Lawrence Duprey, chairman of CL Financial group. - File
The Patrick Manning administration heads back to the Trinidad and Tobago parliament today hoping to push through amendments to the island's central bank and insurance industry laws to give regulators formal authority to take over the investment banking and insurance subsidiaries of Lawrence Duprey's CL Financial group that went belly-up last last week.
But despite the 26 to 15 majority that Manning's People's National Movement (PNM) enjoys in the 41-seat House of Representative, success in the passage of the bills was not assured when debate on the amendments adjourned Monday night.
Such amendments require a three-fifth or 60 per cent vote in favour which, on the face of it, should be handily mustered by the ruling party. However, one member of the ruling party occupies the Speaker's chair, which normally makes him an ineligible voter, except in the rarest of circumstances.
Government resources
Even then, the PNM should have the votes to carry the bill, except that estranged parliamentarian, Keith Rowel, warned that he would withhold support until he receives clear assurance that politics would have nothing to do with the management of the government resources that will go towards the CL bailout.
Regulatory reform has been on the table in Trinidad and Tobago for several years, but parliamentary approval has lagged.
The government was forced to scramble to action in the face of the crisis which, at its worst, threatens a conglomerate with assets of over TT$100 billion and accounts, by some estimates, of between 10 per cent and 15 per cent of the country's GDP. CL has stakes in bank, insurance, energy, real estate and spirits and the media. It is the ultimate owner of the Jamaica's Lascelles DeMercardo Group.
Rowley was last year fired by Manning as housing minister in a wrangle over Rowley's public statements alleging abuse of power, if not corruption, at Urban Development Corporation of Trinidad and Tobago (UDeCOTT), of which Calder Hart is chairman.
Hart also chairs the National Investment Bank (NIB), one of the vehicles that government intends to use to acquire distressed CL assets.
He could not support a bill, Rowley said, that would put "billions of dollars into the hands of Hart", recalling an alleged public statement by the UDeCott boss that public agencies like his were not accountable to ministers.
Manning and his finance minister Karen Nunez-Tesheria can also expect further rough going from the United National Congress (UNC) whose leader, Basdeo Panday, characterised the govern-ment's intervention of CL as a "hostile takeover".
CL's Duprey was known to be a backer of Panday's party and the then prime minister when the UNC held office in the 1990s, a fact for which, Panday claimed in Parliament, the entrepreneur "was never forgiven".
Orchestrated run
In fact, opposition MPs characterised moves by the state-owned National Gas Company in recent weeks to withdraw US$250 million from the CL subsidiary, Clico Investment Bank, as a sort of orchestrated run on the institution.
"...Today, when we hear the prime minister, we understand why. He has never forgiven CLICO and its chairman from being friends of the prime minister and of the UNC," said Opposition MP Kamla Persad-Bissessar.
Like Rowley, Persad-Bissessar opposed the CIB's holding CL's assets if Hart remained chairman of the sate-supported investment bank
"If NIB is going to be involved in this, Calder Hart must go, he cannot be left there," she said.
In Monday's parliamentary session, Prime Minister Manning said the group had liabilities of more than US$1 billion, and that in recent weeks it has been experiencing net withdrawal from its institutions of around US$40 million a week.
business@gleanerjm.com