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NIC scrambles to provide water to farmers

Published:Thursday | October 16, 2014 | 10:00 AM
Samuda
Stanberry
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Edmond Campbell, Gleaner Writer

PLAGUED BY losses in its irrigation system amounting to $1.2 billion, and reeling from the disconnection of electricity at three of its pumping stations for arrears amounting to millions of dollars, the National Irrigation Commission (NIC) is appealing to the Government for a $1.5 billion capital injection to rehabilitate its broken down infrastructure so that it can operate as a viable entity.

Last week, the NIC had to introduce contingency measures to distribute irrigation water to farmers after the Jamaica Public Service Company cut the power to at least three pumping stations in rural Jamaica.

Tafari Burry, chief executive officer of the NIC, said the Pedro Plains irrigation system in St Elizabeth has been disconnected by the light and power company. The facility owes the Jamaica Public Service $14 million.

"We find it very difficult to pay our electricity bills from the revenue earned from our operations," Burry told members of Parliament's Public Accounts Committee. He advised that two of the three irrigation systems have been reconnected by the JPS. "It is kind of difficult to find $14 million at this point, given the fact that our electricity bills have been spiralling in recent years," Burry added.

Meanwhile, committee member Karl Samuda took the NIC to task for failing to introduce scores of projects estimated to cost US$106 million over a 17-year period, ending 2015. Permanent secretary in the Ministry of Agriculture and Fisheries Donovan Stanberry said the NIC was only able to complete seven projects at a cost of US$21 million over the period. He said the agency had difficulties accessing more funds for other proposed projects owing to tight fiscal space.

However, Samuda argued that the performance record of the agency was less than satisfactory. Pointing to an increase in administrative costs by nearly 95 per cent, Samuda chided the NIC for racking up expenditure that exceeded its revenues. "How can you increase administrative expenses against the background of limited resources that are not likely to materialise? It doesn't tell a good story."

Highlighting concerns that affect the earning power of the NIC, Stanberry said the rates charged for irrigation water were subject to approval from the Office of Utilities Regulation. He said since 1997, the NIC has not received a reasonable level of tariff increase to run the system properly. In the meantime, he said electricity costs have increased over the years. "The rates are not tailored to recover the electricity costs," Stanberry asserted.

Another committee member, Edmund Bartlett, is of the view that a $2.8 billion government subsidy for the NIC is unsustainable and suggested that the NIC be merged with the National Water Commission in an effort to reduce administrative expenses. The NIC's administrative costs jumped from $122.05 million in March 2007 to $237.2 million as at March 2012.