Grenlec vs Public Utilities Minister

Too much power in the hands of the Minister of Public Utilities, Gregory Bowen.

Those were the sentiments expressed by many persons who attended last Thursday’s 2015 National Consultation on a  Draft Energy Bill that is being piloted by the two-year old New National Party (NNP) Government of Prime Minister, Dr. Keith Mitchell.

The bill seeks to open up the local energy sector and to break the monopoly currently enjoyed by GRENLEC, the sole service provider on the island.

The local company, through its Director, Murray Skeete who is also Vice President of Engineering and Regulation with WRB Enterprises, the majority shareholder and operator of GRENLEC, attended the consultation and delivered a paper on behalf of his employers.

Skeete dropped many hints in his presentation that relations are somewhat awkward between GRENLEC and the current administration in which Minister Bowen is himself a former General Manager of GRENLEC.

He expressed fears that the bill in its current form grants too much powers in the hands of one individual.

“The draft bill provides an extraordinary amount of discretionary power and micromanagement control to the Minister and Government of Grenada. This level of control is reminiscent of Grenada’s electricity sector structure in the late 1980s, and is certain to impede — rather than foster — modernised, efficient and effective operations for the nation’s energy sector”, he told the gathering at the Trade Centre at Grand Anse.

As a public service, THE NEW TODAY provides an edited version of Skeete’s contribution at the Energy consultation:

There are three main points we want to make today:

1.    GRENLEC wholeheartedly shares the government’s goals of (a) lowering Grenada’s energy costs and (b) reducing the nation’s dependence on foreign fuel by increasing renewable energy generation.

2.    We want to continue building on GRENLEC’s substantial investment and significant progress achieved over the last 20 years since privatisation in order to assure the nation’s on-going reliable, high quality and efficient electricity service at the lowest feasible cost.

3.    GRENLEC again asks for an opportunity to meet with Government to address the technical issues and identify the optimal pathways for accomplishing these shared goals. While we have had very little time to review the new Bill, we have serious concerns that several key proposals could have very adverse effects on the reliability and cost of electric service for the citizens of Grenada.

A. Brief Overview of GRENLEC’s Post- Privatisation History

Many of us remember that privatisation of GRENLEC was recommended to the Government of Grenada in the early 1990s by leading international industry authorities to help improve the reliability and quality of electricity service, reduce national debt, introduce new and more efficient technologies, control costs, and help support the nation’s economic growth.

In a competitive bidding process, 50% of GRENLEC was sold to WRB Enterprises, a privately owned company that brought decades of energy experience and a proven track record in successfully rebuilding and upgrading other Caribbean utility companies.  Government entities retained 21% and the remaining shares were sold to employees, as well as local and regional shareholders.

In the 20 years since privatisation, Grenada’s severely outdated, inefficient and unreliable electric utility has been transformed into a world-class system providing reliable, efficient and universally-available service.  GRENLEC is widely acknowledged by international experts in energy and finance to be a highly-effective and well-managed utility.

GRENLEC has been at the heart of change and growth in Grenada, investing more than $150 million dollars for capital improvements to modernise the nation’s electricity system. Under our management, the system’s installed capacity, peak load and customer connections have more than doubled. Emergency operational systems and funding are in place to expediently restore power when devastating hurricanes hit.  And every year, GRENLEC donates 5% of its pre-tax profits to benefit Grenada’s public institutions and other worthy charitable causes.

B. Current Challenges Facing The Electricity Sector

We fully recognise the challenges facing Grenada and other small Caribbean and island nations to control energy costs.  While our rates are comparable with similar-sized islands, we’re continuously improving operational and fuel efficiency to stabilise costs.  In addition, the current statutory regime imposes a critical restriction on GRENLEC’s price increases: specifically, our non-fuel price changes must be 2% below Grenada’s annual inflation rate.  Indeed, GRENLEC’s non-fuel base rate has actually decreased 23% when adjusted for inflation over the last two decades.

However, the cost of electricity remains higher than we all want, due to a series of complex issues that confront most small island utilities around the world.

•    Grenada’s stand-alone island electric system requires maintaining high generating reserve margins at significant cost

•    Grenada’s relatively small population and lack of energy-intensive industrial customers creates a higher per unit service cost than in larger economies

•    Unlike Trinidad and Tobago, today Grenada has no native fossil fuel resources

•    Until very recently, the cost of renewable energy generation and its associated reliability concerns did not compare favourably with conventional thermal generation

•    The risk of hurricanes imposes significant costs on the system to ensure resiliency and speedy recovery.

These are the realities of a small island nation.  However, we all have a shared desire to pursue lower energy prices and increased deployment of greener generation technologies.

That’s why we have for the last six years proactively sought opportunities to join with the Government of Grenada and its advisors in order to develop broad-based solutions for stabilizing costs and developing a reliable, sustainable energy portfolio that accommodates renewable energy, energy efficiency, and least-cost planning.

The essential question for all stakeholders is how to achieve these objectives in a manner that is (1) economically sustainable, (2) does not sacrifice operational reliability and (3) is legally valid, reasonable and balanced.  GRENLEC believes the answer is: through careful analysis, active collaboration and implementation of well-established best practices.

GRENLEC Has Urged A Collaborative Approach In Addressing Sector Challenges

GRENLEC has continuously explored renewable energy options dating as far back as 1996; however, until the 2008 spike in international oil prices, renewable technologies were simply not cost-competitive with fossil fuel generation.

Once those post-2008 economic shocks kicked in, GRENLEC’s efforts to assess and deploy renewable technologies were significantly escalated.

GRENLEC acknowledged that potential legislative and regulatory amendment should be considered in order to facilitate renewable energy deployments, and voluntarily offered to participate in negotiations along these renewable energy deployments, and voluntarily offered to participate in negotiations along these lines.  Regrettably, and due to no fault of GRENLEC, no progress was made with the Government, either on geothermal development, the wind/diesel hybrid project for Carriacou or negotiations about legislative and regulatory reform.

