Source document: https://docs-lawep.s3.us-east-2.amazonaws.com/1698075124084.pdf (Guyana)
REPORT OF THE ADVISORY COMMITTEE APPOINTED TO INVESTIGATE THE TRADE DISPUTE IN THE SUGAR INDUSTRY OF BRITISH GUIANA DECEMBER, 1965.

.• .. ' (i) TABLE OF CONTENTS INTRODUCTION Terms of reference Hearings and meetings Thanks 1.

•THE Pli.l~TIES The S u gar Producers' Association The Man-Power Citizens' Ass o ciation Other Trade Unions in the Industry 2.

TUE TRADE DISPUTE The Union's dema nds Suramary of the Union's Arguments_ Summary of the Associ n t ion ts Arguments 3.
'l'rEi: ROLB OF SUGAR IN THB COUNTRY'S ECONOMY " · The Indus try 1 s contribution to Empleyment and Wages •• The Industry's contribution to ~avenue .DZVELOPM~NT Suga r Producing Companies of British Guiana Growth of the Indus try •• Field and Factory I mpr ovement • • ... 7 l 1 2 2 3 - 6 3 - 4 4 - 5 5 - 6 6 - 32 6 - 25 25 - 29 29 32 33 - 36 33 - 35 35 - 36 37 - 41 37 37 - 39 39 - 41 (ii) 5.
MARK2THJG AfJD SAL~S The available mc.rkets •• The Negotiated Price c:uota The U.S.A. Market The Free Market •• I •• TH~ FI NANCES OF THE INDUSTRY The Local Mark~t ' 6.

Subscribed Share Cap ital and Bonus Shares Cap ital employed Bonus Shares •• •• •• Balance Sheets of the Industry • • •• .

•· •• .. .

• • ·•.

•• Depreciation Replace~ent Reserves and •• the Rehabilitation Fund P:irice of Mol as;::; es to Distilleries Raw Spirits Profits •• •• .

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41 - 54 41 - 42 43 48 48 - 49 49 - 52 52 - 54 54 --96 67 - 58 68 - 69 69 - 70 70 - 71 71 - 79 80 80 - 81 81 - 87 ~ • • • (iii) Dividends • • M2 rketing Co mmissi on on Sa l es Hedging 0 .

7.

SUGAR INDUSTRY SPECIAL FUNDS --General •• Price Stabilisation Fund The Labo ur Uelfare Fund 8.

THE UNI ON'S DEMANDS The Annual Production Bonus The Once~for-All Bonus for 1964 Hages .

Other Demands •• •• SUMMA.RY OF RECOPilMENDJ1TIONS •• ••• .. •• •• 0 .
• • •.. .. • • •• •• 88 - 93 93 - 95 95 - 96 97 111 97 - 1Q3 104 - 110 111 111 166 111 137 137 - 149 149 - 165 165 - 166 16~ ·- 169 .. ... .. (iv) T A B L E S TABLE I The Industry's Contrib~ .

':i on to the Country's Economy during the year 1963 o• II II II " " I I Local Sales of Sugar (1956 - 1964} •• III Production Sales and Brices 1956 - 1964 •• IV v VI Comparison of, Factorr, Data and Coraparison of Field Data: 1952 - 1963 Marke ts and Sa l e s London Daily Price •• .
·• ii VII Consolida ted Balance Shee ts of the )A.

'· C .

C .

.

~h S .

Iond,1pant.

ies.

-omB, p~t1 ~ JLPh:~GL.

e ug~ r )Liabi liti e s n us ry :n:n ri i s ·.

· i.u .. ana a c 31st Decemb e r, 195 6 to 19640 ) sse s ) •• · t 11 VIII .... Ana lyses of Other i'.ssets, 1956 to '1964 " IX Conso li dated Stat ement s of Pr ofit and Loss and Appropria ti ons the r e of of the Compan i e s Compr i s ing the Sugar Industry i n British Guiana for the years 19-56 to 1D64.
Ii Cons olid a ted Sta tements of Reve nue a nd Expend iture :for the yea r s 1956 to 196 4 .

XI .Analysi s of Income f r oo Invest me nts in other Assets • • XII Co n sol ida t ed St a tement of Revenue and Expend itu re fo r the y ears 1956 - ( Expressed as Cost Per Ton)e 1 964 o• II XIII Portra y al of Ret urn on Cap i ta l Emp l oy e d in the Sugar Industry ( Exclusive of Raw Spirits).
•• II XIV Reconcilia tion of Gl oba l Pr o fit s with P r ofits Adjus t e d fo r Ta xati on Pur poses - 1 96 0 t o 1964 . "

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Page 33 36 38 40 42 50 56 57 58 59 6 0 61 6 2 6 3 ~- .. .. " (v) TABLE XV Land Net Book Value (~xcluding Dernerara Co Ltd.) " XVI II XViI Rates of Depreciation Applied the Industry Within •• Share Capital Subscribed and Capital •.
Employed " XVIII Sources of Bonus Shares II XIX ii xx Statement showing Depreciation and Rt placement Reserves in relation Value of Cost of Fixed Assets (Exclusive of Land)n Statement showing Depreci a tion Reserves in Relation to the Cost of Fixed Assets Bxclusive of Land.

•• to •• .. II XXI Withdrawals from Rehabiliiation Fund, Replacement Reserves, Depreciation and Capital ~xpendi ture .. • . "

XXII 11 XXIII Receipts from Rehabilitation Fund Considered to be Revenue.

to the Industry.
to the Industry.

•• Profits of the Industi~ ~fore Tax (Exclusive of Raw Spirits).

•• II XXIV Return on Capital Inclusive of Profits on Raw Spi:::-its.

•• II JCX\T Return on Capital Employed Combining Revenue from Sugar, Rqw Spirits and Rehabilitation Fund ~efore Charging •• Once-for-all Bonus.
11 XXVI Return on Capital Employed Combining Revenue from Sugar, Raw Spirits and Rehabi l itation Fund after flharging • • Once-for-all Donus.. II XXVII Average Annual lleturn on Average Share Capital Subscribed• "XXVIII ,.. Funds from which Dividends Paid •• •• -f)/ 65 .. 66 67 69 72 73 75 79 83 84 86 87 89 91 .. .. • • ~vi) TkBLE x:nx II xxx Allocation of btvide~.

s Paid to Sources from :Jhich ~ .m d s Generated.


