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Rent arrears headache for BIDC


Rent arrears headache for BIDC

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SOME $11 MILLION in rent is owed to the Barbados Investment and Development Corporation (BIDC).

Industry Minister, Donville Inniss, made the disclosure recently, and said when he took up his current portfolio two years ago, the BIDC was already owed this sum by tenants.

“Now show me which private enterprise in Barbados can sustain that on their books, they would be deemed to be insolvent.  They would not be able to function,” he remarked.

The Minister added that because the BIDC was a state agency some people might feel that this was not a major issue.

 However, he stated that every time the Ministry of Finance or the Accountant General had to transfer money to a state agency like the BIDC, the money was coming from each taxpayer in this country.

“It would be remiss of me to adopt an attitude that taxpayers have deep pockets, an infinite resource of finances that you can just transfer to every entity.  That is why, sometimes we have to make adjustments, and therefore, along with that there has also been an attitude because it is Government, we will not pay,” he said.

Acknowledging that the BIDC was not the only entity facing this problem, the Minister said the situation existed at Oistins, where the NCC has been having challenges collecting their rent from vendors.

 “You can go throughout other government ministries that own physical assets and understand the dilemma that they face in collecting rent from tenants.  Our rent default situation is considerably higher than it would be or could be anywhere else in the private sector, and when an agency like the BIDC which depends quite a bit on that rental income for its operation, then we have to do what we have to do to remind tenants of their obligation and to work with them,” he insisted.

Inniss added the BIDC was not in the business of shutting businesses down, but rather, they were focused on opening businesses and expanding them.  However, he said when everything possible had been done and there was nothing more that could be done, then one had to make a judgment call.

 “There are others who perhaps can do better, but adopt an attitude that they will not pay… The reality about it is, if the cash isn’t coming in then you cannot service your debt, and I have simply said to BIDC that you need to adopt some private enterprise approaches in conducting your affairs.

“So, therefore you dispose of some non-performing assets but that takes time, but that is only going to help in the short to medium term and when that cash goes and you have not corrected some other inefficiencies or deficiencies in the system, then you will find yourself back to square one,” he said. (BGIS)