However, the prospects for legislative and regulatory reform regarding the electricity sector appeared to obtain very constructive impetus in 2014 with the United States Caribbean Energy Security Initiative (“CESI”).

The Grenadian and U.S. Governments executed a Memorandum of Understanding which committed to facilitate discussions between the Grenadian Government, the United States Government, and GRENLEC focused on identifying, assessing and implementing optimal ways to address key electricity sector issues in Grenada.

All parties committed to the following Vision Statement:

“Achieve a reduction in imported fossil fuels and energy prices through a comprehensive process led by Government of Grenada in collaboration with GRENLEC and involving all stakeholders as part of a transition towards a Green Grenada.” (Emphasis added.)
Unfortunately, without explanation to GRENLEC, and despite GRENLEC’s:

•consistent record of outstanding operations,

•    exclusive legal rights confirmed both in its contracts with the Government of Grenada and in existing legislation, and

•    repeated offers to join with the Government of Grenada to explore and implement collaborative reform measures for Grenada’s electricity sector, the Grenadian Government has not proceeded with the collaborative discussions.  Instead, Government chose another path, specifically by tabling a statute that would institute a unilateral and radical restructuring of Grenada’s electricity sector and a fundamental alteration of GRENLEC’s operations.

Observations About The New Energy Sector Restructuring Bill

We must stress that GRENLEC has not been given sufficient opportunity to review the far-reaching restructuring provisions set forth in the new Bill that is the subject of today’s “consultation.”  Thus, we cannot provide detailed comments at the present time regarding the full impacts — operational, technical, economic and legal — that this dramatic shift will have on Grenada’s electricity sector.  Accordingly, GRENLEC must reserve the right to provide additional comments after further review.

However, from GRENLEC’s initial review of the new Bill, the following observations can be made:

•    Without discussion or sharing of any substantive facts and empirical data that would support and warrant this far-reaching action, the new Bill summarily terminates GRENLEC’s contractually- and legislatively-granted exclusive licence.

•In addition, contrary to widely-followed international best practices, the new Bill turns back the clock and re-vests control over virtually every aspect of GRENLEC’s operations, technical planning and finances to a single Government minister.  This flies in the face of efforts across the Caribbean and the world to de- politicise the electricity sector.

E.  The Bill Appears To Treat Five Assertions As Inherent And Proven Truths

Noting and responding to these assertions in turn:

1.ASSERTION:  Allowing multiple licencees to engage in electricity generation, and also potentially to engage in electricity transmission & distribution, will drive down consumer prices.

GRENLEC contends that the small size of Grenada and its electricity system would prevent an efficient and cost-effective competitive market from functioning properly.

ICF Resources, a recognised leader in international energy consulting with significant experience in Caribbean utility operations, conducted a comparative analysis of the power industry structure and potential for utility unbundling and competitive energy procurement in Grenada.  ICF concluded that the incremental cost of duplicating operations to separate generation from transmission & distribution on Grenada will carry a much higher cost per customer compared to a larger utility.

The report states: “… it appears that unbundling Grenada’s generation and wires businesses would be an endeavor more likely to increase costs than provide significant benefits. The endeavor carries risk for the system and for Grenada.”  (Emphasis added.)

To stress this critical point again, there is substantial reason to fear that introducing multiple generation and/or network licensees into Grenada’s relatively small and insular market could materially increase electricity costs for some, or even many customers, and destabilise the reliability of Grenada’s energy network.

ASSERTION:  GRENLEC’s exclusive licence has impeded the development of utility-scale renewable energy generation.

Again, GRENLEC has been actively exploring cost-effective renewable energy options since 1996, and aggressively striving to introduce renewable energy generation in Grenada since 2009.

Our voluntary Customer Renewable Energy Interconnection Programme – the first of its kind in the Caribbean – includes more than 70 customer sites, and is about to move into its third phase with an aggregate installed capacity approaching 800 kW.

And with Government cooperation, we can do much more.  We have made multiple proposals to the Government of Grenada for access to land that could have resulted, and still could result, in the rapid deployment of substantial renewable energy generation.  To date these proposals have not elicited any official action.

ASSERTION:  Utility-scale renewable energy generation will necessarily drive down prices.

Once again, although wind and solar power costs have been steadily decreasing world-wide for many years, the size of Grenada and the relatively small scale of any renewable projects that can be installed will result in significantly higher installed costs than would pertain on larger systems.  It’s simply a matter of scale.

At today’s lower fuel prices, most renewable technologies are not competitive with traditional fossil fuel generation.  Nonetheless, deploying renewable technologies now can help lessen Grenada’s dependence on foreign fuel when higher fuel prices return.

However, it is essential to recognise that renewable generation technologies will not necessarily drive down retail prices in the near term.  The reason for this is simple and unavoidable – intermittent renewable technologies only displace the need to burn fossil fuel, and not the capital infrastructure that must remain for the frequent times when wind and solar conditions cannot support the system’s overall power needs.

ASSERTION:  Greater self-generation will benefit all citizens and businesses in Grenada.

Self-generation of electricity does not necessarily benefit everyone, especially those who are not generating their own electricity and lower income residents who can least afford it.  These customers will inevitably be burdened with a disproportionate share of the carrying costs for the overall electrical system.

ASSERTION:  Greater politicization and increased governmental control over the electricity sector is needed to assure efficient and reliable electricity service in Grenada.

This belief is not only contrary to present experience in Grenada, but is counter to world-wide best practices. It has been demonstrated repeatedly that private enterprise is far better than Government at managing and delivering essential utility services.

The draft bill provides an extraordinary amount of discretionary power and micromanagement control to the Minister and Government of Grenada.  This level of control is reminiscent of Grenada’s electricity sector structure in the late 1980s, and is certain to impede — rather than foster — modernised, efficient and effective operations for the nation’s energy sector.

Operating under the current regulatory framework, GRENLEC has diligently and successfully worked to build a sound, efficient system that Grenada can rely upon.  And GRENLEC has never objected to the introduction of a fair, competent and politically-independent regulatory authority for the electricity sector.  However, a race back to the political micro-management of the past is not a constructive approach for achieving those objectives.

