Grenada Today - The National Newspaper of Grenada, Carriacou & Petite Martinique

Trade unions in Grenada have stated their intention to continue struggling with government for a better deal for workers in light of the imposition of the controversial National Reconstruction Levy (NRL).

The Grenada Trade Union Council (GTUC) had vigorously opposed the planned introduction of a 5% income tax on the salaries of workers earning in excess of $1000.00 a month.

The Keith Mitchell-led New National Party (NNP) government made a compromise by agreeing to introduce a 3% tax until the middle of the year and to bring it up to 5% at the end of June. The latest position on the TUC position on the issue was outlined by its acting President, Madonna Harford, who heads the Public Workers Union (PWU).

Following is the text of an address delivered by Harford to workers in the country: The GTUC wishes to inform all workers that it is prepared to continue with the process of negotiations to ensure that benefits are obtained through tax credits for the majority of our members who fall under the $5000 range.

In addition TUC is desirous of pursuing the good governance issues which will form part of the Social Contract to be signed by all the social partners including government. Address from the President (ag.);

Grenada Trades' Union Council
Monday 30th January 2006

Fellow Citizens of Grenada, Carriacou & Petite Martinique:

As Acting President of the Grenada Trades' Union Council, I wish to take this opportunity to provide our membership as well as the Grenadian populace with an update on the National Reconstruction Levy.

The position of the Grenada Trades' Union Council has always been and will continue to be that the National Reconstruction Levy is an untimely taxation which will bring additional hardship on the backs of workers of our nation.

Under different circumstances, the Grenada TUC may have supported the introduction of the National Reconstruction Levy. However, with the passage of Hurricanes Ivan and Emily, calling on workers to contribute towards national reconstruction when they themselves are undergoing severe hardship is inhumane and not in the best interest of workers.

To date, some workers have not yet started to rebuild their lives and their homes due to lack of financial resources. Others continue to live under sub-standard conditions including under tarpaulins and old galvanize as covering and barricades.

With these prevailing conditions, workers have also had to face a sharp increase in the cost of living which has escalated due to the increase in the price of petrol and other petroleum products.

Asking workers who are already overburdened with debt, in receipt of very little take home pay, with children to maintain, the high cost of transport, second mortgages and a food bill that increased by approximately thirty to forty percent since October1st.2005 is very distressing.

Workers are hurting and need assistance themselves if they are to get out of that level of poverty caused by two natural disasters. The TUC is cognisant of the fact that our country needs money for reconstruction and development purposes. However, it is not fair to put the burden on labour alone.

If we have to contribute to the reconstruction of our country then other key sectors must be required to make a contribution. Hence the reason, the TUC provided recommendations to Government for alternative mechanisms for raising revenue.

These measures included the introduction of a tax on Cell phone cards which other Caribbean Countries have already implemented; an increase in Land Transfer Tax, an increase in General Consumption Tax, a Capital Gains Tax, an increase at the Port on items excluding basic food items, building materials, medicines and agricultural items and an increase in Corporate Tax; Grenada is among the countries with the lowest Corporate Tax in the OECS.

As we are all aware, discussions were ongoing with the Government and the social partners on finding a solution to the impasse on the National Reconstruction Levy .

The Grenada Trades' Union Council met with the Government and the Grenada Chamber of Commerce and Industry on two occasions and on one occasion with all the other social partners including the Conference of Churches, the Employers Federation, and the Inter Agency Group of Development Organization.

The GTUC accepted the offer of the Grenada Chamber of Industry and Commerce to mediate.

After three (3) sets of meetings, it was decided that the GCIC as mediator will meet with Gov't and TUC separately in mediation talks.

At the meeting on Wednesday 11th. January, 2006 between the Chamber and the TUC, the Position advanced by the Chamber in its capacity as mediator was as follows:

(1). The Government of Grenada will issue a Statement of Intent to engage all social partners in a Social Contract.

(2). GCIC will assume responsibility for drafting the Social Contract

(3). The NRL be implemented effective January 1st 2006 with the following provisions:

(a) At a rate of 4 % for the first six months of 2006, during which time the Agreement will be reached on provisions for the exemption of allowances. Effective July 1st. the rate will increase to 5 % inclusive of such provisions for persons earning up to $ 5000 per month.

A Sub Committee of the Multipartite Committee will develop the modalities for exemptions and make recommendations to Cabinet.The Sub-Committee must conclude its work by the end of March 2006. The exemption for the first $1000 will still apply.

(b) Persons earning between $5000 and $9000 will be required to contribute a flat rate of $225 per month.

The GTUC's response to the Chamber was that we could not agree to such a proposal since the 4% proposed was much too close to the 5 %.

TUC was then informed by the Chamber that the 4% was not cast in stone and as such we should take some time to re-consider the proposal and get back to them.

