THE EDITOR, Sir:

THE ANNOUNCEMENT that Petrojam has not paid over some $699 million to the Government was explained as arising from an accounting error. Understandably, the credibility of the reason for the non-payment is brought into question when it is observed that after the revelation of the non-payment, rather than settling the amount in full, a part-payment was made. That would suggest that regardless of whatever accounting error that might have occurred, there was also a shortage of cash. It begs the question therefore: How serious is the cash-flow problem?

serious trouble

Recently, Petrojam announced that it lost $4.4 billion because the price of oil fell sharply and another $4 billion in foreign-exchange transactions. The public was never advised of any investigation into the matter neither was any credible explanation offered. If Petrojam now requires the special consumption tax (SCT) deduction to complement its working capital, then Petrojam is in serious trouble.

The Government and, in particular, the minister of finance, has a responsibility to enquire into the operation of that institution. A company that is operating as a monopoly supplier and one that makes weekly adjustment to the prices of its products, factoring both exchange rate and commodity price, must not be permitted simply to say 'We have lost money' and it's business as usual. Someone must be accountable.

mismanagement and misdirection

Are the losses real or are they the product of creative accounting which would make the company one that is worthy of speedy divestment? Whatever the reasons, the public must be told how can these things be and who is accountable. Is the financial state of Petrojam the result of managerial ineptitude or bad policy directive or political interference?

If Petrojam is losing money, it is doing so not because it is owned by the Government, but because it has bad managers or it is being misdirected. To the extent that the Government accommodates bad management they become responsible. At this time, Jamaica cannot afford to sit in silence and do nothing to stop it. Petrojam must be managed properly by the public sector, failing which we will be exposed to the ravages of a private-sector monopoly in the provision of an essential commodity.

I am, etc.,

LUCIUS C. WHITE

Kingston