Furbert: Media ‘misconstrued' my comments on Global House
The media “misconstrued” comments he made regarding the United Bermuda Party's purchase of Global House, Bermuda Industrial Union president Chris Furbert claimed yesterday.
Mr Furbert said he had “suggested” that the 1987 Government “took money out that they shouldn't have taken out, in order to fund the purchase of the building”.
He denied saying the party had “raided” the Public Service Superannuation Fund for the buy.
The union leader made the claim in a March 7 interview with
The Royal Gazette in support of his contention that UBP had mismanaged the pension fund.
He said in that article: “The fund was supposed to sit for 20 years, meaning no money should have been paid out of that plan until 2000 or 2001.
“Between 1984 and 1986 they started paying out to retirees. Then in 1987 they actually took $10,750,000 out of there to buy Global House. They took that out of pension contributions. And this is all in the time frame where the fund is not supposed to be touched. So the fund is underfunded right now because of the UBP's mismanagement of the fund.”
In questions sent to Mr Furbert last Friday
The Royal Gazette asked for evidence of extraordinary transfers made to the Consolidated Fund.
No mention was found of pension funds in the House debate on Global House's purchase, while the 198⅞8 Budget Statement refers to the use of Bermuda Monetary Authority profits to acquire the property.
Asked for information that could substantiate his claims, Mr Furbert did not respond. Asked for clarification yesterday, Mr Furbert replied that he hadn't said the UBP took money out of the pension at all. He said the party should have used $10.5 million from the Bermuda Monetary Authority to offset growing liabilities in the Superannuation Fund instead.
The latest statement came after the Bermuda Public Services Union called a press conference to clear up “misconceptions and misinterpretations” about the PSSF and the purchase of Global House.
Mr Furbert and BPSU secretary Ed Ball charged the civil servants' pension fund, which was established in 1978, had been mismanaged since its inception.
Mr Ball, who was flanked by BPSU president Kevin Grant, Bermuda Union of Teachers general secretary Mike Charles and Mr Furbert, said: “In 1987, when it was deemed that [the UBP] Government would purchase Global House for $10.5 million, the unions asked for that $10.5 million to be put into the pension fund rather than into the building. Hence, that's where the confusion lies. All the unions said that the Government was more prepared to buy a building than to defray a liability of the pension fund. They were adamant that they money should have been used to offset the liability.”
Referring to actuarial reports going back to 1985, he continued: “This fund failed from day one.”
Mr Furbert contradicted statements by then-Financial Secretary Mansfield Brock, who told this newspaper that the PSSF had remained fully funded.
Mr Ball said an actuarial report is now underway on the status of the pension fund, which would make tough recommendations to bring down its liabilities.
Asked what he thought those recommendations might be, Mr Ball said: “The only way to bring down that liability is by Government either grandfathering those that are in the plan now, and then putting new hires on a defined contribution plan.”
Mr Furbert stressed that he had never said Government took money out of the fund, but that it had been badly run.
“The point I want to make is that while there was an underfunded liability for the superannuation fund of $111 million back in 1990, as of March, 31 1999 that liability is $221 million,” Mr Furbert said. “All we have to do is set the record straight, put the facts out there.
“When people are challenging where these numbers are coming from, I can show you the Government of Bermuda's Consolidated Fund Statement of Financial Position. That's where it's coming from.”
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