Public Sector Reforms: 4. Housing and the 55+ Retirement Age

Edited extracts from my Interview with Parmesh Chand, Permanent Secretary Public Service Commission. Vinaka, Tui, for this transcript.

We have got a lot of things right we have decided on more prudent use more efficient use of Government properties meaning housing and office space we have decided that we bid it out to the private sector and that it be commercially rented out and the civil servants who want to live in government quarters would have pay commercial rent and we have a select group of civil servants who are entitled to housing allowance. So that work is underway at the moment some of the house in domain have been spruced up and rented out.

Croz: In other words there are no more housing entitlement with jobs?
Parmesh Chand: They’ll be no more housing in relation to a job but they will be a housing allowance if a job is of particular necessity and demand and if government agrees so that they be paid a housing allowance so we are listing at the moment which jobs carry legibility for housing.

It will go across the public service, housing allowance will be paid to regardless of your status to any body whose in the outpost stations and what is an outpost station it’s a station which is a non-urban area with limited provision for housing so we pay them a housing allowance in lieu of that we provide free housing.
The other that needs to be looked at is Government may not be able to give a loan there is no provisions available in the superannuation scheme guys from Singapore came to review the superannuation fund and I was the chairman at that time and they said its very absurd that the superannuation fund is not giving much more flexible loans to its members to buy a house at the moment members can only access 1/3 of their contribution of their housing and this should be liberalized because housing is something everyone needs to have and more over its not a wasteful expense when people invest in housing it accumulates to wealth.
It’s a better way of using superannuation I mean somewhere along the line our allowance together with superannuation funds helps civil servants buy houses.

Croz: What about the 55 retirement policy?
Parmesh Chand: 55 Plus is misunderstood a lot both in the civil service as well as outside. It was brought in to do a number of things. Firstly, people 55 and above had recourse to their own superannuation. It was recommended to make way for the younger people. Secondly there was enough pool of young people who could be trained through a succession plan; and thirdly with older people leaving it gave good opportunities for restructuring with new ideas, new blood and new things. And fourthly if none of this could be done the options based on skills to re-engage them. So there’s all that flexibility.

Croz: I was thinking more in lines with surgeons and…
Parmesh Chand: Yes. Well, 99% of the people in the hospitals were re-engaged, 99% of the scientists were re-engaged. In fact we off-loaded the responsibility to the Ministry of Health to tell us who they wanted re-engaged and none of them had declined.

The two concluding parts of the interview will be published early next week.


Corruption Fighter said…

In September last year you published an article by Thakur Ranjit Singh entitled 'Questionable Dealings in Fijian Holdings Ltd'. It made allegations against Laisenia Qarase and others in Fiji Holdings Ltd.

You might like to revisit this issue in the light of the recent grab-back of $20 million from the Fijian Affairs Board.

The Thakur Ranjit Singh litany of allegations was circulated widely before and immediately after the 2006 military takeover and was influential in leading some Fijians to believe that a clean-up was necessary.

TRS claimed that individual Fijians or Fijian owned-companies could buy Class A shares with the assistance of finance obtained through FDB loans. He did not explain what was wrong with such loans. Were the loans made with inadequate security? Was a concessional interest rate given for the loans? He did not show that there had been defaults on loans, as there were with the notorious NBF loans. Clearly the income earned and the growth in value of the Class A FHL shares meant that the borrowers should be in a position to repay the loans. The allegation of FDB loans was no more than a smear.

Another of his allegations was that "Fijian Provinces were betrayed" because the individual Fijians who had bought Class A shares were able to control FHL. The Class B shares held by the Provinces and the FAB, TRS asserted, had no voting rights for directors. This was obviously believed by the military cleaners for some time because it took them a year more after their takeover of government powers to realise that their illegal Minister for Fijian Affairs could appoint a majority of directors to the board.

Yet another allegation, and one the hardest to understand, is that the Board members of FHL had FHL shares. TRS said: ""Note that board members of FHL, with shares then included Laisenia Qarase, Sitiveni Weleilakeba and Josaia Mar, who has been removed as Chairman of FEA by Commander." Again this is a smear, implying that ownership of shares somehow disqualifies someone from serving on a board of directors. Surely shareholders want directors who have shares in a company, because they have a stake in its prosperity.

Then there's the smear that a loan to set up FHL was converted to a grant. "What taxpayers of Fiji need to know is under whose authority this taxpayers' loan of $20m was converted to a gift for FHL."

This is not true, it's never been true, he should always have known it to be false, but now the evidence is out on the table where he can't deny it.

It was the Fijian Affairs Board that received the grant, not FHL. And FAB used the funds to pay for shares, ie an asset which yielded it $24.75 million in dividends. In the last three years alone, when the FAB has been directly under the control of the military regime, these dividends have totalled $10 million.

Where has this $10 million (along with the other $14 million) gone? Has the FAB sat on the money or have they used it to do the job that government would otherwise have to fund them to do? If they haven't been using it to pay for the normal business of the FAB the FAB should have it in a bank account and the government can take it back.

In short, there was no loan that was turned into a grant to FHL. The loan was turned into EQUITY in a sound and profitable company, an asset held by a government agency. These shares have been a consistent sources of income for the government, including the illegal one in the past three and half years.

So FHL owes the government nothing. It's Thakur Ranjit Singh who owes the builders of FHL an apology. They built a major business which has given Fijians a stake in their economy without taking anything from the taxpayer.

This is in stark contrast to the money that the National Bank of Fiji lent to undeserving Fijians such as the Ganilau family in the name of affirmative action. This left huge debts because the family were intent only on funding a lifestyle they felt they were entitled to.

Popular posts from this blog

Lessons from Africa

Fijian Holdings Scandal: Betrayal by their trusted sons