During the recent budget debate in the House of Assembly, Prime Minister Perry Christie and Official Opposition Leader Hubert Ingraham hit out at each other over the failed attempt to privatize the Bahamas Telecommunications Company (BTC), formerly BATELCO.
“As regards privatization of BTC,” the prime minister said, “the opportunity was ripe in 1998 or 1999 when the dotcom boom was taking place to privatize BTC. The administration of [Hubert Ingraham] lost its nerve and lost the opportunity.”
But Mr. Ingraham said the prime minister has read the files and he knows why the FNM government did not take BTC to the privatization table.
“He knows that the audited accounts for the [then corporation], prepared by a local accounting firm, were unacceptable and that a new audit had to be undertaken,” he said. “The new audit was completed just before we left office. Those accounts were clear and unconditioned and nothing prevented the government from moving forward with privatization, if it chose to do so.”
But Prime Minister Christie said the FNM government spent more than $140 million on failed privatization with nothing to show for it. He indicated that at the end of the day, the PLP government decided that the offers it had received were not worth selling BTC.
The former prime minister, however, insisted that there was something to show for the money spent on the privatization effort.
Mr. Ingraham said that in 1992 BATELCO with revenue of $120 million and 2,359 employees, a monopoly for the provision of all telecommunication services including customer premises equipment, incurred a net loss of $1,868 million; the year before, in 1991, the net loss was $1.1 million.
In right-sizing the corporation and in preparation for privatization 1,229 employees were voluntarily or otherwise disengaged from BATELCO. This left 1,130 employees, according to Mr. Ingraham.
For the 10-year period, 1982 – 1992, BATELCO’s net profit was $62.5 million.
Mr. Ingraham said BATELCO’s net profit in 2001 was $57,391 million; and BATELCO’S profit for 2000 was $56 million.
“That’s $113 million in net profits in two years,” he said. “Those profits were made after right-sizing; after eight new paging services had been licensed; after five new Internet providers, and four other trunk service providers had been licensed. In short, after liberalization began.
“And then the prime minister says that we have nothing to show from the exercise preparing BATELCO for privatization. We didn’t take BATELCO to the privatization table, the governing party didï¾…One has to wonder why people seeking to buy the company made offers not worth the paper they were written on.”
Government officials have continued to say that they are still committed to privatizing BTC.
When he contributed to the budget debate in the House of Assembly recently, Minister of Works and Utilities Bradley Roberts said, “I must re-iterate, Mr. Speaker, that it is my government’s philosophy and intention to facilitate privatization, but we will do it in a manner that is best for the people of the Bahamas.”
He added, “It is not the intention of my government to have a fire sale for the treasures of The Bahamas, and today, BTC is not fire sale material when one accounts for its revenues, profits and network upgrades.”
Mr. Ingraham claimed that in 2005, BTC’s net profit was $38.6 million, but Minister Roberts said it was $34.5 million, compared to $8,340 in 2004.
The company’s total assets, according to Minister Roberts, were $494.7 million compared to $461.8 million in 2004.
“BTC’s performance for the first quarter of 2006 is continuing in its 2005 tend,” he said, pointing out that first quarter net profit has increased by $7.4 million over the first quarter of 2005.
By: Candia Dames, The Bahama Journal