In summary, working under the current regulatory framework for over two decades, GRENLEC has succeeded in creating a world-class and highly-effective utility that serves the entire nation of Grenada.  At the same time, Grenlec agrees that appropriate legislative and regulatory reforms can help the country reduce its reliance on fossil fuels, stabilise generation costs and develop a more diverse and sustainable energy supply for all citizens.

GRENLEC is a strong and willing proponent of working in partnership with Government of Grenada to benefit all residents and businesses of Grenada, and working towards national and regional regulatory change that will help lessen the energy challenges on Grenada, and foster our mutual goals of cost control, continued reliability and sound environmental stewardship.

New partnership for Gravel and Concrete

Public Utilities Minister, Gregory Bowen has given the strongest possible hint that the two year old ruling New National Party (NNP) government is about to change the ownership structure of the state-owned Gravel Concrete & Emulsion Production Corporation.

Speaking in Parliament last Friday, Minister Bowen who is the line minister for the state body announced that a “potential partner” was expected to submit a proposal on Monday for a stake in the company.

He said the cash-strapped administration which cannot pump money into Gravel & Concrete Corporation favours a “private/public partnership model” for the enterprise.

“We are expecting a proposal from a current potential partner on Monday,” the minister told the sitting that took place at the Grenada Trade Centre, Morne Rouge, St George.

“…If that (the proposal) does not meet governments’ requirements then we would put that proposal aside and move on to the next person and we will negotiate…”, he said.

Speculation is rife that a local company that operates in the Dusty Highway area in the south of the island has expressed interest in Gravel & Concrete.

A well-placed source told this newspaper that a senior official of the company visited the Mon Rush premises of the corporation to access its property especially the equipment.

Minister Bowen told Parliament that several proposals are already on the table for consideration and that this Friday (March 6)  is the proposed deadline for all submissions to be sent in.

His announcement comes against the backdrop of a report submitted to government for consideration by the International Monetary Fund (IMF) regulated consultancy group – Caribbean Regional Technical  Assistance Centre (CARTAC) that the State should consider selling the company declaring it as a “loss-making venture”.

The 2013 annual report of the Corporation that was presented recently in Parliament indicated that after operating at a steady decline in revenue for four consecutive years totaling more than EC$7.5 M, Gravel & Concrete was on the rebound.

The financial audited report done by local accountant Rupert Agostini indicated that the losses in revenue for 2013 was only EC$56, 720 as compared to a massive EC$2 M experienced in 2012.

The annual report stated that Gravel & Concrete  recorded EC$12, 737, 129 in net sales in the year under review as compared to EC$10, 093, 316 in 2012, while cost of sales stood at EC$9, 061, 984 and EC$ 8, 321, 505 in 2013 and 2012, respectively.

Despite acknowledging that Gravel & Concrete is on a path to economic recovery, Minister Bowen told the Lower House of Representative that the NNP government’s venture into public/private partnership is in keeping with IMF recommendations.

Bowen who also holds the responsibility for Communications, Physical Development, Public Utilities & ICT lauded the quality of manufactured products as done by Gravel & Concrete.

“It is the only organisation in Grenada whose product can compete with any international standards”, he said.

Gravel & Concrete is the sole producer and supplier of gravel and gravel aggregates in Grenada, Carriacou and Petit Martinique.

It was established through an Act of Parliament in 1986 under the then NNP administration of Herbert Blaize in which current Prime Minister Dr. Keith Mitchell served as Minister of Works.

Curtains come down on Dutch Lady Milk Competition

Happy Hill Secondary School is the overall winner of the 2014 Dutch Lady Milk Competition held under the slogan, “From Grass to Glass”.

The competition, which was launched on the island in 2011 with essay writing and later spiraled into culinary and poetry, is aimed at developing students health and their intellectual capacity.

Happy Hill Secondary School emerged the winner of the Culinary competition

Happy Hill Secondary School emerged the winner of the Culinary competition

The closing ceremony for the competition was held last week at the National Stadium where prizes were handed out to the first, second and third place winners.

The overall winner of the Culinary Competition went to Happy Hill Secondary School while the first place for the Essay competition was taken by Jasmin Cummings of the Happy Hill RC School, followed by Shirlan Pierre of the St Andrew’s Anglican Secondary School.

First place in the poem competition was awarded to Aureon Andrews of the Woburn Methodist School.

During the ceremony a message from Friesland Campina was delivered by Lessa Peters, an Assistant Manager at Hubbards.

“We were really surprised by the amazing essays and poems you have written. Every story in its own way tells the natural goodness of the Dutch Lady Milk products. For this reason you all are ambassadors of the Dutch Lady Milk brand. You have inspired us in doing our jobs even better,” she told the gathering.

In giving an overview of the four-year competition, Manager at Hubbard’s Agency Department, Margaret Roberts said her company has demonstrated that it is interested in the development of both body and mind of the nation’s children.

“The competition has provided the opportunity for students to use their creative skills, develop good penmanship and foster good relationships among themselves”, she said.

“…Our support was encouraged with the simulating writing from the students and the delights prepared during the culinary competition. Ventures like these can produce teachers, lawyers, doctors, chefs – all of these professions can help shape the nation’s tomorrow and Hubbards is grateful to be part of this,” she added.

Curriculum Development Officer at the Ministry of Education, Pamela Courtney, gave a brief review of what transpired after the readings, essays and poems.

“The competition continues to build students’ confidence in themselves, and awaken hidden talents, talents that they didn’t know they have. Most of us who read the poems and the scripts for the essays we were left in awe. I remember vividly one of the lines from one of the poem; “Dutch lady cows graze on fresh green grass,” – that tells you their imaginative sense that they were able to use,” she remarked.

Managing Director of Hubbards, Allan Bierzynski used the occasion to officially open the 2015 competition and touched briefly on some of his own observations about the finals of the competition.

He warned that the skills learnt by the students “must not be allowed to disappear”.

