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Belize City
Thursday, October 1, 2020

No!!!

Never in Belize’s modern history has there been such intense public debate on a national issue as there has been on the Government’s move to settle a $33 million debt for Universal Health Services with the Belize Bank. Over the past week momentum has been building as various community factions and the media have been campaigning in an effort to get Belizeans to give their symbolic “no” or “yes” votes on the issue. The clock is ticking towards a heated showdown in the capital city of Belmopan.

Nationally, Belizeans were expecting to hear a firm vote in the National Assembly on the UHS issue tomorrow Friday, May 18, but the Government of Belize announced late today that the voting won’t take place until a week’s time. Still, the two driving political forces – the ruling People’s United Party and the Opposition United Democratic Party, as well as the independent party – Vision Inspired by the People – are mobilizing their people to make a strong showing tomorrow in Belmopan for or against the issue.

 Clearly, the PUP’s will be chanting for the proposal that their party leader, Hon. Said Musa, presented to Cabinet and his party’s parliamentary caucus today, while the Opposition will be sounding a loud “no.” After a late decision announced today, the unions are expected to also make a significant showing in Belmopan, but we also understand that many Belizeans will show up independently to declare their stand on what will be formally unveiled tomorrow.

A release from Cabinet today only spoke of a “structured solution,” but our information indicates that that $33 million bill will, at the end of the day, run in excess of $144 million.

Firstly, the Government has reportedly gotten the Belize Bank to give it a new loan to settle the UHS debt, but the terms of the loan will leave the bank with more than triple what is owed today – and if the National Assembly gives the green light on tomorrow’s motion, the bill will be paid by all taxpayers across Belize.

We understand that the so-called “structured solution” that the Government has reached with the bank involves a repayment schedule that stretches over the next 25 years at a rate of 10%. Three million dollars ($3,000,000) in interest is payable each year in quarterly installments, and there is a repayment of the entire principal at the end of the term, resulting in a grand total of $104 million.

While today’s Cabinet release says that Cabinet has endorsed this “structured solution,” we understand that those PUP’s in and out of Cabinet who have given their approving nods did not have the benefit of an audit, nor a black-and-white listing of exactly what assets the Government would acquire for taking on this massive debt. In fact, the effect of Government paying off the UHS debt would be that the collateral that the UHS principals had signed over to the bank would be released, and exactly what agreement Government has with the UHS to secure their “takeover” and control over those assets remains dubious.

When we posed the question to the Prime Minister last week, questioning what guarantee he could give the Belizean people that in the event that the Government does settle the debt that there won’t be any resistance on the part of UHS principals, Musa said that GOB’s legal position is that the UHS principals are not in a position to resist, and the Government would step into the shoes of the Belize Bank.

But if and when the Government takes over, it will have quite a sizeable bill waiting to settle at the UHS. Add to the $104 million Belize Bank debt we mentioned earlier in our story, another $12 million in pending bills. Sources say that this includes $4 million the Belize Bank paid for the UHS to settle another debt with the Development Finance Corporation (DFC).

Recently the Prime Minister told the media that the UHS’s debt with the DFC was $12 million total, with $4 million in principal. He said that it was the interest of $8 million that was being written off to reduce the loan to $4 million. However, reliable information to our newspaper is that this is not the case – and there is a documented trail to explain.

Initially, DFC took over a $4 million loan from the Social Security Board for UHS, but there are other bills the DFC has reportedly settled for UHS: $2.2 million in interest payments, $107,000 DFC paid to Strukture Architects, $2.6 million for interest to the Belize Bank, $2.7 million disbursed to UHS, $255,000 for payment of legal fees, and $310,000 for F&G Insurance.

The DFC board had directed staff to write off the bulk of the loan, leaving the $4 million that was paid by the Belize Bank, but which remains a collectible bill for the bank.

The bigger concern over the massive DFC write-off is that the DFC did not survive on free cash, and in fact, the money that was written off was, in effect, expensive money borrowed from foreign banks and refinanced under the 22-year super bond, which will cost roughly 130% more in interest payments.

So if you do a running tally, that’s $104 million for the Belize Bank loan, plus $12 million in pending bills at UHS, plus the $12 million written off at DFC, and the associated $16 million in interest that has to be paid under the super bond. The conversation, therefore, is no longer about $33 million, but about a grand total of $144 million.

It will take a while for this new reality to sink in, so on Friday morning the heated debate will continue about the $33 million Belize Bank debt, and the ruling party will table in the House a motion to square off that bill, and to give the Belize Bank a pillow of comfort to rest upon.

The Government’s upshot to all of this is that the entire public – and especially the indigent – will have access to a state-of-the-art medical facility that will provide very specialized services to people of all walks of life.

There will be no voting in the House tomorrow, Cabinet says, and this will give interested parties time to present their views on the motion before a vote is taken on Friday, May 25.

On the morning talks shows, on the evening news, and in the streets, as well as in the recent SPEAR poll, overwhelming public sentiment against the payment of this debt has been apparent. However, we understand that those who have given Musa their nod of support have not been giving much weight to that public sentiment, and in fact, the opposing forces – even those independent thinking, non-partisan Belizeans – are being viewed with a shadow of UDP red.

Our sources tell us tonight that Musa’s proposal enjoys majority support from members of Cabinet and the Parliamentary caucus of the PUP, which is made up of members of the Cabinet, the House and the Senate, and so all indications are that it will pass both houses of Parliament – the House of Representatives and the Senate. It is a very small minority, enough to count on one hand, which is still opposed to paying this multi-million-dollar debt from the public purse.

By the time this newspaper hits the streets Friday morning, we will know if the poll being taken by Derek Aikman and the Belize Covenant Movement has mirrored the overwhelming public dissent so far exhibited on the morning talk shows, the evening news and the SPEAR poll, and we will get another read on where our parliamentarians stand versus where the wider populace stands on this issue.

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