Alternate Views: Addressing Professor Justin Robinson’s Position on Barbados’ Debt Problem ( 2005-2022)

Kemar J.D Stuart, Economist and Director Business Development , Finance and Investment Stuart & Perkins Caribbean

In the recent launch of the BERT 2.0 the term lost decade is still a heavily used term in that document that can be reinforced by the unassuming mind in reading a recent article published by Professor Justin Robinson on Thursday 27th October 2022 on the level of government debt in Barbados. Professor Michael Howard, Professor Don Marshall and Economist Carlos Forte offered that Barbados is in a debt trap.

To add facts and context to Dr Robinson’s naked assessment of Barbados’ public debt . The global financial crisis which is categorized as a shock similar to covid hit in 2007-2008 and Barbados’ public finances saw an upsurge of domestic debt. The economic strategy of government at the time relied heavily on local debt from the Central Bank of Barbados via money printing, the NIS , Treasury Bills and debt and interest payments owed to these local Barbadian institutions skyrocketed causing unsustainable fiscal deficits.

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Government MUST Clear the Air on the State of the NIS Fund, it is Our RH Lifeline


Ian Carrington, Director of Finance

Ten  years have elapsed since the 2008 global financial meltdown left Barbados exposed for the open economy we have been taught it is in primary school. Across the Caribbean our little economies find themselves in the same boat with high debt to GDP and rotting infrastructures, rising corruption and a dearth of leadership.

Barbados WAS considered the gem of the Caribbean.

With all of our problems – some of our making – others caused by the vagaries of life’s existence- the blogmaster is concerned that after five months in office no definitive statement has been formally issued by the government about the current and future state of the National Insurance Scheme (NIS).

  • Is the NIS fund still marketed as our life line?
  • Was it established to provide financial support to citizens in the golden years?
  • Is the knowledge that we have a well managed NIS  fund an emotional comfort for the citizenry?

It appears from all the talk we have been hearing the NIS Fund is under threat. Given the catastrophic impact a failing fund would have on the Barbados society Prime Minister Mottley would do well to schedule another press briefing to lay the issues on the table and outline, what is the plan to stabilize and rescue the fund after it was used as a lender of last resort to add debt like no other time in modern history. To add to the problem, we have been told the former government didn’t pay 400 million dollars in employee deductions to the fund.

The blogmaster has posted several blogs about the lack of management demonstrated by successive NIS Boards and by extension government. The latest Actuarial Review is late (what is new?). Audited financial statements of the fund have not been laid in parliament to comply with the law for many years. Several projects funded by the NIS and decisions taken have been questionable.

  1. Prime Minister we need to know when the Actuarial Review due will be completed or if it was completed when will it be made public?
  2. Prime Minister we want to know when will the audited financial statements be laid in parliament and soon after be made public?
  3. Prime Minister we want to know on what basis Ian Carrington who was director of the NIS fund during the lost years has been given a leading role in the BERT execution in his current role as Director of Finance?
  4. Prime Minister we want to know why Dr. Justin Robinson remains active given his leadership role on the important Boards of the Central Bank and NIS Boards.
  5. Prime Minister we want to know who will be held accountable for the unconscionable squandermania of NIS funds in the last ten years.

In the debt restructure project the IMF document details that:-

NIS: T-bills, treasury notes and debentures. T-bills held by the NIS will be swapped for the new 15-year debenture; and its treasury notes and debentures will be exchanged for a 20- year discount debenture. The debenture will have with a 2-year grace period. Principal will be reduced by 17.5 percent at the issuance of the security; after the 2nd successful review under the proposed EFF-supported program, principal will be reduced by an additional 12.5 percent of the original principal; and after the 4th successful review under the proposed EFF-supported program, principal will be reduced by a final 5 percent of the original principal. Interest will be paid at a rate of 4 percent per annum for the first 3 years, followed by an interest rate of 8 percent per annum for remaining years.

Leading into the last general election the blogmaster had a brief exchange on Facebook with the former Chairman Justin Robinson about when current NIS financial will be laid in parliament- his response did not give hope the matter will be resolved anytime soon.

Prime Minister Mia Mottley you have been a big advocate for transparency AND accountability in government. We waiting to see!

Not So Fast Justin Robinson!

BU has not had the opportunity to thoroughly review the delayed release by government of the 15th Actuarial Review of the National Insurance Scheme. It is a very important fund- a safety net and lifeline- hence the reason BU has been uncompromising in our calls for transparency in the management of the fund.

The inability of the fund to publish audited financial statements in recent years highlights a level of incompetence that is informed by a separate blog. To be fair to the NIS management the unacceptable situation has straddled both political administrations and mirrors the wider state of public sector poor financial management. See a decade of Auditor General Reports.

