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EVERYTHING FOR SALE: PRIVATIZATION IN TRINIDAD AND TOBAGO: PART IV by GODFREY VINCENT

posted 3 Nov 2020, 02:37 by Gerry Kangalee   [ updated 3 Nov 2020, 02:53 ]
In 1995, the Patrick Manning administration appeared to have a favorable rating among the electorate. However, there were rumblings among the masses that the government had abandoned them. They pointed out that the government was paying too much emphasis on large-scale infrastructural projects and not meeting the needs of the unemployed. Additionally, the government faced its own political crisis when Prime Minister Manning declared a state of emergency and placed Occah Seepaul, Speaker of the House of Representatives, under house arrest.

Facing dissension within the party, the Prime Minister prematurely dissolved Parliament on October 6, 1995 and set the date for general elections for November 6, 1995. On Election Day, there was a voter turnout of roughly 63.3%. The PNM obtained 48.76% of the votes and the UNC received 45.76%. In terms of raw numbers, 256,159 persons voted for the PNM, and 240, 372 for the UNC. This meant that both parties won 17 seats. However, the UNC formed a coalition with the NAR, which won the two Tobago seats and formed the government.

Basdeo Panday
The Panday-led UNC underwent two stages of metamorphosis. As part of the coalition that formed the NAR, which formed the government in 1986, it was known as the ULF (United Labour Front). When the NAR imploded, Panday and his cohorts formed Club 88. Some political commentators viewed the UNC as a new form of the defunct Democratic Labour Party (DLP). During the campaign, the UNC attracted some members of the left, disgruntled PNM supporters and even some prominent trade unionists like Errol McLeod. While on the campaign trail the UNC embarked on a populist campaign to attract support but once in government, the party adopted the same liberalization policies because it was still beholden to the IMF and World Bank.

In addition to this political metamorphosis, some in the party, especially the political leader, Basdeo Panday moved from an ideological position that a “parasitic oligarchy” existed in Trinidad and Tobago to an embrace of the parasitic oligarchy. As one of the leaders of the ULF, Panday railed against the dominance of the business elites and their stranglehold over the economy. However, once in power, he sought the support of the powerful elites.

Trevor Sudama eloquently captured this transition and declared that, “Thus it was that in the late eighties and early nineties Panday was vehement in his criticism of the parasitic oligarchy arising from his leftist philosophy as trade union and working class leader as well as the conviction that the oligarchy has sufficient influence with ANR Robinson to have him removed from the NAR government. Subsequent events would lead one to speculate whether Panday was earnest in his condemnation or whether it was just platform rhetoric.”

Furthermore, he noted that, “In the run-up to the 1995 general election, it appeared that Panday had softened his position on the parasitic oligarchy and was willing to accommodate certain representatives in the persons of Brian Kuei Tung, Ishwar Galbaransingh and Steve Fergusson.”

It is not known what financial contribution and other resources these ex-PNM stalwarts brought to the UNC to enable it to win 17 seats. Moreover, Sudama pointed out that, “As the UNC administration settled down to the task of governing, it was clear that Panday had had a conversion to the virtues of unbridled capitalism and absolute faith in private sector investment for achieving national growth and progress. It was a sea change in his philosophy which might have come about by consorting in high society and being offered the blandishments of comfort and a taste of luxury living not hitherto experienced. Thus, it was that the working-class hero and his wife acquired the hobby of golfing and fine dining” (See Trevor Sudama, “CLICO, PANDAY AND THE OLIGARCHY, Newsday.co.tt, November 09, 2020).

This ideological shift became quite clear from the government’s first Budget Speech to the House of Representatives on January 10, 1996. Finance Minister Brian Kuei Tung stated that, “What we can do at
Brian Kuei Tung
this stage is to ensure Parliament and by extension, the nation, that this Government will pursue an economic policy that will encourage growth as well as development, maintain exchange rate stability, keep inflation under control, and continue to develop a climate conducive to investment, both local and foreign. Its monetary and fiscal measures will be informed by these considerations”
(See Budget Speech 1996).

Seeing that the government was interested in creating a climate for investment, its policy of liberalization of the economy did not differ from the PNM’s except in its implementation. While the UNC did not radically shift from the fundamental IMF and World Bank’s policy directives as they related to the fundamentals on the economy, the UNC, as of 1999, did not aggressively pursue a privatization policy as the NAR and the PNM.

A reputable ILO study on privatization in Trinidad and Tobago has confirmed that, “The present Government which is comprised of a coalition between the UNC and the NAR has not privatized or divested any of the State enterprises to date. Very pointedly, it announced that plans to divest PETROTRIN have been put in abeyance. It has however, continued with the exercise of the restructuring of state enterprises, and has retracted on the plan, mooted when in opposition, of cancelling the management contract with Severn Trent of Britain, which was restructuring WASA.

While there have been statements suggesting that the programme of restructuring will be continuing, the present administration is not as committed to privatization in respect of the remaining companies. There still exists an important State enterprise sector, with some of the largest companies in the country under the control of the Government, who also retains a significant interest in a number others”
(See ILO Report, 1999).

Why did the UNC not aggressively pursue privatization? Was it that Panday did not want to lose support of significant sections of the leadership of the labour movement? Or, was it waiting on the “parasitic oligarchy” to make the call and then the government would have acted? These are questions that need answers.

One thing we can know for sure was that the government had a policy to divest Caroni Limited. Writing in one of his regular columns, Raffique Shah detailed the following, “Last week the Express broke the news story that a Cabinet-appointed committee (Working Group for the Restructuring of Caroni Limited) had recommended to government that the sugar industry be shut down by October of this year. 

The story spoke of a draft report to Cabinet, dated May 25, which stated in bold terms in its first few paragraphs: "An objective analysis of both the internal and external environment confirms (sic) that the local sugar industry cannot become financially viable...a total shutdown of the industry is inevitable.” Later in its final recommendations, the Working Group was clear in its conclusions: "Sever all Caroni Limited employees in 2001...rehire 3,500 employees on contract for nine months...sever all contract employees by June, 2002...pay obligations to farmers contracts (sic) on a phased basis." 

This decision on Caroni Limited and the pursuit of more privatization became front and center when the PNM returned to power in 2001.


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