MINISTER of Rural Development and Local Government Khadijah Ameen has estimated debts at regional corporations to be over a billion dollars.
After a meeting with mayors and other regional corporation officials yesterday, Ameen said that although money was allocated in the past, it was not being released by the previous government.
Speaking outside the San Fernando City Corporation’s Auditorium, she said that yesterday’s meeting was a normal administrative exercise she started having before the mid-year review and budget. She added, however, there were a number of issues in local government going back years.
“These corporations are managing debts they inherited from years of releases that were never sufficient. So they had shortfalls on allocations. In fact some of them, although the money was allocated, it was never released by the previous government…I have encountered debt to the tune of millions and I’m sure it will run over a billion (dollars),” she said.
She reported in the area of scavenging services, for example, the Tunapuna/Piarco Regional Corporation had a debt of $30 million to contractors and had begun receiving legal letters. She added that the relationship with businesses in the community had also suffered because payments were not being made.
“Some corporations had five months shortfall in allocation under the previous administration and when the next fiscal comes around they are paying old debts continuously. Some of them are months behind, so some of them are owing $80 million, $50 million, $20 million per corporation for scavenging service. This is one of the larger items but if I also add up other supplies that they are owing, it’s a tremendous debt and it is a disservice that was done by the former government as a means of just suppressing funding, and some corporations were getting and some corporations were not getting enough. So we have to manage it, we are here and we are fixing it,” Ameen said.
She said this involves ensuring corporations use any unspent balances they have to cover existing debts. “So we say don’t throw a fete if you know you’re owing money. Let’s try to settle,” Ameen said.
She reported the ministry has been managing some of the debt.
“We have managed to cover some of those developing projects that were outstanding. It means that they would have done less work in this current fiscal but we are in a better situation financially and therefore even now as we go forward, we are taking into consideration the increase in NIS, the proposed increase with NUGFW (National Union of Government and Federation Workers) with the CPO (Chief Personnel Officer) although we have not received official communication from the CPO, we are catering for that,” she explained.
Ameen was referring to the announcement by the CPO last week that Government has reached an agreement with the NUGFW for a 10% wage increase for daily-rated workers, after months of negotiations. The agreement means that 20,000 workers (labourers and other skilled workers) are expected to receive new salaries by June or July.
Yesterday Ameen reported that chief executive officers, chairmen and mayors have been co-operative on the debt issue.
“They understand the situation (and) what we are also doing is aligning the corporation in terms of HR (human resources) management,” she said.
Ameen stated that upon becoming the minister, she created a procurement unit and units for public health management and local economic development. She said that administrative complexes will next be explored as current offices are shoddy and have leaky roofs.
