Opinion: The truth about debt relief

POSTED: 02/17/12 12:45 PM

Vice Prime Minister Theo Heyliger created the impression at Wednesday’s press briefing that St. Maarten is entitled to 183 million guilders in debt relief – at least to the part that remains after the Netherlands covered 60 million in debts to the pension fund Apna.

This assumption is wrong, and we think that our vice prime minister knows this as well. So why bother making such statements?

The Netherlands Antilles signed the so-called Slotverklaring (Final Statement) on November 2, 2006. That document contains all the agreements about constitutional reform – the road to country status. The chapter about debt relief states that the Netherlands will take care of payment arrears for the Netherlands Antilles to a maximum of 483.5 million guilders ($268.6 million). In the transition accord of February 12, 2007 that was signed by Prime Minister Sarah Wescot-Williams, the share for St. Maarten in debt relief payments was set at 183.3 million guilders ($101.8 million).

Under the heading Arrears of Payment article 15 of the transition accord mentions this number in paragraph C. But it is preceded by the text: “It concerns the following maximum amounts.”

The transition accord does not stipulate that the Netherlands will pay 183.3 million guilders to St. Maarten just like that. The number was pinned down as a maximum, and the vice prime minister ought to know this.

Paragraph D. of the same article sets a clear condition for the payments: “The Netherlands shall proceed with payment of these accounts, after an accountant appointed by the Netherlands has verified the accounts.”

And that is where the problems started for St. Maarten. The Island Territory’s financial administration was such a mess that the government never managed to substantiate debts beyond the 60 million guilders it owed to the Apna pension fund. It is interesting to note that our current finance minister was the head of the finance department.

Because St. Maarten was unable to prove that certain debts existed, the Netherlands kept those 120.3 million guilders. While the vice prime minister wants people to believe that the country always was entitled to this money, the truth is that it was the maximum the Netherlands was ready to fork over – on the condition that St. Maarten presented verifiable accounts for its debts. This is where years of neglect and sloppy accounting finally caught up with the government. The General Audit Chamber of the Netherlands Antilles has not approved a single annual account of the island territory. The island governments have chosen time and again to simply ignore the signals it received from the Audit Chamber. Had it cleaned up its act and made sure that its accounting practices were up to standard, the debt relief payments would have been made a long time ago.

But the finance department was never able to produce the right figures, backed up by credible documentation that certain debts existed.

The fired head of the finance department, Bas Roorda, presented in court in October a document outlining how a row between him and drs. M.J. Hooi, a former audit manager at the government accountant bureau Soab, had frustrated the debt relief payments.

Hooi withheld an opinion on 27 different accountant statements. Such an opinion means that the Soab could not guarantee that the debts described in these statements were genuine. Had Hooi approved these statements, the Netherlands would have paid the debts, Roorda stated in the document.

Roorda also explained that the government’s financial administration was inadequate and that the balances showed unacceptable differences: “This was caused by the fact that the receiver, who remarkably enough also makes payments, never gives specifications of what exactly is being paid. If you keep this up for years, you will automatically get differences.”

Soab later of course denied that it was the culprit and accused Roorda of submitting information too late.

But Roorda stated that Hooi refused to approve the statements until the balances matched exactly. “He constantly asked the creditors for information and then waited for months for answers that never came.”

When Roorda found out from the finance ministry in The Hague that based on the so-called can-rule debts would be paid if St. Maarten made it only plausible that they existed, positive Soab-opinions on the 27 statements could have saved the day – but this never happened.

Dutch parliamentarians this newspaper spoke with during the recent Ipko-conference confirmed that under the current conditions payment of what could have been the remaining debt relief is simply out of the question.

The Netherlands did not move any goal posts, as our vice prime minister claims. It simply sticks to the agreements it signed with St. Maarten.

I couldn’t play the game so I had to change the rules. That expression comes to mind. But based on irrefutable evidence it is not the Netherlands that attempts to apply it – it is our own vice prime minister.

 

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