Stating that some investors might pass away before the cash arrives, Opposition Leader Mia Mottley has urged Government to fast-track help for elderly people who put their savings into the troubled CLICO International Life.
She told members of the Barbados Chamber of Commerce & Industry at lunch at Hilton Barbados yesterday that a reported Government multimillion-dollar bailout plan for CLICO did not go far enough.
“A great many of CLICO’s direct clients were vulnerable, senior citizens who had put away savings for their retirement,” she noted.
“These people are being asked to wait for the return on the majority of their deposits for an uncertain period that could well be beyond their life expectancy.
“The position of pensioners whose pension plans are invested in CLICO is even more uncertain.”
Mottley suggested: “Government must consider new instruments that convert the existing enormous liabilities the state has taken on for something useful to the vulnerable depositors, especially our senior citizens.”
She said Government could issue a “perpetual bond”, backed by the company’s assets, with a state-guaranteed rate of interest, similar to the offering on long-term Government bonds.
According to Mottley, this would be better than making a payout in two years’ time, which is expensive from the perspective of Government but “miserly” from that of individual clients.
Cash ease
“The guarantee of a Government interest rate would allow the instrument to be traded and sold by those who need cash today, without Government having to fork out this principal today or in the immediate future,” she explained.
“A broadly similar commitment of Government can be turned into something worth several times what depositors have been left with today.”
She said Government should decide who would be eligible for the perpetual bond and up to what level of deposit.
“I hope this would focus where possible on the most vulnerable in our society,” she told the gathering that included several business leaders.
Press reports have put the bailout plan at more than $300 million.
‘However it is cut, this Government guarantee is the single biggest guarantee in our history,” Mottley said. (TY)
