Has National Insurance Fund Managers Ever Followed Actuarial Recommendations?

Dr Esther Byer, Minister of Labour with responsibility for the NIS

Data issues delayed the preparation of this report and also affected the quality and reliability of some data that was provided. In some instances, data relationships noted from previous actuarial reviews helped determine current data assumptions.  Revisions made to financial statements that were provided for the preparation of the 14th Actuarial Review resulted in some amounts presented in this report being different from those presented in the previous report15th NIS Actuarial Review.

A repeated criticism made of government reporting by international agencies is the questionable integrity of data collection and reporting. A similar observation was made by the Bahamas based Actuary that conducted the 15th NIS actuarial review. It is worth mentioning that the next report is due at the end of December 2017. It is therefore fair comment to make that successive governments have not managed resources to ensure the most effective financial management  of the National Insurance Fund (NIF).

With questionable data identified as an underlying issue by the actuary, BU is forced to question the quality of decision-making by those responsible for the management of the NIF. If there are ‘data issues’ at play which affected the preparation of the actuarial report, logically management decisions based on questionable data must concomitantly be questioned.

The other observation arising from the 15th NIS Actuarial Review was effectively summarized by BU commenter NorthernObserver:-

Dr Robinson speaks

https://www.barbadostoday.bb/2017/10/30/low-reserves/

Alas,[how silly of us all] the problem is the NIS cannot find anywhere else to invest its money. The Fx reserves are too low to be wasted on NIS foreign investments. So the best it can do in this small island economy is to invest in GoB fixed investments.

The figures quoted in the BT piece are correct, but irrelevant. Why? another titbit from the 15th Review:

“The portion of combined investments held in government and quasi-government securities increased from 68% to 75%. This increase is contrary to both the Investment Policy and previous actuarial advice.”

previous actuarial advice??… this was 3 years ago….”Increase investment diversification with goals of reducing the portion of the Fund held in Government of Barbados to 50% over 5 years and increasing the portion held in overseas investments.”
And from the 13th Annual review some 7 years ago
“the National Insurance Board should limit additional lending to government
to amounts that will not allow the percentage of the Fund now held in government securities (57%) to grow any further.”

My point… Forget the reference by Dr JR to actuarial recommendations, the NIF have never followed them anyway. Was Forex low in 2008-09-10-11? Did the NIS alter their investment mix then as advised, or did they load up even more on GoB Debentures/Bonds? Would the NIF be better off today with cash or nearly junk bonds? The wussest part, is the primary reason the Bonds are nearly Junk, is because the NIS bought more, against all advice.

Another tidbit from the Review…After falling behind on its contributions and rental payments, the Government of Barbados covered some of its arrears by issuing Treasury notes and debentures to the NIF….so even though the NIS is lending the GoB millions, the GoB don’t have the money to pay NIS????? More paper.

You see Worrell? You see what happened to him after he towed the line, until he couldn’t take it any more? From the moment you hear the barber IS IN TOWN, catch the first flight you can.

If we are to listen to Minister Denis Kellman and Darcy Boyce before him, the government’s policy is to use the NIF to fund local ‘projects’. Although the holdings in government securities was less under BLP governments, there was no stark deviation in the investment policy of the NIF. Under the tenure of the last BLP government there was a healthy forex reserves yet there was no aggressive position taken to improve the investment mix. The point to register, although the government will never be able to apply the recommendation of the actuary to increase its foreign holding by 20% because the forex chest is virtually empty, it does not address the rising concern driven by market and sovereign risk.

81 comments

  • The way I look at it, what is the point of paying good money for excellent actuarial advice and then ignoring such advice.

    Oh yes I get it now.

    People also pay doctors good money for good medical advice for their CNCD’s, pay the pharmacists good money for the prescribed medicine, and then never take the medicine.

    And that is their own bodies.

    I bet that a good number of our policy makers do not follow good medical advice, I mean we look around and we see that not many make it to three score and ten, don’t take care of themselves, so why is it again that we expect them to take good care of us?

    I understand perfectly why policy makers do not take good expensive advice.

    Like

  • If the NIS fund were a private pension fund, the fund managers would be now facing the court or living in Brazil for what is being done to that fund. There is an urgent need for legislation to protect the NIS fund from the political class.

    Like

  • @ Caswell
    …and how will you protect the fund from the other idiots involved …besides the ‘political class’ …. namely the brass bowl class?

    Now that we are broke (going from the figures of THREE YEARS AGO) everyone talking shiite….

    When kellman was up and down advocating spending the money on local projects (like COW’s polo place) all the brass bowls were silent…

    When Robinson demonstrated that he was nothing but a lackie postman for Stinkliar ..with not an original thought to his credit ….. brass bowls said nothing…

    When the NIS spent millions on computers systems that DID NOT WORK…. brass bowls said nothing

    When the Director Carrington spoke – and sounded as clueless as angela Skeete….. not a BBBB asked….

    Shiite … even when the NIS could not find the money to pay ‘Aunt May’ her little $179.00 pension on time ….brass bowls remained silent.