“The Chefs who did the judging, the Chef who did the report are all of one gender… I would like to see some ladies wearing the Chef’s coat and the Chef’s hat, and conversely in the 2015 competition (and) I would like to see more males taking part,” he said.

G’da on path to sustainable development

The ruling New National Party (NNP) Government of Prime Minister, Dr. Keith Mitchell is boasting about “remarkable achievements and tremendous strides” in stabilising the nation’s economy, since taking office approximately two years ago.

Minister for Economic Development, Planning, Trade, Cooperatives and International Business, Oliver Joseph said “the country is on a path to sustainable development” as a result of the austerity measures implemented under the International Monetary Fund (IMF) supported Structural Adjustment Programme (SAP).

“We have seen that the measures that we have introduced under the Structural Adjustment Programme are working for the benefit of the people of Grenada”, said Minister Joseph in his presentation to Parliament last week Friday.

The cash-strapped Mitchell administration has introduced a number of taxes including a widening of the income tax threshold, hikes in Property Tax, as well as on a number of fees for government services provided to the public.

Minister Joseph told the Lower House sitting that Grenada’s “economy grew by 2.9% in 2014 and that “Government’s recurrent revenue and expenditure have been reduced by more than half.”

The Minister who was delivering his ministerial statement during the sitting of the House of Representatives recalled that when the NNP administration came back into office in February 2013, there was a fiscal gap of EC$18M.

“Right now Mr speaker, at the end of 2014 we dropped the deficit from EC$18M to EC$9M,” Minister Joseph told the House, pointing out that the “Inland Revenue Department (IRD) and Customs Department collected more revenue than what was budgeted.”

“This is the first time” that the major revenue earning departments performed so well, Minister Joseph claimed, noting that government has been able to “raise revenue” to meet its recurring spending needs.

He said Government, is using “the extra monies collected to ensure that all public officers remain employed.”

“We have seen over the last two years this government has been able to pay over EC$47 million in back pay and six percent increase. We have to be able to raise sufficient revenue to meet our recurrent expenditure,” he said, while adding that the former Congress government had to resolve “to the selling of Government assets to pay salaries.”

“Nobody gave us money to pay salaries…we have been able to do that…we increased revenue and cut back on expenditure,” he said.

Minister Joseph alluded to a downward trend in the millions outstanding in Unpaid Claims in the Treasury as another achievement of the NNP in the past two years in office.

He said that “at the end of 2014, the unpaid claims (monies that government is owing to local suppliers for goods and services) at the Treasury was reduced from EC$100 million to EC$66.4M, putting money in the hands of Grenadian suppliers.”

“When you have money in circulation and people spending more, businesses import more goods, consumers have more disposable income and government collect more taxes, you would see growth in the economy”, he added.

“That is what we achieved,” Minister Joseph stressed and attributed the achievements to the cost cutting measures implemented under SAP.

The Mitchell government is expected to introduce a few more taxes in the 2016 Budget to be presented in Parliament towards year-end as part of its Letter of Intent signed with the IMF to govern the operation of the Structural Adjustment Programme (SAP).

Bank executives visit G’da

Mark St Hill and country manager Nigel Ollivierre and staff member speak with customer

Mark St Hill and country manager Nigel Ollivierre and staff member speak with customer

Staff and customers of CIBC FirstCaribbean International Bank were in for a surprise when two executive members of the bank’s management team visited several branches on February 26.

Managing Director of Retail and Business & International Banking, Mark St. Hill, along with Managing Director of Barbados Business, Donna Wellington, who are based at head office in Barbados, made a special trip to the various CIBC FirstCaribbean branches across Grenada to engage with staff and customers.

Both staff and customers, extended a warm welcome and expressed their delight at the opportunity to meet with the senior managers of the company.

“We were pleased to be able to make this special trip to meet with our team. They play a vital role in the success of our goals and as such it is our pleasure to have this exciting opportunity to meet them personally and hear from them”, said St. Hill.

“It is also equally rewarding to meet our loyal customers and hear first-hand of the outstanding service that makes their banking experience at CIBC FirstCaribbean so unique,” he added.

The visit of the Head Office Executives concluded with a general meeting with staff at the main branch located in St. George’s which allowed them the opportunity to socialise with their local team members and collectively receive feedback to assist with future goals of the bank.

CIBC FirstCaribbean International Bank, is the largest, regionally-listed bank in the English and Dutch speaking Caribbean with operations in 17 territories.

It offers a full range of market leading financial services and maintains its commitment to putting its customers, staff and communities first.

IMF second review in the positives

The Washington-based International Monetary Fund (IMF) has once again given Grenada the “thumbs up” with progress being made with its 3-year self styled Home Grown Structural Adjustment Programme.

IMF representative  Aliona Cebotari and PS Finance Timothy Antoine at head table reporting growth in Grenada’s economy

IMF representative Aliona Cebotari and PS Finance Timothy Antoine at head table reporting growth in Grenada’s economy

A team from the fund led by Aliona Cebotari has just concluded a visit to the island to conduct its second review of the programme that the Keith Mitchell-led New National Party (NNP) was forced to institute to deal with a fiscal crisis.

Cebotari told reporters at a press briefing last week Thursday that the mission was very encouraged by the progress made by the two-year old administration in St. George’s to stabilise the economy and to return Grenada to a path of sustainable growth.

“The Grenadian economy seems to be recovering at a stronger paste than we anticipated earlier under the programme. In fact the average growth that we expected for 2014 and 2015 was about 1 percent during our earlier review, currently we estimate that growth has average about 2 percent, slightly higher,” she said.

According to Cebotori, the tourism sector continues to fuel the recovery in Grenada which has a burdensome national debt of EC$2.5 billion.

She said the outlook for 2015 has also improved and it is expected that growth for this year would be between 1.5 and 1.8 percent.

“While these trends are indeed encouraging, the challenges remain significant as unemployment remain fairly high, the leveraging in the private and public sector continues,” she added.

The IMF official stressed that the government is now collecting more in revenue from the new taxes now on stream.

“…Taxes have picked up because of the fiscal efforts the Government is doing, that has supported an increase in taxes. The Government has continued to control spending very well. We are on track in terms of where we expect it to be. In fact as I said we are significantly above our targets,” she remarked.