On Saturday January 14th 2006, TUC after serious consideration of the GCIC's proposal recommended the following:

(a) the threshold with respect to the NRL be lifted from $1000 to $5000

(b) a Technical Committee comprising the Social Partners and Government be established to determine the tax credits within the first 6 months

(c) the 10 key governance issues as presented in the GTUC's Position Paper submitted on January 10 2006 and circulated at the meeting of January 11, 2006 be implemented at the same time;

(d) that a Social Contract be formulated by the Social Partners including Government and be signed by all parties by the end of March 2006. At another meeting between the TUC and the Chamber on January 17th 2006, Chamber indicated that the TUC's proposal of 14th January 2006 had common ground except for the proposal for the lifting of the threshold.

After lengthy discussions, TUC put forward to the Chamber its latest proposals as follows:

1. Social Contract
(a) The Statement of Intent from the government to engage all Social Partners in a Social Contract to be issued by 20th January 2006

(b) A Resolution to be passed in Parliament at its upcoming sitting commencing 20 January 2006 in support of this Statement of Intent
The main elements of the Social Contract will be:

( a) Systematic reduction in wastage
( b) Effective collection of government revenues
(c) Prices and Wages Indexation
(d) Productivity
(e) Procurement procedures
(f) Monitoring and Reporting
(g) The passage of a Freedom of Information Act and an Integrity and Anti-Corruption Act within three months

(2). Drafting of the Social Contract
GCIC will assume responsibility for drafting the Social Contract

(3). The National Reconstruction Levy
(a) The NRL will be implemented from 1st March 2006 at a rate of 2.5% until December 31st 2006 and thereafter to be reviewed
(b) the threshold will be $1000
(c) Exemptions will be worked in from the time of the application of the levy that is from 1st March 2006

Since the TUC met with the Chamber on January 17th and put forward its latest proposal, Chamber has not been given the opportunity to meet with Government to present the said proposals. Notwithstanding Government went ahead and announced on Budget Day an NRL at a rate of3% effective 1st January 2006 for six months and 5% from July2006 with tax credits to be determined.

TUC wishes to inform the general public that Red Protest Day which was staged on January 20th 2006 was purposely organised to coincide with the announcement by government of the implementation of the National Reconstruction Levy. While discussions were ongoing Government unilaterally made its announcement which caused a break down in negotiations.

TUC wishes to reiterate that if negotiations were ongoing between the Government side and the Chamber, TUC would have cancelled all plans for the protest action. On the 24th January 2006, TUC requested a meeting with the Chamber to ascertain the position with respect to the negotiations.

At that meeting, TUC was advised that it was the opinion of the Chamber that it was unceremoniously dismissed as mediators and it had put out a statement to that effect. It appeared to us that the process had ended prematurely on the Government side since it had taken the proposal of the Chamber as a Final Position although same was rejected by the TUC.

TUC has since sought and obtained the assistance of the Conference of Churches to intervene in the negotiations and act as mediator to bring closure to the matter. The GTUC wishes to inform all workers that it is prepared to continue with the process of negotiations to ensure that benefits are obtained through tax credits for the majority of our members who fall under the $5000 range.

In addition TUC is desirous of pursuing the good governance issues which will form part of the Social Contract to be signed by all the social partners including government. As such all protest action regarding the NRL will be put on hold during the negotiation process. TUC wishes to express its total disgust with the low level displayed by some of our parliamentarians at the recently concluded Budget Debate.

It was shameful to listen to the presentations coming from those who are expected to know better. Also disgusting was the continued attacks on the TUC leadership by government ministers. TUC wishes to state that it has been in existence for the last fifty years having been established as an umbrella body for workers organizations since 1955.

The TUC has represented the workers of this nation and will continue to do so irrespective of the government in power. Our struggle is a workers struggle and TUC will continue to defend the rights of workers of this nation.

Linking the TUC with the NDC when it is convenient for the Government to do is ludicrous. TUC as a workers organisation is prepared to work with all political parties, groups and organizations in our country for the advancement of workers.
TUC wishes to place on record its deepest appreciation to the Chamber for initiating the dialogue between the Government and the TUC and for the several hours which were spent in bringing both parties together on the NRL. We thank you wholeheartedly for the role you have played in the negotiations to date.

TUC wishes to thank the Conference of Churches Grenada for agreeing to act as the current Mediator thus ensuring that the negotiation process continues. We wish to thank also government for realising that the matter is worth negotiating for the good of workers and our country and for accepting the Conference of Churches as current mediator.

TUC also wants to take the opportunity to thank our members who participated in RED PROTEST DAY which has sent a clear signal to the authorities that the poor and working class of our nation are unable to make a contribution at this time.

In conclusion, TUC wishes to reiterate that it is prepared to work with all the social partners and government to ensure that the matter is brought to a resolution within the shortest possible time.