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Home General Cabinet confrontation ends in compromise

Cabinet confrontation ends in compromise

Amandala understands that although he is out of the country currently, a seventh Cabinet member, Deputy Prime Minister, Hon. Johnny Brice?o, made it known that he, too, would resign if the demands were not taken seriously.

Among the Ministers? list of demands was for the current Minister of Finance, Hon. Ralph Fonseca, considered by some observers to be the most powerful man in Cabinet, to be thrown out of the Cabinet. This is the first time that Fonseca?s own peers have made such a call. The ultimatum is for Ralph to leave the Cabinet, or more than half the Ministers would.

Still, when the Prime Minister publicly spoke this afternoon after the negotiations, he did not concede that Ralph would be removed from Cabinet. His guarded words were that there would be ?restructuring at the highest levels of government.?

When we pointed out to one of the protesting Ministers that it was actually the Prime Minister, Hon. Said Musa, who was the Minister of Finance from 1998 until 2003?the period during which many of our financial troubles took root?the reply from the Cabinet member was that Ralph has been the Minister of Budget Management, and the one who has really been controlling the public purse. We were told this evening that the 7 Ministers still want him to be ousted by the end of August.

The Prime Minister did not say if he, himself, would voluntarily resign, and his Cabinet members were not asking him to.

The news of the threatened resignations ?supercharged? an already electric atmosphere. Two weeks ago, the scandal broke that the Government had used $6 million of Social Security Board funds to pay the defaulted loans for companies of a former ruling party politician, Glenn D. Godfrey.

About a week later, the Opposition exposed a letter purportedly sent from Godfrey to the new owner of the Belize Telecommunications Limited, Innovative Communication Corporation, exposing the details of the negotiations for the sale of Intelco. The details of the negotiations made it clear that the talks were leading to the resurrection of the telecommunications monopoly that ?the Government jumped through hoops to end,? in the Opposition United Democratic Party?s words.

What was more startling, however, was the allegation that Government had guaranteed over $100 million in debt for Intelco, and had lent it almost $3 million more?all assertions that Godfrey has since publicly denied.

This week Monday, things heated up when the Belize Chamber of Commerce and Industry (BCCI) led the call for a special financial audit of the SSB, in light of the monies the SSB had had to pay on Godfrey?s behalf since last November.

That was followed a day later, on Tuesday, with a call from the National Trade Union Congress of Belize for full disclosure of Government?s financial dealings with Intelco and Glenn Godfrey?s companies.

Joining in the call were the BCCI and the Belize Business Bureau, who had both been appointed to the new SSB board last year.

On Tuesday evening, August 10, Works Minister, Jose Coye had publicly conceded, through interviews with Channel 5 and Channel 7, that the Government had put Social Security funds at ?undue risk.? (Coye was the Acting Minister of Finance and the one who accompanied the PM when GOB completed the sale of BTL to Prosser, after which GOB misled the public into thinking that it had received US$89 million for the sale, when it later confessed that it had, in fact, gotten less.)

The loud proclamations and the call for answers and action continued on Wednesday, when the Opposition United Democratic Party called for a full-scale commission of inquiry into the spending of SSB?s funds to be headed by the Chief Justice of Belize.

Things picked up momentum when five hours later, the Society for the Promotion of Education and Research (SPEAR) called for the resignation of the SSB?s board of directors and its investment committee.

Those who knew of the alleged misuse of SSB funds, should resign out of shame; the rest should resign out of protest, said SPEAR?s programme director, Dr. Jason Price.

Then followed the march of the six Cabinet Ministers to the Office of the Prime Minister early Thursday morning, less than a day afterwards. Their call?after the public had already reached the conviction that the country?s financial management has not been the most prudent?was for better financial management and for the Cabinet, overall, to have more control over the finances of the country.

When we questioned the timing of their call on the Prime Minister, the reply we got was that ?we need to get it right; we have to find a way to make a change.?

While the six Ministers contemplated resigning their Ministerial portfolios, they were still prepared to remain members of the People?s United Party and area representatives for their electoral divisions, Amandala was told.