Cebotori told reporters that one of the negatives cited in the programme were delays in the introduction in some of the agreed upon and badly needed structural reforms.

This, she said is due to no fault of the administration since government might have “underestimated perhaps the time they would need for public consultations on some of the reforms and we also found that in many cases we had to put more efforts in estimating the revenue impact to some of the reforms”.

“…For example on the tax incentive side … that took a little bit longer than anticipated but all of the reforms that had to be done during 2014 and towards March 2015 they are all coming through…”, she said.

To date the IMF has disbursed about US$5.9 million to the Mitchell government under the SAP programme that was approved by the fund on June 26, 2014.

In a prepared statement at the conclusion of the mission visit to Grenada, Cebotari made the following official statement:

“The IMF is encouraged by the progress made to stabilize the Grenadian economy and return Grenada’s public finances to a sustainable path.

“The Grenadian economy is recovering at a stronger pace than anticipated, with growth in 2014-15 expected to average above 2 percent, compared to earlier estimates of 1.1 percent. While strong external demand for tourism services has continued to fuel the recovery, growth in other sectors, especially agriculture, is gradually strengthening.

“The outlook for 2015 has also improved, with the decline in world energy prices and a robust recovery in the United States. We now expect growth of 1.8 percent, compared to 1.1 percent at the first review. While these trends are encouraging, significant challenges remain, as elevated unemployment, contracting credit, and large debt continue to weigh down the prospects for a faster and sustained recovery.

“The fiscal performance in 2014 has also been stronger than anticipated. The government reduced its primary deficit from 4 percent of GDP in 2013 to 1 percent in 2014, outperforming the program targets. Tax revenues recovered to pre-crisis levels, reflecting the adjustment measures and stronger tax collection efforts, and expenditures were kept under strict control.

“The government has continued to repay its debt to domestic suppliers, reducing the stock of arrears by about 20 percent during 2014 and staying on track to fully repay them by the end of this year.

“To secure fiscal sustainability, this adjustment effort will need to be complemented by the completion of the debt restructuring currently under way. In addition, ambitious reforms to strengthen the fiscal policy framework are ongoing and continued progress is expected in the coming months. These include the introduction of the planned fiscal responsibility and public debt management legislation, the reform of the tax incentive regime, the enhancement of the strategy to strengthen statutory bodies and state-owned enterprises, and the approval of regulations for the sustainable management of the resources in the National Transformation Fund.

“The government has also initiated institutional reforms of its Inland Revenue Division to strengthen its capacity and effectiveness and to facilitate tax compliance by the largest taxpayers.

“The mission also made progress toward agreement on key policy issues going forward. Discussions will continue in the coming days via video-conference from Washington, D.C., with the aim of securing a timely completion of the second review”.

“The mission met with the Prime Minister and Minister of Finance and Energy, Dr. The Rt. Hon. Keith C. Mitchell; the Minister of Communication, Works, Physical Development, Public Utilities and ICT, Hon. Gregory Bowen; the Minister of Economic Development, Trade, Planning, Cooperatives and International Business, Hon. Oliver Joseph; the Permanent Secretary of the Ministry of Finance, Timothy Antoine; the Deputy Permanent Secretary of the Ministry of Finance, Mike Sylvester; the Executive Director of the Grenada Authority for the Regulation of Financial Institutions (GARFIN), Angus Smith; other senior officials, representatives of the private sector and civil society, and the Monitoring Committee for the Home-grown Program.
“The mission would like to thank the authorities and technical staff for their cooperation and hospitality, and reaffirm the IMF’s support for the government’s efforts to implement Grenada’s program. We encourage Grenada to press on with this collective effort and these vital reforms.”

NDC supporters turn out in large numbers for Convention Rally

Harold Lovell  came out of Antigua to deliver the feature address to Congress members and supporters

Harold Lovell came out of Antigua to deliver the feature address to Congress members and supporters

The first major event held by the main opposition National Democratic Congress (NDC) for the New Year has attracted a large gathering of its supporters at Victoria Park in Grenville, St. Andrew.

The rally which lasted for nearly five hours took place within minutes of the party bringing an end to its 27th Convention at the nearby Grenville Secondary School (GSS).

The NDC is trying to rebound after the party suffered a humiliating defeat at the polls in February 2013 while in government to the New National Party (NNP) headed by Dr. Keith Mitchell who returned after a five year break to get his fourth term in office.

Guest speaker at the Rally was Deputy Political leader of the Antigua United Progressive Party (UPP), Harold Lovell whose party also suffered defeat at the polls in 2014.

Lovell urged the newly elected NDC Executive to adopt a new mindset in order to be successful politicians in this era.

The former Senator in the Antigua Parliament admonished the various Constituency Caretakers and those selected by the NDC to do work in the different constituencies to use their political office to “elevate and to empower the people through committed service.”

“Go and entrench yourselves in your constituencies. From Sauteurs to Point Saline your voices must be heard”, said Lovell amidst loud cheers from Congress supporters.

Stressing the importance of good leadership, Lovell reflected on the Convention’s theme, “Standing with the people to safeguard our economic livelihood and our democracy”.

He expressed the view that the theme “resonates not just in the Spice Isle but throughout the Caribbean” and that now is the time for the NDC Executive to stand with the people of Grenada.

“Now is the time to challenge this government on issues that affect the man in Gouyave and the woman in Grenville,” he told the large group of NDC supporters.

“I implore you tonight do not be discouraged…now is the time to reorganise, regroup, reflect and rejuvenate the party branches; to motivate the troops and to strategise for the victory of the party. Now is the time to give hope to those who feel hopeless, to be a voice to those whose voices cannot be heard and to give strength to those who may feel tired, to those who are weak and those who are weary”, he said.

Former Member of Parliament for the St Andrew South-west and Minister for Social Services, Sylvester Quarless lashed out at the policies being pursued by Prime Minister Mitchell since his return to power.

