Finance Minister Colm Imbert has revealed that after a decade and multiple assessments, that the government’s bailout of CL Financial and CLICO has cost taxpayers $30 billion.
Speaking at a post Cabinet Media Briefing, Imbert said: “Remember as well that the government, taxpayers by extension, bailed out the CL Financial Group and CLICO, in the tune of billions of dollars – in fact I can tell you now that the final account in terms of indebtedness of CL Financial and CLICO to the state is $30 billion.”
Imbert indicated that it was originally thought that the debt would be approximately $15 billion. He added that when the Ministry went to court with the liquidation “it was $23 billion+ and having done, the final account it is $30 billion.
Imbert said there are many different approaches in the the way in which the debt to taxpayers is being settled .
According to the Finance Minister, one of these approaches is a “set-off”, “in other words you get value for debt”. He gave the example of the golden grove estate in Tobago which was acquired for the Sandals hotel project. Imbert said it was valued, the estate was transferred to the government and then the debt was reduced by the valued amount.
The Finance Minister said that a similar process occurred with CL Marine. While he did not have the exact figure, Imbert disclosed that with regard to CL Marine, the company and it’s assets were valued at ‘a bit over $100 million’.
He said that this acquisition has now reduced the liability of CL Financial/ CLICO Group to the government as result of acquiring that property.
The disclosure of the valuation comes after the Ministry of Finance issued a press release, asserting the fact that CL Marine and its subsidiaries have been acquired by the government, which was part of a court supervised liquidation process.
Based on the liquidation, Imbert said that the government was going through the process of “acquiring strategic assets and netting off/setting off the value of CL Financial Group assets against the debt owed,” thus reducing the debt accordingly.
The Minister insisted that these details were included the recently published press release, but they were not. Hence the reason former Minister in the Ministry of Finance and newly appointed CEO of the Arthur Lok Jack Graduate School Mariano Browne asked: “Where is the report from the Court?”
The Ministry of Finance, in the release, noted that the government has created the National Marine and Maintenance Services Company Limited, a new wholly owned State enterprise for the aforementioned purpose.
Having completed the acquisition, the Finance ministry disclosed that the Government “recently appointed an interim Board of Directors, pending a permanent board, comprised of senior public officials, with an immediate mandate to implement a proper governance structure according to the Companies Act and the State Enterprise Performance Monitoring Manual.”
The Minister of Finance went on to say that the government is quite enthused about this particular acquisition “because we have to diversify away from oil and gas and ship repair, ship building and so on, is a major area of government policy, has been for may many years.”
Imbert emphasized that ship building and ship is also a major area of diversification. He remarked that the government is in the process of acquiring brand new vessels – two fast ferries and two military vessels coming from Australia.
The Finance Minister also reminded the public about the Galleons passage, noting that the facilities of CL Marine and its assets which are housed in Chaguaramas, is intended to repair the aforementioned vessels.
“So it serves a multiple of purposes, it’s part of our diversification effort and it is also a very efficient means of repairing the government vessels,” said Imbert.
As a result of this, the finance minster said he was expecting the government to receive salutations and congratulations for starting the first major diversification project of the government, “rather than being subjected to all sorts of questions about, Why we do that? How you do that? How much you pay for it et cetera?”