Acquisitions of New Businesses outside Dritish Guiana, 1955/1964 and Releases for finance therefor .. II XXXI Once-for-all Bonus in Relation :to Capital Employed.

• 0 11 XXXII n XXXII I .. II II XYJCIV xxxv Comp arative .Minir:mm t1age - Unskill e d Compa rative Wage Rates in Industries Employment Cost i!

:xcluding lrunior and ~· Senior Staff N.P.


Q& Prices Compared with Wage Rat e s~ II XX XVI Suga r Production Re venue and Wages II XXXVII Consumer Price Index as Related to Minimum Daily rJages.

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Page.

.. 92 96 144 150 152 156 157 158 160.

~ INTRODUCTION The Advi3ory Corn ... m1.ti; eo wa.o appointcu cri.

the 29th.
day of June, 1965, by His Excellency the Governor of British Guiana i_n accordance wi_th the provisions of Section 6 of the Labour Ordinanc e , Chapter 103, With the followtng t erms of' :reference - 11 to enquire into the exiating dis pute between the British Guiana Sugar Producerst Association and the Man~Power Citizen.st Association in connection with (i) wage a _and condit1.ons of employ ment in respect of the years 1964 and 1965; (ii) the payment of a once-for-all bonus for 1964; (iii) the payment of an annual pro duction bonus for 1964; and to report thereon, ana make - such r ocom menda t :i.ons as it may deem expedient.
tt Th E~ members of the Commit t ee were: The Hon.

Mr. Jus tic e Percival A. Cum.rnings - Cb.airman .

G. -B • Kennard, Esq ., C.B.E.

John Jardj_m, Esq.

_, F.A.C.C.A.

F. Ramprashad, Esq., Barrister-at-Law w. G. Stoll, Esq., A.c.b.A • .. .

.

• - 2 - The Committee conv ened on the .

}0th ,June , 196,5.

ThG parties to the .

dispute pr e sen--; ,: d their submissions and led evidence j_n support thereof at 39 private hearings held between the 18th of August and 25th October , 1965, .

inclusive.
inclusive.

The case f or the Union was opened by its President, Mr. Richard Ishmae l, but was later conducted by Sewnarine Mohabir, Esq., Barrister-at-Law.

C. L. Luck hoo, Esqo, Q.C., E. V. Luckhoo, Esq., QoCo, With him, pre- sented the case for the Association.

Both sides presented their cases fully, led evidence in support thereof, and addressed .

the Committee on the evidence.


Hearing was concluded on the 25th day of October and the Committee met daily thereafter to .consider the evidence and to prepare its report.

In addition to memoranda submitted prior to tho hearing, the Committee .

.. " " also examined over ~50 exhibits tendered by the parties.

The Com.~ittee desires to express its thanks for co-operation and assistanc e to the Ministry of Labour, the Man-Power Citizensr Association, and the Sugar Produ- cers' Association.

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..

Finally, the Committee records its appreciation of ..• - 3 - of the work of it.s staff, and wishes to thank Mr .• .

F. Eytle, Inspector of Labour, who performed the duties of Secretary throughout the .

enquiry, and the stenographers whose tas.k it was to report the proceedings, all of whom discharged their duties loyally and effici ently.

l. THE PARTIES The Sugar Producers' .As sociation .
The British Guiana Sugar Producers' Association (hereinafter referred to as the "Association") has been in existence for many years and was constituted in its present form 5.n 1942 as a Company l imited by guarantee • The Association exists generally to promote and protect the int er ests of the sugar industry in British Guiana.
In so doing it enters, on behalf of its affiliates, into nego- tiations and ~greoments with Trade Unions representing employees in tho industryo The Association acts in union negotiations on behalf of the following estates: "" .. Estate Owner ALBION/PORT MOURANT .... BLAIRMONT Bookers Sugar Estates Ltd.~ j_ncorpora ting Port Mourant Ltd. Blairmont Estates Ltd., a wholly-owne d subsidiary of Booke rs Suga r Estates Ltd .
1 - 4 - Estate Owner DIAMOND ENMORE Demerara Company Ltd. Enmore Estates Ltd.~ in which 48% of shares are held by outside share holders; 52% by B4S.EoLtd.

HOUSTON Houston Estates Ltd. LA BONNE INTENTION/OGLE LEONORA ROSE HALL SKELDON UITVLUGT VERSATLLES WALES The Ressouvenir Estates Ltd. in which 41% of shares are held by outside shareholders ~ 59% by B.SoE.
Ltd. - Demerara Company Ltd. Bookers Demerara Sugar Estates Ltd. Bookers De merara Sugar Estates Ltd. Bookers Demerara Sugar Estates Ltd. Versailles & Schoon Ord.Ltd.

West Bank Estates Ltd., a wholly-owned subsidiary of Bookers Demerara Sugar Estates Ltd.

The Man-Power Citizens' Association.

The Nan-Power Citizens' Associat'Lon (herein- after referred to as the 11Un i_on 11 ) was the first Un ion to be recogni_sed in the Sugar Industry.
An Agreement pro viding means for the Avoidance and Settlement of Disputes was signed with the Union on 22nd February, 1939; and .

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• .

this .•.

• • .. 711 this Agreement was supple me nt e d and e xpanded by arl.

Agr e e- ment made on 29th January, 1945, under which provision was made for machi_nery for conciliati_on and settleme nt of differences.

The last Agre ement regulatlng wo.ges ... and conditions of employment was s-igncd on 29th March, 1963, cove rjng the years 1962 and 1963.
Oth er Trude Unions in the Industri.

The Association recognises four othei· unions in the industry, viz.