After they broke from their meeting with the PM this afternoon, the Ministers, who had scheduled a press conference at the Radisson if things went badly, decided that they would not go public with their gripes after all. The compromise was that the Prime Minister would be the only one to make a public statement on the matter. The media was denied any opportunity to question the Prime Minister.

Disappointingly, the only public comment the PM had today?despite the public?s growing list of questions?had been packed inside a three-minute pre-recorded speech that was made before the Government?s press personnel and later distributed to the private media.

His statement, however, did little to quell public concerns over their monies. In fact, SPEAR issued its second consecutive press release after the PM?s mini-speech. Added to SPEAR?s list of demands, it called for, ?A vote of no confidence against the Minister of Finance to be passed at the next sitting of Parliament, if by that time he has not yet resigned.?

The recent tremors that have hit the Musa administration have undoubtedly brought back haunting memories of the typhoon that stirred up things only three years ago. First, former Minister of National Security and Economic Development, Jorge Espat, resigned on October 8, 2001, after three public castigations against the Government. (Incidentally, the devastating Hurricane Iris also struck the southern part of Belize on October 8.) Days later, the Prime Minister reshuffled his Cabinet and shortly afterwards a team of four Cabinet ministers?who were casually known as ?the Gang of Four??also threatened to resign.

One member of the ?gang,? Dr. Henry Canton, former Minister of Works, Transport, Citrus and Bananas, resigned the following June. The other three ministers?Brice?o, Courtenay, Smith?remained within the Cabinet. Smith had resigned his Broadcasting and Information portfolios but remained in Cabinet, and Brice?o had temporarily resigned his post as the Deputy PM just as the PM was about to leave the country to get hurricane assistance.

Brice?o, Courtenay and Smith today found four others who would join with them in protesting against the actions of their own administration through their threat to walk away from the administrative team.

We note, however, that it is the highest law of the land, the Belize Constitution, which makes all thirteen members of Cabinet, including the protestors, collectively responsible for the actions of the current and former Ministers of Finance?Fonseca and Musa.

Section 44.2 states that, ?The Cabinet shall be the principal executive instrument of policy with general direction and control of the Government and shall be collectively responsible to the National Assembly for any advice given to the Governor-General by or under the general authority of the Cabinet and for all things done by or under the authority of any Minister in the execution of his office.?

It is that same Constitution that gives the House of Representatives?the elected officials?the power to remove other representatives by calling for a ?no confidence? vote. Even the Prime Minister is not immune from this. (Sections 37.4 and 40.4.d)

Even though Fonseca was the Minister of Budget Planning and Management during the 1993-1998 term, it was the Prime Minister and PUP party leader who was officially responsible for ?financial policy; budget preparation, control and review; fiscal management; public debt servicing; and insurance and banking.?

It was the Prime Minister who announced to the House in 1999 that Government would securitize mortgages to foreign financiers. The SSB?s annual report for 2002 listed over $20 million worth of mortgages that GOB had effectively guaranteed for St. James National Building Society, which Glenn Godfrey controls.

Fonseca became the Minister of Finance on March 7, 2003.

Notably, neither SPEAR (an organization which the PM, incidentally, co-founded in 1969), nor the group of seven protesting Ministers, made a call for the PM?s resignation.

However, SPEAR has circulated a petition for the removal of the SSB?s board and investment committee, and for an independent audit to be conducted while an interim committee is put in place to run the SSB.

Speaking with Amandala this evening, Dr. Price, SPEAR?s programme director, told Amandala that the Prime Minister?s decision announced today on SSB, the issue of paramount importance, was inadequate.

This afternoon, Musa said that there would be no new SSB loans to the private sector. He also said that there would be full disclosure on Government?s finances, particularly as they relate to the matters in question, and that Cabinet would now be ?ultimately responsible? for the country?s finances. The Prime Minister said nothing about the calls for an independent audit of the SSB.

?It?s like you?re sending your face to investigate your leg,? Price remarked.

Read Prime Minister?s Statement here

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