Quarless charged that the Grenadian leader who he referred to by his initials “KCM”can be considered the most transparent Prime Minister the country has ever had for taking bold and open decisions on matters affecting the country.

He said that the Prime Minister “is so transparent that for everybody to see KCM is attacking our institutions, our way of life and by extension our democracy”.

In a clear attack on the much-talked about “Project Grenada” agenda being pushed by two former Congress Rebels who have now teamed up with NNP – Peter David and Chester Humphrey, Quarless said they are now trying to create a one party state by pushing the new agenda of “One for all, all for one”.

The Congress supporters who turned up at the rally

The Congress supporters who turned up at the rally

He told the rally: “In plain view he (Mitchell) is finding ways to send home those that are not in his favour for all to see. KCM is hiring retirees, denying opportunities to young people to be gainfully employed. KCM takes away the (Free) School Books programme…without looking back he imposed tax and more tax.”

Former Health Minister Ann Peters who co-chaired the rally lambasted the NNP claiming that since it came into office its only achievement has been uniting the Grenadian people “in an institution of poverty”.

“I know they have been able to do one thing good, they have united us and brought us in the institution of poverty and all of us have graduated from that institution with a PhD – poor, harassed and distressed. That is what NNP has done for us – graduated all of us in the institution of poverty with PhDs, the former Senator told NDC supporters.

NDC’s Assistant Public Relations Officer, Randall Robinson disclosed that the Convention and Rally was streamed live attracting more than 4, 500 online listeners.

Most of the Executive members of the party were returned to their positions unopposed with the exception of a few minor changes made to the Executive in elections held.

There was no contest for the post of Political Leader as the party’s constitution stipulates that the position can only be contested every three years.

Joseph Andall was returned to his position as Deputy Political Leader, George Vincent as Chairman with Glen Noel serving as his Deputy and business woman Merle Byer as Treasurer.

Former Education Minister, Franka Alexis-Bernadine was re-elected to serve as Public Relations Officer, with her deputy once again being Randall Robinson.

The important post of General Secretary as the chief party organiser was retained by former Sports Minister, Patrick Simmons.

Simmons would be assisted by three Assistant General Secretaries – former floor member and veteran calypsonian, Elwyn “Black Wizard” Mc Quilkin who was elected Assistant General Secretary for the Eastern Zone; Ali Dowden for the Western Zone and Wade Phillip who will concentrate in the Southern Zone.

The post of Recording Secretary has been retained by Vincent Roberts and his Assistant is once again, Petra Williams.

The NDC delegates also elected – Frederick Parker, Dale Simon and Ian Thomas – to serve as floor members which guarantees them a place on the National Executive.

Although Prime Minister Mitchell has until 2018 to remain in office, many political pundits are beginning to predict that he will call general elections in 2016 or 2017 for the latest.

Nazim Burke: NDC remains strong and united

It’s 24 months since the National Democratic Congress (NDC) suffered another bruising defeat at the polls losing all 15 seats to the New National Party (NNP) of Dr. Keith Mitchell.

The defeat was brought on by bitter infighting in which a Group of Rebels, led by former Foreign Minister Peter David were trying to take control of the party and government from the then leader and Prime Minister, Tillman Thomas.

Congress held its second convention last Sunday since the defeat in which new Political Leader, Nazim Burke, the former Minister of Finance, sought to allay the fears of supporters about their 25-year old party.

Addressing a public rally at the Grenville Recreation Grounds after the convention, Burke affirmed that the party remains strong and united having passed the stage of internal crisis.

“We can confidently state that we have a strong united party – a team of committed and capable leaders with proven track records in their chosen fields of enterprise and endeavour”, he told supporters.

Burke recalled the “unfortunate selfish political ambitions of a few individuals” who were subsequently expelled from the Party for working “assiduously to undermine the authority of the (then) Prime Minister (Tillman Thomas), trying to form a government within the government and a party within the party,” thereby “rendering the party and its organs largely dysfunctional.”

At the time of the bitter internal feuding, David held the all important post of General Secretary of NDC which placed him in the seat as main party organiser.

Burke conceded that in the wake of the “internal crisis,” the NDC was unable to secure the confidence of the people to manage the country’s affairs for another term and suffered defeat at the 2013 polls.

“Sisters and Brothers, every negative situation, no matter how adverse, contains the possibility for something positive. We are proud to say that while we lost the election, we were able to protect our two most critical assets – the NDC brand and our political base,” he said.

The NDC Political Leader noted that the party has regrouped and forged into a “strong united force capable of providing visionary, mature and responsible leadership that our country and people deserve.”

In providing an analysis of the present state of the country, Burke put forward the idea that “we stand at an important crossroad in the history of our country.”

“Our individual and collective stances will determine whether our country continues to slide down this dangerous slope of economic ruin, failed dreams, increased hopelessness and legal and constitutional bullying; or whether we arrest the decline and place our country on the path of economic, social and moral recovery,” he said.

He noted that “at this time, both our economic livelihoods and our constitutional democracy are under serious threats from within and only the collective weight of resistance by the people will safeguard them”.

He went on to say: “Our country faces a crisis of confidence in those who run our affairs. The genesis of this crisis is to be found in this government’s record of deceit; its gross incompetence in the management of our economic affairs; and the stark inability to find or create any programme or project capable of creating jobs for the tens of thousands of unemployed persons, especially our young people.

“The genesis of this crisis is to be found in the high-handed arrogance with which they have violated and disrespected the Constitution and laws of Grenada; the culture of nepotism and corruption that they have cultivated; the consistent refusal to practice accountability and transparency in government, hiding critical information from the citizens; and the pursuit of a culture of victimisation and petty political spite against its political and journalistic opponents”, he said.

The Congress Leader alleged that for the past 14 months in particular, the NNP government has displayed a callous and criminal neglect of the needs, circumstances, wishes and aspirations of the people while engaging in a wanton abuse of political authority.

“Every policy expression, every project, every programme” undertaken by the NNP he said, “appear to find its justification in the desperate and narrow objective of this moribund group to retain political power at all cost, in spite of, and at the expense of the people.”

