Real News – Even as Social Security pensions and salaries continue to be delayed, the Scheme could possibly lose even more of its assets without adequate compensation, sources say.
REAL News has learned that National Mortgage & Trust Co., of which the Social Security Scheme is the majority shareholder, is likely to be taken over by State Insurance Company.
Reportedly, Social Security will be offered a minority shareholding in State Insurance after the takeover, but insiders say the equity will fall far short of the Scheme’s investment in National Mortgage.
One person explains that Social Security poured millions into National Mortgage & Trust, which the company, in turn, disbursed in mortgage loans. He says it is unlikely that any dividends earned will compensate for all the Scheme has invested over the years.
The other two shareholders – State Insurance, itself, and the Central Housing and Planning Authority (CHAPA) – are said to have made much smaller inputs into National Mortgage.
Meanwhile, Social Security insiders liken this turn of events to the recent divestment of the Hadeed Building for the sum of $5 million, and say the State Insurance deal will not put the Scheme in any better position.
“When you think of what has been taken out of – or not paid into – the Scheme; and when you consider that what was invested in National Mortgage was people’s pension money, you have to shake your head. And from a business perspective, the management of our collections has been very poor,” one person says.
The sources also reference the Government’s turnover of the old Air Force Base to the Scheme in settlement of some of its debt, and say it has brought little relief.
This is because the Government continues to undermine the Scheme’s efforts to earn desperately needed cash by packing the facility with departments that either pay nothing or pay rent below market value.
The sources say that, in addition to the compound now serving as a second base for the Defence Force, the Immigration Department and other agencies have taken up residence there. However, the rents – or absence of rent – is determined by the Cabinet; so there is little opportunity for the Scheme to make money.
“It makes no sense, especially at a time like this, when cash is what Social Security needs,” one insider tells REAL News. “This trade-off just doesn’t make sense.”
It is also public knowledge that the UPP Administration floated a nearly $500 million bond as a vehicle to settle the monies owed to the Scheme by previous Labour Party governments.
Accordingly, even staff are at a loss to explain why the Government is not making a better effort to honour the bond now, in the Scheme’s hour of crisis.
Employees of the Scheme reportedly were paid their September salaries only last week, when the last batch of pensioners received their deposits at the Antigua Commercial bank. It is expected that the wait for October payments will be just as long.