: The British Guiana Headmen's Union, The British Guiana and West Indies Sugar Boilers 1 Union, The Sugar Estates Clerks' Association, The Guyana .Sicknurses 1 and Dispensers r. Assoclation.

With the exception of' the fourth named, which was recognised in 1964, the Association had 5-year Agre e- men ts w:t th th o other three, all of' which expire d on December 31, 1964.
'The Assoc-i_ation proposed early th-i.s y ear to these four unions that in view of the i_ndustry 1 s pre- carious position, thi pr~~ious Agreements should be extended without change until December 31, 1965, when the situation for future years could again be considered .

So ••• • .. .. .

- 6 - So far no agreement has been reac te d wtth any of them.
Although tho claims of th e se unions do not fall within the ambit of our terms of ref e r ence, we arc not uri- mindful of the i.r impact on the wage cos ts which the indus ... try may have to bear.

2.
2.

THE TRADE DISPUTE The demands of t he Union conta1ned in a lett er to the Association dated 30th October, 196,, are as fol- lows: nwages and Other Demands - 196Lk The Union's demands are intended to cover all types of workers in the Sugar Industry who are not r epr e s ente d by the three special j_sod unions, viz.

tho British Guiana Headmen 1s Union, · ~he Sugar Estat es Clcrks 1 Ass oc iation, and tho British Guiaca and West Indi e s Sugar Boilers' Unlon.
The demands are also intended to cover Motor Transport Driv er s., Irriga tion Operators, Watchmen and ot her cat egories of workers who are covere4 by othe r existing agre ements between tho Brit ish Guiana Sugar Produc ers' Association and the Man-Power Citi zens' Association.

All demands, except wher e otherw j s e mu tu ally a gr eed , arc to take effe ct from lat J anuary, 1964.
(I) WAGES - TIME WORKERS ( i) Una killed ti me workers · in th e fi e ld and factory - $4.00 minimum per ei ght-hour day ; (ii ) Semi-skille d worke rs~ $5 .00 minimum per eight-hour day ; ' • .

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(iii) ••.

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r ' • '·' .. .. - 7 - ( ii.i.)

SkD.led workers - $6~00 mlnl- mum per eight-hour day, except where workers are presently in the .

~eceipt of higher dally rates and also where workers receive htgher rates and work less than elght hours per day as of custom and pract:i.co.
Hourly, Weekly and Monthly ~m12loyees.

Equivalent increases for those workers so classified~ (II) PENSIONS.

The Unionts proposais will be submitted after consultation among :Mr. Sven Boye , United Nations Pensions Expert, the British Guiana Sugar Produc erst Association, the Man-Power Ci t :t zens 1 Association and Govern ment.
The Union wishes to point ou~ that the delay in implementing tho Pensions Sche me whi ch should have commenced on th o 1st J"uly, 19 61, has bee n frus tra t lng and pen sione rs c ontinue to suffer from inadequate cx-gratia pensions .

We are certain that the Association appreciat e s the urgen t need for us jointly to make every effort possi ble · to have the Pensi.ons Scheme implomcn tGd without furthe r delay.
Should the frap l e men ta ti on of the Pon s ions Scheme b e ftirthe r de layed beyond the ls t Januar~r; 1964, th e Unj_ on demands that a blanke t pe ns ion of a mini mum of $30.00 per month b e paid to all ex ts ting pe ns ·5.on e·rs unt5 l s uch · time as t he permanen t Schemo ·rs impleme n t ed .

Th ls · demand is w5 thou t pre j.udice to existing pensions which are hi gher than this state d minimum.
On all existing pe ns ions ••• .. • 1 - 8 - pensions above $JO.OO p er month the Union demands a so% increase i..::r tj_l the date of j_ntroduct5_on of tho permanent scheme.

(ITT) SEVE:::tANCE PAY - AMENDMENTS TO EXIST ING AGREEMENT .

(i) A furth er amendmont to the Sever ance Pay Agreement to r e ad n-vifuen Management decid e s tha t a parti cular job is becoming re dundant there must b e prior con sul tation with the Union and in the cas e where alternative em ployment i_s bei_ng offered.
the workers, t here must be agre ement between Un-ton and Managorr.e nt on what constitut e s suitable alter native employment for the indi vidual worker or group of workers affe ct ed .
11 ~ - (ii) Amend ment to thG Existing CJause C ---~~~~~~~~~~~~-'-"-~~~- We propos e the following amend ment : 11For the purpose of these cal culations , one week 1 s pay sha ll be considered as the total of wa g es paid over the previous twe lve months at the job at which the worker became r edundant; and one week 's pay t o moan the aver age pay for six days for both fi e ld workers and factory wo rk ors .
The wages for the purpose of th e above · calculation s b.al l include workmen 1 s comp ensation, Tfolidays - wj_th-Pay payme nts, and shall :'tnclude ·all bonus es, s ick nos s benef-i_ ts, overt1.me and pre mium t:tme payments."

( .

.. ) J_ 1. l • • • ( ... ) ]_ l _ 1 9 Delete from the Agreement 2lgned on 20th .January, 1961, the fol low:i_ng: (a) 0 To decide on methods, machiner·y, equipment.

n (b) nTo .

doc:i.de on the number to be employed, kept in employment, laid-off, retrenched and/ or retired.
n (c) 11 To decide on tho age , sex, _educational standards, physical stands(stc) general qualifications and apti tudes roqu ired in_ cmplo;r ecs or those to b e em ployed.

11 (d) "Dolet8 from (f) 'termina tion of employment.

1 ( o) nDe lote (a) Lay-Off : The entire section and all other sections connect ed therewith.

In addlt-i_on, there nmst be a clear definition of what is "continuous employment 11 • (TV) SUPPLEMENTAL UNEMPLOYMENT.

AND TnifDER EMPLOYMENT BENEFITS.


(i) The Union demands the introduction of a scheme which will provide piece and time workers with a weekly minimum wage of $20.00 for a five-day week where the worker customarily works a five-day week and $25.00 per week where the ~orker customarily works a six day week.

1rl'.10 minimum, however, shall.


