Jamaica was denied $625 mln in bauxite levy payments due to govt "slackness"- says minister

Minister of Finance and the Public Service Audley Shaw says that Jamaica was denied $625 million in bauxite levy payments last December due to the “slackness” of the previous Government.

Shaw, in closing the 2016/17 Budget Debate yesterday in Gordon House, spoke about the loss to the country when he addressed the issue involving the ailing Noranda Bauxite in St Ann, which is in discussions with the Government over waiving its levy payments following an application for bankruptcy by its US parent company in the United States.

Shaw said that former Minister of Finance and Planning Dr Peter Phillips, “apparently allowed” the US$5 million (J$625 million) letter of credit, which was issued on behalf of Norando to pay the Government of Jamaica the company’s bauxite levy, to expire last December without making a claim on it.

“It expired. Five million dollars which we could have drawn down in December was not drawn down,” Shaw said.

Dr Phillips, who intervened on a point of order, said that all matters regarding the revenues are handled by civil servants.

“The financial transactions entered into by the Government of Jamaica are not the remit of the minister. They are the remit of the public officials responsible. For the member to suggest that I either received or had in my care the letter of credit is misleading the House,” he said.

Shaw said that while he had no difficulty withdrawing the suggestion that Phillips had the letter of credit in his possession, on a matter of such gravity, the minister should have known.

“All of that money down the drain. Fiscal recklessness and the minister of finance ought to have known about it,” Shaw responded.

Shaw said that Noranda officials expressed great surprise to the Jamaican negotiators that the then Government allowed the letter of credit to lapse and thereby lost the US$5-million payment.

“… So, because of that fiscal and managerial slackness, the Jamaican people were short-changed to the tune of $625 million by the previous Government,” he insisted.

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