After one year of country-wide consultations and expert reviews, the PPP/C Government successfully debated and passed the Local Content Bill 2021 which represents one of the key pillars in the country’s legislative framework to increase citizens’ access to opportunities for employment, procurement, and capacity building.
Opening the debate which commenced this morning at 11: am and saw 16 speakers, was Natural Resources Minister, Vickram Bharrat. The parliamentarian noted that the Bill contains several provisions which protect the interests of all citizens. The first he noted in this regard was the definition of what constitutes a “Guyanese company.” The Bill states that “Guyanese company” means any company incorporated under the Companies Act which is beneficially owned by Guyanese nationals who ultimately exercise, individually or jointly, voting rights representing at least fifty-one percent of the total issued shares of the company; and that has Guyanese nationals holding at least seventy-five percent of executive and senior management positions and at least ninety percent of non-managerial and other positions. In light of this, Bharrat said only legitimate Guyanese firms would be considered as applicable for opportunities in the sector.
He said too that there would be a Local Content Secretariat of highly skilled professionals to ensure the law is enforced. It will do so by auditing the local content reports of oil companies and their subcontractors to ensure they have used only those persons and companies listed on the State’s Local Content Register.
Among the other key provisions he cited was the fact that oil companies and their subcontractors would be mandated to provide a five-year plan of how they intend to use Guyanese for employment, procurement, and capacity development. They would also be ordered to provide yearly updates of how they are achieving the goals outlined in the master plan.
His colleague, Attorney General and Minister of Legal Affairs, Anil Nandlall also spoke to some of the key provisions of the legislation as he highlighted that there are 40 categories of work that have been ring-fenced for Guyanese participation. These areas include catering, transportation, accounting, legal services, and the provision of insurance. If companies fail to meet the minimum targets of these categories, they would be fined as much as $50M.
As for the position of the Parliamentary Opposition, this was outlined by the AFC’s David Patterson who noted that there are key amendments that should be made to the Bill. Patterson throughout his presentation criticized the government for tabling the Bill on December 16, 2021, but now rushing less than two weeks later to have it passed. In such a short space of time, he said the opposition found 14 areas that needed improvement to ensure greater accountability and submitted same to the government on Tuesday. In light of this, he said the Bill should go to a special select committee.
In the spirit of inclusionary democracy, Bharrat said the opposition’s amendments were considered by the government late last night. He said 10 of the 14 were adopted despite the failure of the political opposition to be present at a 9 am meeting today to discuss their recommendations. Nevertheless, he said the opposition’s recommendation for there to be an oversight committee was taken on board. He said the proposed Inter-Agency Committee will now be termed the Local Content Advisory Committee and will support the government’s Local Content Secretariat.
Furthermore, the Opposition’s suggestion for representatives from the National Toshaos Council, Guyana Bar Association, the Parliamentary Opposition, and from local Petroleum Organisations, to make up the committee were also accepted. Other members of that committee will be taken from Office of the President, Ministry of Natural Resources, Ministry of Finance, Ministry of Home Affairs, Ministry of Labour, Guyana National Bureau of Standards, Guyana Revenue Authority, Attorney General’s Chambers, and Ministry of Legal Affairs, Guyana Office for Investment, Ministry of Foreign Affairs and International Cooperation, Ministry of Tourism, Industry, and Commerce, Ministry of Education, Ministry of Public Works, Private Sector Commission, and the Labour Union.
Also taken on board is the Opposition’s recommendation for the Local Content Registers of qualified companies and nationals, to be published on the website of the Ministry responsible for petroleum or any other media of wide circulation.
Minister Bharrat also noted that there were four separate amendments by the government. The first was an expansion of the definition for a “Guyanese company.” It previously stated: any company incorporated under the Companies Act which is beneficially owned by Guyanese nationals who ultimately exercise, individually or jointly, voting rights representing at least fifty-one percent of the total issued shares of the company; and that has Guyanese nationals holding at least seventy-five percent of executive and senior management positions and at least ninety percent of non-managerial and other positions.
The government has added that a Guyanese company will also mean: any partnership between Guyanese nationals and a company constituted in accordance with the Partnership Act.
With respect to the minimum level of local content targets, the government has amended local accounting services from 20 to 90 % by December 2022 and insurance provision by Guyanese moved from 90 to 100 percent. Bharrat said this was done based on consultations done this week. Another amendment will also ensure Guyanese get equal payment or remuneration if their qualifications and skills are on par with that of expatriates.
Meanwhile, Deputy Speaker and Opposition MP representing the joinder parties, Lennox Shuman lamented the apparent dearth in proposed policies to ensure Indigenous People’s participation in the sector. He referred to the lack of policies that lead to the sidelining of Indigenous peoples from infrastructural works in hinterland communities.
Finance Minister, Dr Ashni Singh rebutted, saying that Shuman should have submitted recommendations, the same way Patterson did. Shuman insisted he did, but the Minister said he is yet to find one document from the Deputy Speaker that entails his suggestions or concerns.
Prime Minister, Mark Phillips in his contribution to the debate, called for MPs to “seize the day” and have the bill passed. He lambasted the former APNU+AFC for pussyfooting on the legislation during its time in office and shared similar sentiments as Dr Singh, regarding the timeliness of the bill. He also spoke ardently on the urgent need for systems to be implemented post-haste so that Guyanese can reap the benefits of the trillion-dollar sector.
Alliance for Change (AFC) Leader and former Public Securities Minister, Khemraj Ramjattan was the penultimate speaker and like Patterson, strongly suggested that the bill be sent to a special select committee for added “interrogation”. He said that government MPs emphasized the importance of the bill but questioned their reluctance to have the bill further scrutinized.
After seven hours of contributions, Minister Bharrat wrapped up the debate and asked that it be read for a second time. The House then resolved itself into a committee to consider each clause. The Bill was subsequently put to a vote and passed.