.. .. • 1 - lO - shall be $20 .. J O per week if the worker has cust omarily worked a four-day we e k c.::> less due to no fault of hi.s own, but has contin ued to qualify for Holidays-with Pay or is .

considered a permanent worker, i.e.

one who is qualified to remain on the payroll of the respective estates.
(ii) In cases where workers are not provided With work, for example, in the non-grinding weeks ( exclud ing Holidays-with-Pay weeks) that they receive on a weekly basis So% of the average pay earne d weekly over the previous crop · period.. Thi.s amount to be paid during thos 2 weeks when suitable alternative work is not available to them.

(V) MEDTCAL FACILITIES (i) Equ~l facilities for all workers resident and non- resident.

( i 1-) Maternity beneflts to _be free for all qualified fe male workers.
(VI) PENSIONERS AND MEDICAL FACILITIES (i) The Wives of pensioners qualifi ed to receive medi cal facilities be afforded tho same facilities that are available to the wives of Grade A workers.

(ii) Children of pensioners und er six teen years of age be afforded medical facilities.

(VII) SICKNESS BENEFIT (i) The existing agreement to be • amondcd ••.

.. 7 .3> - 11 - amended to ~ncludo whatever 'oro visions now · exi.st for computing workerst qualifications for Holi days-With-Pay for the purpose of .
_as.sessi.rig qualifications fol' sick ness benefits.

(ii) The Union demands that qualifica tions be standardized for Holidays with-Pay, sickness benefits and medical facilities.

(VIII) NON- ABLE BODIED WORKERS ( IX) GENERi1.L (a)Ovcrtim8 All hours in excess of oj gh t hours be credit e d as 11days wo r>kod 11 in computing qualifications for holidays-with-pay, Annual Produc tion Bonus, -s:i.clmess Boric.fits, MccHcal Fae iliti es, e tc.
(b) De ta tnanc c (i) Cane cutte rs and othe r workers ~ho arc detained from c omplbt- .

ing the5r job or task be paid the established mi.

nimum hourly rat e f or e very hour or part th er e of and that tho existing grac e p eriod of one hour whtch is now grant ed manage me nt b e abolished.

(ii) A r evi ew of "alterna tive work n condi tio ns which has i n t he pas t l ed to .a numbor of dis- .

~ut e s ~nd stoppages of work.


(c) .,Factory (i) A pre mi um rate of 10¢' an h our b e ..• - l2 - be pa :id for t~.1.6 t;wo n igb t..:.

sh if ts, namely the 2 p m. to lO ~.m.

and the 10 p.m. to 6 a.m. shift.
(d) Classification of Workers as Unskilled, Seml-Skille d and Skilled This is to be undertaken without further delay and that any compen sation due the worker after the classification is completed be re t roactive 1964. to the lat January, (o) Motor Transport Drivers 1rJhore Motor Transport Drivers and other workers conv ey pay-rolls that they be g jven an extra com pensat1on at a minimum of $3.00 for such dut1os for the add itional responsibilities and danger involved in conv o ying such pa y rolls.
(f) Split Shlft The Union demands that th e Opera tor of thes e vehicles b e enti tl ed to th e allowanc e for the entir e day, that is, that the rate b e e stablis hed at 64¢ pe r day, for an e ight-hour day and not calcu lat e d on the actual number of hours worked as is the curr ent practice on c erta in estates.
(X) UNION SHOP The Union again dema nds that all negotiated b enof ita be an entitlement for members only, and that members 1oJho benefit from wage neg otiations con duct ed by the ir recognis e d Union , the MPCA ••• .. .. - 13- - MPCA, shall not bo permitted to with draw their membersh i_p from the Uni on at any tlme prior to the term:i_natj_on date of the Agreement.
(XI) ONCE-FOR-ALL BOW-iJS The Union demands that the entire surplus revenue directly accruing from tho sale of sugar to tho United States of America and from tho high world price obtained during 1963 bo paid to sugar workers as a Once-for-All Bonus based on the productio'n of 1963.

11 Tho Association and tho Union both agreed to the inclusj_on of the Union's demands for 1965 in the terms of reference of the Committee .
The se demands sot out in the Union's lett e r to tho Association are as follows: 11A Onc e -for-all Bonus arising out of .
the Salo of sugar to th e Unites States of America which would normally hav e had t o bo sold on the World Market at an average price o:r- £21 per ton ; from any 1-ncreaso j_h wor ld prices of sugar wh i.ch may occur during the year 1965 the inc r ease being r e l evant to arid to b e compared wlth the average wo rld price .which has be en pr evaj_lj_ng in th e fr ee ( Sugar ) durin,g the past y ears exclud marke t ing the years 1963 and 1964 when the pr ic e had climbed to unusually_ high l eve ls .9 and from the sale of ( a ) Mo las 3 o 3 ( b ) Rum, and from other ancilliary operations con nect e d wl th the Sug ar Trtdustry in British Guiana, such as tho marketin g of sug ar ln tho ••• - l4 - the United .Kingdom thrcuzh Booke rs Sugar Co. Ltd.,.
and other Sug3..~-; Brokerage agen c:tes from prof1_ts accr·u ·L g from shipping of sugar by Bookers Vessels, -.frotn profits from the Demerara Sugar Terminals Ltd. which profits directly accrue only from the handli_ng of sugar .

produced in British Gui_ana, and from any other agenc i.os used for diverting profits.
The Union's demands are made for and on behalf of all typos of workers in the Sugar Industry who are not r c prosonted by the other thre c 1 specialist 1 Unions recog nised as the sole bargaining agents for certain categories of workers.

Tho throe unions referred to are the British Guianats Ifoadmenls Union, tho Sugar Estates' Clerks Associati_on, and tho British Guiana and West Indies Sugar Boilerst Union.
Tho demands are also intended to cover such workers who arc covered separately by existing agreomcn ts between the British Gulana Sugar Producers' Association and the Man-Power Citizcns 1 Association, e .g.

motor transport drivers, watchme n, Sophia Sugar Experimental Station employ e es, and Estate Hospital employees.
All demands exc e pt where othe rwise mutually agreed, arc to take effect from lat Janua~y~ 1965, as has boon the custom and practice durtng the past years bcarj_ng i.n mind that all rat e s of wages, cond1-tions of employment etc.

ne gotia t od and agreed to, are for a period of one year and the Union therefore mak es its d emands on an annual bas is.

