Public Utilities Minister, Gregory Bowen has put workers at the state-owned Grenada Postal Corporation (GPC) on alert that they face retrenchment as government looks for ways to combat a severe cash flow problem at the enterprise.
Minister Bowen told reporters at a recent post-Cabinet press briefing that retrenchment at Postal Corporation is one of the recommendations coming out of a study done by CARTAC, an arm of the Washington-based International Monetary Fund (IMF) to get rid of loss-making state bodies through privatisation.
He confirmed reports circulating in the country that the IMF looked at the public utilities and recommended that a significant amount of them be privatised.
The senior government minister admitted that the Postal Corporation is facing financial problems and can barely keep the business running.
“As a matter of fact they would’ve utilised over 1 million dollars of Customs (Department) monies to keep the cash flow going and this came from the global business which Postal Corporation operates”, he said.
The state body has turned to importing goods for locals that are purchased in the United States and bring them into the country at a cost.
A Customs Officer is stationed at the post office to access the duties payable on the imported items.
According to the minister, the corporation has been utilizing this money which should have been collected by Customs for government.
Minister Bowen pointed out that in excess of one million dollars of this money was used up by GPC in the last five years in order to pay employees and keep its services running.
Unfortunately, the Public Utilities Minister said this gave the GPC a false sense of security.
“That made the World Bank (and IMF) to come and say this corporation cannot exist, you should get rid of it. A simple analysis shows that we have to revamp the Postal Corporation”, he said.
“We have looked at the recommendation of the IMF and we know that we have to restructure the Corporation”, he added.
Minister Bowen hinted that the workers are on board with the planned retrenchment for GPC.
“…We have spoken to the workers and they have indicated very clearly that they understand the provisions. They know it cannot survive any longer so we must do all that we can to pay them the severance so that they can start (a) business, start a new life and that is basically what we are working on,” he remarked.
The Minister disclosed that as soon as Government can locate the money to pay severances, the workers would be laid-off at the Postal Corporation.
He pointed to a future role for GPC in working alongside existing courier service in dropping off packages at home for persons.
Minister Bowen noted that the corporation is “strong in dropping things to your home” and can seek to work out an arrangement with the likes of DHL and FedEx to handle their delivery.
“…They (GPC) must go in now as a private person and solicit jobs from companies, so they’ll be a lean, mean machine utilizing many of the little people you have in the village,” he explained.
Minister Bowen said there are no plans to abandon the Global service involving imported item that the post office is currently operating.