Trinidad & Tobago
Hard times ahead for TT
By Sandra Chouthi
Special to Indo Caribbean World
Port-of-Spain – There are stringent times ahead for Trinidad and Tobago, former minister in the Ministry of Finance, Mariano Browne, said last week. This would be forthcoming in the wake of Standard & Poor's downgrading of the credit rating of the US from a top-tier AAA to AA+, Brown told the media.
He advised Finance Minister in the present PP government, Winston Dookeran, to exercise prudent financial management in the months ahead of an already struggling economy.
"Really, it is about austerity and what type of measures you put into position," Browne said.
Standard & Poor cut the US credit status in light of its government's huge budget deficit. Another downgrade is likely in the next 12 to 18 months. This could trigger increases in borrowing costs for the US government, as well as minimise the purchasing power of consumers.
Browne said cutbacks by the Trinidad and Tobago government in the sums allocated for various programmes will be a reality.
"Some of the difficulties we face are actually what programmes will we cut, shall we cut, or when will we cut. The issue is not if we could cut them or not. I think we are going to find ourselves in a position where we are going to have to cut them. And the only question is when and how much," he said.
He added that the petroleum subsidy will also need to be reviewed "and the minister may find himself in a situation where he may have to cut it".
Browne noted that the US credit downgrade did not augur well for TT's large deficit.
"So far, he has done quite well. He has not spent any money," Browne said of Dookeran's management of the deficit.
"The Minister of Finance now has been very sensitive in how he balances his expenditure profile, because we are on target for having the biggest deficit on the basis of the supplementary appropriation budget. But I think he has been saved from the incapacity of the ministry to spend all the money that has been allocated. Even so, we still have a large deficit."
While local experts are viewing the fiscal developments abroad with foreboding, the Trinidad and Tobago government continues to deal with ongoing wage demands from the labour unions. Last month the unions threatened to shut down the country in a massive protest against what is being claimed as government's "five percent cap" in wage negotiations.
The five percent has been a contentious point of issue with the unions. Last February, Prime Minister Kamla Persad-Bissessar said in response to police demanding a 40 percent increase that her government could only offer five. The government is unable to place a better offer on the bargaining table at this time, she told the union.
On July 25, Persad-Bissessar met with the leaders of 19 trade unions, including Ancel Roget, president general of the powerful Oilfield Workers Trade Union to discuss a way forward. The unions continue to object to "the government's five percent cap". However, the government insists this is not a cap.
Last month talks between Persad-Bissessar and the union leaders broke down after three hours. She had proposed wiping the slate clean and starting negotiations from scratch, which the unions rejected.
Persad-Bissessar said she went through all items of concern on the accord of the union leaders, but they could not get past the five percent.
"At the end of the meeting, we went back to square one. They asked me about the five percent cap and at that point of the meeting, they wanted me to actually negotiate, and I said I cannot negotiate, you will have to negotiate with your employers.
"So I was placed in a position where I was being asked to declare that there is a removal of the five percent cap and, at that point, I felt, as I said, that I was in a position where I would now be negotiating what should be dealt with by the various employers and the CPO, and I could not accede to that request. I repeated to them there is no five percent cap, go to the collective bargaining table and negotiate there.
"If it were that I were to say that I have removed this five percent cap, then what would happen, they would go to the bargaining table starting at five per cent," she explained.
Finance Minister Dookeran, speaking at the July 28 post-Cabinet press conference, described the five percent as a guideline.
"I have no hesitation in saying that I had indicated that the five percent guideline with the PSA would have been an adequate part of the compensation package. Now free collective bargaining will continue with the other institutions and see where they end up. Therefore, there is no cap, in that sense of the word. We have been setting the guidelines for the compensation packages.
"These guidelines went up to five percent wages (in negotiations with PSA). It also included the consolidation of cost of living allowance, the revision of allowances, the expansion of the medical plan and a commitment to put into effect a better pension programme for the daily paid in the public sector."
Dookeran said the effective rate of pay (increase) would be far beyond the five percent.
"What we have done is establish guidelines with respect to a compensation package. It is the compensation package we are willing to discuss. Focusing this on a five per cent (issue) may be a good rallying point, but it does not really address the issue of compensation packages that is being negotiated."
He said the government continues with its search "for the right equilibrium in TT to maintain the stability of our finances and, at the same time, to redirect our expenditure to re-ignite growth."
He added that "fiscal excess" could erode recent economic successes in Trinidad and Tobago.
Port-of-Spain - Finance Minister Winston Dookeran believes the Trinidad and Tobago economy will continue to show resilence to new and emerging global challenges.
But he said the government remains conscious of the need to be vigilant and to deal with the fiscal situation.