    …and WHAT??!!??
    Stinkliar still stinking up the fine ants ministry…
    Robinson still there mumbling and stumbling in his squeaky voice – talking shiite…
    …and the NIS now almost as brek as you …Caswell

    How long before wunna BBBBs recognise that wunna ass is already in the grass…?
    …when the CURRENT accounts come out in four years time?

    #whatasetofenuffs

    Like

  • In an exchange with Chairman Justin Robinson last night he confirmed the following in response to a question from David, BU blogmaster on the progress the committee he heads has made to to rationalize SoEs:

    Justin Robinson the report has been submitted. the recommendations may or may not form part of the economic plan the MOF is supposed to submit to the nation.
    Justin Robinson I am director of the central bank and NIS. I chair an SOE oversight committee which includes Prof. Winston Moore, Jeremy Stephens, David Simpson, Chris Decaires and Oliver Jordan. you too love to put me in things.

    Like

  • Well Well & Consequences Observing Blogger.

    “Justin Robinson I am director of the central bank and NIS.”

    He is chairman and a director of too many things that are going wrong.

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  • Despite the chaos at the NIS and its overall poor management, the assumption that investment policy is determined by the actuary is wrong (either the scheme actuary or external ones) – by the way, is there a staff actuary at the NIS?
    Investment policy is determined by the investment committee, and that should be restricted to asset allocation. Stock picking should be left to the fund managers who should have a clear mandate.
    As to the chair man’s claims about asset allocation, has he got any experience of investments?
    Is there going to be an overhaul of the scheme’s management? What will a future BLP/Solutions Barbados/UPP government do in regard to the management of the scheme?

    Like

  • Re: the FB thread, felt like a Jekyll and Hyde. Unfortunately, it is not unique to Barbados. The challenge, is the politicians, which are a revolving door, have too much power. Appreciate nobody said their job was easy? Today they are (whatever job) and tomorrow they are Minister of ????. And now have to deliver on whatever promises they (party) made. Both the public and the private ones. And none wish to enact any legislation which may potentially ‘cramp their style’ because they were elected by the people to execute the wishes of the people.

    Yet the facade continues, because those charged with the responsibility of operating this plethora of bodies, enacted largely to provide the appearance of independent and unfettered decision making, are anything but. A decision over there, suddenly affects operations here.

    A convoluted mess. There is a single check and balance, and that occurs on election day.

    Like

  • millertheanunnaki

    @ David November 2, 2017 at 5:36 AM
    “Justin Robinson: the report has been submitted. the recommendations may or may not form part of the economic plan the MOF is supposed to submit to the nation.
    Justin Robinson: I am director of the central bank and NIS. I chair an SOE oversight committee which includes Prof. Winston Moore, Jeremy Stephens, David Simpson, Chris Decaires and Oliver Jordan. you too love to put me in things.”

    And these are the same people (including the MoF) who are always harping on about the need to improve productivity and castigating the ordinary workers for their poor work ethics.

    This exceedingly poor performance at the top has been going on for far too long now.

    This is almost 4 years what these so-called educated and qualified people have promised to do but have not been able to deliver.

    Just a never-ending load of lying excuses. No wonder Barbados finds itself in such a dark fiscal and economic bind.

    The following extract from the same MoF December 2013 statement supports valid criticisms of their massive incompetence:

    “Additionally Mr. Speaker, earlier this year, the Ministry of Finance formally requested technical assistance from the IMF’s Fiscal Affairs Department in two critical areas of government’s operations: Tax administration, and fiscal/operational reform in the key statutory entities which rely on central government for large transfers for their operations. For some time now most internal and external examiners have expressed deep concerns about both of these areas as key examples of parts of government’s operations which exhibit unacceptable levels of inefficiency and dis-functionality resulting increasing financial burdens to the state. I am happy to announce that the Fund has accepted the requests and starting next month, the first team will begin its examination of the fiscal and operational challenges of some of our key statutory entities. In anticipation of that and in an effort to advance and concretize this work, the Ministry of Finance will assemble a high level task force of senior finance, business and accounting experts to work along with the Fund’s team to finalize a reform agenda for the selected entities to be presented to the Minister before mid-year. I also anticipate that very shortly the Fund will identify a team of experts to conduct the long overdue comprehensive assessment of the direct and indirect tax systems in Barbados with a view to advising government on major reforms necessary in both tax policy and administration. Mr. Speaker the additional measures which I have just announced, though tough, are designed for the specific purpose of helping Barbados’ economy to accelerate the process of adjustment and fiscal consolidation.

    In the end though, Sir, as a country we cannot hope to cut or tax our way out of this economic decline. We must push ahead even more radically with our growth initiatives through greater public and especially private sector investment.

    As a government the pressure is on us to step up and remove all obstacles to investment in our country whether from domestic or foreign investors. We must work harder and faster and facilitate more. Our private sector partners must bemoan less and invigorate more. We must together do more to help each other rather than just satisfy ourselves with highlighting every fault that exists on either side. It is in increasing our levels of productivity, expanding our creativity and innovation that will help us build the efficiencies that will make Barbados more externally competitive and internally dynamic.