In response to the findings recorded in the actuarial review the Chairman of the National Insurance Board Justin Robinson felt duty bound to release a statement to the traditional media. Unfortunately our resident actuary Walter Blackman appears to have been silenced after receiving a ‘pick’ with the government owned and controlled Caribbean Broadcasting Corporation (CBC). It seems BU will have to forego his analysis of the actuarial review in this forum. We hope not!

BU’s comment on the Chairman’s response is anchored in commonsense. Chairman Justin Robinson admits what we know, the government is unable to earn adequate foreign dollars to effectively and efficiently manage the issue of portfolio diversification i.e. accept the recommendation to reduce local holdings from 75% to 50%.  What his explanation confirms is that the NIS Fund is under threat from the risk of heavy local concentration in the domestic market, especially government paper, an anemic economic performance and concomitant low yield on investment.

The public relations tactic of the Chairman will satisfy the political partisans, however, independent minded Bajans AND vested actors remain unappeased.


Statement from Chairman of the NIS Justin Robinson

Rising Concerns about the National Insurance Fund

Barbados Underground (BU) has written extensively our concerns about the lack of public disclosure of the National Insurance Fund. Since 2006 Chairman after Chairman, Minister after Minister have promised to bring the NIS financials current with little success. The last time we sighted Dr. Justin Robinson on BU, Chairman of the NIS- who was not averse to posting to BU- he commented on the 01/11/2015 at 4:02PM as follows:

Walter, I respect your views, expertise and comments and I take being accountable to the public very seriously and I have responded to queries about NIS many times on this forum, in fact quite recently. What I don’t quite appreciate is the NIS ambush whatever the issue I am commenting on.

As I have said on many occasions, when I became a member of the NIS board in 2008, the last audited financials filed were for 1998, as a board we hired an accounting firm to help bring the financials up to date. As a result of that project the NIS has submitted its financial statements for up to 2014. The NIS is a government dept and as such has to be audited by the auditor general. The auditor general put out a tender for the large backlog of financials and EY was the only bidder. The audits have progressed much slower than expected for two main reasons. Firstly, the audits are going back well over a decade and secondly the 2004 audit posed a major challenge as this was the first year of the nis switch over to the sap system.

We have gotten the financials up to 2014 and cleared the audit backlog from 1998 to 2005 i think. I was not there when the backlog was created, but I am chairman now and the failure to have up to date audited financials is mine. I accept full responsibility, the failure is mine.

I still hope I can engage in a public debate on other matters without constantly having to explain NIS.

It is ironic the Walter (Blackman) mentioned in Robinson’s comment was also a frequent BU commenter until he landed a ‘pick’ hosting a talk show on the government the owned media outlet. We look forward to hearing him in his professional capacity as an actuary host a program which critically analyses the current state of the NIS Fund. We suspect the government ‘pick’ has effectively muzzled Walter and all for 30 pieces of silver.

Fortunately Barbadians have Charles Herbert who is head of the Barbados Private Sector (BPSA) and a respected actuary to share his view on the state of the NIS fund.

We do have real problems. But the truth is, all it is going to mean is – and we already have the highest NIS contributions in the region – they are going to have to go higher or we are going to have to cut benefits because we cannot realize our investments . . . . So I think cash flow is going to be an increasing problem for National Insurance like it is a serious problem for Government – Barbados Today

Here is what Robinson posted to BU on the 02/11/2015 at 11:49AM:

The NIS in Barbados is currently able to cover benefit expenditure from its contribution income. Given the population demographics and current contribution levels, unless either benefits or contributions are adjusted, at some point in the future the scheme will need to draw on its investment income and assets to meet benefits. I don’t think there is anything especially unusual about this. The NIS is very open about the fact that 75% of its portfolio is in government of Barbados of securities (its been around that level for most of the life of the scheme). Therefore if at some point the government of Barbados is unable to meet its debt obligations the NIS would be severely impacted.

Barbadians, an ageing population, find themselves between a rock and a hard place. Either our NIS contributions will have to be increased in the near future- already the highest in the region- or benefits will have to be reduced. As far as BU is aware the most recent actuarial study was received by government earlier this year but it has not made public. Barbadians are left to speculate about the state of the fund. If BU were to add our voice to the speciation we would hazard to state that the NIS is cash poor and Barbadians should be very concerned. We do not have the power of recall, 20,000 Barbadians marching appears not to have registered concern with the government even as a general election looms.

Is the NIS Fund cash poor?

National Insurance Fund: Dr. Justin Robinson an URGENT Update is Required

Dr. Justin Robinson, Chairman of the NIS

Dr. Justin Robinson, Chairman of the NIS

This space is created to accommodate comments about the National Insurance Scheme (NIS) of Barbados.  The BU household concedes that the management of the NIS as with any social security fund is a complex matter. It is against this background that Barbadians need to hear the technocrats explaining the status of the NIS fund and NOT the politicians.