Dookeran said one of the most important lessons of the recent impasse in the United States which found itself in a position of continuing deficit, was that it emphasised the need to reduce this country's exposure to external shocks and also the need to ensure fiscal balance in this country's finances.
He said this was why the government could not give in to the calls of "give me my money and give me it now" which came from Clico depositors, the contractors and more recently from the labour unions.
He said if the government did not have a policy framework to withstand these demands on the country, the economy would not have had the resilience to the global shocks.
If the government is not careful with its expenditure the country will eventually get to the same point that the US found itself, he said.
Foreign Affairs and Communications Minister Suruj Rambachan pointed out that the deficit for WASA for this fiscal year was estimated to be $2.4 billion, while the deficit for T&TEC was estimated to be $535 million.
He added that the fuel subsidy for this year was $3.698 billion. And this figure did not include the $4 billion in arrears owed to Petrotrin.
He said loans taken by State enterprises and guaranteed by the government amounted to $11.2 billion, while the government provided letters of comfort for another $7.2 billion.
Dookeran said the goal was diversification of the economy while ensuring that there is fiscal stability.
While most countries were experiencing downgrades, Trinidad and Tobago was able to retain its financial ratings, he said.
Three other Ministers —Housing and Environment Minister Dr Roodal Moonilal, Local Government Minister Chandresh Sharma and Minister in the Ministry of Works and Infrastructure Stacy Roopnarine — are on the committee which also includes Minister of Works and Infrastructure Jack Warner.
The highway extension project will impact on areas within the constituencies of Ministers Moonilal, Sharma and Roopnarine, and also the PM's Siparia constituency.
The mega project falls under Warner's purview. Warner handed over a $1.5 billion cheque to the National Infrastructure Development Company on June 29, to commence construction of the project five months after the Prime Minister turned the sod. The cheque, Warner said, was the first of four payments taken from government resources and not borrowed as initially planned. However, he admitted that the second payment was not yet available but assured the project would not be halted.
The mega project is being constructed by Constructora OAS and sub-contractor Namalco. Construction of the highway includes 18 cross roads, eight interchanges and eight bridges.
The project is expected to generate some 10,000-plus jobs. Local contractors promised piece of the 'pie'. It was in January, Warner promised local contractors that they would not be left out of the construction boom. Warner assured contractors that 40 percent of the mega projects would be awarded to them. The minister maintained that national contractors must earn the right to get work on the government's major construction projects over the next few years. Warner made the comment after touring the industrial complex of Coosal's Construction Company in central Trinidad.
He stated: "Our intention is to give the local construction industry a minimum of 40 percent of the contract on the highway to Point Fortin but it would be given to those who deserve it. The contractor has to earn the right to participate." One such contractor, Warner said, who has earned that right is Coosal's Construction Company Ltd. Coosal's executive chairman Sieunarine Coosal had said a ministerial visit should form part of the pre-qualification process for companies seeking contracts. The company is at present involved in major road works along the Solomon Hochoy Highway.
Confirming the setting up of the committee, Leader of Government Business Dr Roodal Moonilal said the aim was to assist with the process. "The highway to Point Fortin is a major infrastructural challenge. Maybe one of the biggest in our history and it involves about 10,000 residents of south Trinidad, hundreds of households, farmers, commercial and private properties and infrastructure issues. It is really complex and we needed to have a team in South to ensure that the highway is built and construction takes place in a timely basis."
Moonilal said the three MPs appointed on the committee constituencies fall within route of the highway.
The constituencies are Oropouche East, Oropouche West and Fyzabad. Moonilal said officials from Nidco and the Ministry of Works and various community groups are also on board.
"There is an ongoing procedure in terms of the construction of the highway. MPs that are so affected because their constituencies fall within route of the highway are on the committee. We have a team that meets regularly to look at the issues in terms of the relocation matter and some of the legal obligation that the government has to contractors," Moonilal said.
Meanwhile, Warner said he was aware the Prime Minister is head of the committee.
"The terms and reference of the committee in some ways were designed by me and if the committee is to supervise and to have oversight that the highway is built within budget and time I have no problem with that. The committee is really to look and see the people who are to be relocated are not compromised in any way and to see that the highway and to see the constituencies of the MPs where the highway passes are not affected," Warner said.
Port-of-Spain - Prime Minister Kamla Persad-Bissessar wants "an unqualified and proper apology" from Opposition senator Fitzgerald Hinds for statements he made about her during a press conference last Wednesday.
If he fails to do so, she intends to file an injunction in the High Court restraining him from further libel/and or slander against her. Attorneys representing Persad-Bissessar last week issued a six-page pre-action protocol letter to Hinds. He has been given 14 days to respond.
