The government last evening took a major step towards scaling back the controversial benefits package for former presidents, which Finance Minister Winston Jordan denounced as a “vulgar” insult to hardworking taxpayers that have had to foot the bill.
In the absence of the PPP/C members, who have yet to take up the opposition seats in the National Assembly, the house passed the Former Presidents (Benefits and other Facilities) Bill 2015 after being told that it would cut waste and unnecessary expenditure.
The benefits were enacted by the then Bharrat Jagdeo-led PPP/C administration in 2009 and were defended by then President Donald Ramotar in 2013, when he vetoed a similar bill passed by the APNU and AFC to cap benefits. It is expected that President David Granger will assent to the just passed bill shortly.
Jagdeo, who is expected to return to the National Assembly as opposition leader, is the only former president who has benefitted under the current Act. However, Ramotar is now eligible. Former Prime Minister Samuel Hinds, who had served as president for 288 days in 1997 after the death of Dr Cheddi Jagan and prior to the election of Janet Jagan, will also be eligible to benefit from the scheme.
According to the explanatory memorandum, the purpose of the Bill is to repeal the Former Presidents (Benefits and Other Facilities) Act of 2009, and to replace it with the new Act, to provide greater specificity “especially if account is taken of the fact that the former president is eligible for a pension which is 7/8’s that of the president in office.”
Despite the absence of opposition members and an audience in the public gallery, Jordan delivered a fiery presentation that won the approval of his colleagues.
During his address, Jordan described the uncapped, taxpayer-funded benefits package set out for former presidents in the 2009 Act as “vulgar.” “It lacks the imprimatur of important moral values,” he said.
Jordan gave the example of a retired graduate headmistress, who now draws a pension of $86,857 a month after working for over 34 years and which she would receive for the rest of her life. The plight of the teacher demonstrates the “absurdity” of the “anomalous situation,” he said, where a former president now receives $1.4M, which will be automatically increased whenever the sitting president’s salary is increased.
“This, conceivably, could lead to a scenario where a former president could enjoy a pension that is larger than his income at the time he demitted office,” Jordan noted, while adding that the package under the present Act has sparked controversy due to its sheer audacity.
He argued that while Guyanese are aware and accept that former presidents must live out their natural lives in dignity, the uncapped, taxpayer-funded benefits package reflects a level of arrogance, self-righteousness and entitlement that degrades servant leadership.
“It thumbs its nose at the hard working taxpayer, who labours mightily to fund the tax-free salary of the sitting president and who, under the current Act, is asked to acquiesce to his/her tax dollar being used to fund a tax-free pension and other benefits for former presidents. It disregards the plight of lower and middle-class families whose taxes are funding these exorbitant, excessive, uncapped benefits,” he added.
‘Spousal benefits’
Apart from the monthly pension under the current Act, the former presidents are also entitled to unlimited coverage for local and overseas medical treatment; utility services at their place of residence in Guyana; services of personal and household staff, including an attendant and gardener; services of clerical and technical staff; the provision of motor vehicles owned and maintained by the state; toll-free road and bridge transportation in Guyana; and an annual vacation allowance equivalent to the cost of two first-class return airfare tickets provided on the same basis as that granted to members of the Judiciary.
According to Jordan, the most recent claim for benefits cost taxpayers $7,466,700 for two first-class tickets. While Jagdeo was not named, he is the only former president to benefit under the current Act. Jordan said what “was interesting is that the individual claimed for himself and spouse even though no spouse was named.” Jagdeo is not married.
“It drives home the point that not only do these benefits need to be capped but there must be greater clarity, definition and specificity, for which this bill lays claim. We would not be entertaining claims for spousal benefits where no spouse is acknowledged by the claimant,” he said.
“The time is opportune for us to act to cut our waste, and unnecessary and uncalled for expenditure,” Jordan said, while noting that Guyana is faced with a large debt and pressures on the deficit, especially as a result of billions of dollars in unplanned transfers to state corporations.
He said the new Bill incorporates the positive features and best practices of several countries in so far as they meet and reflect local circumstances.
He also cited founder of the PPP and former president Cheddi Jagan, who had warned against “Cadillac-style” living in “donkey-cart economies.”
“Were he alive, he would have been appalled and disgusted at the entitlements granted to former presidents that are embodied in Act 12 of 2009, which was assented to by one of his protégés. I believe that he would have applauded the contents of this Bill, which seeks to cure the ills of Act 12 of 2009, return a level of decency and civility to our domestic affairs and ease the financial burden placed on the treasury as a consequence of the Act,” Jordan said.
Meanwhile, First Vice-President and Public Security Minister Khemraj Ramjattan noted that while the former opposition proposed that allowances allocated for monthly water, telephone and electricity bills should be $5,000, that has been increased to the sum of $25,000 a month and would bring it to a more “realistic figure” of $75,000 a month for the three utilities as against $370,000 a month that was spent previously.
Ramjattan said he believes that there is justice in the bill “in the context of our economy that is not doing that well, in the context of the country of a whole” even though there will be persons who will argue that the allowances are still high expenditures to incur in the category of other benefits.
With enactment of the new Bill, household staff would be limited to three persons; security personnel limited to two persons; and clerical or technical staff limited to three persons who must not be engaged in any political work. The Bill also seeks to limit a former president to two vehicles to be owned and maintained by the State.
The just passed bill also intends to see a former president being entitled to free medical attention and treatment or reimbursement of medical expenses incurred by the former President and his or her spouse or children below the age of 18 years.
The reimbursement shall not be given where any attention and treatment obtained abroad or at private health facilities in Guyana were available in Guyana at government institutions. This is also subject to a financial limit of $200,000 annually.
The new Bill also stipulates that the benefits and facilities granted shall not be the subject of any tax exemptions, concessions or privileges.
