It is a day that trembled to begin, as the political power structure was shaken to its roots this morning when 6 Cabinet Ministers went into the Prime Minister's office and threatened to resign, if the Prime Minister does not strip Finance Minister Hon. Ralph Fonseca of all Cabinet responsibilities. The 6 ministers are: Jose Coye, Mark Espat, Cordel Hyde, Godfrey Smith, Eamon Courtenay, and Servulo Baeza and we are reliably informed that Deputy Prime Minister Hon. John Briceno, who is on vacation, has communicated to the Prime Minister that he has associated himself with the effort of this, now a group of 7; more than half of the 13 member Cabinet.
At issue is the mismanagement of public finances, long a sore point in the Musa administration, but brought arrestingly to light when 7NEWS broke the story two weeks ago about Social Security funds being used to cover Glenn Godfrey's private debt. Since then, revelations have come tumbling forward about further Social Security exposure extending to the tens of millions of dollars for more Glenn Godfrey and Intelco debts. Now, the public foment and national outrage has led to this: the greatest crisis of governance ever seen in a Musa administration, and possibly in any post independent government as the Prime Minister faces a stern ultimatum from over half of his Cabinet.
Tonight I have in studio to analyze it 7NEWS Director Jules Vasquez. Jules can you detail the inner working of what has been happening today.
Jules Vasquez, News Director
“Well, yes Indira this morning at 9:00 they met for four hours, where 9 ultimatums were made, including centrally that Ralph Fonseca be stripped of his finance portfolio, and interestingly that he not take up any other portfolio. That meeting we are told lasted for over 4 hours. During that time it was made clear to the Prime Minister that these 6 ministers would have a press conference at 11:00 this morning where they would publicize their demands and basically embarrass the Prime Minister into make the decision. And more than that, Indira, they would then resign effective Monday, August 16.”
So what happened in those four hours because there was no press conference and no resignation?
Jules Vasquez,
Well, that's because the Prime Minister agreed with them. He basically gave in to their demands, and agreed to give a public undertaking to do so. So the Ministers and the Prime Minister drafted a statement, where some concessions were made; the main one being that he would not say ‘I hereby fire Ralph Fonseca.’
Well Jules we have that statement here now, and let's see what it says, here's a tape of that statement read live on radio at 2:30 this afternoon.
Hon. Said Musa,
“The board of directors of the Belize Social Security Board will with immediate effect refrain from making any new loans to the private sector. A Cabinet team along with appropriate public officers will formulate and implement a short and medium term plan for the public sector addressing the financial management process, debt management, cost saving, and revenue generation. As soon as possible there will be full disclosure to Cabinet and to the public of all public sector loan guarantees and other financial arrangement and obligations of government and statutory boards. There will be full and immediate disclosure of the actual budget outturn for the last fiscal year in order to make the appropriate adjustments to the government’s finances. Ultimate management of the financial public sector, including the Social Security Board, DFC, and all statutory bodies will be the responsibility of the Cabinet. We will afford the Central Bank full autonomy within government.”
Jules Vasquez,
Ok those Indira are the recommendations which if you study them closely make a massive indictment of Ralph Fonseca's mismanagement of the country’s finance. It says that basically a Cabinet team with public officers will take over managing public finances, that all loans will be disclosed, full disclosure of the real budget details, full autonomy to Central Bank, and leave management for the DFC and SSB with cabinet. All this is saying that Minister Fonseca was not doing a satisfactory job or knowingly obfuscating the facts that he was acting secretively with public funds.
But again, Jules the statement does not say that Ralph Fonseca basically is being fired. Correct? However you are saying that the Prime Minister did allude to it?
Jules Vasquez,
Yes, but it goes on to say that changes will be made at the top. If we could roll that part:
Hon. Said Musa,
“We further recognize that the success of this plan is dependent on certain fundamental changes to the current approach and management of public sector finances. These changes will require restructuring at the highest levels of government. We will be disclosing the details of our plan of action and embarking on its implementation by month’s end.”
Jules Vasquez,
"Restructuring at the highest levels of government" that's the line that's meant to implicate Fonseca.
But it does not, it comes short of doing that but it does not say "fire Ralph Fonseca." What is your take on how he handling the situation and why he has refused to just come out and say it?