(II) WAGES - TD1E WORKERS (i) Unskilled time workers in tho - field and f~ctory to roccivo a minimum of $4.50 por eight- .

hour day.
hour day.

( ii) ... .. - 15 - 7 7 (j·j) s:em1-sk111ed t-.rorkers - ~P5 .62t;t' minfmurn per e1ght-hour day • ( ii.i. )

Skj llod workers - $6.

75· minimum per o:i.ght-hour day.


The s e rates to be applicable as mini mum rates except whore workers aro presently in rece ipt of higher rate s in one of the three categorie s,unskillled, semi-skilled or skill8d, and/or work l e ss than eight hours per day as of custom and practice in accordance with the Field Time Rate Agree ment sigr:i-ed on 17th Septembe r, 1959.

(iv) Pie ce, weekly and monthly omploy eos - equivalent increas es for thos e workers so class if i ed 5 i. c .

12~-% .
12~-% .

(III) HOLIDAYS .WITH PAY (a) Days of c ertified sickness and ap prov ed l eav e to be discount ed from th e qualifying period .

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(b) Qualifj_cations in tho autumn cr op for factory work e r~ to bo restricted to the grinding period, except where Management undertakes to provide a full~week's emp loy- ment .

· (c) All periods when a factory does not grind for any part of a week to be regarded as a broken week and be so treated.
(d) Holidays With ·pay for wo okly paid workers to b e calculated as other fi e ld and f actory workers, ie e • a full we ek 1 s pay of six days plus t11rnn ty-fi ve p er c ont.

( e ) · Holidays with pay to be calcula tcd so that a worke r would r e ce ive tho .... 1-A - lb - the _ oqui_valcnc of slx days' pay plus 2_S per ce ~1 t _.

(:f) Workers to be pa:td on a pro rata bas~s.


(IV) ANNUAL PRODUCTION BONUS Qualification to be based on work available to the individual workers and workers to be paid on a pro rata baa is .

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· (V) MOTOR TRANSPORT DR:rJERS AND WEEKLY PAID WORKERSo (a) Drivers to b e placed on a fixed eight-hour day, i. e .
four hours follpwed by a ono hour bre ak for meals, then r esumo duties for .four hours immodiately following the meal break ; or that they be regard ed as day br shift workers on a straight oi ght-hour s hi:ft w}_th time off for meals.

(b) The same shou.

}d b e app l icable to a l l week ly pa id workers , ing watchme n. i nclud ( c) Hourly pa i.d or temporary motor tran s po1,,t drivers who a.r e paid· on t he ho~rly basis to r e c eive a pre mium of 2_S% on tho equivalent week l y rate.
(d) The .Motor Tr~naport Dri v ers' Agree ment - Section 12 - to b o a mended to cxpress ly s tatc that any mori t incromon t grante d by Managemcn t should not pr e clude any drive r from r bc e iving Union negotiated .

increas c s •' ( o ) - ' Motor Transport Drivers to r c ccivo a pre miu m· of o i gh ty c ents p er day whon r oqu ir e d to dr ivc 11Bu.lk Lorri ca 11 • - 17 - (VI) SICKNESS BENEFIT SCHEME.
1 (a) Tho Scheme to be conve rt~ d into a provj_dent scr~ome to provide pay ment as and when request ed by workers.

draft agr eement on this, but no final deci.sl o n has b een r ea ch ed) .

( The r e alre·ady exists a (b) The 150 days qualification p e riod to bo adjust ed and r e stri cted to 75% of the days during whl ch work is available to tho workers.

(c) Workers to be paid on a pro rata basis if they do not achiev e the 75% qualification.
_ (d) Tho qualification period required of workers to qualify for sick ness b enefits· to b o un oncumborcd and to bo reduced by the fo ll ow ing: ( i ) period of d isabilj_ t y un.dor th e Workmen 1 s Compensa tion Ord inane e; ( ii) c or t •-e>• lJ- J_ e d. s 1. c l:\..c1C s s , and i ~ • ( .

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l 1.J_ appr ov e d l eave .

(VI I) MEDICAL .FACILITIES (a) The present arr a ngement ·- to b o .
c on j ointly administ ered verted to a scheme invo lv ing lVIanagement and Union representative s. (b) All f acilities availab l e under tho s c heme should be dofinod in th e gr eatest de tail possible .

(c) Employee s, t heir f amilies, pen s ioner s and the ir l egitimat e dependents .

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- i8 - dopondonts sh ::mld rcco1ve ben c fi ts under the s ch 0 mo .

to ·our demanc~ of 1964).


(We refe r you (VIII) IRRIGATI QN OPERATORS (a) To be pa1_d for a fnll shif't,, who thor it be an oight-hour, twelve hour or tw?.nty-four-hour s~~ift.

(b) To be provirl~d transportation to and from th e5r work place.

(TIC) SEVERANCE PAY Every worker whose job becomes redundant to be entitled to Severance Pay as of right.

(X) GRATUITIES (a) Medical: Any worker who is dis charged on medical grounds includ ing cases which Management con r accident pronot to bo onti.
sider tlod to severance pay or to a gra tuity ·whichcvor :e is tho greater in amount of money, and that this entitlement be as of right with out r egard to ago, provided tho worker is under th e ago of 65 years.

(b) Pre gnancy: Female employees laid off through pregnancy to be cnt j_ tled to a gratuity calculated on the sovorance pay formula (as c on ta:tned in the Unicm's demands for 1964).
(XI:Y PENSIONS (a) Until the Pension Scheme is · intro duced, every worker who retir es shallo .. - l9 - s h all bo e n t itJ_e d to a gratuity compute d on t he _ basis of th0 S e v erance Pay formula (as amende d :in our demands .for 1964).