    In 2014, from the government’s side, we are set to initiate a set of major public sector investments either directly on our own or in PPP arrangements. We are confident that if such investments are matched by investments from our domestic and foreign investors that 2014 will truly begin a substantial turnaround in the Barbados economy. Now is the time to forge ahead with those plans and I encourage our colleagues in business to match us in this regard. In this way we will create newer more sustainable private sector jobs to assist in redeploying those whom we now have to release from the employ of government to the private sector.”

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  • @HA
    may I politely suggest you READ the Review. It answers most of your questions.
    As to what any future GoB may do if directed by another party, who knows.

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  • Bernard Codrington.

    @ David

    A very educative piece . My fear is that not many have learned anything. Dr. Robinson was not flowery, he was trying to explain the mechanics of the system so that we may understand why things are where they are. If one does not care to understand how things work then we will all end up apportioning blame where we should not. But apportioning blame gives some of us pleasure of orgasmic proportion. And it is addictive.

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  • millertheanunnaki

    @ Bernard Codrington. November 2, 2017 at 12:50 PM
    “Dr. Robinson was not flowery, he was trying to explain the mechanics of the system so that we may understand why things are where they are.”

    What “mechanics of the system” was he explaining?
    We already know those mechanics. The same mechanics that existed under the previous administration working with the same system.

    These people applied for the jobs of being able to make a difference by making the same mechanics work in the interests of the people.

    The people bought into their ‘convincingly flowery’ language and hired them by replacing the previous tired lot working under the same system.

    Shouldn’t the people now seriously consider another set of applicants for the job since they (the people) have been tricked lock, stock and barrel by current lot of incompetents and con artists?

    “Why Good governance? Good Governance is characterized by the principles of participation, consensus, accountability, transparency, responsiveness, effectiveness and efficiency, equity and inclusion, and the rule of law. It assures that corruption is minimized, the views of minorities are taken into account and that the voices of the most vulnerable in society are heard in decision-making and the allocation of resources.

    I invite the people of Barbados, therefore, to join the Democratic Labour Party on this exciting journey to the creation of a Better Barbados. This journey emphasizes hope rather than despair, light rather than darkness, and movement rather than stagnation. This journey aims at human fulfilment and development. It does not aim at numerical worship and statistical purity. This is the true way of the Democratic Labour Party…”

    Like

  • Bernard Codrington.

    Northern Observer at 12 : 21 PM

    Election day is not the single check and balance. The houses of parliament, The Governor General, The Judicial system, A competent Press, The Public servants, Boards of Directors etc. These bodies and others too numerous to mention need to read their job descriptions and try to fulfill their remits.
    Directors of Public sector corporations once they are appointed have a fiduciary responsibility to the taxpayers. They have also to meet the professional standards established by their regulators. And most importantly personal integrity.

    The fees paid by most state corporations do not even cover the costs of gasolene to get to these meetings . So for the most part they provide free national service. It is short term gain to abuse these persons.You n[may end up with worse….mainly political yardfowls.

    Like

  • Bernard Codrington.

    Miller A at 1:21 PM

    I do not know whether you are a wolf in sheep’s clothing or a sheep in wolf’s clothing. If by any chance I discover that you are related to me, I will publicly denounce you.

    Thanks for the comic relief.

    Like

  • millertheanunnaki

    @ Bernard Codrington. November 2, 2017 at 12:50 PM

    BTW, BC, didn’t the people endure almost 8 years of explanations for the current state of the Bajan economy from the previous Guv of the Central Bank.

    Didn’t he have the habit of expatiating on how the system works and who or what was to be blamed (including the annual Dodds foreign debt repayment) for its underperformance and what has to be done to ensure its future good performance?

    So why was he gotten rid of for merely explaining the mechanics of the system?

    Before similar treatment is meted, Dr JR should do the honourable thing and in true Japanese business management style fall on his own sword of resignation since he has proven incapable of making that difference he projected himself as being capable of achieving.

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  • @Bernard

    Whay happens when the DPP does not act?

    Isnt the post of GG ceremonial? Could easily have added the public counsel and Ombudsman.

    Like

  • millertheanunnaki

    @ Bernard Codrington. November 2, 2017 at 1:26 PM
    “These bodies and others too numerous to mention need to read their job descriptions and try to fulfill their remits.
    Directors of Public sector corporations once they are appointed have a fiduciary responsibility to the taxpayers. They have also to meet the professional standards established by their regulators. And most importantly personal integrity.”

    The Auditor-General’s annual reports clearly do not support the ‘normative’ position you have postulated.

    Why are the annual financials and reports not prepared and submitted according to the same “professional standards”?

    Wield and come again. We prefer to side with “N O” on this one.

    Like

  • Is there going to be an overhaul of the scheme’s management? What will a future BLP/Solutions Barbados/UPP government do in regard to the management of the scheme?

    NorthernObserver November 2, 2017 at 12:34 PM #

    may I politely suggest you READ the Review. It answers most of your questions.

    Did I miss a trick? Did the review tell us what the opposition parties policies were on the NIS?

    Like

  • Bernard Codrington.

    @ Miller

    I only playing your game , so do not get offended. I know that you know better.

    Board of Directors are at the mercy of management and staff of public corporations.B o D can only deal with what is presented to them monthly. Directors can ask searching questions and be given answers that are at variance with the actual situation.
    A good director cross references figures and uses qualitative information from other sources to assist him/her in arriving at an opinion. If he has expert qualifications and experience he brings these skill to assist him at arriving at a decision.

