When Political and Investment Considerations Intersect to Affect the NIS Fund

In response to an an exchange between David of BU and Hal Austin on the NIS Dumps 21 Million Dollars in Apes Hill Development blog, respected Barbadian actuary Walter Blackman responded with a comment deserving of deep thought and rich discussion by Barbadians everywhere – Barbados Underground

Hal Austin March 31, 2017 at 11:53 AM #

I know it is fashionable to blame individuals, but should we not be blaming the minister, who is ultimately accountable; the chairman of the NIS, Justin Robinson, and members of the investment committee; and the person(s) who carried out the due diligence? In any case, this is not an investment, but a loan. Is the NIS authorised to make commercial loans to private businesses without the approval of parliament?

David March 31, 2017 at 3:29 PM #
Know this is a busy time for you but an opinion on this matter given your expertise would be valued.


I don’t believe that the governance structure of the NIS has undergone any radical change in its 50-year existence, so I will state these pointers from memory, as a means of steering the discussion in the right direction:

The NIS Board is a corporate entity with a corporate seal. It can transact business in its own right. The National Insurance FUND was established under the control and management of the NIS Board. However, when it comes to the fund, there are two instances where the practical power of the Board either intermingles with, or is superseded by ministerial power.

One, the Board with the approval of the Minister responsible for Social Security, may write off sums of money from the fund as losses.

Two, any monies belonging to the fund may be invested by the Board in whatever manner, and in whatever securities, that the Minister responsible for Finance may direct.

The Minister responsible for Social Security, and the Minister responsible for Finance are two political positions which, by nature, tend to put political considerations first. For example, in the realm of extreme probability, whilst a directed NIS investment decision can end up in hundreds of millions of dollars forever being lost, it may provide invaluable political benefits. Additionally, hundreds of millions of dollars can be written off as losses to the fund, in instances where borrowers have the capacity to repay. Such decisions might prove to be injurious to the fund, but may be calculated to provide excellent political payoffs.

The governance structure does not subject these extreme positions to any “prudent man” rule at the transactional level, so any “blaming” would have to manifest itself in political terms at election time. Of course, this depends on how vigilant or sensitive the electorate is to the management of NIS funds.

In the 2013 general election, our current Minister responsible for Finance, the Hon. Chris Sinckler, would have been subjected to a great amount of “blame” for the millions of NIS funds which were considered to be wasted on ill-fated projects. The electorate held him to be “blameless” and returned him to parliament. It is highly likely that the electorate will return him to parliament when the next general election comes around.

Our current Minister responsible for Social Security, the Hon. Dr. Esther Byer-Suckoo, is seeking to avenge the political defeat she suffered in 2013. With respect to the NIS fund and any associated problems, her political opponents will be expected to highlight instances, if any, where she injudiciously approved the writing off of monies, owed to the NIS fund, as losses. If they cannot do this, then she must be viewed by the electorate as totally and completely blameless when it comes to any mismanagement of NIS funds.

I tried to keep this comment short and simple whilst simultaneously tackling Hal’s questions. I have also deliberately left some dots to be connected by the more thoughtful and discerning BU readers and bloggers.

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190 Comments on “When Political and Investment Considerations Intersect to Affect the NIS Fund”

  1. London Morris April 10, 2017 at 11:09 AM #

    Barbados will be much the better of when these two JOKERS retire or are forced to retire from the business landscape of this island.


  2. Well Well & Consequences Observing Blogger April 10, 2017 at 11:24 AM #

    If you had strong governments and not weak, corrupt government ministers who have been compromised through bribery and scams against the taxpayers….both Cow and Bizzy could be forced out of the business environment. .they have been parasitic long enough….living off the backs of black people.


  3. Exclaimer April 10, 2017 at 12:21 PM #

    off message:

    Another jewel in our crown is being sold to foreign investors. Check out the headline price for the forthcoming sale of the company listed in the link below. In real terms it amounts to a paltry sum of money – the equivalent of a bag of peanuts. Why do we place such a low value on our country and her assets?



  4. Vincent Haynes April 10, 2017 at 12:37 PM #

    What always amuses me today is that in this 2×3 incestous island where everybody is related despite skintone we are still looking for people to be kicked out,retire or die in order to move forward.

    A 100 years ago the slave&indentured descendants owned businesses from rumshops to plantations,were known as skilled artisans,built all sorts of buildings&structures all over the island and were in demand up and down the Caribbean as teachers and civil servants.

    What do we have for a society today but a bunch of spineless,mendicant,sniveling poor rakey lot more interested in feeling sorry for themselves on one hand or on the other hand killing and bling……..from rags to riches back to rags.


