Occasional Essays
September 22, 2006
Once again, much ado about nothing

SVG has a TV station, eight radio stations, innumerable talk shows, three newspapers and x number of persons are happy to go before a microphone and pronounce on various issues. The media can therefore not be described as small given that our country contains only about 110,000 people. Where we have a shortfall is in persons prepared to get down to the details of an issue and having grasped them, do some analysis and come to some logical conclusions. Our deficiency in this regard has once again been on display over the last few weeks.{{more}}

It takes no rocket scientist to have noted that the SVMC supermarket was going to the dogs. Indeed two ladies who used to be office attendants when I was Financial Secretary, came up to me and asked if I could not get the Government to do something about the supermarket since things were really bad up there.

The Government eventually did. It told National Properties (NP) to go and sort it out. This very newspaper carried a picture of Messrs. Hadley, Morgan and Dougan, all of NP, emerging from the Cabinet Office having received their charge.

NP had two choices. It could try to find a private individual to operate the supermarket. Alternatively, it could run the business itself. NP pursued the first option vigorously. The best offer that it got however was a relatively low rental for the entire building with Government being left to bear the outstanding debts of the supermarket. These amounted to some twelve million dollars. Cognisant of the criticism it would face if it appeared to hand over the business too cheaply, NP decided to itself manage the supermarket for at least a year.

Having taken this decision the next question was how to implement it. The SVMC is a statutory body set up by Government under Act No 26 of 1975. NP is a wholly owned government company created under the Companies Act. The issue then is how to bring these two organisations together. Under a recently passed amendment to the Companies Act a statutory body like the SVMC can be converted into a wholly owned government company like National Properties. This was in fact done and the new company, formerly the SVMC, and the old company, National Properties merged.

The conversion of SVMC into a company automatically repealed the SVMC Act No 26 of 1975. The new company however lacked some of the powers of the old SVMC. One such power is the right to specify a commodity that is either imported or exported. Specification of a commodity means that only Government or a body designated by Government can deal in that commodity.

It is not difficult to imagine situations in which it would be necessary for Government to specify a commodity, especially one which is exported. It was therefore decided to introduce a new law: ‘The Produce and Commodity Bill’ to deal with the problem. Under this the Minister was given the power, formerly held by the SVMC, to specify a commodity. In effect all that has changed is the body responsible for doing the specification. The Minister replaced the now defunct SVMC.

SVG is not the only country in which the Government has the power to specify commodities. The legislation exists in all OECS countries. In Antigua five items are specified: in Dominica, two ; in Grenada, three; in St Kitts two and in St Lucia four. In St Vincent only one is. It is the ULP Government which reduced the number from two to one, milk having been removed from the list leaving sugar only. The present hullabaloo is therefore not about what the Government has done. Rather it was about what the Government intends to do.

Divining anyone’s intention has never been a straight forward matter. To decide if the Government is going to nationalise imports and destroy the private sector one has to look at what the Government has said and even more important, what it has done. It has plainly said it will not be nationalising imports. In this regard two actions of the Government speak louder than its words.

The Government leases its car park to the Chamber of Commerce for $50,000 annually. The Chamber however grosses about $100,000 from it. In effect the Government is subsidising the Chamber by over $50,000 per annum. The lease came up for renewal last year and the Government could have terminated it. It did not. The Chamber is of course the main organisation representing the private sector.

The Government built and equipped a Coconut Water Bottling plant in Congo Valley and also a Fishing Complex in Bequia. It handed over both of these to the private sector. It is in the process of doing the same thing with the Vegetable Vacuum Packing Plant at Lauders. This is tantamount to the Government itself physically expanding the private sector. Talk of Government intending to destroy the private sector has therefore to be ludicrous.

The naked truth is that the Produce and Commodities Bill is not the initiation of a new policy or a new programme. Rather it is an attempt to dispose of the leftovers arising from the pursuit of the Government’s primary objective, to wit, increasing the efficiency of the supermarket’s operations.