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Bpl Staggering $70m Exit Plan

By KHRISNA RUSSELL

Deputy Chief Reporter

krussell@tribunemedia.net 

WITH 314 Bahamas Power and Light employees opting to receive voluntary separation packages which will result in more than $70m paid out over a period of time, Works Minister Desmond Bannister said employee departures have been staggered to ensure that the efficiency of Bahamas Power and Light is not negatively affected.

Mr Bannister, who has responsibility for the “debt-ridden” electricity provider, explained the exercise will improve BPL’s financial viability by making it leaner and more competitive.

Although he told House of Assembly members BPL could not be permitted to balloon out of control to “unmanageable” proportions, the minister said offering the VSEPs (Voluntary Separations Packages) will also make way for the company to recruit and hire qualified young people within “tightly controlled” limits.

In total, the voluntary packages will cost $70,403,315, but so far only $56,008,991 has been paid out as of June 30. Each payout would fluctuate based on years of service and other elements.

The money was partially funded from the pension fund administrator. The remaining portion was financed through money secured by BPL on July 2, 2017 through a resolution in the House of Assembly, Mr Bannister said.

A total of $75m was received in two tranches less bank fees, legal costs and stamp tax. He said this leaves the current loan balances at $211m and $35m respectively.

Officials expect an annual salary reduction of $13.6m annually over the next five years. He said this total is an estimate and includes new hires to be added to the payroll.

And as some employees depart, there also will be a change to BPL’s executive team. Bahamian Patrick Rollins has now been appointed to fill the post of executive director, a position that was previously held by Deepak Bhattnaggar.

“It has long been recognised that Bahamas Power and Light has been overstaffed by hundreds of employees,” Mr Bannister told House members.

“The government took the position that the company had to become leaner and more competitive. A debt-ridden utility that relies on government for its continued existence is a drain on the Bahamian taxpayer. Hence, the board initiated a financially attractive voluntary separation exercise, which had the full support of both of BPL’s unions.”

He also said: “It must be emphasised that the entire exercise was voluntary. No employee was separated against their will.”

The VSEP exercise opened to all employees of BPL on May 18 and closed on June 8, promptly at 4.30 pm. Of BLP’s 1,038 employees, 314 applications were received.

“BPL made a determination that everyone who wanted to leave should have the opportunity to do so; hence, many senior employees decided to accept the VSEP. It is, therefore, expected that 60 of the positions will need to be replaced as contracted and delayed applicants exit the organisation over the next two years.

“Among these positions will be posts for senior leadership in many departments.

“There is no question that this exercise will improve the financial viability of the company, making it leaner and more competitive, and permitting it to recruit and hire qualified young people within tightly controlled limits. BPL cannot be permitted to balloon out of control to an unmanageable size ever again,” he further said.

Efficiency

The dates when employees are slated to voluntarily leave BPL have been spread out over two years, Mr Bannister said, so as not to affect the company’s efficiency.

As of June 30, he said 219 applicants were approved for departure, followed by the approval of eight applicants who are due to leave in July.

Four applicants were approved for departure in August; nine applicants were approved for departure in September; four in October; seven in November; and 39 applicants were approved for departure in December.

In March 2019, one applicant will be leaving; 12 applicants were approved for departure in June 2019 and four applicants will depart in December 2019.

Seven others will leave BPL in 2020.

The 314 employees come from several of BPL’s departments, which will see reductions over the next two years.

In Abaco there is a headcount of 99. Twenty-four of the employees there were approved, with two of the applications deferred six months.

BPL’s customer service department, with 139 workers, will be reduced by 33. There are 202 workers in the energy supply department; 61 opted to receive the VSEP. The Family Island department’s 224 workers will be reduced by 63.

In the following departments, various numbers of workers have opted to leave: in field operations, 75 of 224; in finance four of 26; health, safety and environment four of 11; human resources seven of 16; human resource training four of six; IT, six of eight; planning 10 of 20; supply chain 12 of 35; administration two of four; engineering six of 16; legal one of four; and in support services two of four employees.

Comments

realitycheck242 3 months, 4 weeks ago

70,403,315, Divided by 314 averages works out to a hefty take home package of $223,000:00 for each employee. For most of those accepting the VSEP this sum of money will be the largest sum to come through their hands in their lifetime.

All BPL employees accepting the VSEP's should use their funds wisely and invest in financial products with long term yields eg: Stocks, Bonds ,Mutual funds and CD's ...Seek financial advise form reputable firms. Resist the urge to splurge of shopping trips to florida, gambling, and beware of friends who appear suddenly out of no where,because "a fool and his money are soon parted" Proverbs 21-20 .

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hrysippus 3 months, 4 weeks ago

So now each of our electric bills for the thirty years or more will have to include a surcharge to ppay for the VSPs and pensions of this overstaffed government owned corporation. Multiply this situation by every other government owned entity, Multiply this this many times over to cover the unfunded pensions and we can expect a large and continuing cost of living rise in this country. This may snowball if the wealthy segments of society get fed up with power cuts, violent crime, and blame thrown by political operatives onto particular ethnic groups. An economic death spiral.