Jules Vasquez,
That's true. I think the Prime Minister is in a delicate situation. To not seem too easily swayed, led or extorted, by these 7. Also, the Prime Minister and Ralph Fonseca are a team have been for a long team; his leadership both of party and country was predicate on Fonseca raising money. But the interesting thing here is that the statement goes on to say: ‘we will be disclosing details of the plan of action by month's end.’ Again, we are reliably informed that the group of 7, or the G7 as we've dubbed them have given the Prime Minister till the end of the month to strip Fonseca, or again, they will resign.
And will they? Or are they just playing hardball?
Jules Vasquez,
Well the question is, will the Prime Minister strip minister Fonseca. It's tough to tell, and one man who had an interested perspective on it today was Leader of the Opposition Hon. Dean Barrow here are his comments when I spoke to him earlier.
Hon. Dean Barrow,
“The Prime Minister’s statement is not just an anticlimax, it is nothing, it is less than nothing; it is insulting. All the Prime Minister is saying is that he put an end to, for now, to Social Security loans to the private sector. And that in the context of generalized restructuring, Cabinet will have ultimate responsibility for all public sector managed funds including Social Security. The people of this country, and the calls have gone up from every corner of society, are demanding nothing short of a complete and thorough-going audit slash investigation of the Social Security portfolio with special emphasis on these private sector loans.”
Jules Vasquez,
But isn’t it a statement of portent when the Prime Minister says that the success of this plan is dependent on certain fundamental changes in the current approach and management of public sector finances. Isn’t that an indication that indeed he will make the change at the top?
Hon. Dean Barrow,
“Not at all, it seems to me that is either meaningless gibberish or the kind of coded language from which he can very easily back off.”
Jules Vasquez,
You think that eventhough the Prime Minister says that that these changes will require restructuring at the highest level of government...for anyone who has eyes to read it seems to say that when they are talking about highest level of government and the management of the public sector finances you are talking about the removal of...
Hon. Dean Barrow
“The Financial Secretary?”
Jules Vasquez,
_No the Finance Minister.
Hon. Dean Barrow,
“Sure it can mean that but I am saying if he meant that he could have said so far more explicitly. I am saying the language is so guarded as to allow the Prime Minster all the room in the world to back off from any call later on or at the end of the month or any attempt to hold him to account to say him but you promised us the Minister of Finance’s head but you have not delivered. He would say you show me where in that statement I said the Minister of Finance was going to go. It is not there.”
Jules Vasquez,
But even if you think he intentionally left it open for equivocation the point of it is that 7 ministers went to the Prime Minister and said we have a list of the demands and the demands include, we are told since I have not seen the list of demands, the removal or the stripping of Ralph Fonseca from the Ministry of Finance.
Hon. Dean Barrow,
“I don’t think the Prime Minister has ever been good at political math. In the normal course you would think the numbers would oblige him to side with the 7 rather than the one. But it is my conviction that based on all we know of the relationship between the Prime Minister and the Minister of Finance, if it came to it, it would be the 7 that would have to go rather than the one. It is also my conviction that in the end nobody is going to go.”
“A coup of a similar nature was attempted sometime before, remember the gang of 4, what the Prime Minister did on that occasion as on this occasion was buy time and then he picked them off one by one.”
“The bottom line is Jules those that are the coup movers are, and I need to be careful but I want to make this clear, are very much a part and parcel of the administration to the extent where they cannot afford for revelations to take place publicly as to where the bodies are buried. They simply have too much to lose to be able to follow through on any threatened walkout. They don’t have the moral capital to be able to follow through on their threatened walkout. Clearly the gang of 7 are asking that they be brought more into the picture but in the final analysis it will continue to be a one man show. In my own opinion this is all smoke and mirrors and the Belizean I don’t think, I am certain are not going to be fooled.”
Jules Vasquez,
So Barrow doesn't think anything will happen. And he may be right, but these Minister have said that they will resign together that's what we are told they told the Prime Minister although those we could reach declined any public comment.
So what will the Prime Minister do? Since obviously whatever transpired today has brought about even a greater ground swell for him to take some action?
Jules Vasquez,
Well what can he do? He's bought some time, three weeks to the end of the month during which time we are told he will be on vacation. But certainly during that time Ralph Fonseca a man who is keenly interested in self preservation and an astute politician who can play hard and soft one thinks he will be hard at work consolidating his power base even if it means driving a wedge through the PUP. So it'll be a very interesting month.
But Jules, we must be careful to not lose focus in all this political wrangling that, at bottom, this is a fight that started when it became public knowledge that Social Security funds are being used to cover Glenn Godfrey's debt.
And what do you think will be the faith of Finance Minister Ralph Fonseca...Will the Prime Minister strip him of his portfolios? Vote in our online poll.