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NIC Defends Loan To Government

Prime minister Allen Chastanet says NIC loan is business as usual.

[dropcap]D[/dropcap]uring a town hall meeting in Vieux Fort on 22 July, St. Lucia Labour Party personnel criticized the government’s decision to borrow $100 million from the National Insurance Corporation. Party leader Phillip J. Pierre described the situation as very serious and that it may have implications on the availability of money for pensioners.

Pierre told the crowd: “The government’s cash flow cannot afford the $100 million to pay back investors and that’s a dangerous sign for a government that says the economy is improving.” He asked: “What assurances does the government have that the $100 million worth of bonds will be sold in time to repay the NIC?”

Last November Pierre had threatened: “If Allen Chastanet believes he can touch the NIC funds of the people of Saint Lucia . . . all hell will break loose in his country!”  Asked on Tuesday to elaborate, he said: “Hell is already breaking loose. Aren’t you reading on social media how people are worried?” He said his party had in mind protest action that would be “purely democratic and peaceful”.

Responding to the SLP criticism as he made his way to parliament on Tuesday, Prime Minister Chastanet said he was “not sure, what the hoopla is all about”.

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Referencing the NIC loan, he said: “This is a traditional practice. Governments have either gone to the commercial entities or to NIC to borrow short-term funds to help with cash-flow processes. As you’re collecting your tax revenues and issuing out new bonds and turning over these bonds, there generally tends to be a cash-flow disruption . . . which is absolutely normal.”

Additionally: “I’m very embarrassed for the opposition, that they would attempt to play cheap politics with the stability of the country. To even suggest in any way that this was jeopardizing the pensions of people!” He said the NIC is “extremely well financed” and has a “very large pool of reserve resources”.

The NIC later issued a press release that read in part: “We would like to assure all stakeholders, including contributors, pensioners, employees, and other service providers, that we would not take any decision that would either impair the Corporation’s ability to discharge its obligations in the normal course of business, or adversely impact the long-term viability of the Corporation.”

Joshua St. Aimee

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