These include big payouts to Clico and Hindu Credit Union.
Dookeran told reporters he plans to pay Clico policyholders $75,000 each and 20-year zero-interest bonds. He said for 25,000 people, who invested less than $75,000 in cash. Depositors of the Hindu Credit Union will also receive $75,000 cheques before Christmas, the minister promised.
JYOTI reported the HCU payout exclusively earlier this week.
Dookeran also said he plans to pay contractors who are owed billions of dollars. “That contractual obligations must be met if we are talking about good governance and financial accountability.
He said he prefers a cash as opposed to bonds as suggested last Saturday by Works Minister Jack Warner in a speech to the contractors association. The contractors had discussed the idea as far back as September ans said they would accept such an offer.
However Dookeran doesn't think the bonds is a good idea. “Bonds will be tantamount to a loan and increases our indebtedness over time,” he explained. “Once we can handle within our cash management, this situation, we prefer to do it that way.” He said the biggest problem is verifying the actual debt owed to the contractors, which is said to be about $7 billion.
Dookeran will take to Parliament three bills to raise the debt ceiling.
The Government’s deficit in its 2011 $49 billion budget is already $7.3 billion. That does not include enough to meet the present payment demands of the Contractors’ Association and the Public Services Association (PSA). Also, the budget did not cater for the increase of the minimum wage by $3.50 an hour, to $12.50.
Dookeran said his objective is to stimulate the economy by injecting cash into the system to encourage people to start spending. He explained that there is excess liquidity in the banking system within $4 billion but there is a very low demand for loans.
That is why he wants to circulate more cash to trigger growth in the system, especially in country’s declining construction sector which should generate jobs.
The Government is borrow more than $6 billion from Inter American Development Bank. It expects to have $630 million of the funds approved by the beginning of December. Much of that will go to finance Public Sector Investment Projects (PSIP).
The International Monetary Fund has endorsed the People’s Partnership Government financial strategy. Its report released on Tuesday projected growth in 2011.
Read the story: IMF projects growth in 2011 due to 'expansionary' budget, praises plans for structural reform
“The situation on the financial side is improving and while we do have a lot of overhangs we will resort to some borrowing to be able to meet our deficit but not going into any bonds at this point in time,” Dookeran said on Wednesday.
“We have the Finance Act that will be placed in Parliament within the next month to give effect to the measures in the budget and when it becomes law, we can go ahead,” he said.
With respect to civil servants, Dookeran announced that the Public Services Association (PSA) will resume talks on Monday with the chief personnel Officer (CPO) “We will continue to negotiate and hope to come to a conclusion early on this matter." However he stated that it is not his responsibility to satisfy "today’s generation at the expense of future generations".
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