Attorneys for the Prime Minister issued the letter days after the Integrity Commission wrote to her last Thursday, indicating there was no complaint against her in relation to any matter.
Senior Counsel Alvin Fitzpatrick, Jagdeo Singh, Larry Lalla and Christlyn Moore are representing Persad-Bissessar. Persad-Bissessar plans to initiate High Court action against Hinds for damages, including exemplary and/or aggravated damages for libel and/or slander; an injunction restraining him from further publishing the statements or any similar libel/and or slander about her; and legal costs.
However, she gave him an alternative which is to issue an unqualified and proper apology, in terms to be agreed; pay a substantial sum in damages to demonstrate the baselessness of his allegations and compensate her for the injury to her reputation and the considerable distress the statements caused, as well as payment of her legal costs. The letter, signed by Moore, stated that Hinds' statements necessarily lowered the prime minister in the estimation of ordinary, reasonable members of the public throughout Trinidad and Tobago, and wherever his statements were published.
On May 19, Hinds wrote to the commission asking for an investigation into the award of a $40 million contract by NP to Gopaul and Company or some other entity beneficially owned by Ralph Gopaul. On July 25, the commission wrote to Persad-Bissessar and on the same day, at the weekly post-Cabinet news briefing at the Office of the Prime Minister, read the letter to the media which cleared her from any wrongdoing of an alleged breach of the Integrity in Public Life Act.
"The commission has considered the matter and rejected the complaint," wrote the commission's registrar Martin Farrell.
On August 3, Hinds received a letter from the commission which stated that the prime minister's stay at the Gopaul's residence did not constitute a breach of the Integrity in Public Life Act.
However, the letter further stated: "The other aspect of your complaint has been considered and is being investigated by the Integrity Commission. You will be informed of the decision of the Commission in due course."
At a press conference the same day, Hinds told the media: "Ladies and gentlemen, when that deceptive, smiling Prime Minister waved that letter in front of you, she did not tell you that last paragraph which she would have known. She told you only an element of it, deliberately hiding from the national community the fact that it was only one aspect of the complaint that was rejected."
On August 4, the commission responded to Persad-Bissessar's August 3 letter in which she asked whether there was any pending complaint against her. The commission said there was no complaint regarding the Prime Minister.
probe continues
Lutchmedial said teams have been removing the aircraft from the runway field. "We'll have to drop the engines and altogether the move will take several days," he said.
Lutchmedial was also highly critical of a Guyanese news report regarding the crash. He said: "I'm very disturbed about this because we need to steer clear of all speculation for the probe to be done properly. There are no reports yet. We've collected data and this is being analysed." Guyana Transport Minister Robeson Benn in a statement to Guyana's Parliament last Thursday, also chided what he described as "local and international" media reports on conditions at Guyana's airport where the incident occurred.
Benn told Guyana's Parliament that four of the five probe teams had concluded preliminary investigations and were in the process of working towards a preliminary report. He said an investigation of this nature and magnitude usually took up to one year before a final report.
Benn also defended Guyana's airport response to the CAL incident, chiding local and international media for painting "a less than rosy picture" of the response and the condition of the Cheddi Jagan International Airport. Benn said the landing occurred after the airplane "apparently overran the runway."
"The Government notes with great concern attempts in the media to discredit and vilify the physical and operational environment at the Cheddi Jagan International Airport, particularly at the time of the accident," he said.
Benn said descriptions of the prevailing weather conditions and the state of the runway at the time of the accident and the timeliness of the emergency response personnel "are issues that have been sensationalised in certain sections of the media, both nationally and overseas."
Benn said reports from Guyana's hydro meteorological office which is equipped with a modern Doppler radar system, indicated there was a light drizzle at the time of the accident.
"Visibility was at eight km with a cloud ceiling of 9,000 feet," he said.
Concerning the state of the runway, Benn said according to the Cheddi Jagan International Airport, the annual audit which the International Civil Aviation Organisation conducted in January 2011 described the runway as "excellent."
"The runway has a length of 2,270 metres or 7,448 feet," he said. "The runway is cambered and grooved to shed water from rainfall at a rapid rate. Given the amount of rainfall - 1.8 mm - reported 30 minutes before the accident and runway design, there was no possibility of standing water on the runway," he said.
Benn said he was told "that the runway lighting and the precision approach indicators necessary for the type of approaches and landings normally executed by the type of aircraft in question are all functioning."
He added: "It is worthy of note that these are the same instrumentation that have been used for at least the last eight years at the airport and over that time Caribbean Airlines' aircraft have executed over 10,000 landings handling a total of 2.1 million passengers without accident.