Burke noted that NNP increased the Parliamentary Representative Constituency Allowance from “$1, 500 per month to $ 11, 100 per month” while the “youth are drowning in a pool of unemployment, criminal delinquency, over-exposure to sexual activity and a sense of hopelessness.”

Presently, he said more than “18,000 young people” are not benefiting from the IMANI programme, some who “live in despair, are paralysed by a feeling of hopelessness and are driven to illegal and immoral conduct.”

He added that “even for those within, the IMANI programme does not provide our young people with much needed sustainable jobs; education and training opportunities and facilities; career counselling, entrepreneurial guidance and support; counselling, life skills and social skills- which, they badly need.”

Additionally, Burke said the Keith Mitchell-led government has done little or nothing to improve the business climate and Grenada’s international doing business ranking continue to plummet.

“As of today, over 40 businesses, including supermarkets, banks and hardware suppliers have closed their doors sending hundreds of people on the breadline,” he told supporters.

He claimed that to date NNP has done “nothing to seriously engage the Government of the Bolivarian Republic of Venezuela with a view to reaching agreement on the delimitation of our maritime boundaries with that country.”

The NDC leader also alluded to the Oil and Gas agreement entered into with the Russian outfit, Global Petroleum, and the agreement concluded between Grenada and Trinidad and Tobago for “the joint development of non- living marine resources” which he said “has been gathering dust in the office of the Prime Minister.”

Burke also accused the Mitchell government of affecting the disposable incomes of Grenadians with the many taxes imposed through the Structural Adjustment Programme (SAP).

Stating that disposable incomes of Grenadians have been reduced by more than “18 per cent,” under the watch of PM Mitchell, he noted the 24 different taxes, levies, fees, duties and charges on the backs of Grenadians who are being “driven to frustration, despair and professional indifference by the lack of leadership, vision and arrogance of the powers-that-be and their several political cronies padding the ministries.”

“There is a breakdown in the social values in our society with an increase in alcohol consumption, gambling, violent crimes and the incidence of family breakdown and dysfunction,” Burke said, while adding that “many of the weakest and most vulnerable among us, including the elderly, children and the physically and mentally challenged are being forgotten and ignored by those who run our country.”

The former Finance Minister charged that “while paying lip service to “national unity”, the NNP regime has done “all in its power to divide our people and to persecute its perceived political and journalistic opponents,” under the banner of  “Project Grenada” with the intention of “making Grenada a one party state,” among other measures aimed at  staying in control.

Burke affirmed that if Grenada is to move forward, “every patriot has
to be recognised and accommodated and our people must be made to feel that that they have a stake and we are all in this together.”

“As an alternative government in waiting, we need to address these issues which are affecting our people in a bold and confident way,” the congress leader said as he outlined the NDC’s plan for Grenada.

“A better Grenada is possible,” he declared in outlining the party’s vision for the country which includes in a broader sense maximizing on the following: National Pride, Inclusion and National Reconciliation, Integrity in Public Office, Constitutional Reform, Institutional Development, Rural Development and Local Government, Agriculture, Agro-Industries and Fisheries, Tourism and Hospitality, Information, Communication Technology, Energy development, Export Services, Health Care, Human Resource Development, Youth Development, Social Development, Physical Development and the Environment, Housing, Sports, Cultural Development, National Security, Regional and International Relations, and a Knowledge- based Economy.

“In this vision, I can see Grenada, Carriacou and Petit Martinique being transformed into a dynamic, prosperous and stable democracy, capable of sustaining a high quality of life for all its people.

“It is absolutely important for us to understand and appreciate that our quest for socio-economic progress and sustained prosperity will come to nought if we allow ourselves to be enslaved by a mindset of dependency.

“If we are to succeed, we must unconditionally embrace the philosophy of self- reliance. By self-reliance, Ladies and Gentlemen, I mean the capacity and determination to seek and extract from within our own circumstances and environment, the resources, opportunities and energies that we require to advance as a nation,” he added.

Burke thanked the gathering for their support for the NDC admonishing that “as we depart from this Convention today, we must do so with renewed energy, commitment and determination to lead our country following the next general elections.”

“A better Grenada is possible,” Burke declared to a cheering crowd of supporters.

NNP cautioned on GIS and Printery

A group of Consultants with links to the Washington-based International Monetary Fund (IMF) has cautioned the Keith Mitchell-led government in St. George’s against turning the Government Information Service (GIS) into a statutory body.

A report from the consultants who operate under the banner of CARTAC was presented to the two year old administration which dealt with the status of GIS, the Government Printery and the Central Statistical Office.

Within weeks of winning the February 2013 general elections, Prime Minister Mitchell had met with staffers at the Government Printery and informed them that he was committed to carry through on his 2003-08 policy of removing the Printery as a Department within the Ministry of Finance and turning it into a full-fledged statutory body.

Well-placed sources told THE NEW TODAY newspaper that during the meeting PM Mitchell did not outline a strategic plan for the future status of the Printery and did not entertain any questions from staffers.

According to a well-placed source, the government employees are rather cautious of the move in light of the fact that most of its printing is done for Government Ministries and Departments with no financial transactions involved.

He said the workers are fearful that if the Printery is privatised that they might not be able to collect monies due to them on time from government ministries to run their operations including paying staffers.

In addition, the Printery workers are said to be concerned about their retirement benefits from the State.

The CARTAC consultants is suggesting to the Mitchell-led administration that  the Government Printery should instead be privatised rather than established as a separate entity.

As a public service, THE NEW TODAY highlights the points made by CARTAC on the operations of GIS, Government Printery and Statistics Ofice:

Government Information Service (GIS)

The Government Information Service is currently a Department within the Office of the Prime Minister, with the Director of Information as head. GIS provides media services across television, radio, print and the Internet. It also provides media services to Ministries and Parliamentary recording.

Across many jurisdictions, government owned media corporations are established as independent bodies. Usually this is designed principally to preserve their editorial independence, particularly in relation to news services.

Separately governments have media and communications units that deal with the internal media needs of Government, and these are usually retained within Government.