  5. NorthernObserver April 10, 2017 at 12:48 PM #

    the simple answer is…..there is NO money to be made selling BULK rum. And if you cannot market against the giant spirit distributors, you are running upriver. Not focused on, is the sale also included a sizeable slice of National Rums in Jamaica. Another BULK rum giant. The purchaser, aka Maison Ferrand, simply continues the trend of major spirit/wine operations growing by acquisition. The windfall the article speaks of, is breaking even or less.


  6. Hal Austin April 10, 2017 at 1:15 PM #

    All the talk about tourism, rum is our only real global product. Yet our business people and politicians cannot grow the brand.
    First, we need a legal definition of Barbados (Bajan) rum: is it the method of distilling? Or the ingredients? Or the breed of sugar cane from which the molasses is made?
    Second we need registered distillers. To be a Barbadian rum distiller one must be registered with the Barbadian authorities.
    We must also ban the importation of molasses to made the product; and there must be an authority approving the product, similar to Champagne.
    The problem is that a political culture in which every man and woman is, or wants to be a lawyer, there is an ignorance of high end manufacturing. Just look at what they did to the Barbados and Central foundries.


  7. David April 10, 2017 at 1:22 PM #


    Bajan rum can be defined as that rum whic is 100% molasses as an input.


  8. Hal Austin April 10, 2017 at 1:26 PM #

    Unless it is legally defined and recognised by the WTO there will be nothing to stop others from producing ‘Bajan’ ‘Barbadian’ rum. Remember we deal with the Chinese, the biggest fraudsters in global trade.
    Our lawyer/politicians should know this.


  9. Vincent Haynes April 10, 2017 at 1:26 PM #

    100% local molasses may become a sticking point.


  10. Hants April 10, 2017 at 1:49 PM #


    Mount Gay 1703 Master Select
    LCBO# 225664 | 750 mL bottle
    Mount Gay 1703 Master Select

    Plantation XO 20th Anniversary
    LCBO# 366609 | 750 mL bottle
    Plantation XO 20th Anniversary


  11. NorthernObserver April 10, 2017 at 2:12 PM #

    and Plantation is the Maison Ferrand brand who just bought the WIRD.


  12. NorthernObserver April 10, 2017 at 2:17 PM #

    when was the last year our sugar industry produced enough molasses to supply the rum demand? I am guessing it had to be 10 years ago?

    Further the marketing costs to promote what HA is suggesting is staggering. Especially when Diageo or other large spirits distributor is strangling the retailer to buy “their brands”. Any one off brand is swimming uphill against them.


  13. Bush Tea April 10, 2017 at 3:02 PM #

    @ NorthernO
    Any one off brand is swimming uphill against them.
    Yours is exactly the kind of logic that is used by the shiite managers in Barbados to sell off every shiite to white people.
    It reflects a mindset of inferiority and hopelessness and is almost exactly opposite to the kind of thinking that prevailed back in the 60’s and 70’s when Bajans felt that the world was lucky to have them as special guests in its environments.

    It is why we killed Almond, and crawled on our belly to Sandals.
    It is why Republic replaced BNB, why EMERA now owns our energy resources, who MASSA is back in control of BS&T and why “Banks …no thanks”.

    This is another excellent characterisation of brass bowlery….


  14. Vincent Haynes April 10, 2017 at 4:23 PM #


    Making rum from 100% bajan molasses,the last time goes back to close to 50 years if memory serves.

    Exporting raw sugar should cease as soon as the present contract expires and we should concentrate on producing molasses for rum,soft drink from syrup,quality sugars in all grades,pure alcohol,vinegar,wine,plywood from the pith,animal feed from the stalks and fertiliser from the mud……have no doubt that other areas can be identified such as cane arrows.

    We spend fx for fertiliser,weedicides and pesticides…..one wonders when our UWI will look at mud,seaweed and animal manure and come up with a cane fertilser and do like wise with other natural products on the island for the ……cides……are they waiting for an outside entity to discover it?


  15. Hants April 10, 2017 at 4:44 PM #

    I wrote on a previous blog.

    BARBADOS BRANDED RUM…… produced in Barbados from molasses produced in Barbados from sugar cane grown in Barbados.

    How difficult is it to do this in a country that has produced quality rum for over 100 years ?


  16. Hal Austin April 10, 2017 at 4:49 PM #

    The marketing is not prohibitively expensive, it is the will that is the problem. We get 600000 tourists on average a year; each and every one is a future ambassador of Barbados. Remember we are not starting from a standing position. In any case, impose a marketing tax on the product.