    Financial decisions are not easy. we are dealing in an area that is nothing short of chimerical. In the internet age the price of investment products can change every second. Indeed there is computer trading that reacts at every blip in share prices.

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  • @Bernard,
    I am not sure how management in Barbados works, but normally the board of directors are responsible for strategy, while the executives are responsible for its implementation. Any corporation/business is run by its directors, not its executives, and power is delegated to the chairman. The buck stops with the chairman.

    Like

  • Bernard Codrington.

    @ David

    @ Miller

    All of us are failing the system . We need to examine ourselves and make sure we are executing our civil responsibilities. Any new administration will earn the same condemnation if we all continue on the same trajectory.
    Our input matters: changing the administration is no magic wand. THERE IS SERIOUS WORK TO BE DONE .

    @ Hal

    Politicians do not manage the NIF. They may attempt to interfere. They will succeed in doing so if the BOD allows it. The Administration of the day appoints only three of the directors. The others are appointed by statute. The NIF is a segregated fund,. It is not part of the Consolidated Fund. The BOD owes the NIF beneficiaries/ contributors a fiduciary responsibility.

    @ Miller

    Do you think you have the real story surrounding the late submission of information relating to the lateness and absence of the audited accounts?

    There is always more in the Mortar than the pestle. And do not ask me me either. I will have to borrow Bushie’s Wacker to cut you ask no question.

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  • @Bernard

    Politicians do not manage the NIF. They may attempt to interfere. They will succeed in doing so if the BOD allows it. The Administration of the day appoints only three of the directors. The others are appointed by statute. The NIF is a segregated fund,. It is not part of the Consolidated Fund. The BOD owes the NIF beneficiaries/ contributors a fiduciary responsibility.

    Is the above aimed at me? What is the point you are making? No one is saying that politicians run the fund, certainly not me. The board runs the fund, no matter how they are appointed, not the executive. (by executive I mean the company executive, not the Cabinet, ie the CEO and his/her senior team, who sit below the board)..

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  • Bernard Codrington.

    David at1:45 PM

    If you define “ceremonial’ to mean does nothing, the answer is no.
    He is ,very much like the queen of England, part of the governance system. He assents to bills passed in the houses of parliament. He approves or sign into law appointments to the civil service etc. The PM by convention should consult with him and bring him up to date on matters of state. He appoints the Prime Minister and prorogues the house. etc etc .

    I believe your question was rhetorical.

    Like

  • Bernard Codrington.

    @ Hal

    Please review your submission at 1:59 PM.

    Like

  • @Bernard,

    Is there going to be an overhaul of the scheme’s management? What will a future BLP/Solutions Barbados/UPP government do in regard to the management of the scheme?

    What is there to misunderstand? Shareholders of a corporation (ie taxpayers) select the board, the board selects the executive team.
    (I will give an example from the media: the board/senior executives appoint an editor, but they cannot tell any editor worth his/her salt how to run the publication or what should be published. Their job is to hire and fire, the editor’s job is to edit).
    The NIS scheme is in a mess and it can only be re-organised by a future government, thus the questions. That is the job of the politicians.
    You seem to misunderstand the basic structure of a management team (ie board and executive team) at a corporation.
    The board is responsible for strategy, and the executive for implementation ie the day-to-day management, under the supervision of the chief executive..
    Government has nothing to do with the day-to-day management of the scheme. I am aware that many Barbadians, and many in BU, believe this is the case with statutory boards and the wider public sector. What they are in fact talking about is a weak board and a weaker executive.

    Like

  • @BC
    your points are well taken.
    What are the workable solutions?
    It would appear to me, several of the other checks and balances you mention, are under similar duress.

    Like

  • @Bernard

    Wasnt the BoD summons to Bay Street by the MoF to lend to Paradise? Wasnt the BoD pressured to sell BL&P shares to Emera? Didnt former Chairman of the NIS Jepter Ince boast about how he took a decision to invest in domestic and regional securities? You mention statute as if politicians cant change it. Tom Dick and Harry are aware of the poltical influence exerted in Barbados.

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  • David,
    Appointees to a board who are being pressured by politicians have the freedom to say no. If that means being fired, so be it. If they give in to pressure, then they are weak and lack moral backbone.
    But, you know, as I do, that if they refused to do what the politicians ask they will be sacked and there will be someone queuing up to take over from them.
    That is the issue. Instead of Tom, Dick and Harriet being aware of the power and influence of politicians, they should put more steel in their backs and tell the politicians to go away. They will not because they see these appointments as an easy way to make money.
    Changing the law is different.

    Like

  • @Hal

    This is Barbados, what resign what!

    It is about board fees and supplementing income.

    Like

  • David,
    That is the problem. Too many people queuing up to make easy money and forgetting their principles.
    My one serious criticism of Dr DeLisle Worrell, apart from his neo-classical economics, was that he allowed Sinckler to pressure him when he was the one with a reputation to lose. At the very first hint of pressure he should have told Sinckler to get on his bike. You cannot do deals with the devil. Justin Robinson should reflect on this.
    Take, for example, if you are the chairman of a statutory body and it is not your only source of income, then you should be prepared to walk away on principle.
    We need principles in public life. That is what we need in Barbados.

