fall on the Government.
Having put the policy framework to allow Barbadians who are not known for their risk-taking to invest, they responded by investing in mutual funds and other financial products, one of which was the highly attractive Executive Flexible Premium Annuities (EFPA).
The EFPA offered a rate of return that was irresistible, almost doubling what the market offered. So the usually risk-averse Barbadians were seduced by the offer.
The outward trappings of the company with a private jet, a car park laden with top of the line cars and housing investments that paved the way for pecuniary and non-pecuniary benefits, to flow inwardly and outwardly, were sufficient to indicate the appearance of health and wealth.
In the circumstances, the public and certainly the policymakers in Barbados and the Organization of Eastern Caribbean States have a right to see the real picture. After all, a picture paints a thousand words!   
• Clyde Mascoll is an economist and Opposition Barbados Labour Party spokesman on the economy.


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