$12 million BIDC hole

Pay your rent, was the message Minister of International Business Ronald Toppin sent on  Monday to delinquent tenants of the Barbados Investment & Development  Corporation (BIDC), who owe the agency some $12 million.

The situation is now so bad that the BIDC’s acting Chief Executive Officer Dwaine Stuart told Parliament Monday it was “really hampering” the operations of the state agency.

The financial bind, in which the business development and export promotion agency finds itself, was outlined Monday during the first day of debate on the Appropriation Bill – the Estimates Debate in the House of Assembly.

Toppin made clear the defaulters had been asked on several occasions to make arrangements to settle outstanding rents. Now their failure to pay was a major drag on the BIDC’s ability to fully carry out its mandate.

“Instead, you get some people who owe the BIDC as much as $1.2 million in arrears of rent and are still tenants of BIDC. But fair is fair. We understand COVID; you grant relief in hard times but how you expect an institution to run when . . . a major source of its revenue . . . [was not paid]. Come on people. You got to be reasonable. We meeting you halfway,” an animated Toppin lamented.

Neither would the minister nor the acting CEO name the tenant that owes $1.2 million.

Stuart, who joined other senior civil servants of the Ministry of International Business to respond to MPs’ questions, told the House: “The amount that is owed to the corporation on the books right now is approximately $6 million.”

Offering what he described as clarity to the rental arrears figures, he revealed: “There are some persons who are still tenants of the BIDC, still operating in the space and because the arrears may have been removed from the books, in terms of the accounting, we are still tracking the amounts owed by those persons.

“Those who are in the space and owing the BIDC, the arrears currently stand at $12 million . . . . One tenant owes $1.2 million. . . . We are speaking about arrears that are owing for a number of years.

“In that same space that is occupied we have had at least two or three expressions of interest from people who want to get in the space; people who are in business, in profitable businesses, that are looking for the size square footage.”

Earlier,  Toppin said the agency had granted rent relief of almost $10 million to its tenants last year as a direct response to the COVID-19 pandemic. He added that in the first quarter of this year, some $600,000 of expected rental income will be written off in a similar effort.

But Stuart explained to MPs that the arrears problem of the state agency pre-dated COVID-19 and was now undermining its operations.

According to Stuart: “We have as a corporation over the years written off $20 million in arrears off our book. So, $6 million on the books and $20 million over the years, gives you an indication of the lack of payment the corporation has had to endure.”

The CEO said the BIDC expects a $1.6 million reduction in rental income due to COVID-19 rental relief.
(IMC1)