Raid on Sugar Cane Growers Fund

[posted 2 Oct 2009, 1600]

The National Farmers Union is extremely worried at what appears to be a raid on the Sugar Cane Growers Fund by the insolvent fertiliser company, the South Pacific Fertiliser Ltd (SPFL).

The cash-strapped SPFL which cannot obtain loans from a commercial bank, is using the Fund for its working capital.

There is now a very real threat of the Fund being exhausted and going bankrupt.

SPFL has already taken out $25 million from the Growers Fund of which $14 million is now lost through a government directive that it be converted into equity for the Fund. Such equity in an insolvent company is worthless.

The company is making no repayment for the remaining $11m it owes the Fund and continues to dip into the fund for more easy money.

Under authoritarian rule there is nothing the growers can do to stop this raid on their money. The Growers Council is soon to be dissolved and government decisions cannot be challenged in a Court of Law.

Meanwhile, in a media statement FSC chief executive Deo Saran wrongly takes credit for bringing forward the last cane payment this year as a Diwali payment to enable cane farming families to have money for the festivities.

The truth is that this was an initiative of the Sugar Cane Growers Council which had written to FSC requesting that the last cane payment be brought forward as a Diwali pay out.

Furthermore, the $3 a tonne bonus payment that Deo Saran is raving on about now was approved by Cabinet in 2008 when Mahendra Chaudhry was the Minister for Sugar. FSC can hardly take credit for this initiative.