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Alex_Charles 3 months, 4 weeks ago

That payout seems excessive. Why do we the consumer always have to get shafted with this shit! ALWAYS, EVERYTHING that happens with that nanny up institution always involves us paying more and more and getting worse and worse service!

It feels as though BPL/BEC is nothing but a big loom. How can my light bill be $56kwh then $245 fuel surcharge? Yet we can afford this nonsense?

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DDK 3 months, 4 weeks ago

THIS MAKES NO SENSE!!!!! The Bahamas needs a Government. How in the name of all that is good can this exercise " improve BPL’s financial viability by making it leaner and more competitive." Is Bannister of sound mind?

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realfreethinker 3 months, 4 weeks ago

This is a direct result of those poor union contracts previous governments entered into. I am glad at least this gov is making an effort to clean house. Now all new hires will have to pay into their pension plans and the gravy train should be over. bitter pill now but sweetness later

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Dawes 3 months, 4 weeks ago

I hope you are right, however i have not heard about the new hires paying in to the pension. Is this Correct?

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Well_mudda_take_sic 3 months, 4 weeks ago

Hubert Ingraham first introduced these large scale Voluntary Separation Packages (VSEPS) when Batelco (now BTC) had to be downsized to enable its privatization. In fact the initial $55 million dollars ($55,000,000) in VSEPS paid by Batelco was squandered because of serious delays in its privatization process. During the delays the head count of Batelco was allowed to balloon again because of political cronyism in the granting of jobs by our corrupt politicians to their family members, constituents and friends. Even some who benefited from the initial VSEPS were re-employed by Batelco. This necessitated another round of VSEPS by Batelco costing an additional $60 million dollars ($60,000,000) in order to persuade Cable & Wireless to acquire a controlling stake in Batelco, which was subsequently renamed BTC. Since then, these VSEPS have been used at other government corporations, like Bahamasair and BEC as it was named back then. In each case very generous packages in aggregate totaling millions of dollars were paid and in each case, within a few years, the head counts of these corporations were once again bloated as a result of our corrupt politicians padding the payrolls with 'generous' jobs to their family members, constituents and friends. Now we have accepted VSEPS for BPL totaling $70 million dollars ($70,000,000) and planned VSEPS for the Water & Sewerage Corp. and no doubt others to come. What the public needs to understand is that these planned VSEPS by our government subsidized corporations have become nothing more than a mechanism for our corrupt politicians to periodically shower (unjustly enrich) their family members, cronies and constituents with our hard earned tax dollars. The reduced head count is always allowed to balloon again and frequently beneficiaries of the VSEPS are re-hired because they possess knowledge or skills the government corporation finds it cannot do without. And the cycle of VSEPS now gets repeated every 5 years or so at most. The whole concept of VSEPS has become a very costly fraud perpetrated against our country's taxpayers by our corrupt politicians. It's absolutely absurd and repulsive that the average per capita cost of the BPL voluntary separation package is $224,000....primarily paid to family members, cronies and supportive constituents of our corrupt politicians.

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DDK 3 months, 4 weeks ago

So right, but we as a people keep swallowing it hook, line and sinker. In other words, there is method in their madness. It's all part of the 'hopes for re-election scheme'. I, for one, am sick and tired of being forced to being a part of it. It's unbelievable.

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BahamaPundit 3 months, 4 weeks ago

This settlement amount seems ludicrous, crazy, insane and corrupt. It doesn't seem normal at all. How can any company give away 70 million dollars and think that's a smart business decision and will lead to profitability? Who is the lawyer that came up with this figure? How much are they being paid (probably 5 million). This deal smells funny. It smells outright rotten. Another play out of BOB's playbook. When will the stupidity/thievery end??? And, as stated above, the majority of these people will just get rehired and pocket the chunk of change!!!! How does the Bahamas even still exist???

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DDK 3 months, 4 weeks ago

Why does customs lose 50% of its income? Because there is no integrity amongst the workers. Why? Because there is no integrity amongst the leaders of the country. The Bahamas exists but is on the point of imploding, thanks to this latest round of elected officials. Bunch of frickin kleptocrats.

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bogart 3 months, 4 weeks ago

If wid the 314 going plus 60 hired again workers out of 1,038 ..let go so it will not continue to balloon outta control to unmanageble proportions...to make it leaner an more competitive...sooooooooo dis compaany been running roughly wid 1 outta 4 employees not needed.........dont dey have a Human Resources Department ...Training.....Planning....Administration.....who assessed the needs of the various departments and needs...????.? ..........FOR $70,000,000 OF THE TAXPAYERS MONEY.....HOW COME NOONE CHARGED IN COURT FOR GROSS INCOMPETAMCE....?overstaffong by hundreds.....WHAT WAS DA BOARD OF DIRECTORS DOING ALL DESE YEARS....?.....how come all pore taxpayer money to prop up dese employed all dese years.....an even more money to pays dem off....while the pore hav to pays fer dis.......ANODDA EXAMPLE DAT THE RICH PEOPLE DONT KNOW DAT MONEY DONT GROW ON TREE.....WHICHIN DA PORE DONE KNOW AS DEY GOES TO SLEEP EARLY CAUSE DA LECTRICITY DONE CUT OFF....,move round da house wid candle....in saucer so da wax aint driping over!!!

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