  17. Vincent Haynes April 10, 2017 at 5:05 PM #

    Hants April 10, 2017 at 4:44 PM #

    Last I heard it is adulterated Bim molasses and has been for decades.


  18. NorthernObserver April 10, 2017 at 5:40 PM #

    I disagree on the cost.
    Yes we get tourists, but every tourist doesn’t drink rum?

    I am not privy to the marketing strategies but I never see Foursquare Rums in N.America. Plenty of M-Gay, Cockspur has all but disappeared. The export tax wouldn’t support anything of value, beyond a small targeted campaign.


  19. NorthernObserver April 10, 2017 at 5:42 PM #

    I was “told” at least one distillery got the bulk of its molasses from S.America, Ecuador in particular.


  20. Vincent Haynes April 10, 2017 at 6:40 PM #

    The value of rum lies in export to the UK&EU and to a lesser extent North America as premiom rum,which all are fetch some fantastic prices…..In the UK it is cheaper for me to drink Gin than our local rum import.

    Note Foursquare has done a deal with Seagrams as far as overseas markets are concerned.

    We need to get back to 100% local molasses before the rum lobby prevents us from using the 100% tag,which has worth.

    Remy is growing its own canes locally and getting its own molasses in order to show provenance to its Mount Gay.


  21. Tron April 10, 2017 at 6:58 PM #

    You need lots of rum to survive in Bim. Especially if you attend a DLP conference on FACTS. I guess, there was too much Absinthe in the rum, when they mixed these alternative facts.

    I count down the days to the new Central Bank report on foreign reserves. If they are higher than 350 million, then somebody from Greece wrote the report.


  22. Exclaimer April 10, 2017 at 7:55 PM #

    @ NorthernObserver,

    If we continue to sell off our family silver we could as well dig our own graves. We have little to fall back on. Apart from our rum industry can you tell me what Barbados excels in?

    We fail because we are unable to appreciate the knowledge and skills that we have attained and honed since our inception as a colony. We value and appreciate outside experts at the expense of the local knowledge that yesteryear would have been passed on from generation to generation.

    The value of our local produce, products and our vernacular approach to solving problems have become lost. Our limited size as a nation should be a huge plus. There is no reason why we should not be able to gear up our economy towards catering for niche markets. I say leave the big boys to play amongst themselves.

    I always remember the incredible knowledge that my grandparents had. They had an amazing knowledge of the health benefits of plants. They were incredibly observant and highly adaptable. This link with our past has become severed and we have lost our way. I say let’s restore confidence in our ourselves and let’s learn to shape our own destiny.

    The story below highlights what could be achieved if only Barbados had a supply of people with both the vision and the ambition.

    “Scotch whisky industry ‘bigger than UK iron and steel or computers’
    Report finds investment pouring into new distilleries, but Scotch Whisky Association calls on government to reduce tax”



  23. Bush Tea April 10, 2017 at 9:38 PM #

    Well said Exclaimer.

    Interesting that we could have found people to run organisations such as BNB, BET, BL&P, BS&T, Mutual, the old sugar industry and infrastructure like the water works etc back in the 1970s and 1980s …. but suddenly – (with the enfranchisement genius Sir Cave Hilary installed at the helm) our education system can only produce clerks …and we have to look for outsiders to run these entities when the Trevor Clarkes and Nicky Sealys retire….

    Wunna could do an inquiry to find out what went wrong, but the answer will be brass bowlery – fuelled by greed, incompetence (created by pushing idiots and second rate citizens into leadership positions) and wickedness.

    What the hell is someone who could not even pass the 11-plus doing making national strategic decisions…? …unless we are focused on committing national suicide…?

    steupsss… Which company would hire such a person to manage it?
    …only a shiite rum shop – or Barbados.


  24. NorthernObserver April 11, 2017 at 1:56 AM #

    it is easy as shiite for you to sit behind a computer keyboard and be critical, with your daily ration of brass-bowlery and skin tone slanted comments.
    Not for one moment, should you infer I agree with the sale, applaud it or think it was a good solution to a problem.
    However, if you follow the wine and spirits business, the assimilation in the past 15 years has been unprecedented.
    To sell anything in the retail business, you need shelf space. When you are trying to sell one product, and you have 7 other guys, who are way bigger and with many products, you know the story…if you want A,B and C (market leaders) you have to buy X, Y and Z. I didn’t say it was impossible, or not worthy of effort, only you are up against it.
    To paraphrase a former superior, these newer operations cut the old distribution channels a new asshole.
    Cockspur tried with Diageo, got phucked, and were back to square one.