    Like

  • @David
    BC suggested there wasn’t a lot of money. I know here in Canada, on similar bodies, we get a daily per diem for attending meetings ($0 if you don’t attend) plus travel expenses. It’s a good CV padder if you need it, plus one is performing a civic duty. You don’t do it for the money.

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  • @Hal
    life is full of pressure, you have to ‘work with others’. If you run at the first sight of difficulty, you will never achieve anything. Everybody has an agenda.

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  • Northern,
    You do not compromise on principles, if not by definition yo do not have any principles. There is a very negative saying that everyone has a price. Compromising on principles proves it.
    More important, only people who doubt themselves compromise on their principles; if you at e confident in your own ability, you walk away from a mess. The only agenda in public is to serve.

    Like

  • Bernard Codrington.

    @ Hal
    @ David
    @ Northern

    You have all agreed with me . In the final analysis it depends on the professional and personal integrity of the appointees to the BOD. You cannot manifesto it into the appointees, nor can you legislate it into to the appointees.

    @ Northern

    Thanks for confirming that the BOD of state corporations do provide virtually free national service.

    Twisting and using different words do not change the substance of what you are saying.

    Like

  • Bernard Codrington.

    @ David at 4: !5 PM

    What is the substantial point you are making here?

    Like

  • Bernard Codrington.

    @ David at 4 :15 PM

    Wherever there is a market ,there will be a supply. The market for political corruption will not disappear even with a change of administrations. That is as true as the Gospel of JOHN Chapter 3 verse16.

    In the final analysis it is INTEGRITY, INTEGRITY, INTEGRITY.

    Like

  • millertheanunnaki

    @ Bernard Codrington. November 2, 2017 at 7:43 PM

    Couldn’t agree more with your take on this basic economics maxim known from the days Adam Smith was a lad.

    That is why you need to limit the excesses of greedy politicians by reducing to the minimum their role in the allocation of scarce resources i.e. taxpayers’ money.

    That is why you need to keep the government’s involvement in the supply of ‘public’ goods and services to the necessary minimum. Let them make policy pronouncements on the government’s major role of legislating, enforcing and regulating market forces.

    Get rid of the many SOE’s and you would see a dramatic drop in the opportunities for politicians to ‘get rich quick’ by seeing your concept of national service not as a Ponzi-type scheme but a calling to improve the lot of their fellowman based on the altruistic principle of ‘Noblesse Oblige’ so well expressed in your Christian principle of ‘helping others’ and clearly demonstrated in the fable of the ‘Good Samaritan’.

    Like

  • Bernard Codrington.

    Miller at 8 : 40 PM

    Excellent. I cannot fault you on this intervention. The original intention was to hand back these commercial entities to the private sector but somehow they seemed to have taken on an internal dynamic of their own.

    But Miller, you confusing me now.
    A few blogs away you were heckling me about GoB sale of BNB shares, and the Sale of BL& P shares to Emera. Are You a reincarnation of Eric Fly or a transfiguration of Punka ,dancing all over the political and ideological space ? What is your philosophical position on GoB ownership of entities that produce goods and services? Do you see why I can never give you full marks?

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  • @Hal Austin November 2, 2017 at 5:01 PM “You cannot do deals with the devil.”

    True.

    Because once you say “yes” to the political devil(s) the first time, how to you say “no” to the second request, or the 3rd, or the 300th?

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  • @BC
    ….a possible fix?

    If you do not ‘call them out’, nothing has been done to alter the status quo. Call them out, and they may lose the desire to serve, and one may end up with ‘wusser’.

    Since integrity cannot be legislated, how does one seek to reinforce its value and necessity?

    Like

  • @NorthernObserver

    Agree with this comment. We are all waiting with bated breath to read Walter’s review of the actuarial report.

    Like

  • @ Northern Observer
    Since integrity cannot be legislated, how does one seek to reinforce its value and necessity?
    ++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++
    Simple answer Boss……
    CONSEQUENCES….!!

    It is how Nature works.
    You can do whatever shiite you like, …but nature is designed to make you pay.

    There should be AUTOMATIC, MANDATORY, INDEPENDENT audits of all public operations – with the results published, and where those responsible then face public sessions to account for all actions taken.
    Any criminality is then referred to the DPP.

    Anyone NOT open to such scrutiny simply goes into their OWN business.

    Like

  • Bernard Codrington.

    Bush Tea at 7 :42 AM.

    All those measures are already in place in the private and public sectors. It is the enforcement by the relevant persons that is absent. Where the enforcement and implementation are done the enforcer is the person with self confidence, fearlessness ,and professional and personal integrity. Those are the elements that are lacking. Those who should enforce and implement policies ,penalties etc know what should be done and do not do them or worse are prevented from doing them. It takes testitudinal fortitude to do the right things in this society.

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  • Bernard Codrington.

