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Is incompetence now a permanent feature of Jamaica's social and political life? The following sentences are taken from the editorial below:
What is even more surprising about this episode was the Government's decision to put in train a redundancy programme for SCJ staff, even ahead of a clear deal in the divestment. In the first instance, it is questionable if redundancy is necessary, supposing that the workers would continue in similar jobs at comparative pay.
In any case, given the SCJ's heavy indebtedness and the Government's own fiscal difficulties, the decision to pay out nearly $650 million in notice pay for redundancy seems nonsensical in the absence of a clear deal.
EDITORIAL - A bungled divestment
Published: Monday | January 5, 2009
Prime Minister Bruce Golding, encouragingly, has promised that, going forward, it can't, and won't, be business as usual for Jamaica. Business as usual, he warned, "won't be good business" in these turbulent times.
Mr Golding, in his New Year's address, had his sight set on the larger macroeconomic canvas, especially in the context of the global recession that is likely to bite deeper during 2009. But as the prime minister knows, and implied, the picture of the macroeconomy is a composite of the micro-environment - every firm, each deal concluded.
And notwithstanding the PM's, though subdued, chest-thumping about his administration's skill in guiding the country through the economic thickets of the past year, there is too much about the Government's management of our affairs that, by any measure, just wasn't good business.
The divestment, or attempt thereto, of the Sugar Company of Jamaica (SCJ) stands as a grand metaphor for the kind of cacophonous bungling, which Mr Golding has said "were not able to cut it in the past - (and) are even less likely to cut it in the future".
For, if we are to be generous to the administration, its handling of the SCJ affair has been somewhere between naive and incompetent, leaning more towards the latter. Towards the middle of last year, as the administration moved close to a deal for its sugar business with the Brazil-based Infinity Bio-Energy, questions were raised about the company's financing. These were rejected out-of-hand by government spokesmen. Moreover, there are legitimate questions about whether all potential suitors competed on a level playing field, with the administration's late addition of Petrojam Ethanol Ltd as a sweetener to close the deal with Infinity.
But even at that, Infinity, with softening profits and a tanking share price, couldn't raise the US$125 million to close the deal last September. Nor was it able to do so at its extended three-month period that closed December 31. And still there is no clarity on the part of the administration if Infinity will eventually close. Nor has there been an enunciation of a clear alternative for the management of the SCJ until the administration extricates itself from this embarrassing entanglement.
What is even more surprising about this episode was the Government's decision to put in train a redundancy programme for SCJ staff, even ahead of a clear deal in the divestment. In the first instance, it is questionable if redundancy is necessary, supposing that the workers would continue in similar jobs at comparative pay.
Difficulties
In any case, given the SCJ's heavy indebtedness and the Government's own fiscal difficulties, the decision to pay out nearly $650 million in notice pay for redundancy seems nonsensical in the absence of a clear deal. We can only assume that whatever the outcome of the negotiations with Infinity, the Government is contractually obliged, at the start of the next fiscal year, to complete redundancy payments to the staff. This will be multiples of what is already paid.
This clear blunder has consequences for the Government's fiscal targets and appears to make political rather than economic sense. It has consequences, too, for the availability of workers for the next sugar harvest, whenever that starts.
Indeed, as this issue shows, there is need, as Mr Golding says, for "fundamental changes" to ensure "a quantum leap from a frustrating past".
The opinions on this page, except for the above, do not necessarily reflect the views of The Gleaner. To respond to a Gleaner editorial, email us: editor@gleanerjm.com or fax: 922-6223. Responses should be no longer than 400 words. Not all responses will be published.
What is even more surprising about this episode was the Government's decision to put in train a redundancy programme for SCJ staff, even ahead of a clear deal in the divestment. In the first instance, it is questionable if redundancy is necessary, supposing that the workers would continue in similar jobs at comparative pay.
In any case, given the SCJ's heavy indebtedness and the Government's own fiscal difficulties, the decision to pay out nearly $650 million in notice pay for redundancy seems nonsensical in the absence of a clear deal.
EDITORIAL - A bungled divestment
Published: Monday | January 5, 2009
Prime Minister Bruce Golding, encouragingly, has promised that, going forward, it can't, and won't, be business as usual for Jamaica. Business as usual, he warned, "won't be good business" in these turbulent times.
Mr Golding, in his New Year's address, had his sight set on the larger macroeconomic canvas, especially in the context of the global recession that is likely to bite deeper during 2009. But as the prime minister knows, and implied, the picture of the macroeconomy is a composite of the micro-environment - every firm, each deal concluded.
And notwithstanding the PM's, though subdued, chest-thumping about his administration's skill in guiding the country through the economic thickets of the past year, there is too much about the Government's management of our affairs that, by any measure, just wasn't good business.
The divestment, or attempt thereto, of the Sugar Company of Jamaica (SCJ) stands as a grand metaphor for the kind of cacophonous bungling, which Mr Golding has said "were not able to cut it in the past - (and) are even less likely to cut it in the future".
For, if we are to be generous to the administration, its handling of the SCJ affair has been somewhere between naive and incompetent, leaning more towards the latter. Towards the middle of last year, as the administration moved close to a deal for its sugar business with the Brazil-based Infinity Bio-Energy, questions were raised about the company's financing. These were rejected out-of-hand by government spokesmen. Moreover, there are legitimate questions about whether all potential suitors competed on a level playing field, with the administration's late addition of Petrojam Ethanol Ltd as a sweetener to close the deal with Infinity.
But even at that, Infinity, with softening profits and a tanking share price, couldn't raise the US$125 million to close the deal last September. Nor was it able to do so at its extended three-month period that closed December 31. And still there is no clarity on the part of the administration if Infinity will eventually close. Nor has there been an enunciation of a clear alternative for the management of the SCJ until the administration extricates itself from this embarrassing entanglement.
What is even more surprising about this episode was the Government's decision to put in train a redundancy programme for SCJ staff, even ahead of a clear deal in the divestment. In the first instance, it is questionable if redundancy is necessary, supposing that the workers would continue in similar jobs at comparative pay.
Difficulties
In any case, given the SCJ's heavy indebtedness and the Government's own fiscal difficulties, the decision to pay out nearly $650 million in notice pay for redundancy seems nonsensical in the absence of a clear deal. We can only assume that whatever the outcome of the negotiations with Infinity, the Government is contractually obliged, at the start of the next fiscal year, to complete redundancy payments to the staff. This will be multiples of what is already paid.
This clear blunder has consequences for the Government's fiscal targets and appears to make political rather than economic sense. It has consequences, too, for the availability of workers for the next sugar harvest, whenever that starts.
Indeed, as this issue shows, there is need, as Mr Golding says, for "fundamental changes" to ensure "a quantum leap from a frustrating past".
The opinions on this page, except for the above, do not necessarily reflect the views of The Gleaner. To respond to a Gleaner editorial, email us: editor@gleanerjm.com or fax: 922-6223. Responses should be no longer than 400 words. Not all responses will be published.