CLICO hit by new cash woes
There will be no pensions for CLICO policyholders this month because the company has run out of cash.
President of the Barbados Investors and Policyholders Alliance (BIPA) June Fowler disclosed that worrying development today, as she accused Government of leaving policyholders to “suck salt”.
Barbados TODAY’s efforts to reach judicial manager Patrick Toppin of Deloitte Consulting were unsuccessful but Fowler issued a statement this evening indicating that a representative of Deloitte had advised her that “effective immediately, those traditional policyholders who have been receiving their pensions on a monthly basis will no longer do so as CLICO has run out of cash”.
She said the representative indicated that payments could no longer continue because the long promised Cabinet-approved injection of funds to sustain the operations of the company and proceed with the proposed restructuring had not been forthcoming.
Fowler described Government’s promise as nothing more than smoke and mirrors and a public relations charade that now leaves policyholders to “suck salt” from this month.
“We are sick of the stream of false promises relating to CLICO dating back to those made by the late Prime Minister in 2009 and others since. None of which have been fulfilled,” she lamented.
“It is nothing less than a national disgrace that the . . . actions of a small number of people can be allowed to continue to destroy the lives of so many in Barbados, some of whom have now died without seeing or knowing what will happen to their lifelong savings.”
She said this latest development would not only slash the income of hundreds of pensioners but it would also reduce, by over $1 million a month, the amount of cash being spent by those pensioners in the economy.
This, she said, would put “a further strain on businesses and threaten jobs”.
On December 18, the Ministry of Finance issued a statement indicating that the directors of the new company to replace CLICO were expected to meet with the judicial manager to be fully apprised of the current administrative and financial status of CLICO.
Government said once that was completed the initial short-term capitalization of CLICO through the new company would commence.
It said meetings would also be held with all other critical stakeholders including BIPA, as well as national and regional regulators.
After the judicial manager indicated it had no choice but to move to liquidate the company, given the lack of cash, Government said resources would be transferred to the new company for the management of its affairs and execution of the proposed restructuring of CLICO, once all the necessary arrangements were in place. A timeline was not given.
However, in a statement today, Fowler said that to date, neither the judicial manager nor BIPA had been contacted by the newly appointed directors of the company.
She said the inability to pay policyholders this month would appear to confirm that the judicial manager had no choice but to put the company into liquidation, a move that the Government had said would be “premature, unwarranted and unnecessary”.
The BIPA president said she hoped that the creation of the company referred to by the Ministry of Finance was not simply an attempt to further delay a resolution to the CLICO fiasco.