City Council claims GPL owes millions in tax arrears
-- Power Company says M&CC encouraged disconnection
Kaieteur News
November 28, 2006

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The Guyana Electricity Corporation owes the Georgetown Municipality arrears of taxes amounting to $214M and had refused to settle its payment before transferring to new ownership, Guyana Power and Light Incorporated (GPL).

This disclosure was made by City Mayor Hamilton Green, in a release, where he states that existing legal regulations require that all taxes owing to the Municipality be satisfactorily settled before the transfer of any property in the city is effectuated to the new owner.

The release points out that the Georgetown Municipality levies taxes according to the law and practice on properties, irrespective of change of ownership.

“We were never officially informed that GEC had transferred its plant and properties to the Guyana Power and Light Inc.

“GPL, with the apparent concurrence of others, is sheltering behind the contention that it is not responsible for the indebtedness of the predecessor company, Guyana Electricity Corporation (GEC),” the release states.

This revelation comes in wake of disconnection works undertaken by GPL at several municipal locations due to non-payment of bills amounting to $243M.

But Mr Kesh Nandlall of GPL said that the power company never acquired the assets or the liabilities incurred by GEC.

He said that following an agreement with the government, GPL merely collects monies owed to GEC and pays these to GEC.

At a press conference on Friday, Green revealed to media operatives that the Council was unable to pay its electricity bills due to its narrow revenue base.

The amount owing to GPL is for the cost of electricity provided for 46 municipal locations, including street lighting which has incurred $201M of the current debt.

Among the areas already affected are City Hall, The Bourda Constabulary Outpost, The Constabulary Training Complex, The South Road Day Care Centre and the Abattoir in Kingston.

Yesterday the South Road Day Care Centre and the South Road Nursery School were unbearably hot. The staff kept taking the various classes outside where the conditions were so much more favourable.

And to compound the issue, with the absence of electricity, the two institutions could not access water for the routine activities.

Green states in the release that after Friday's press conference, several other locations were disconnected.

“I expect street lighting to be next. The public and the government should know that we have had ongoing discussions with GPL over an extended period in an attempt to settle our accounts.”

The release adds that GPL is refusing to deal with individual installations and has indicated it would only reconnect on the basis of a settlement which includes all of the installations.

As such, Green believes that the actions by GPL seem therefore to be part of a centrally directed plan to humiliate the Mayor and Council elected. “If not it is crassness, injustice and unprincipled behaviour by GPL. I hope that there will be an explanation for this brutal action by GPL, beyond the legal and constitutional technicalities, but one that addresses justice and morality.”

According to Green, efforts to implement rental systems for GPL's use of its parapets were obstructed by Central Government.

Meanwhile, GPL in a release yesterday said that the Mayor and City Council (M&CC) was afforded a credit arrangement on which it lapsed on the terms of agreement earlier this year.

“Promises were made and a cheque for a small amount was paid to GPL in October. Soon thereafter the commercial bank was ordered by the Municipality to stop payment.

“Other efforts to make contact with certain officials at M&CC repeatedly failed.”

The release states that the management of GPL was left with no choice but to begin disconnection of the facilities operating under the purview of the M&CC, starting with the less essential buildings.

“Disconnection or notice of disconnection is the only option to GPL to encourage customers from every category – residential, business or service – to pay for electricity that they have already consumed.

“This company is autonomous. GPL must generate its own revenue and capital…to continue to generate and distribute electrical power to pay our creditors and to meet daily overheads, especially to purchase that vital raw material, fuel, which requires hard currency in advance…”.

GPL could be classified as a social organisation with important responsibilities to the citizens of this country but the business has to be run on a level playing field, the release indicated.

And in the Bourda municipal market the disconnection campaign seriously disrupted the lives of the stallholders, all of whom have independent meters and who all said that they were not indebted to GPL.

The power company simply disconnected the municipal market.

Yesterday, Mr Nandlall said that he was unaware of the situation affecting the stallholders and that GPL would be revisiting the situation.