Barbados: IMF Signals Looming Attack On Public Sector Workers’ Pensions

By A.T. Freeman

On 5 February, following a 3-day IMF staff visit of Barbados, conducted via video-conferencing due to Covid 19, Bert van Selm, the leader of the IMF team responsible for Barbados’ file issued a statement to the press.

In his statement, van Selm praised the government for progress in implementing its IMF backed structural adjustment programme named the Barbados’ Economic Recovery and Transformation (BERT) plan and stated that his team looked forward to continuing the discussions with the Barbados government in its next review meeting which is scheduled for May this year. In particular, van Selm stated,

“Strong steps have been made in implementing structural reforms. A new central bank law, aimed at strengthening the autonomy of the bank while limiting the provision of credit to the government, was adopted by parliament in December 2020. An actuarial review of the civil service pension system was completed in November 2020, providing the basis for upcoming public pension reform. A new procurement law to strengthen the fairness, integrity and transparency of the procurement process is expected to be submitted to parliament in February”.

These statements from van Selm demonstrate the colonial nature of the relationship between the IMF delegation and the Barbados government and the anti-people direction of the structural reforms. It lays bare the reality that the IMF is directing economic and social policy in Barbados and driving the legislation to achieve its neo-liberal goals. 

It was not surprising that van Selm praised the passing of the new central bank law in December, since this was one of the conditions the IMF imposed on the country as part of its Extended Fund Facility (EFF) agreement. As he pointed out, the central bank law is aimed at providing the central bank with ‘autonomy’, by which is meant that it acts quite independently of the elected government. Commentators have noted that the IMF insists on ‘central bank independence’  as a key condition of its loans because it wants to future proof its neo-liberal structural reforms from any government which attempts to prioritise the well- being of its citizens over debt repayment. 

However what has particularly caught people’s attention in van Selm’s statement is his declaration that there is “upcoming public pension reform”. The IMF spokesman presents this as a “fait accompli”, something that has already been agreed and will happen. This is rather odd as there has been no discussion in Barbados about public sector pensions and no arguments presented as to whether these pensions need to be reformed. The actuarial review which was completed nearly 3 months ago has not been published and so it’s impossible for those workers who are likely to be affected to analyse the situation with regard to public sector pensions and draw their own conclusions about what needs to be done.

This is how, in the system of representative democracy, key decisions that affect people’s lives are taken in the dark and behind their backs and they are deprived of any opportunity to give their opinion and take part in the decision making process. In these circumstances, the public sector workers will have to take a stand to defend their pension rights. The examples of the recent successful struggles of the hotel workers over their redundancy payments show the way forward. If the trade union leaders refuse to carry out their responsibilities to their members, they should be removed from office and replaced with individuals who are prepared to defend their members’ rights. As a start, the demand must be raised that the actuarial review is published so that it can be read and carefully analysed. Secondly, the workers must demand that any reforms of the pension scheme do not lead to worsening of pensions for retired workers and those currently employed.         

Please join the conversation on Caribbean Empowerment’s Facebook page at https://www.facebook.com/groups/2583126101949661/ Or, you can comment by emailing us at: caribbeanempowerment@pm.me
Image caption: Bert van Selm, leader of the IMF delegation with Barbados Prime Minister Mia Mottley

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