This d emand would apply to all workers who ar c r e tired as of 1st January, 1965.

Tho d emands for 1964 r emain unchanged for thos e who wer e r e tired prior to 1st January, 1965.
(b) The jmplemen tat1.on of tho P ens~ons Scheme in -tts amend Gd fo rm t o b o activ el y pursue d. (XII) ESTAri:1E MESSENGERS \Nhen e ver me ss cng ors are s e nt b y Management to George town t hat thoy r e c eive a mea l a llowa nce of $1.25 e ach day.
(XIII) ESTATE COMMITTEE REPRESENTATIVES T§HOPS STEWARDS) (a) Every gang should ha v e a t least one r e presen tativ e and in tho se cas e s whe re a gang is compris e d of moro than fj_f t ;r work e rs that o ne a d ditio n al r e pre s enta t i v 6 b e appoint ed for e v er y fif ty worke rs or part the r oof .
( Th 5_s wj_ 11 make for an improv e d s ys t em of r epr e s e nta t ion so bas ic to tho qu ick s et t ling of g r iev a nc e , pr o v e n t ion o f wild-c ~ t strike s, a nd t hus grea tly as sj_st our cfi' or t s t o a c hlcv c l o n~ t erm industr i a l p e a c e .)

- (b) On.

ea c h e stat e t h er e shoul d be ohe full-time pai d r epr e s enta t i ve t o b e pa i_d by t he emp loye r for ev er y s i x r e pr e s en t a ti v e s t o d-5.

s cu ss t h o se ttle men t of gr i ev anc e s ••.


- 20 - irri.med ia te grievances aw;:..v from tho work place to permi t : for the dis cuss ion an d poss iblc sett l e men t of grj_evanc e s during normal (Thia system working hours.

op erat e s e ff o cttvo ly in many i ndustri e s in the United Kingdom wher e tho work forc e is r e lative ly large) .

(c) Representatives to be appointed (Ther•e is already by the Uni.on.
Un i. on- Manage me nt agreomen t on this but must b e incorporated in the Agreement f or• t he Avoidance and S e ttlement of Dis pu t e a).

·cxrv) EXISTING AGREE~'[ENT FOR THE AVOIDANCE AND SETTLEMENT OFITTSPUTES.

.

.. . '
.

.. . '

,· (a) The Estate Joint Committ ee st e p and the Joint Conferenc e l eve l st ep S e ction 6(b) and (c) r os pe c tiv o l y of' tho Agro omont f or tho Avoidanc e and S ettl ement of Dis put e s to be incorporated and tak en up at tho es tate l e v e l a t which ropres entattvos of both c om pany and union representatives will par ti c 1 pate in the discuss-tons .
(b ) Tho n a me 'Joint Committ ee ' t o b e chang e d to 'Join t Meetings '~ (c) A definit e time l imi_t for ea c h step in th o sett lt ng of gr i evances to be stated as is e stablishe d i n curr ent ind us tri_al r e l ation s pra c t _:i_c e s r·i.

gh t h e r e i. n - Guyana .

Th is will s erv e to expe dite th e ae ttle .ment of di 3put o 3 and pr e v e nt un- n e c e ssary- delays which the Union has experi enc e d · and whi.
ch in cer ta4.n ma tt ers hav e ex t end ed ove r a p e ri6d of as l ong as four years .

( d ) •.• ---- -- - - - 21 - 7 (d) The ·cnt5-rG tGr:iDvanco or R0prc s0ntati~n Pr0c0 duro' to be stream- 1-·n~~d.

(XV) .
(XV) .

PAYl'IElJT TO ?~PRESENTATJVES All employoss both tlme and pioc e workers who aro memb0rs of ths roco12: nised union delegation invcilved ~n - making r c~ pres eu tat·ton at any st::p of the grievance or r e prcs cnta ti_onal pro cedure in the agreemsnt for tho Avoid anc o and Settlcmen t of Di_sput o s to bo paid for t he days involved whoth0r they bo at work or not, i. e .

whe ther work is availabl~ or not and that they also be paid sistence allowanc es .
trav e lling and sub (XVI) CHECK-OFF OF TJI-TTON DUES AND IBVTE.S (a) The employer t o be j:'espons tble for tho check- off of all mcmb cx•s' dues a s psI' cxi.s tinG agrc e men t and in cas 2 s 1.-1f1crc m.om.bcrs' dues have bb en che cked off a nd whore th e CJP11.s s '.tot1 i_s brought tc ti'lan a g0rnen t ts attont·i on that thc:y be.

held r'GS pnns -~ bl c:: fo.r thC; s11n::.s of money not che cked off as unlon due s and that they make eompensa tion to th n Un1.6n fo r the amoun t.3 due.
(b) The employ ers to make deductt ons of any and all sums mado as l ovl.cs by th e Union in a ccordanc e with th e Rules of t he=: Uni.on, and that they b e held responsible for any sums due as l evies of tho members should th e y fa il to makt~ the neces sary deductions.

(XVII) UNION SHOP AND UNION SECURITY The Union shop to be introduced to ••• -i 22 .... to prov:tdo compul3 c:ry me mborship as a eond:tt1.on of emp··.oyment.
The Uni.on has been soeki ng t · with t~e Sugar ~rodu~ers 1 -Association on this issue slncs 1958. r.:et ao.

:reeme nt (XVIII) GENERAL (a) Immediate classification of workers by agre ement · into the categoric~ (I) UnskillsdJ (ii) Semi-skilled , and (iii) Skilled and the r a t es of pay to be ostab lishod for sarnc.

Agrnement in principle has been read1 Gd on this issue since 1957, but the B.G.

Sugar Produ6crs 1 Association have made no pos1tlv.
: steps towards tho r ealisation of thi_s i.mportant mat t er .

As a r e sult over the years skilled workers have rec e ived les ser rates than thoso to which they arc on tl tl od .

(b) All piec e work should b e d efined and the ra tea fj_xed for same.

(c) An increase to be s ought by tho S.P.

