We had to respond to Christmas Eve disaster – Senator Gonsalves

While he agrees that the Government should have paid its monthly contributions to the National Insurance Services (NIS), Senator Camillo Gonsalves is of the view that the immediate crisis after the Christmas Eve disaster had to be given priority.

Gonsalves shared {{more}}his opinion while contributing to the debate in Parliament on Tuesday, on the resolution that was passed for the Government to raise a loan from the National Insurance Fund to the tune of $15 million, in an effort to cover outstanding contributions owed to the NIS by the Government.

“I think that in many ways, the two sides of this honourable House have been having a separate debate. One side of the House has been having a theoretical argument and I agree with many of their theoretical points. We should pay the NIS in an ideal situation, every month. I agree with that,” he said.

“This side of the house, Mr Speaker, has been having a conversation cognizant of the reality of governance in St Vincent and the Grenadines and in the Caribbean in this present time and in that context, some of these theoretical points really don’t stand up.”

The Minister of Foreign Affairs made reference to the presentation made by Opposition senator Linton Lewis, who suggested that there should be a provision in place for a contingency fund, which he said is in accordance with the constitution and the Finance Administration Act.

According to Gonsalves, while a contingency fund is a good idea, that source of funds would have already been exhausted, because of the number of disasters that have passed through this country within the last four years.

“In the last four years in this country, Mr Speaker, we have had four natural disasters, accounting to, on average, double digit hits in loss and damage. We have had the April floods, we have had Hurricane Tomas, we have had drought and we have the Christmas Eve disaster. If we had a contingency fund of $15 million, it would have been spent in 2009, in 2010, in 2011 and in this year.

“The point of the matter is…the realities of this country, the realities of our current budgetary situation, the realities of near annual occurrence of natural disasters do not permit the lovely theoretical idea that is being floated of a contingency fund.”

Gonsalves took the opportunity to map out the reasons that led to the Government delaying their NIS payments and began by highlighting the damage that was caused by the 2014 December flood disaster, which was estimated at approximately $300 million.

He pointed out that while Prime Minister Dr Ralph Gonsalves had indicated that he had raised $230 million of the $300 million, all the money was not yet at hand, which caused the Government to make “hard choices.”

“The day after the floods, BRAGSA (Roads, Buildings and General Services Authority) was in the river. Rivers had to be trained, bridges had to be repaired, landslides had to be cleared, money had to be found, and 104 homes to date had to be built, either on their current location or different locations. Land had to be purchased for that effect. People were living in shelters; they had to be fed. The money that was pledged or that was promised was not yet in our hand,” Gonsalves said.

“It was a question, Mr Speaker, of priority. It was a question of how humane the Government’s response to the Christmas floods would be.”

Like other Government ministers, Gonsalves highlighted only 10.7 per cent of NIS resources had been invested in the Government and pointed out that it is not so in other countries in the region.

Using Grenada as an example, he highlighted that the Grenadian Government owed their NIS a total of $280 million. He added that on a $92 million instrument, that Government had asked their NIS for a “hair cut” of at least 50 or 60 percent.

“It has been admitted. The Government did not make its NIS payments. And if you add from December, the 1.4 [million] they owed in December and the 1.7 [million each month from January] they owed to date, you would get $15 million. What the Government is saying is that a natural disaster hit us, we were in a bind, and we did not have the money on hand…so, therefore, we use the money we could find and now we are trying to regularize that situation. That is what the Government is saying,” the Foreign Affairs minister said.

“Here we are talking about a $15 million that we are willing to pay, willing to pay in full and we are willing to pay with interest, whereas one nation to our south, a government is saying we can’t give you all the money that we owe you and we owe you hundreds of millions of dollars.

“Let us have some perspective in this matter. I agree with the assertion of the Leader of the Opposition and everybody who said the NIS should be paid promptly and readily. I agree with them, but sometimes circumstances do not so permit and when circumstances do not so permit, the mark of good governance, the mark of humanity, the mark of prudence is how you deal with the debt that you’ve accumulated in an emergency. And in this case, the Government said we would pay you back, plus interest.”