The dispute over massive increases in tolls for crossing the Berbice River Bridge came to an abrupt end when the government seized temporary control of the bridge on November 5, one week prior to the proposed implementation of higher tolls on November 12.
Though the bold move was anticipated in some circles, it could have a negative backlash among investors desirous of pursuing Public-Private Partnership arrangements with the government. But to give the government credit, it rightly choose not to allow a private

corporation, the Berbice Bridge Company Limited (BBCI), to unilaterally disrupt the lives and livelihood of Berbicians by putting an essential service out of their reach. Plus, Berbicians are already suffering economically from the rationalization of the sugar industry and the decline in agricultural production which have been integral to the economic health of the region.
Incidentally, the closure of two of the country’s largest sugar estates in Berbice have led to massive layoffs, hurting not only sugar workers and their families but also local businesses and communities which have been traditionally sustained by their spending power. Berbice has historically been the largest producer of sugar in the country.
Concurrently, agricultural production, which has been the mainstay of the so-called ancient county, has been declining due to lower levels of government support, adding to the economic burden of Berbicians. In what is believed to be a senseless political move, the government has been placing greater emphasis on the development of agriculture in the hinterland regions, leaving Berbicians to largely fend on their own.
The truth is, Berbice has traditionally been a stronghold of the PPP but the party’s support declined for the first time ever during the 2015 elections, primarily due to neglect by the PPP which took the long-standing support of Berbicians for granted. As a result, the Alliance for Change (AFC), led by two former PPP stalwarts – Moses Nagamootoo and Khemraj Ramjattan – eroded the PPP’s support in the region, placing Berbicians at the mercy of the ruling APNU-AFC coalition government, which nonetheless saved Berbicians from further pain by using its power to put an end to the threat of higher tolls.

The government’s decision to take control of the Berbice River Bridge comes after years of wrangling over higher tolls, which came to a head on October 16 when the BBCI announced that it will be increasing tolls by 365% (see table for proposed increase in tolls) on the same day local government elections are scheduled to be held.
In announcing the increases in tolls, BBCI Chairman, Dr. Surendra Persaud claimed that the company has up to $6 billion in debts and losses in excess of $2.8 billion. He noted that no dividends have been paid to ordinary shareholders and that the company is now in default of its obligations to its stakeholders, including the National Insurance Scheme (NIS), its largest shareholder. Persaud is also Chairman of the NIS.
In supporting the case for the increase in tolls, Persaud stated in a BBCI press release: “Let me take this opportunity to refresh everyone’s memory that the construction of this bridge would not have been possible without a partnership with the private sector in which private sector financing contributed G$5.1B (US$25M).”
Ironically, Persaud considered the NIS 70% stake in the bridge as a private investment – which is a highly debateable claim.
He noted that the contract for operating the bridge has an established formula for increasing tolls to meet the obligations of the BBCI which is a private company, adding that the government has the option, similar to other services, to subsidize the cost of the toll to reduce the impact on the consumer.
The bridge was commissioned in December 2008, with 70% financing from the NIS, with the remaining funds coming from a handful of private companies, among them the New Building Society, Demerara Distillers Limited and Hand-in-Hand Life Insurance Company.
Since May 2015, the government has been subsidizing the cost of tolls to the tune of $150 million annually, following its elections promise to lower the cost of tolls. In addition, the government introduced river taxis for the Berbice River to take nurses, senior citizens and school children, free of cost across the river – to alleviate the impact of tolls.
Following the rejection of the BBCI’s proposal to increase the tolls, the company proposed a 19-year extension to its agreement to operate the bridge as a solution to avoid the increase in tolls. But rather than engage in what could become far-reaching and lengthy discussions, the government decided to seize control of the bridge, with the hope of reaching an amicable solution with the BBCI sometime in the future.
This solution might include buying out the stake of the private investors, which would be relatively small if the NIS investment is excluded. At the end of the day, the government has responsibility for the operation of the NIS, which is a public entity and not a private entity as perceived by the BBCI.
In a press release announcing its decision to seize control of the bridge, the government stated that it “cannot support the unreasonable demand for an increase in toll on the public which is based on a flawed formula and computation. We have stated that these increases by BBCI are unwarranted and will become burdensome to the people of Berbice and the public at large.
“Therefore, in accordance with the powers conferred upon the Minister by Sections 4 (1) and 11 of the Berbice River Bridge Act, in the interests of public safety, the Minister issued an Order declaring that the functions of the Concessionaire to maintain and operate the Bridge shall be exercised by the Government of Guyana as of 5th November 2018 until the date the Minister specifies by notice on the cessation of the threat to public safety.”
The release added: “The truth is, too many of our citizens are dependent on the continuous operations and use of the Berbice Bridge and we should not allow anyone to unreasonably and capriciously endanger their livelihood and public order in one of our vital regions.”
There is no doubt that the government’s decision will face severe criticisms. But in reality, though the BBCI was established through a partnership with the government, it was awarded too much power in arrangements under the former PPP administration, which can be deemed questionable. For instance, though a minority stakeholder with less than 30% investment in the bridge, it controls both the Board as well as the company.
For now, Berbicians can be assured that increases in tolls would not be an additional burden on them. The government’s decision has been seen as a political ploy heading into local government elections but, if so, it is a sensible ploy.