As such, there would be limited rationale to corporatize the elements of GIS’ business that provides media and communications services to Government.

To the extent that the broadcasting functions are designed to be editorially independent, there would be some justification for corporatization, but this would mean splitting the existing function and would involve substantial costs.

In summary, it is unlikely that there is sufficient need or benefit from establishing the GIS as a separate statutory body.

Statistics Grenada

The rationale for establishing statistical authorities as independent entities is that it seeks to maintain the independence of the publication of national statistics, and in doing so promote confidence in the quality and reliability of published statistics.

The approach to organising national statistics offices varies considerably. The UK, for instance, established an independent authority in 2008, although all staff remain as public servants.

In New Zealand, Statistics New Zealand is a separate government department and all staff are public sector employees, although the Government Statistician is a statutory position, whose independence is guaranteed by legislation.

Australia operates a separate Bureau of Statistics, with an independent Government Statistician, but again all staff of the Bureau are public sector employees.

Bureau of Statistics, with an independent Government Statistician, but again all staff of the Bureau are public sector employees.

The role of the Statistician has similarities to other checks and balances of government, such as the National Audit Office and the Ombudsman. It is a role that requires functional independence but this does not necessarily mean administrative independence.

It is usually sufficient that the statutory office of the Government Statistician has their independence guaranteed by legislation, but that they remain within the public sector.

It is unlikely that the costs of establishing a separate statutory authority in Grenada for the statistics office could be warranted by sufficient offsetting benefits.

Government Printery
The Government Printery has “tied clients” in the sense that Ministries are obliged to use the Government Printery for certain products and equally the Printery is limited to serving clients within Government.

This is not uncommon: the logic of such arrangements is normally defined around the need for confidentiality and service quality.

However, these requirements are usually overstated, with many governments now relying solely on the private sector for printing services.

Where commercialization of government printing services has taken place elsewhere it has usually involved unwinding both of the market constraints: the printing office is enabled to seek alternative clients, and Ministries are able to source competitive bids.

Printing offices are often corporatized as part of this process to improve their commercial focus. The history of such reforms is mixed, with private sector entrants usually more responsive to the market and better equipped to compete.

Grenada’s experience with other statutory corporations operating in competitive markets (the Housing Authority; Gravel and Concrete; MNIB) would suggest the prospects of the Printery successfully competing are limited.

If reform is contemplated in this area, then the most feasible option is for the Government to move to private supply of printing services and privatise the existing Printery.

Recommendation: The Government Information Service and Statistics Grenada not be established as separate statutory authorities. The Government Printery to be privatized rather than established as a separate entity.

Pannell Kerr Forster loses out at Hubbards

It’s being described as a coup against a local company by a Bajan conglomerate that had the backing of a few Grenadians.

That’s the conclusion of one Grenadian businessman who is peeved at the way in which local accounting firm, Pannell Kerr Forster was replaced as the accounting firm for Jonas Browne and Hubbards by Ernst & Young which has its regional head office in Barbados.

According to a well-placed source, the successful move against Pannell was done at the  annual general meeting of the shareholders of Hubbards which was held last week Thursday at the Conference room of the Flamboyant hotel in the south of the island.

He said that the Barbados-based Goddards Group of Companies used its majority shareholding interest “to literally dump a local accounting firm” and to give the work to foreigners.

He described as “shameful” the action of a small shareholder with Hubbards to vote alongside Goddards to get rid of PKF which is run by local accountant, Henry Joseph.

He feared that the former Managing Director of Hubbards, the late Fred Toppin who was Barbadian by birth and who became a naturalised Grenadian citizen would be turning in his grave at the latest turn of events.

“Mr. Toppin was Barbadian but made sure that a lot of Grenadians were able to buy into Hubbards and became shareholders and put the company firmly in the hands of Grenadians. Today it is shameful to see some Grenadians turn around and vote with the Bajans to kick out a Grenadian company”, he remarked.

The source said it was despicable to see this particular small shareholder who has one single share in Hubbards to rise and second the motion put forward by Goddards to appoint Ernst & Young as the new accounting firm for the local company.

Goddards sprung the resolution after Joseph had presented his report to shareholders on the financial status of the company that is managed by Allan Bierzynski.

The source said that Joseph quickly excused himself from the meeting when he realised that a vote was to take place among shareholders to appoint the new set of Accountants.

“I was present at the meeting and can tell you that Mr. Joseph was given a loud round of applause from many local shareholders for what he did”, he added.

He spoke of Goddards informing the meeting that it had a “competitive bid” from someone else for the job of accountants thus forcing a vote.

THE NEW TODAY understands that PKF fees was in the vicinity of EC$64, 000.00 and Ernst & Young was offering to do the job for EC$1200.00 less.

According to the source, the first vote was done by a show of hands and the local shareholders were able to defeat Goddards on the PKF vs Ernst and Young motion.

He said the representative of Goddards then turned on the screws by requesting that a poll vote be done in which the count would be based on individual shares.

“It was clear to us that Goddards will win because they have the majority shares. It was not a foregone conclusion that Goddards was using its might to over power all the other minority shareholders”, he remarked.

The source indicated that a local female shareholder rose on her feet and put forward the suggestion that the other local shareholders boycott the vote but it was ignored by the Grenada Ports Authority (GPA) and the lone shareholder who had earlier seconded the motion to change accounting firm.

He stated that Goddards was quizzed and gave assurances that awarding the job to Ernst & Young would not result in Hubbards having to pay extra dollars to accommodate the accountants who would have to travel from Barbados to Grenada to do the work.

He said that the Bajan outfit indicated that the parent company will bear that expense on behalf of Ernst & Young and it will not be a financial burden on Hubbards.

THE NEW TODAY was also told that one local shareholder reminded Goddards that it is illegal for the majority shareholder to act in a manner prejudicial or against the interest of the minority shareholders.

“It was good to see Grenadians come together to defend a Grenadian Company (PKF) except for this one individual who seems to hate everyone in this country and most likely every other human being on the face of this earth”, the source said.