The leader of Government Business in the Senate today warned that there were no guarantees that CLICO policyholders will recoup all their investments.
“In the interest of preservation, I believe that it is reasonable to expect that in seeking to preserve the interest, there has to be a shared responsibility in that process. In other words, as Government seeks to preserve it, it cannot in all reality, given all the complexities guarantee persons that they will receive every single cent. I feel very strongly about that,” warned Senator Maxine McClean as she led off debate on the CLICO International Limited (Guarantee) Bill 2015 this morning.
However she assured the Senate that Government was “working very hard to do so.”
“But there has to be a balance on the demands of the resources and I believe when we follow through on what this legislation seeks to do, the overall interest of all parties, those directly affected, those not affected directly or those who had no interest but who will be called upon as taxpayers of the country as would have occurred in other jurisdictions,” she added.
The proposed legislation is geared at restructuring the CLICO International Life Insurance Limited, which collapsed back in 2009. It seeks to among other things to set up an entity called the New Life Investment Company Incorporated (NLICO). That company would be responsible for issuing Government bonds to CLICO for the purpose of transferring the real estate assets of CLICO to NLICO.
McClean sought to explain why it had taken the Government this long to get to this point.
“We are seeking, and we have sought to address this situation at a time when the Governments of the region and certainly the Government of Barbados did not have the luxury of a good economic climate. It did not have the luxury of readily available resources to use and therefore the efforts had to be done within very constrained circumstances,” she told the Senate.
McClean who is also Minister of Foreign Affairs and Foreign Trade said that the Freundel Stuart administration also looked at other avenues in seeking to help policyholders get their investments back including, putting in place an oversight committee.
“Madam President while that process could have worked and when we look back and see the recommendations made in most recent times there are parallels . . . there has been a significant effort on the part of this administration to address this.”
McClean was adamant that Government had been seeking to address the situation as best as it could.
“This piece of legislation is intended to put in place a number of requirements to ensure that the interest of the policyholders are protected as best as they could. It puts in place a set of arrangements which says that Government recognizes that in the context of an entity of this size . . . it cannot be allowed to fail . . . notwithstanding the call on citizens because at the end of the day where Government funds are expended, those are tax payers resources that we protect them.
“Overall I believe that this legislation is being put in place in a proactive way to ensure certain guarantees that will facilitate the preservation of investments made by policyholders,” she said. (FW)