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The Gleaner - August 18, 1999

 

Davies defends FINSAC

OCHO RIOS, St. Ann: THE NEED to prevent the total collapse of certain financial institutions will, through FINSAC, cost the Government $8 billion this year, according to Minister of Finance, Dr. Omar Davies.

Addressing party supporters at a People's National Party (PNP) North East St. Ann constituency conference at the Marcus Garvey Technical High School on Sunday, Dr. Davies conceded that FINSAC had cost the Government a lot of money.

He defended the Government's decision however, to create the agency and reiterated his claim that it was a protection tool for thousands of depositors and pensioners.

"We were advised against using FINSAC to intervene in the affairs of troubled financial institutions by both the IMF and the World Bank," the Finance Minister said.

"I don't regret intervening, as the question is not what it will cost to intervene, but what would have happened if we didn't. If Mutual Life, LoJ and Crown Eagle had gone under, there would have been thousands of people, many of them old pensioners with all of their life savings wiped out."

Dr. Davies explained that the cost of FINSAC this year will be the equivalent of what it would take to build roads and hospitals, and that it was the first time that he was actually given a figure to the actual cost of the bail-out.

He also warned that the Govern-ment would vigorously investigate and prosecute those who had defrauded these institutions, and have brought them to the brink of collapse and at the expense of the depositors and taxpayers.

"Many of those people who have created this problem should be wearing short pants in some jail somewhere," the Minister said. "However, we have to let due process under the law run it's course before any action can be taken. I can say this to you though, that we will spare no expense in bringing those responsible to justice".

Strong message

Dr. Davies added that the Government has to send a strong message that those assigned to look after peoples' money should do so with great responsibility, and not to abuse it as if it were their own.

"Can you imagine a 65-year-old pensioner, whose entire life savings have been wiped out?" Dr. Davies asked. "Any country that has its citizens' money being wiped out in financial institutions is a country on the verge of collapse. Jamaicans abroad, who make up a large group of depositors, would refrain from sending their money here, and there would be riots and demonstrations everywhere," he added.

The Finance Minister, who declared himself pro hanging, also came out strongly in support of capital punishment, and said that it might be the only real deterrent to violent crime.

"I am not a lawyer, but I can recognise the frustration of this country, with all the violence that is taking place," Dr. Davies continued.

"I have told K.D. Knight that the day he decides to resume hanging, I will voluntarily knock off two and go and have my breakfast," he said.

 

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