A. from the Governme nt for all sugar sold loca lly, and the entire sum to be used to e stablish an Unemployment and Unc1er- omployment Benefi ts Sche me .

This has b e en a standing demand sinc e 1957.


(d) The muster roll plays an important part in qualifying workers for futur e emplo yment in the sugar industry; the r efore · ( i) For th e purpos e of mus t or r oll, if work is no t avail able i n the workers 1 nor ma l categor y a nd alternative work :t s off 0rod i.n a no the r ca t ee;ory •.. - 23 - category, that day should be muster-rolled as 'not required'.
Should the worker accept the alterhative work offered him, then it should be muster rolled as a day available · and .

a day worked.

(ii) Whenever a worker works up to 12 noon or after .that day should be muster-rolled as a day avallable and a day wor.ked.

(Thts was agreed to in pri~ci - .· ple at a past n egotiation, but has not ye t been strictly adhered to by Manag8ment to .

the detrime nt of work ers).


The Union demands a written agree ment on this general question in order that the wo rker c ould be protected.

(ii1) Tho automatic transf e.r of all rights and benef its which have accruea ··to a worker on one estate if the worker is trans ferr e d to anoth er estate or the worker on his own secur e s employment on another estate.

( e ) Employers to undertake to .

print all agreements for free dls tr ibution to all employees.
(f) Merit i.ncreases to be determined ·aft er di_scussi_oha between Manago-.

ment and the Union.

rt HISTORY OF NEGOTIATIONS A joint mee ting of the Assoc"iation and the Union was h e ld on 28th Novemb e r, 1963, in orde r to clarify some of ... • 1 - 24 - of the demands mad o by the Union.
Ori 11th February :r 196l~ .. the Guyana Agricultural Workers' , Union, an unreco gnised Union operating in the industry, called for a stoppage of work on all estates; this was accompanied by violence and intimidation of workers and lasted until 25th July, 1964.

Discussions which .

commenced in February on the payment.

of a Once-for All Bonus in respect of 1963, demand e d at paragraph (XI) of the letter of 30th Octob er, 1963, were cons equently suspended.
In August, 1964, the Union was struck off the roll of registered Trade Unions for failin g to comply with certain statutory requirement s. Consequently discus s ions on the payment of a Once-for- Jt ll Bonus for 1963 were further suspended.

On 17th Septembe r, 1964, the Supr eme Court rul ed that the Union had been wrongfully so struck off.

Discussions on this issue were accordingly resumed after this date, and s e ttl ement reached on th e 1963 Onco for-All Bonus on 17th Nove mber, 1964.
Targets for the 1964 Overall Annual Production Bonus were a gre0d on Decem ber 4, and on the same day the Association fixed the tar gets for indivi.dua 1 estates • .

After .

s everal meetings at which no agreement was •••.

- 25 - 737 was reached With regard to demands embraced by our terms of reference, the matte!'.
was referred by the Union to the Ministry of Labour for conciliation, but on the suggestion of the Conciliator (Mr. Chung, Deputy Com.missioner of Labour) a further joint meeting was held between the Asso ciation and the Union on 12th April, 1965, but again no agreement was reached.

Several conclllat i 0~ meeti.n gs were held in May and June but the matter remained unresolved.
A. meeti.ng was the'J'.1 held with the Acting M:i_nister of Labour, the Honourable Robert Jordan, on 8th June, 1965, at which the Association restated its position and its inability to meet the Unionts demands.

Both parties were advised of the appointment of an Advisory Committee, its personnel and its terms of reference c;m Friday, 25th June, 1965.

In support of its demands THE UNION URGED AS REGARDS: A.

THE ONCE-FOR-ALL BONUS FOR 1964.


(a) The existence of a formula for arriv ing at the Once-for-All Bonus, based upon a favourable price differentlal between the 1956 World Market price of sui.

:ra.r sold on the Free World Market and the price for the year for which the bonus was be'i.ng claimed plus the proceeds •.. 1 g - 26 - proceeds of the s ~le of sugar to the U.S. Market.
(b) That even though the Association claims that in 1964 the Sugar Companie s suf f ered a substantial decrease :tn revenue, (i) They nevertheless sold 26,232 tons of su~ar to the United Stat es Market at $173.53 pe r ton.

Had th ey to sell it at $105 - $115 p er ton the loss in revenue ·would -have been $1,535, 358 .00 whtch ' must· ·there- .

fore be conside red surp lus (based on 1956).
(ii) Tfie av0rage pri:.co tn 1964was higher than the more r eali stic pri c e ~ to which they have in the past been accustomed and on Hhich they have -1 n previous years budgeted as shown by the followin g calcu lati on: Frees 31, 872 tons @ ~~246 .34 ~ $7,8'51,348 At normal world nrice 31,872 tons @ ~115.00 Diffe r ence ~ $3,665,280 ~ $4,186 ,068 r e s u lting in a t o t a l surplus of $5, 721, 426 made up as follows~ From U.S. :Mark'ot From Fr ees Market $1, 535, 358 $4,186 , 068 (c) That the workers a r c en ti.
tled to no l e ss than 75% of this amount, that is, - $L~,29 1,069.

)o .

.. (d) .That the Union had b een misle d by the Association: during the n egotiations for o•• - 27 - for th'e Once-for-All Bonus for some of the years ,dur ing the period under r ev ie~ by be-trig g iven wrong fi gures as to the global profj_ ts in tho industry and that had they been given the correct .figures they would have st:e>elt.,-.. out f or higher onc o-for-all bonuses for those years.
Thut since general and other r e s erves are car rj_ed forward from year to year those er~ars should- be taken 5.nto a c count ln considering a once-for- all bonus for 1964.

4 B.

THE ANNUAL PRODUCTION BOJl:rtJS.

That the colony targets were not achieved as a result of - (i) Misrepresentation by the emp loyers With respect to the production esti mates given by them to the Union as a bas is for fj_xing the targe·t ·s.
(ii) Failure by the employers to carry out an und ertaking to the Union to 'con-· tinue grinding until the tar gets we r e reached .