    Northern Observer at 5 :14 AM

    “Call them out “? You does make jokes so early in the day? What do you think BU , Naked Departure, Facebook etc and the radio call in programmes have been doing for decades? Have these’ name and shame’ tactics worked? Far from that the alleged perpetrators tend to enrich themselves by winning big financial settlements in and out of court. Check the facts. Do a reality check. You can be right morally and wrong legally. If you doubt me, ask Caswell and Jeff. They are the BU experts on these matters.

    These are fundamental reasons why some young people do not vote, some young people do not bother with formal education, some young people do not go to church and I can go on and on. They hear our words; but our actions are deafening.

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  • @ Bernard
    All those measures are already in place in the private and public sectors.
    +++++++++++++++++++++++++++++++++++++++++++++++++++++++++++
    Nonsense.

    When has there been an AUTOMATIC, MANDATORY, INDEPENDENT audit in Barbados outside of the Auditor General’s? Not even in damn CLICO or CAHILL has it been done.

    Bushie is NOT speaking of those shiite audits by the crooked audit firms who take NO interest or responsibility for thieving or other malfeasance …and ONLY go by what the same dishonest principals tell them.
    Those ‘financial audits’ are a waste of money and time.

    Bushie is talking of STRATEGIC audits that examine compliance with laws, bylaws, organisational ethics etc.

    IT DOES NOT HAPPEN.

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  • millertheanunnaki

    @ Bush Tea November 3, 2017 at 10:27 AM
    “ Bushie is NOT speaking of those shiite audits by the crooked audit firms who take NO interest or responsibility for thieving or other malfeasance …and ONLY go by what the same dishonest principals tell them.
    Those ‘financial audits’ are a waste of money and time.”

    The CLICO fiasco (more a feast of fraud) strongly supports your ‘critically-negative’ opinion of local audit firms.

    It could have been only with the active collusion of the incestuous bribe-taking BoD and the obvious ‘cover-up of respectability’ by the hired watchdog while ‘turning an external blind’ eye to obvious financial malfeasances for easy-earned but rather large audit fees that such large-scale robbery of policyholders funds could have gone on for so long.

    Even Gearbox with no fiduciary responsibility but only with a paper spreadsheet, pen and manual calculator would have smelled from a distance on the Wharf a red-herring of bold-faced fraudulent misuse and abuse policyholders funds.

    Like

  • Bernard Codrington.

    @ Bush Tea at 11 AM

    I cannot speak of your experience with local audit firms but those with which I am familiar do carry out what you describe as strategic audits ” that include compliance with laws, bye laws , organizational ethics etc. In fact they audit in accordance with international established principles for audits. These rules are revised regularly for loop holes that are detected in audit practice.
    The fact that BOD do not follow through to ensure recommendations are instituted is no fault of the audit firms nor the measures and systems put in place. We return again to personal will and competence.
    Change your management or their mind sets and you are home high and dry. If on the other hand you mean a forensic audit . This is not done routinely. It is done only when there are reasonable grounds to suspect malfeasance . That is very rare. Have we reached that stage in Barbados yet?

    Like

  • millertheanunnaki

    @ Bernard Codrington. November 3, 2017 at 11:40 AM
    “The fact that BOD do not follow through to ensure recommendations are instituted is no fault of the audit firms nor the measures and systems put in place. We return again to personal will and competence.”

    So how do you explain CLICO & BAICO?

    Why would the kind of ‘highly reputable’ audit firm you describe fail to ‘qualify’ the financial representations of the management of its client should the BoD fail to “follow through to ensure recommendations are instituted”?

    Why undertake audits in subsequent years unless those recommendations are implemented?
    Why issue ‘unqualified’ opinions instead of ‘qualified opinions’?

    It is also a matter of professionalism and following standards, both accounting and auditing, in exercising fiduciary responsibilities.

    Like

  • Bernard Codrington.

    Miller at 12: 29 PM

    What about CLICO & BAICO need explaining?

    Are you implying that the external auditors did not discharge their responsibilities to BOD and shareholders of CLICO and BAICO?

    Since when is it the responsibility of external auditors to implement their suggestions and recommendations to clients?

    Do you not think you are mashing the crease when you want to suggest to reputable audit firms what type of opinion to give?

    Miller , I know that you know better. Stop misleading the BU Household.

    Like

  • millertheanunnaki

    @ Bernard Codrington. November 3, 2017 at 2:32 PM

    Who is misleading the BU household?

    The facts are there (even without the evidence uncovered by the forensic audit) for all to see.

    Why would an audit firm worth its salt in large fees continue to issue ‘unqualified’ opinions on financials year after financial year in an environment where there was massive evidence of a glaring breakdown in financial and management controls?

    Maybe an unbiased interview with TT the smart CFO would have revealed that the books were being cooked to launder ‘management fees’ posing as legal fees.

    Oh, we forget that real auditors rarely examine the minutes of the meetings of the BoD approving such large payments arranged by the chief launderer only, right BC?

    Like

  • Bernard is obviously being deliberately provocative… but he is talking a roll of shiite.

    Even when audit firms write confidential management letters, they give them to the same damn principals who are the ones stealing or misappropriating the money ….and who has it in their hands to either retain or change the audit firm….

