While the National Insurance Scheme (NIS) recognizes that something needs to be done to secure the returns on its investment in the Berbice Bridge, it is right now placing its faith in the three directors representing it on the Bridge’s board, as well as the terms of its contract with the entity.
At an end of year press conference on Friday, at its Brickdam Head Office, the scheme’s Finance Controller, Jacqueline Scotland said that they have not yet been paid dividends on the $80 million worth of ordinary shares, nor have they received dividends for 2014 and 2015, on the $950 million worth of preferred shares owned.
“We had invested $2.5 billion in the Berbice Bridge through contractual arrangement. It is true that we have not received any dividends for our ordinary shares, but the bridge did not declare any dividends on those shares in any year. Also, dividends on the preferred shares are outstanding for 2014 and 2015,” she explained.
According to Scotland, the contract between NIS and the Berbice Bridge Company Inc. (BBCI) provides for NIS to earn 10% from the preferred shares, and have those earnings accrue at a rate of interest of 1% per annum. The scheme is presently computing BBCI’s debt along these parameters.
“At some point in time, NIS will have to revisit what is happening with the bridge, but for now we are working along with what is in the contract,” she stressed.
Scotland also noted that the scheme is presently in a better position to ensure that its interests in BBCI are protected and advanced.
“As it is, NIS has three directors on the Berbice Bridge board. In fact, our Chairman [Surendra Persaud] is Chairman of the Bridge’s Board of Directors. Also, we have a contractual arrangement that ties the bridge to repay NIS. We are awaiting those to see what will happen,” she said.
A 2015 Forensic Audit of the scheme identified the entity’s $2.59 billion investment in BBCI, as one of two “major high risk investments”, classified as “potential losses to the scheme”. The other was its $5.1 billion investment in CLICO.
Since that time, the APNU+AFC government has begun implementing Parliamentary Resolution 82 of 2009, which had called on the then PPP/C government to take “all possible actions to secure the investments made in CLICO (Guyana) by the NIS, on behalf of contributors and beneficiaries of the Scheme, to prevent any consequential loss in benefits to them.”
In September this year, the Government formalised a deal through which the NIS will recover the $5.6 billion which it had lost in 2009. The agreement signed by Finance Minister Winston Jordan will see the scheme recovering the sum over a 20-year period. These payments, according to NIS, are expected to enhance its 2017 investment income by $85.9 million.
