Mining companies often make the world of promises in exchange for handsome tax concessions. The Guyana Geology and Mines Commission (GGMC) is one of the key agencies which must ensure that the promises made by these firms are honoured. In the event that it finds breaches, the Commission has the power to implement sunset clauses as stated in the contracts.
But is the regulatory body effectively carrying out this crucial function?
GGMC’s Commissioner General, Newell Dennison was faced with this and other related questions during a recent interview with the Guyana Standard. After a 20 minute discussion, it became quite clear that GGMC has failed to police contracts as firmly as it should in the last two years.
Dennison was challenged to say what the cause for this state of affairs was. The official avoided giving a direct answer but admitted that “more work needs to be done where these contracts are concerned.”
The GGMC Commissioner General said, “Indeed, one of our objectives is to check these contracts and see if the promises made in exchange for the menu of tax breaks are actually being carried out … But to be honest, I cannot answer on the spot on that. I have to go back to the agreements and check and see how the context applies and so on.”
Dennison continued, “But listen, we understand that there is a concern about what we are getting from these companies…we are seeing it in the news…The tax concessions are considered as part of the reason they are permitted to operate and we see that we have a certain level of obligation to monitor that.
In addition to its failure to implement sunset clauses when necessary, the GGMC official also admitted that the Commission does not even collect data on the movement of equipment imported by mining companies as well as their local content figures.
The Commissioner General said, “Well again, we in our general operational mode, we don’t specifically say this piece of item which the company got concessions for is being used for the said purpose…We don’t even have a regime that speaks to reporting in that way. We are not up to date with that.”
He continued, “As for the workers, well, in a very, very, general sense, I think we do monitor it. But it may not manifest itself in a granular aspect. Like say company X started out with 100 Guyanese workers at the beginning of 2017 and at the end of the year, they have a 50/50 mix of foreign and locals.’’
Dennison concluded, “Indeed, we have to make sure we are way more diligent in having that aspect of the operations of these companies reported on and documented once and for all. But it is not our role alone. In the context of GGMC, and our monitoring we will step our game up.”