    You need to ask your star boy CH, as to why? What did the WIRD sale have to do with them needing to unload that crazy prior investment in National Rums?

    You are right in many of your comments. Only Bajan Rum will never be scotch whiskey, at least not at this late stage, esp with the molasses gone.

    for you obviously have a passion and knowledge for sugar….what the hell is Sagicor doing with all those plantations they bought? Leasing them to the GoB? I understand the GoB rents sugar land from several places.


  25. Exclaimer April 11, 2017 at 2:08 AM #

    Here is an article from today’s Barbados Today.



  26. David April 11, 2017 at 2:12 AM #


    All the experts continue to echo comments posted by many on BU. The political parties will not admit it witha year to go (if we make it) but giving public workers is the only way to make any significant dent in the deficit OR apply it to government paper. Pick your poison!


  27. David April 11, 2017 at 2:15 AM #

    Didn’t the government cut a deal with Sagicor after they threatened to pull stumps couple years ago?



  28. Hal Austin April 11, 2017 at 4:48 AM #

    I did not say all tourists drank rum. I do not drink rum. I said they could be ambassadors. There is a difference.
    As an occasional visitor to the financial sector in Scotland, part of the welcome is a visit to the Whisky Association museum. I suggest that our officials do a tour of Scottish whisky distillers and look at their marketing to get some ideas.
    The bottom line is that our governments have focused on the wrong things for development: tourism, international business, bilateral deals with dodgy governments, a flag of convenience for ships owners that do not even now where Barbados is, etc.
    It is lawyer/politician-led over-ambition.


  29. Bush Tea April 11, 2017 at 6:53 AM #

    @ NorthernO
    Not only is it “easy as shiite for Bushie to sit behind a computer keyboard and be critical” it is also sweet as shiite. If Bushie had been given a comforter instead of a whacker, the bushman would likely have enjoyed that too…

    The fact is that a small country like Barbados DOES NOT NEED to follow the traditional marketing logic used by the multi-national, super-albino-centric, greed-mongers of this world….(in which Bushie is fully trained) nor do we need to bow down to their ways…..

    If you are living among them, then it may be hard to see this FACT, but the whole point of Bushie’s various rants is simply that ….. THERE IS ANOTHER WAY THAT SEEMS FOOLISH IN THIS SHITTY WORLD, but it is the way of true success in life….

    Bushie only started drinking wine after visits to vineyards in France and Switzerland -and to personalised, educational tours of MICRO, family owned wineries in those countries…

    If tourists who actually pass through Barbados, plus those of us in the diaspora, …along with some of their friends – were to become supporters of Bajan products, then our businesses could be outstandingly successful.

    BUT… instead of aiming for QUALITY, personalised service and customer satisfaction, we seek to mimic the big time albino-centric greed mongers with marketing gimmicks…

    Only a fool agrees to fight an enemy using his favourite weapon…..


  30. NorthernObserver April 11, 2017 at 12:06 PM #

    But you and a few BBE’s, could have gone to the credit union if needed, and bought WIRD (it had been for sale for years) and shown others how to do it? And we are talking well less than $15 million.

    How do you think all these ‘craft breweries’ have rocked the beer world in N.America? One by one, little by little, one innovation after another the BIG guys couldn’t figure out how to implement across the board. You went to France, but imagine 20 years ago if you were a winery in Chile or Canada, same story.

    They all do exactly as you described it. The one ingredient you didn’t mention was Passion. You gotta love it, cause it is many hours, and sleepless nights.


  31. Hal Austin April 11, 2017 at 12:30 PM #


    In the UK a micro-brewer cost about £25000 (Bds$75000). Since most tourists are from the UK and prefer beer to lager, catering to that market is like taking candy from a toddler.


  32. Vincent Haynes April 11, 2017 at 1:03 PM #


    Sagicor is still waiting to sell theirs or buy over the 2000 odd acres of CLICO lands.

    The Planters have been caught up with late application of fertiliser due to late payment of on their sale of canes.

    The industry like the country is drifting rudderless,of note is that the govt through the BADMC is the largest land owner and manager of lands in Bim.


  33. Hal Austin April 11, 2017 at 1:17 PM #

    Why does an insurance company want to buy plantations? This looks like the Clico investment strategy all over again. Where is the regulator? Are there reporting requirements on solvency capital calculations and the reporting on those calculations? Does the regulator examine the actuarial models, including the risk factors? What about the signing off on these decisions (the very signing offs that got some people’s knickers in a twist over Clico)?


  34. Well Well & Consequences Observing Blogger April 11, 2017 at 1:41 PM #

    Hal…you should know no one is going to give you an answer to those questions, your head is too damn hard.


