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Published On: Thu, Jul 23rd, 2020

MP Wescot-Williams wants clarity about liquidity support conditions

MP Sarah Wescot-Williams - 20191010

PHILIPSBURG – United Democrats MP Sarah Wescot-Williams questions the measures the government is taking to meet the requirements for receiving the second tranche of liquidity support. She points in particular to the Cft’s position that pension reform cannot be part of the package of cost-cutting measures.

In fact, the Cft wrote in an advice to the Kingdom Council of Ministers that the demand for reforming the pension system is part of an instruction issued by the kingdom in 2015 that should have been completed by the end of 2016. The adjustments of the pension system and the decision not to compensate for inflation in the past have no place in the required package of decreased labor conditions per July 1, Cft-chairman Raymond Gradus wrote in his advice to Mark Rutte as the chairman of the Kingdom Council of Ministers on June 24.

MP Wescot-Williams wants to know “what government’s approach will be to these unacceptable measures.” However, the government accepted the conditions attached to the second tranche of liquidity support unconditionally.

“What are the changes to the vacation allowance payment and in how far are these changes part of the 12.5 percent reduction in personnel cost? That is also a requirement for liquidity assistance.”

The MP furthermore asks for a projection of the government’s liquidity position until the end of this year and for an overview of necessary changes to legislation that are needed to “legitimate decisions they have taken to comply with the Dutch conditions.”

According to Wescot-Williams, it remains unclear what the measures are to achieve the 12.5 percent reduction in personnel costs, wondering “how legal it is what the government is doing in this context.”

That financial supervisor Cft apparently does not approve of some of the measures the government has taken is another reason of concern for the MP: “How close are we to receiving the second tranche of liquidity support and what is our alternative?”

The Cft asked in its advice dated June 24 that St. Maarten proves before July 15 (by now more than a week ago) that it has complied with the condition of lowering the salaries for civil servants and employees in the (semi)public sector by 12.5 percent. The Cft observed that the cost-cutting measures at telecom provider TelEm are below target at 10.93 percent.

It is also unclear whether ministers and parliamentarians have complied with the demand to lower their remuneration by 25 percent. It is incorrect to include the 10 percent salary reduction for the period April-June in this calculation because this was a condition for the 2019 liquidity support. To the Cft it is also unclear whether this 10 percent is part of the proposed 15 percent cut, due to a lack of specification.

“The current proposal does not represent a 25 percent reduction of the total package of labor conditions per July 1,” the Cft wrote in its advice.

There is yet another stumbling block: St. Maarten wants to correct the cuts in 2021, but the condition for receiving liquidity support requires that they remain in place until further notice.

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