(Kaieteur News) – As Guyana inches closer towards becoming a mega oil producing state, the World Bank is urging the citizenry and all transparency bodies to be on the lookout for four types of corruption that come with the petroleum sector.
In one of its recent reports, the World Bank outlined these forms of corruption to be: policy corruption, administrative corruption, commercial corruption and grand corruption.
With regard to Policy Corruption, the World Bank explained that this involves corrupt influence on the design of sector policies, as well as the enactment of sector laws and taxes in a manner intended to provide political or personal gains at the public’s expense.
It said that examples of this, take the form of policies or laws being passed with loopholes, tax breaks, price controls, awards of exclusive rights (such as oil blocks to companies and individuals), and special account procedures. It also called for the citizenry to be mindful of the relationships of legislators and special interest groups aligned to oil and gas companies.
Turning its attention to Administrative Corruption, the World Bank said that this refers to the abuse of administrative office to extract illegal benefits in exchange for approval covering a wide range of commercial and operational activities. The Bank said, “In other words, it is looking the other way in the face of corrupt behaviour, or for a favourable interpretation of fiscal regulations in favour of the company.”
With respect to Commercial Corruption, the Institution explained that this relates to procurement abuse, including tender rigging, kickbacks, and cost inflation.
As for Grand Corruption, it said that this is the most common form of corruption and it speaks to the direct theft of massive amounts of money or diversion of production; products, or revenues made from the sector.

How To Avoid It
According to the World Bank, several steps can be taken to ensure that these forms of corruption are kept at bay.
It noted that robust anti-corruption laws should be drafted, passed, assented to and implemented without fear or favour. It said that the Head of State should start implementing the laws from his Cabinet and any of his ministers, advisors and aids found guilty should be made to face the law. The World Bank stressed that when it comes to anti-corruption laws in oil and gas, the law should not be selective but applied holistically.
The World Bank added, “Dealing with the malaise of corruption in the sector may appear complex and intractable when the management lacks transparency and accountability in managing the affairs of all oil business activities from seismic survey, development, production, transportation, refining, marketing, etc. It is therefore suggested here that all culprits in any form in the sector should be immediately suspended/or dismissed, prosecuted and if found guilty, should be imprisoned. This will serve as a deterrent to others and the issue of ‘Plea Bargain’ should not be allowed or permitted in any form.”
Further to this, the financial institution said that fighting corruption in the petroleum sector requires resources, the right skills and adequate funding. It said that the resources needed range from moderate, for informational campaigns, through serious, for technical assistance to capacity building in government agencies and civil society, to significant, where complicated investigations and surveillance are called for. It stressed that political rhetoric without these resources will not go far.
It also said that the Government should, as much as possible, implement to the fullest, the global Extractive Industries Transparency Initiative (EITI) launched in 2003 by the former Prime Minister of United Kingdom, Tony Blair. “This is because the initiative is designed to address the paradox of plenty in resource rich countries by requiring transparency of payments made by companies and of revenues received by governments, thereby limiting opportunities for corruption and promoting accountability.”

EITI And Guyana
It was in October last year that the International Board of the Extractive Industries Transparency Initiative approved Guyana’s application to become a member of the prestigious anti-corruption body, which demands good governance in oil, gas and other mineral resources.
Head of the EITI local chapter, Dr. Rudy Jadoopat, told Kaieteur News that the next step is for Guyana to submit its first EITI report within 18 months from now. He said that an international team is currently helping local authorities with the preparation of this document.
He stressed that it must meet all the strict EITI Requirements, which are covered in the EITI Standard 2016 (See link for more information on this: https://eiti.org/document/standard).
Fredrik Reinfeldt, Chair of the EITI, said that the expected growth of the oil and gas sector in Guyana is both a huge opportunity and a big challenge. He said that the further development of the mining sector is also an important focus of public debate. Further, Reinfeldt noted that implementing the EITI rules will help Guyana lay the foundation for transparent and accountable management of its natural resource wealth.