  35. NorthernObserver April 11, 2017 at 1:58 PM #

    I suspect VH knows alot more about this than I do. But memory was that Clico was the initial expressor of interest, which was followed by the Williams brothers, and subsequently Sagicor was the buyer, based on their ability to sway several previous shareholders.

    Without knowledge, I would guess the sale of that much Bajan land would be ‘politically sensitive’.

    Some months ago, I read a piece where Sagicor said they were not making any money, but appreciated it was a major employer, and hence they continued to work on finding a long term solution. Hindsight says we should be thankful it didn’t end up with Clico?


  36. NorthernObserver April 11, 2017 at 2:22 PM #

    Respectfully, this is the myth of the uninitiated….”catering to that market is like taking candy from a toddler.”

    The plan and strategy maybe obvious, but the execution takes effort. It has to be done. The money has to be committed, the equipment installed, the recipes perfected, the contacts made, the promises kept, sales collected and bills paid, and the back end of people and equipment operated. Running a business takes effort. We can laugh at Kellman as a Minister, but I suspect he is a hard working, successful retail store owner.


  37. London Morris April 11, 2017 at 2:40 PM #

    Wonder when next Sir Charlie-Cow going to go back to NIS with another scam for them to ‘invest’ into?


  38. de pedantic Dribbler April 11, 2017 at 3:01 PM #

    Most infra-dig; bah humbug @ Mr Bush Tea April 10, at 9:38 PM re ” What the hell is someone who could not even pass the 11-plus doing making national strategic decisions…? …unless we are focused on committing national suicide…?”

    How does the resident doyen of BBE proselytizing adopt such a snobbish ‘holier than thou’ attitude towards your fellow man because early childhood development was hampered by life issues that hindered academic growth at the pace of one’s peers …

    Just as surely he must have gotten up to speed superbly well since then, it seems…like thousands of other successful folks who ‘could not even pass the 11-plus’!

    But beyond any particular individual the real shock is that we as regular folk do this type of ‘snob appeal’ daily to the extent that we become inured to its ridicule and crassness.

    No wonder so many want to do away with these early stage assessment tests. Even with comparative success as an adult one can never completely throw off that ‘failing’ of youth…when brickbats are being heaved.

    Beat up the politician for their folly certainly, but if you are saying that a less that impressive academic star is running the show then one would have to ask who are the geniuses that elected him…how many of ‘us’ really passed that test, then!!!

    Oh how harsh and crass we can be with simple words!


  39. Bush Tea April 11, 2017 at 3:38 PM #

    Oh buzz off do, dribbler.

    Only idiots would seek to justify putting the runt child in charge of the family business…. presumably this makes sense to you…!!!?

    What late developer what?
    People who are truly brilliant start to show this before age 5. If at age 10 it is clear that a fellow is not the sharpest nail in the damn pack, then the chances of him outshining a TRUE talent at age 40 is small….. and would need to be confirmed by SOLID evidence and experience.

    Leadership is EXTREMELY complex….. it is not for the faint of heart, the ‘lacker’ of balls or the cloudy of vision….
    It is for the ‘best of the best’ to be identified, groomed, prepared and installed in such critical roles.

    ….but then again… perhaps you really do not get it…


  40. David April 15, 2017 at 7:10 AM #
    Rasheed Griffith shared his post to the group: Social Accountability and Education in Barbados.

    9 hrs ·

    These two charts show the dramatic rate at which the Barbados population is aging. Since Barbados pays pensions out of government revenue (a strange decision) then at this rate it is unlikely that Barbados will be able to pay pensions in 30 years. Potentially the government will unlikely to be able to support any of its welfare programs since the bulk of the population will not be in the labor force generating revenue.

    The Barbados economy is not growing at rates that can support such dramatic demographic bulk shifts upwards in age. The country is potentially on its way to a perfect economic storm: aged population, low growth, and low productivity.

    No automatic alt text available.

    No automatic alt text available.

    Rasheed Griffith added 2 new photos.

    9 hrs · Bridgetown, Barbados ·

    These two charts show the dramatic rate at which the Barbados population is aging. Since Barbados pays pensions out of government revenue (a strange decision) then at this rate it is unlikely that Barbados will be able to pay pensions in 30 years. Potentially the government will unlikely to be able to support any of its welfare programs since the bulk of the population will not be in the labor force generating revenue.

    The Barbados economy is not growing at rates that can support such dramatic demographic bulk shifts upwards in age. The country is potentially on its way to a perfect economic storm: aged population, low growth, and low productivity.

    [Data from the census conducted by the Barbados Statistical Service, 2010]


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