It is unforgivable that in 2016 the public is not able to (re)view the financials of the NIS fund by clicking on the NIS website. Dr. Justin Robinson on several occasions assured the BU family in this forum that his Board intends to be transparent in its work and a first step is to bring up-to-date audited financials to the public.

The BU household invites Dr. Robinson to provide an update on the fund.

The Final Collapse – Debt, Credit, Capital & Investment

Submitted by Pachamama

Ancient Chinese military philosopher Sun Tzu - should Bajans be located on death ground?

Ancient Chinese military philosopher Sun Tzu – should Bajans be located on “death ground”?

“There is no means of avoiding the final collapse of a boom brought about by credit expansion. The alternative is only whether the crisis should come sooner as the result of a voluntary abandonment of further credit expansion, or later as a final and total catastrophe of the currency system involved”. Ludwig von Mises 1881 – 1973

During the last administration Dr. Justin Robinson’s was the solitary voice in the Barbados intellectual wilderness that kept warning us about an aggressive national debt expansionism. Our interpretation then was that Robinson did not just mean the increasing debt of the central government and its statutory agencies but more importantly the growing debt of businesses and households. Maybe even the expansion of his primary employer. To us he was talking in the aggregates. Some of us get confused, sometimes, when this quartet of words – debt, credit, capital and investment, are used. In a number of cases and for simplification, all four could represent credit expansion at one or more points in the global, largely homogeneous, monetary systems.

We are disappointed that the ‘voice’ of Robinson seems not be generally available to the public, like before. We have three (3) reasons why we are persuaded that this will widened public understanding. This is what a public academician should be doing, no? First, the expansion of the national debt has continued to be now close to 100% of the GDP of Barbados, having been boosted by the off-balance sheet amounts, as incurred by the former administration to the tune of over I billion dollars, and as mandated by the IMF, was brought to book and the continuing and significant contractions in the economy, and so on. Secondly, Robinson’s own National Insurance Scheme (NIS) has been heavily called upon by this current government to play a larger role in the economy, providing funding to projects in which government believes it has an interest. Projects that would normally tend to attract external investment capital (FDI) – as based on the credit worthiness of foreign businesses and individuals. Thirdly, Robinson might want to speak to the public about the financial performance of the NIS and the impact additional demands from the central government are having on the integrity of the NIS. We are past the point where foreigners are becoming even less likely to use their own resources or mobilize capital to invest in Barbados and, as seen from the last attempt to raise capital on the international bond markets, will be more and more unlikely to risk their money in Barbados. This crisis is deeper than the mismanagement of any one administration. It is the collective misguidance of all the parties, not only political parties, business people too and others.

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CARICOM Stock Market Review 1st Quarter,2013

Compiled by the UWI,Cave Hill - view more tips and other information at:

Compiled by the UWI,Cave Hill – view more tips and other information at:

The first quarter of 2013 provided equity investors in Caricom with little or no relief from the misery of 2012. Despite gains on Manufacturing, Conglomerate and Communications & utility stocks, returns were depressed by declines on Insurance, Investments and Tourism and Real Estate stocks…Full Report.

WEEKLY CARICOM STOCK REPORT 10 December to 14 December 2012

Compiled by the Department of Management Studies, UWI, Cave Hill

Compiled by the Department of Management Studies, UWI, Cave Hill

Should You sell Those Shares To Finance Christmas Shopping?
In the two years we have been publishing this report, we have noticed an increase in share trading around the end of the year. This has led us to suspect that some investors may be liquidating their shares to help finance Christmas and New Year holiday expenditures. Is this a wise decision? Like so many things it all depends. In general, you should not use investment funds to finance consumption. If you are holding the shares as a means of financing some future expenditures like retirement, education and so on, then you should desist from liquidating shares to finance holiday related consumption expenditures. However, liquidating shares to help finance Christmas and New Year expenditures is generally a better financial decision than undertaking expensive hire purchases or neglecting to pay other bills. In general, I would suggest that you save over the course of the year to finance holiday expenditures, avoid debt to finance holiday expenditures, exercise moderation in holiday expenditures and if you must, then only finance holiday expenditures from the gains on your investments rather than liquidating your capital.

Full report

National Insurance Board Wants Equity Stake In Republic Bank Trinidad

Dr. Justin Robinson, Chairman of National Insurance Board

“In light of this, Dr. Robinson indicated that, “The NIS is looking at all of the options right now. The options are that the NIS could decide not to sell any of the shares it has, it could sell some or it could consider an exchange of BNB shares for Republic Bank shares.”