Guyana/ EITI History
EITI is an international body that was established in 2003 with the aim of making it harder for governments and companies to hide the truth about the proceeds garnered from the extractive industries.
The companies in the extractive sector report on what they are paying the government, and the government reports separately on what it received from the companies in the sector.
A report is then prepared by a Multi-Stakeholder Group. The document, among other things, will highlight whether the numbers data collected from the two add up, or if there is an irregularity.
Dr. Jadoopat explained that Guyana must be praised for its efforts in recent years, which were all geared towards satisfying the EITI candidate sign-up requirements.
The official noted that the Government of Guyana had announced its commitment to implement the EITI Standards since May 2010. He said that Guyana and EITI even signed a Memorandum of Understanding in 2012, which paved the way for Guyana to be assisted with its preparation of EITI candidacy.
He said that the Inter-American Development Bank (IDB), the World Bank and the Carter Center provided assistance to the Government and supported its efforts towards EITI candidacy. Dr. Jadoopat said it is expected that this will continue.
He added that the government, as stipulated in the International EITI Standard 1.4, has committed to working with Civil Society and Companies.
“It has unequivocally and boldly announced its commitment to work with civil society and companies. Also, the government has agreed to ensure that there are no obstacles to civil society’s participation in the EITI processes. It agreed to refrain from actions which may result in narrowing of, or restricting of public debate in relation to the EITI implementation.”
Dr. Jadoopat also took the opportunity to encourage all to consider it their civilian duty to actively participate in the activities and work of the Guyana-EITI.

Georgetown – President of the Guyana Agricultural and General Workers’ Union (GAWU) Komal Chand says that he has no fear that the government or Guyana Sugar Corporation (GuySuCo) will not pay the interest on the remaining severance payments to laid off sugar workers, as was ordered by the High Court, despite it not being catered for in the supplementary funding that was approved by Parliament last week.
On Friday, days after the National Assembly approved over $2 billion in supplementary funds for the payment of the remaining severance to over 2,000 laid off sugar workers, Justice Fidela Corbin-Lincoln ordered that they be paid in full and with interest no later than January 15th, 2019. She ordered that the remaining 50% of severance be paid to the 2,198 workers along with interest at a rate of 6% from the day of severance – December 29th, 2017 – to November 3rd, 2018, and thereafter at a rate of 4% until fully paid.
Chand said he was told by Minister of Agriculture Noel Holder that the sum that was approved by the National Assembly did not include the interest payments that was ordered by the court.
However, he related that he does not believe that the government and the sugar corporation will have any issues with abiding by the rule of law. “…I suppose in this case somebody has to pay it… Maybe GuySuCo has to find that money because it is now a court order and if they defy it they will be in contempt of the court. Somebody has to pay it, whether it’s the government or GuySuCo, it will be paid. It’s an order and the rule of law and we are still abiding by the rule of law, so we don’t see them not honouring the payment,” Chand said.
Chand also called the ruling as well as government’s move to pay the remaining severance a victory for the union but added that it should not be interpreted as the government doing something out of “goodwill” since it was unlawful in the first place to withhold the workers’ full severance payments.
“It is a victory for the union because it is under the union’s leadership that we took the matter to all dimensions. We incurred high costs and so on because we had picketing actions and we had to service the picketing and assist the workers with transportation. We feel satisfied and that it was an unnecessary frustration to the workers because in the first place severance pay ought to be paid within the time it ought to be paid and that is by one month of the expiration of the notice given to them but you had to be constantly engaging them because we were dealing with an unconscionable anti-working class government,” Chand added.
He further explained that the victory should be credited to the efforts on the ground by the workers during industrial actions as well as the drive of the union.
“…Facing the electorate at the local government level must have influenced the move and the fact that we did what we did. We took the matter to court and we were all-dimensional with how we were dealing with the issue,” he said
In total, 4,283 workers were laid off from the Skeldon, Rose Hall and East Demerara sugar estates.
By law, the severance payment ought to have been made at the time of termination of employment and the failure of both GuySuCo and the government to comply with the provision has attracted sharp criticism.
The House had previously approved $1.931 billion for severance payments, which along with $500 million that had been allocated in the 2018 national budget facilitated a total payout of $2.431 billion in January.
At that time, Minister of Finance Winston Jordan had said that this sum would facilitate full severance by the end of January for a little more than 1,600 of the 4,763 sugar workers that had been made redundant by GuySuCo as part of its restructuring programme.
This represented those sent home by GuySuCo, who were entitled to severance payouts of $500,000 or less. The other workers received 50% of their severance, with a promise that the remaining sums would be paid in the second half of the year.

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