Musa’s address raises more questions than answers
The controversy over Prime Minister Said Musa’s unilateral government guarantee and subsequent assumption of a thirty-three million dollar loan from the Belize Bank to Universal Health Services has now escalated into something more closely resembling a financial, constitutional, and political crisis. Today the P.M. for the first time spoke directly to the Belizean people on the subject in the form of a five minute radio address aired by stations nationwide. In case you happened to miss it, we’ll play the audio one more time followed by some pointed questions.
Prime Minister Said Musa
“My Fellow Belizeans,
during my absence from Belize on official business, the issue of the Universal Health Services’ debt to the Belize Bank guaranteed by the Government of Belize erupted into a serious public controversy.
I now take this opportunity to clarify a number of misrepresentations.
As I reminded the Cabinet yesterday, when I signed the guarantee in December of 2004, I did so on the basis of firm legal advice that I had the authority to sign it. In fact, past Ministers of Finance have signed similar guarantees, so there was nothing strange about this guarantee. It was a standard guarantee.
I realize that one of the burning questions out there is why sign a government guarantee for a private company? First of all, remember that in our last Manifesto we promised to “encourage the expansion of private health care facilities” and the “expansion of the National Health Insurance scheme countrywide”. The D.F.C. therefore had this in mind when it made a commitment to finance the U.H.S. project up to twenty-eight million.
The D.F.C. felt that with the government’s projected roll-out of N.H.I., U.H.S. would be able to meet its repayments. The hospital became operational, providing quality health services to countless Belizeans. Then the D.F.C. ran into its own problems and could not continue to finance the project. It turned to the Belize Bank for bridge financing. The Belize Bank agreed and took a guarantee from the D.F.C. Eventually, after continual requests from the D.F.C. to finance the project, the Belize Bank asked for a standard sovereign guarantee.
I signed the sovereign guarantee because the alternative would have been the collapse of a high quality hospital that had been saving hundreds of Belizeans lives. Some people might not agree with that decision. But I made that decision in good faith, believing that no value can be put on the saving of Belizean lives. I never lied to the Cabinet, the Public Finance Committee or the House of Representatives on this matter. The Cabinet accepts that I acted in good faith.
I will not pretend for a moment that this issue is not a complex and messy one. It is. Public emotion runs high. A lot of legal and political games are being played with this matter. That is to be expected and will only intensify as we approach 2008. The real truth is that the government owes a debt to the Belize Bank. And mark my words: whichever government is in will have to settle the debt.
That is why months ago the Cabinet took the decision that the best way out of a bad situation was to settle the debt with the Belize Bank and take over the U.H.S. Our thinking was that since we had to settle the debt, we might as well have something to show for it. That something would be the U.H.S. hospital. We would then use the hospital to provide access to quality tertiary care for those Belizeans who could not otherwise afford it. The public health care system would be enhanced by a well-defined collaboration between a restructured U.H.S. and the K.H.M.H.
The Settlement Deed and Loan Note were never intended as a final settlement of this matter. As the negotiations went on several different settlement models have been proposed and reviewed. It seems to me that in the increasingly charged political climate, the Belize Bank’s letter of May 2nd 2007 was an attempt to safeguard their interests.
But yesterday the Cabinet and I resolved to expedite the negotiations with a view to getting the debt restructured and stretching the repayment over a period of about twenty years. The final product would then be taken to the National Assembly for debate and approval. Let me state plainly that we have no fear of tabling and debating this U.H.S. matter at the soonest possible time before the National Assembly of Belize.
In all of this, I am mindful of the fact that there is strong public sentiment that the principals of UHS should not be shielded by the government. We have no intention of doing so. The principals will bear full responsibility for their own indebtedness to the Belize Bank.
In spite of all the distractions and attempts by some to sow seeds of doubt, fear and uncertainty in the minds of people, the work of government must go on. We have steadfastly pursued the task of creating a better Belize for the present and future generations to enjoy in peace and security. We do not shy away from facing problems and finding solutions.
Providing decent and affordable health care to all our people remains a matter of vital importance. That was our promise when you elected us to office. That continues to be our firm commitment.”
It would have been nice if our reporters had the opportunity to question the Prime Minister, but since his return from Taiwan on Sunday he has denied our repeated requests for an interview. He did do a propaganda session with his own Chief Information Officer, Nuri Muhammed, which ran prior to this newscast as a paid ad. It differed little from the radio statement. There is a real press conference set for Thursday morning at the Prime Minister’s Belize City office. In preparation for that highly anticipated event, our newsroom has put together a list of questions and comments based on the Prime Minister’s address.
One: The Prime Minister set out to clarify “a number of misrepresentations” yet nowhere does he say what those misrepresentations are.
Two: He says he signed the guarantee in December 2004 “on the basis of firm legal advice.” Who gave him that advice?
Three: He refers to similar guarantees made by past ministers of finance. Can he please cite those guarantees and who made them?
Four: The Prime Minister says he acted in good faith. Does good faith even matter if the result was a bad decision?
Five: He refers to “legal and political games being played.” Could he be so kind as to describe those games and who is playing them?
Six: The Prime Minister talks about a Cabinet decision to “settle the debt.” Yet a number of Cabinet ministers say they never even know about the debt. Could you please state unequivocally when you first informed Cabinet about the guarantee you signed in December 2004 and the subsequent deed of settlement and loan agreement signed on March twenty-third, 2007?
Seven: If “the settlement deed and loan note were never intended as a final settlement” why did you sign them? Judging from banker Phil Johnson’s letter, it certainly appears that he thought the matter was settled.
Eight: The P.M. says he and Cabinet resolved to negotiate a restructuring of the loan, extending its terms to twenty years. What leverage does the government have in such a negotiation other than the goodwill of Mr. Ashcroft’s bank … and what is the ultimate cost of that?
Nine: The Prime Minister cites “strong public sentiment” that the U.H.S. principals should not be protected. That’s good, but if public sentiment matters, shouldn’t he consider the strong public sentiment as expressed in the recent SPEAR poll, that there is little confidence in his government and he should call elections now?
Ten: The bottom line that Prime Minister Musa will hopefully address tomorrow is why was the entire thirty-three million dollar commitment was kept a secret … from his Cabinet, from the National Assembly, and most importantly, from the public whose taxes must now make good on a debt that government never should have incurred.
