Mr Golding’s statesmanlike NHT stance

Thursday, February 28, 2013

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FORMER prime ministers, we suggest, should make for excellent statesmen or women, affording the nation their invaluable experience forged in the fire of steering the ship of State.

Mr Bruce Golding's statement on the National Housing Trust (NHT) debacle, which was carried in full in yesterday's edition of the Jamaica Observer, is a perfect example of how a former leader can assist in problem-solving at a level no longer demanding of the partisan constraints of party politics.

In weighing in on the issue, Mr Golding said someting that few could disagree with: "The NHT, as it name asserts, is a trust fund. Every cent of contributions that flows into the Trust is made by or on behalf of a person with a name and a unique number. Its purpose is to offer housing benefits for those named and uniquely numbered persons. The Government's role, exercised through the Board of Directors it appoints, is to manage those funds in an efficient way to ensure the maximum benefits to those named and uniquely numbered persons."

But, no doubt recalling the similarly difficult positions he faced while being prime minister of Jamaica, he was able to emphathise with the current Government now faced with hardly any options but to turn to the NHT, or risk losing faith with the International Monetary Fund (IMF).

Said Mr Golding: "The Government's decision to expropriate $44 ($45.6) billion from the NHT must be seen in the context of the rock and hard place between which it finds itself and the imperative of reducing the fiscal deficit to satisfy the requirements of an IMF programme. The alternative would be drastic cuts in public expenditure that it finds unpalatable and/or heavier tax increases that are not only just as unpalatable, but unrealisable..."

Recall that the Golding Administration lost the support of the IMF, presumably because his Cabinet found the conditionalities being imposed as equally unpalatable.

One could ask, which is worse: accessing funds from the NHT or abandoning the IMF's seal of approval, which in turn tied off certain other funds from critical lending agencies such as the Inter-American Development Bank and the World Bank, among others?

Another pertinent question is, if not the NHT, where else would that kind of money come from? Without this kind of discussion, any successful court action against the Government over the NHT would be nothing but a pyrrhic victory. Ask the Greek king Pyrrhus.

We think Mr Golding's suggestion as to the way forward is worth repeating: "The NHT is in the business of providing housing which requires land. It would have been a much better way for the Government to provide land in exchange for the $45.6 billion... There are large tracts of unutilised government-owned lands that could be transferred to the NHT at market or even discounted value in exchange for the $45.6 billion.

"There are other non-housing related government-owned assets that could make up any shortfall and be treated by the NHT as investment assets. This approach would still reduce the ability of the NHT to provide benefits in the four-year period, but these benefits would be available in the future, the government's cash need would have been met, the NHT balance sheet would not have been affected and the trust implicit in the operation of the NHT would not have been violated."

Are we seeing the re-emergence of the new and different Bruce Golding?




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