    They become INTIMATELY aware of malfeasance, but continue YEAR AFTER YEAR, to give unqualified audit reports to the public – EVEN WHERE THEY HAVE ISSUED management letters with unresolved concerns.
    The usual excuse (as Bernard trumpets) is that it is management’s responsibility to implement corrections (to management’s OWN stealing?), and not the audit firm’s. Meanwhile the gullible brass bowl public assumes that all is well…. until Hell breaks loose as with CLICO.

    The ultimate solution of course is with a Supervisory Committee model – as in the Credit Unions. With wide powers of GOVERNANCE and full access to ALL information (in confidence). It is the ultimate WISE methodology for enforcing integrity in an organisation.
    …it even works in brassbados… 🙂

    Like

  • @BC
    call them out simply meaning pointing out other interpretations, not defamation of character. One can challenge without defaming?
    You sound like my old man, preaching from the high pulpit of morality and integrity, without a clue of what to do when things go astray. The rules should be ‘enforced’.
    Skipper, if you desire enforcement, hire the underworld, they don’t have any morals nor ethics, but they know a thing or two about enforcement. If that isn’t a palatable solution, then all you can do is “talk” and hope. And possibly engage in minor forms of legal civil disobedience.

    Like

  • It boils down to the integrity of individuals and leadership. This is what it will take to disrupt the system. So far this lot has not provided any confidence that anyone will emerge to satisfy what is required. And this is after billions have been sunk in education. What a shame!

    Like

  • Bernard Codrington.

    David at 5:12 PM

    You certainly have it right. Let us try this time around to elect those persons with a modicum of integrity and proven leadership skills in political office. Let us this time around impress on our leaders the need to appoint managers with the relevant skills and professional integrity. Let us impress on them to lead from in front. Let us impress on them that if they mess up in the first term, out they go. No could dear plea.

    Like

  • Bernard Codrington.

    Northern Observer

    Yes I am an old man and quite happy to have reached such an age. I am not too sure I would be proud to have you as a son.
    From an early age I was trained to lead not to follow. That is not likely to change any day soon. Where do you expect me to preach from ? You have /had a good father. Try to walk in his footsteps.

    Like

  • @BC
    we likely agree on a lot more than may be obvious.
    Your comment to David at 5.12pm expresses your displeasure at the the “political process”.
    And you cite…”proven leadership skills in political office”, a valid point, yet >50% of the candidates have never held political office? Barbados has no training ground for politicians.

    You are obviously not pleased with my comments. Why? Is it inappropriate to single out and attack the NIS Chairman, who is a bright and intelligent young man who is giving service under extremely difficult conditions. I/It should be inferred and understood there is political interference, and there is little which can be done, other than replacing the elected “leaders”. The NIS does not set fiscal policy.

    I sense you have an overall frustration, and possibly amazement, that operations in Bim could have deteriorated to the current level.

    What happens if the current administration gets re-elected?

    Like

  • If the current administration gets re-elected, large parts of the population (including middle-class whites, Indians and Arabs) will be sold in Curaçao and shipped to Saudi Arabia for some foreign currency.

    The debt level will rise to 250%, food prices up 50%, NIS broke, more massacres and gangs in Black Rock, Marston Gibson, the leisure king of the Caribbean, will be Chief Justice forever, cabinet ministers and judges starting work 10 AM and finishing after lunch, no new sincere foreign investments, fees for secondary education, UWI shutting down and most important:

    At least TWENTY African countries will overtake Barbados in social and economic terms.

    What a prospect after 51 years of futile effort!

    Like

  • millertheanunnaki

    @ Tron November 4, 2017 at 10:06 AM

    Your highly probable scenario paints a picture depicting the ‘perfect storm’ conditions required for full maturity on becoming a royal black banana republic à la DLP.

    Thank your god the IMF is on its way to save Barbados from that destructive lying party.

    Like

  • @miller
    the IMF? Bajans possess all the skills to solve the issues themselves. The challenges are not some cancer, for which research hasn’t yet found a cure.
    And I am unconvinced certain of the medicines the IMF have prescribed in past similar situations, actually help.
    Barbados needs to fix its fiscal deficit.

    Like

  • millertheanunnaki

    @ NorthernObserver November 4, 2017 at 11:29 AM

    We all know (for a long time now at least since December 2013) what needs to be done to fix the fiscal deficit.

    The problem is who is prepared to bell the cat and bite the inevitable bullet.

    So why not outsource the decision and implementation of much needed fiscal reform by buying a ready-made scapegoat called the IMF?

    Then the party in the sinecure seat of impotence can always blame the foreign bogeyman for all the sacrifices involved in the slaughter of the fiscal cow (now at the point of total emaciation) can always shout “It’s (NOT) My Fault”.

    At least there would be an injection of forex by way of balance of payment support loans from the lender of last resort to save the haemorrhaging patient from economic cardiac arrest.

    Like

  • @NortherObserver

    Yes but the albatross on our backs, the bogey in the room at Bay Street- is how to stem the outward flow of forex. Currently the MoF has implemented IMFlike policy, however, missing is the protection of the forex reserves.

    Like

  • Bernard Codrington.

    Miller at 12:20 PM

    All four cylinders firing perfectly today. Nothing works better than a good cut asked no question.

