Only $500 million was allocated by the government in the 2018 national budget for severance payments for sugar workers when roughly $5 billion is needed, Minister of State Joseph Harmon disclosed yesterday.
President David Granger on Wednesday promised the laid-off sugar workers that they will receive 50% of their severance payments by the end of this month and the remainder in the second half of the year. This means that around $2.5 billion will be needed for the payment this month and it has led government to say that it is looking at making cuts in spending to finance the payout.
Harmon explained the $500 million allocation by saying that the government was not sure of exactly how many workers would be sent home. At last count, around 4,000 have been made redundant by the Guyana Sugar Corporation (GuySuCo).
“There was severance in the sum allocated to GuySuCo, over $500 million. What we weren’t sure of was the exact figure but in December and January, the exact figures began to emerge,” Harmon explained at yesterday’s post-Cabinet press briefing.
The government will likely face criticisms over the size of its allocation for severance as Minister of Agriculture Noel Holder was expected to be aware of the number of workers to be severed. He is the minister with responsibility for GuySuCo and has been in the forefront of the restructuring arrangements for the corporation.
“Government acts in a way that is a process, that is why we have a budget, why we have forecasting of expenses and if you don’t forecast for an expense you have to take from something that is forecasted,” Harmon stressed yesterday.
The Minister of State also reiterated that the APNU+AFC government is not shutting down the sugar industry but is instead taking measures to “right size it.” He further noted that his government, which has invested $1 billion a month into GuySuCo since assuming office, is committed to doing what is best for sugar workers.
“We recognise the importance of the sugar workers, we recognise the importance of their families and we will continue to do what is in the best interest of the peoples of this country. It is our responsibility as a government …[we] government cannot sit idly by and allow a situation like that to continue so what the government has done is to step in to provide resources for the affected sugar workers so that their entitlement under the law can be effected,” Harmon stated.
He explained that each sugar worker will receive a severance payment based on the position they held at the end of their employment as well as the conditions of their employment.
“Severance is a calculation based on what the worker enjoyed as salary and wages, every individual calculation will be made based on his or her circumstance,” he said.
Granger’s address to the nation on the severance payments, which was also read by Prime Minister Moses Nagamoootoo in the National Assembly, came amid growing calls and protests by workers, particularly in the Berbice sugar belt, for the payment of their payments considering the fact that they had been terminated at the end of last year.
The announcement of government’s severance payment plan was however not welcomed by the Guyana Agricultural and General Workers Union (GAWU), which declared the move to be illegal under the Termination of Employment and Sever-ance Pay Act.
At a protest held in Skeldon, Upper Corentyne, on Thursday, the President of GAWU Komal Chand stated that the government’s announcement on Wednesday is a violation of the law. He told the protestors, “When you become redundant you are entitled to your severance pay… it is your legal right.”
He further added that the President of the country needs to respect the law. He said, “You cannot give them half and hold back half, the [workers] are supposed to get their severance pay at the expiry of their letters. Two weeks already pass.”
Harmon yesterday expressed government’s commitment to work with all stakeholders even as he took the time to call out the opposition People’s Progressive Party/Civic (PPP/C) for its failure to present a plan to save GuySuCo.
According to Harmon, while GAWU presented a plan for sugar, the opposition called only for an impact study.
“It is important to note that we have an opposition… that when it was necessary for them to put on the table their plans for the industry, there was nothing there,” Harmon said.
He stressed that having administered the affairs of GuySuCo from 1992 to 2015, the opposition should be in a position to design a plan for the industry instead of criticising the administration at news conferences.
“When it actually comes to actually putting down a plan of action, there is where the chatter become silent… Let us meet, let us see what it is that you have,” he said, before adding that the opposition has claimed to have all the experience over all these years so they should put their plan on the table to be examined.
“We are still prepared to engage at the level of the government. We are still prepared even after we would have taken certain steps that are consistent with that plan which we laid out to the Stakeholders Forum in December, 2016,” he said.
Harmon noted that this position is a direct result of a directive from President Granger to meet with all stakeholders. He, therefore, called for other stakeholders at the table “to produce your plan and let us work together in the interest of this country, in the interest of the industry ensure that we have something that is workable.”
He also explained that the information reaching the Special Purpose Unit is that there is significant enthusiasm from foreign and local companies for the divestment of GuySuCo assets.
Stabroek News has previously reported that the Private Sector Commis-sion, Demerara Distillers Limited and Nand Persaud and Company have expressed interest in owning various sugar estates.