The Barbados Advocate

BU wishes to commend the Board of the NIS Scheme for stating a coherent position regarding the options under consideration regarding Republic Bank’s offer of $5.00 to buyout minority shares. If Republic Bank is successful it means the Trinidad owned bank would 100% own the former national bank of Barbados.

Chairman of the NIS Dr. Justin Robinson is on record confirming that the NIS Fund is cash rich and the Republic Bank is on record it wants ALL of the shares. The two stated positions make the third option favoured by Dr. Robinson the most sensible investment strategy for the NIS and Barbados.  Why should we not seek out an equity stake in one of Port of Spain’s leading companies? T&T capital has acquired many Bajan companies. It is time to confront the hegemony of Trinidad.

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NIS Pension Looms Large

Click image to access presentation in PDF

The presentation maybe of interest if we consider the importance of the NIS Scheme’s contribution  to supplementing retirement income.  BU continues to be optimistic that full transparency will engulf the management of the fund to ensure that one day coming soon the audited financials of the NIS Scheme will be made public to encourage the rigour of public scrutiny. It must be part of the checks and balances to encourage resilience and integrity to our most important fund.

NIS Vigil

Dr. Esther Byer-Suckoo, Minister of Labour and Social Security

The news that the Barbados Rights Bill is currently being debated in parliament is good news. It is one of many bills which was in danger of being still born. Of interest to BU though is the visibility which a successful reading of the legislation will afford Dr. the Hon. Esther Byer-Suckoo, M.P who is Minister of Labour and Social Security. There is a view that St. George South, the constituency she represents, is a bellwether constituency, one which the government cannot lose if it desires to win a second term. Her fight against Dwight Sutherland, the BLP candidate is already shaping up nicely between the two with deep roots in the constituency.

It is not unfair to suggest that Minister Suckoo has not satisfied legitimate expectations about her performance in the several portfolios she has been give responsibility. Her homage to late Prime Minister David Thompson in parliament suggests she maybe disappointed with her performance as well! Many do not know what to make of her invisibility in the current national debate about the the NIS investment strategy. Besides one statement made in the recent Budget debate which was a general statement she has allowed her male colleagues Messrs Sinckler, Kellman and Sealy to defend the investment strategy of the NIS.

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CARIBBEAN STOCK REPORT 17 October to 21 October 2011 And Q3 Caribbean Consumer Sentiment Report

Compiled by the Department of Management Studies, UWI Cave Hill - Click image to read in PDF

Also click to read Q3 Caribbean Consumer Sentiment Report

The Great US Debt Downgrade

Dr. Justin Robinson, Head of Department & Lecturer in Management Studies,UWI,Cave Hill

On Friday August 5 2011, while most of Barbados was partying with Rihanna, there was a loud bang, and the financial world was shaken to the core with the news that major Credit Rating Agency, Standard & Poors (S&P) had downgraded the long term credit rating of the United States of America from AAA to AA+, and with a negative outlook. This momentous decision to downgrade the USA, justified or not, may well in my opinion, hasten a dramatic reduction in the role and influence of the CRAs in global financial markets, and the financial world will be much better for it.

CRAs are private profit oriented entities that issue an opinion on the likelihood a borrower will default on its debt. The opinion is issued in the form of a letter grade, with AAA being the highest rating. The industry is dominated by Moodys Investors Services and Standard & Poors, with Fitch running a distant third. Financial economists have long questioned the value added by the CRAs. To put it simply, many argue that in good times, rating agencies upgrade borrowers, and in bad times they downgrade them. Do you really need them to state the obvious? The CRAs were much maligned for assigning AAA ratings to now worthless subprime mortgage loans, and infamously rating Enron as “Investment Grade” in the same week the company filed for bankruptcy.

Much of the power of the CRAs seems to come from the fact that the credit opinions (ratings) they issue have been written into the law and contracts in many countries. For example, by law or contractual agreement many institutions are only allowed to invest in financial instruments carrying a certain credit rating by one of the major agencies. Also, in many instances, contracts require that financial instruments posted as collateral have a AAA rating. Financial Economists refer to this as the regulatory license granted to the CRAs. In essence to be a player in many financial markets you need the blessing of the CRAs. Due to this fact, attaining or losing a certain credit rating by one of the major agencies is a major issue for many investors and financial institutions. If these laws and contracts are enforced, then come Monday, a number of contracts would have been violated and investors may be forced to sell assets, find new collateral and so on. My guess is rather than face this massive inconvenience, or rather chaos, a number of clauses will either not be enforced or simply changed to allow institutions to continue to hold US government securities and use them as collateral for all kinds of financial contracts despite the downgrade. If this happens, the regulatory license, which has the source of the power of the CRAs would have been undermined and with it some of their influence.

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