    Like

  • Tron

    Curacao’s last heyday was in the refining of oil for the Shell Oil company,the second largest in the world at that time starting in the 20’s upto the 80’s,employing many west indians from the english speaking colonies.

    Its enjoying a well deserved rest with its tourists,casinos and weed.

    So why would you move the slave transhipment from its rightfull origins in Bim over there……Bim could make some good money with reverse trade route especially now that Saudi is looking to diversify…..it could do with some indentureds down there…..a number of Bimmers are there already.

    https://www.google.com/url?sa=t&rct=j&q=&esrc=s&source=web&cd=2&cad=rja&uact=8&ved=0ahUKEwibudPRr6XXAhWCLyYKHZmLCZUQFggqMAE&url=http%3A%2F%2Fwww.bbc.com%2Fnews%2Fworld-latin-america-17290626&usg=AOvVaw0pd7s4RoIro4KOdVrpM-ZF

    Like

  • Protecting foreign exchange is not an economic policy

    Like

  • David November 4, 2017 at 12:36 PM #

    In the absence of a homegrown plan(IMF requirement) for the IMF to sign on to……nothing can happen…..this govt has to bumble its way through for as long as it can before calling elections.

    The Merchant class has made it abundantly clear………stop imports……people go home and you loose the elections.

    Party before country will see the destruction of country.

    Like

  • @Vincent

    It does not matter what fiscal or monetary policies, measures, rules decisions are taken if we cannot pay our bills i.e. pay for imports and service debt we are in ducks guts.

    Like

  • David

    Correct.

    Like

  • @Blogmaster
    There is connectivity. One reason we cannot roll over or get new Fx loans is directly related to the island’s overall public financial position.
    Many moons ago, when the Fx situation was actually worse, the GoB got help from the private sector, in ‘backing’ Fx loans. I am unsure that “help” is as likely today.
    They can tighten up some areas in the private flows.
    A challenge with a pegged currency, is imbalances can build up. I “think” early in 2017, I read the combination of a bloating monetary base and decreasing Fx reserves, left us with a cover of 7. This is approaching speculative range.

    Like

  • @Northern Observer

    We have an economic model that is unsustainable. How do we reduce the monetary base from the 7:1 it is reported to be or produce more? How do we do both? The ownership mix today compared to many moons ago that will not encourage confidence.

    Like

  • Well Well @ Consequences Observing Blogger

    http://www.nationnews.com/nationnews/news/101852/recovery-plan-ready-imf

    this is so ugly. 2 weeks to go and no recovery plan in place.

    to make matters worse the auditor general is complaining that reports are not prepared on time.

    Like

  • David the model is just a framework.
    The challenge is when all the checks and balance measures fail to operate, the system has been neutered. This isn’t ‘flirting with the law’ it is flaunting the law.
    So what do you do? How do you enforce compliance with the checks and balance measures in place?

    Like

  • @NortherObserver

    Can NIS Directors (SOE) be prosecuted for reneging on their fiduciary responsibility?

    Like

  • I am not a lawyer. I have no idea the potential actions, or remedies available.
    But from the time you sniff legal action, most Bajans run, for fear it will be viewed as political, that they will personally be tarred and feathered. And via a judicial system which they question. Rarely is the message shot, the aim is for the messenger(s).

    on another topic, the blogsphere is already filling with Donna Brazile’s new book, due out Tuesday.

    Like

  • @NO

    on another topic, the blogsphere is already filling with Donna Brazile’s new book, due out Tuesday.

    Yes, those of us who are not satisfied with navel gazing are expectant. Seems to be a hint of anti Hilary pro Bernie in there!

    Like

  • I suspect from the many excerpts provided, it is less pro Bernie, than an exposé on process. One the basic tenets, is the DNC’s DEBT was so large, it became open to financial attack.

    Like

  • @David

    Donna B has set the house on fire as she exits, but didn’t Donna provide Hillary with debate questions prior to a debate with the orange blowhard aka 45.

    Waiting for comments from MB 3,2,1……

    Like

  • Donna B is just “cashing in “.

    Retirement plan…..write a book.

    Like

  • @Hants and Sargeant

    Writing a tell all book is the American way.

    Like

  • Since we on the “tell all ” topic wonder if any Bajan women will be accusing prominent

    persons of sexual harassment.

    Like

  • @ Hants
    Since we on the “tell all ” topic wonder if any Bajan women will be accusing prominent
    persons of sexual harassment.
    +++++++++++++++++++++++++++++++++++++++++++++++++++++
    Bushie is trying to correlate the frequency of your talking this kinda shiite.
    So far, it seems to be somehow related to your inability to go fishing – due to the cold-ass weather up your side now – would be Bushie’s guess.

    Boss, most modern Bajan women openly seek out ‘harassment’ in exchange for cash….. OPENLY.

    …and the ONLY reason that Bajan women accuse ‘prominent persons’ is when they refuse to pay up after the agreed ‘harassment’.
    Shiite Hants….. we are talking about people who ALWAYS drop charges after money passes hands – even when it is their young daughters that have been ‘harassed’…..

    Steupsss….
    Man if you need to fish so badly come to donkey long home do!!
    Where you think Bushie spent the afternoon…?
    🙂

    Like

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