Local Gov’t Commission clamps down on City Hall over $200M NIS debt

Aug 14, 2019 News

The Local Government Commission,(LGC) has instructed the Georgetown Mayor City and Council (M& CC) to clear over $200M worth of employee contributions owed to the National Insurance Scheme (NIS).

Chairman of the LGC Mortimer Mingo

The move is part of a wider plan by the LGC to clamp down on local government authorities, which have been failing to honour the statutory obligation of paying NIS remittances on behalf of their employees.
During a statutory meeting held at City Hall, yesterday, Town Clerk (ag) Sherry Jerrick, informed the Councillors of the LGC’ s intention to have the Council clear its debt to NIS.
In addition, she noted that the Commission had asked that the Council pay regularly the monthly contributions of employees. Jerrick furnished the Council with a letter signed by Chairman of the LGC, Mortimer Mingo.
According to Jerrick, the letter outlined that the Georgetown M&CC’s current debt to NIS is $218,416,918. She noted that the correspondence served to remind the Council that non –payment of the contributions will result in loss of benefits for City Hall staffers.
In addition, Jerrick noted the letter emphasised that the statutory obligations of M&CC to pay current contributions on behalf of the employees when they fall due.
Further alluding to the letter, Jerrick added the LGC warned that, “It should be recognised that through the non-payment and corresponding non-submission of schedules the stated debt continues to increase.”
In keeping with powers vested in the Local Government Commission Act of 2013, she said that the Commission had therefore instructed that the M&CC submit to NIS payments submission of the mentioned outstanding remittance to enable computation of the real debt and further to actualise the settlement of the debt on or before August 12, 2019.”
The Town Clerk (Ag) said the M&CC is also required to provide the LGC with all documents submitted to NIS.
According to Jerrick, the Commission has requested monthly status updates as it regards the payment of City Council debt and the monthly remittance of employees NIS deducted.
In response to queries about the City Hall‘s August 12 deadline to make the submissions, Jerrick told the Council that she only received the correspondence on Friday last.
“The correspondence is stamped as received on July 31… It has no signatures as to who received it but I received it from the secretary on Friday afternoon.”
In response to further queries on the issues, Jerrick informed the Council that the outstanding monies owed to NIS are being paid.
Last year, NIS Debt Recovery Manager, Louise Bryan, testified before a Commission of Inquiry into the Mayor and City Council about the city’s indebtedness to the Scheme.
She disclosed the M&CC had racked up over $206M in debt to the National Insurance Scheme.
Bryan told retired Justice Cecil Kennard who chaired the CoI that the outstanding payments span the period September 1994 to August 2018. Bryan stated that partial payments were made for the periods May to November of 2009, September to November of 2016, February to May of 2017, April to December of 2017, March of 2018, April to June of 2018, and July to August of 2018. She said that though partial payments were made, the Council racked up interest, which the city has not paid to the Scheme.
The Debt Recovery Manager provided a series of documents to the Commission, which she explained, comprised a series of demand notices issued to the Council throughout the periods of their non-payment, as well as letters from the Scheme to the Local Government Commission.