Harvesting the surplus?

This letter was written on July 10, 2003 by Harry Dookran, Secretary of the Caroni Pensioners Association. In it he highlights the plight of the pensioners and their effort to get an equitable share of the $79 million in pension funds.

Dr H Harracksingh   The Chairman   Caroni (1975) Limited Brechin Castle Couva

Dear Sir,

I have been directed by the executive of my association to write to you once more on the matter of increasing pensioners in payment pensions as a result of the surplus in the fund. In our letter to you dated May 27, 2003 we have not had a response from you or your subordinate authority. We have returned to the negotiating table only on our challenge that pensioners are in fact legitimate members of the fund and our organisation has been “registered under the Trade Unions Act.” On Monday October 21, 2002 in our meeting with you at your office at the University of the West Indies, you gave us (Mr Lyle Donawa and Harry Dookran — president and secretary respectively) the assurance that existing pensioners matter is on the front burner, based on your request for an independent advice from Messrs Baker, Woodrow and De Souza, which to us was very heartening. In our subsequent meeting with you, you indicated that he Active Staff Unions informed you that the Fund belonged to them. How disappointing. At least we are comforted today by the fact that you have had an independent professional advice to guide you on the administration of pensions.

In our letter to you dated May 27, 2003 the proposals contained therein have been estimated to cost $37 million and this includes paying the exgratia element out of the fund.
At a meeting at the Human Resources Department on Thursday June 26, 2003 the active Associations advisor said that if the Fund is going to pay the exgratia element of pension to staff members with daily paid service they will file litigation to stop it. My association would like to know who is going to pay the exgratia pension in the future. Your senior Human Res-ources Personnel, Sham Ramsaroop could not provide an answer at the meeting on Wednesday July 9, 2003. The exgratia pension is a liability of the company and equally so is the Group Health Plan to its members. We would like to know whether or not there will be continuity after August 31, 2003. I am again referring to our letter to you dated May 27, 2003 and the proposals have been costed by KR Consulting at $37 million on the premise of the Retail Prices Index with the provision of annual increments in accordance with the changes in the Retail Prices Index. I have been informed by S Ramsaroop, Administrative Services Manager that it has been forwarded to the Ag Chief Executive Officer. It has not been raised at any of the meetings my association attended nor do I have any knowledge of its acceptance by the Management Commit-tee. The system of granting monthly pensions increases to existing pensioners and current staff members who will be pensioners in the next three weeks will undoubtedly guarantee fairness, equity and justice. I have enclosed a copy of the Management Committee recommendations for imp-rovements for members and pensioners. Items (1), (3) and (4) are directly related to active members at an estimated cost to the Plan of $34.2 million. Item (2) is related to existing pensioners at an estimated cost to the Plan of $11.5 million. This is unacceptable. The recommended estimated cost to the plan is $45.7 million.

Improvement benefits to members = 75 percent
Improvement benefit to existing pensioners = 25 percent
The active members pension will be calculated on a “Non Discounted” method. This in itself would generate an increase of “0 to 100 percent.” It is the Association incontrovertible view that the Management Committee members and the active associations are in a consort arrangement of harvesting the “surplus.” Come what may there has to be an equity. Active employees are members of the fund. Retired employees are members of the fund. Why there should not be equity of the surplus when one take into account that existing pensioners have not had an increase over the last 21 years. On August 3, 2003 more than 99.5 percent of the active employees will be retired members, the playing field will become level. It would be an opportune time for negotiating pensions for all and sundry. My association supports the process of dialogue from a Deposit Administration contract to a “self Administered Fund” of all stakeholders (ie active members representatives and retired member representatives) with Guardian Life for a smooth and harmonious transition without having to purchase annuities in the present situation.

The active unions are apparently positioning themselves for absolute control of the Management Committee. My association would like to advise that any replacement or formation of a New Manage-ment Committee, the existing “Caroni Staff Pensioners Association” has to be a component of that body. The Staff Pensioners Association has the advice from more than one attorney-at-law and they have advised that in the present circumstances of the fund, the current officers of the Management Committee are in conflict of interest, and its decisions and recommendation will be ruled “Null and Void” by Court of Law. My Association would like to advise you Mr Chairman, that should you pursue Board Approval without reviewing your position on equity and fairness in relation to existing pensioners litigation will be instituted to stop implementation. My association is appealing to all persons of authority copied, to assist us for a fair and equitable settlement of our proposals in our letter to the Chairman dated May 27, 2003.

Harry Dookran