(iii) Unfavourab l e weath er during t he month of De c ember.

( iv ) Unavoidable abs enteeism due to the el ec tio ns and the ho lidays at y ear en d. (v) Low yields due to reaping fro m p0or fielda as we ll as r eaping unripe cane .
( vi ) The e m'Dloyers ondeavouriniz t o save the expenditure of ·some $ 2~ mill ion which they would oth erwis e have had to pay for bonus, while the ir l oss of profits r ea ulting from not r eaching the ir tar ge ts was approximat ely only $L~O , 000 (forty ••• - 28 - (forty thousand dollars), and do l:i.b oratoly stopping g:;:- :Lnding in order to avoi..d paying the b,_:::ius • .

/ .. 0 • ALL THE .
/ .. 0 • ALL THE .

UNION t S CLA TIJJ:S AND IN PARTICULAR THOSE RELATING TO INCREASED WAGESo ·That its demands are justified because of the ability of the Association to pay based upon the following consideration~: (i) The gr·o·wth in size of the sugar indus try in British Guiana including eq uip ment and expansion of cultivation.

(ii) Rise in efficiency from groa ter me chani sa t ion and automat1.on and technical improvements in planting.
(iii) Thb constant rise in sugar prices under th e Commonwealth Sugar Agreement.

{iv) Substant'i.al increases 1n the profits of the Sugar Companies wj_th which wage increase have not kept pace .

(v) Comparatively lower wage ratos for sugar worlrni->s as compared i-ri th other worke rs in British Guiana.

(vi) Good marketing possibilltj_es for suga r. (vii) The Hehabilitation Fund and its advantages to shareholders.
(viii) The employtrs have been understating their prof its by diverting a propor tion to associated companies whfch w~~e permitted to overcharge the indu s .

try for _ g oo~s and ~ervices or WGre receiving the pr'oduct of the industry, e .

g. molasses at l e ss than the market ... - 29 - />fl (ix) price.

Moreover, profi ts made on rum were not shown as profits of the sugar industry.

Instead The profits of the industry had sub stantially incr eased during the past t en years and were excessive.
of b eing p loughed back in"to the indus try an~or shared with workers in the form of better wages and conditions, the profits wer e being used for distri bution to the shareholders, e.g.

through the issue of bonus shares and in 'hedge building ', i .. e. in investments outside of British Guiana i n non-sugar activi ties.

(x.)
(x.)

Depreciation and r eplacement reserves were pr ovided for at an excessive rate and to ge ther with withdrawals from th e Rehabilitation Fund, forme d a sourc e of hidden revenue which was distributed as d:t.vidends or as bonus shares to sharehold ers.

(xi) The cost of living and th e n e ed for improvement in th e standard .of living .
(xii) The-local selling price of sugar should be tncreas ed , and the additional r ev enue applied to meeting part of the cost of the demands for improved wages and condltions of servic e for workers .

THE ASSOCIATION, ON THE OTHER HAND, MAI NTAI!

;I WITH REGARD TO: A.

THE DEMAND FOR A ONCE-FOR- ALL BOlfuS FOR 19~: ( a ) (b) Ther e was n ev er any a gree d formula.

From 1961 onwards discussions had always been held against a background best described in t e_rms of the followmg extra ct •• .
- 30 - I extract of ·the agreer:i-:'.nt r .eached With the Union on 20th Jar.·c3.ry, 1961: 119.

( e) In the event of an abnormal increase or decrease in the price of sugar either for a limited or a long period of time, which affects the pro fit levels of the companies, discussions may be held, at the request of either the Association or the Union."
(c) Its criterion for the payment of the once-for-all bonus was 'always the over all profitability of the industry and that where as in 1964 profit levels had not been maintained, the overall profit ability of the industry did not justify the payment of a once-for-all bonus.
(d) While it is true that on one or two turned out to occas:i.ons the I':i_gures supplied to the Union as a basj_s for negotla tion for the once-for-all bonus be lower than the actual returns after trading accou:..'1.ts for the pertinent year had been closed, i_t must be empha sized that those figures were estimates.

The actual figures could only have been ascertained after trading had closed and accounts had been aud'i.
ted~ Agree ment having been reached for those years, those transactions cannot be re-opened.

B. T".tIE ANNUAL PRODUCTION BONUS (al Employees who had the ·necessary quali fications were paid three days' bonus on those estates which made the targets fixed for them, but where the estate ta~gets were not reached no bbnua was paid or indeed payable.

In view of the fact ••• .. - 31 - :fact that the indu:::it.cy':::: ov e _ra.J 1. target of 260,000 tons was not reached no employee received six days' pay.
(b) The responslbili ty for failure to reach th·e target lay W'L th the workers _who failed to .

take up the work which was av.a i lable.

C. THE WAGE CLAIMS IN PARTICULAR AND ALL Th""E CLAIMS TN GENERAL.
Althqugh the Association is not unmind f'ul of' the social cons i.derations involved, it has had no alternative but to reject the demands because (a) The estimated cost 1964 Wages Claims only is $ 4, 231, 861 The estimated cost 1965 Wages Claims only is The estimatea-·cost 1965 Other Claims is .. -Tota l 8, 612, 131 6,783,772 $19,627,764 This is exclusive of' the amounts claimed for Once-for-All and Annual Production Bonuse~ for 1964.
(b) The- Uni_ on ts memorandum c_ontains a number of ifiaccurate f'inahcial statements and mean1_ngless comparisons.

( c) The wages now ·pa id 5n the 1.n dus try com pare f'avourably with wages paid in othe r industri e s in th e country 7 but, n everthe l ess, in making c ompa risons i t is not sufficient merely to look at actual basic wages but also at the overall benefits rece ived by or _available to a worker in respe ct of his employment.
The •.• - 32 - The numerous fringe benefits which accrue to workers in t "'.1e industry must also be considered.

(d) The substantial impro'J dments in wages and other benefits which the Union has --secured over the years have only been possible as a result of the industry's undoubted growth ana.

improved efficiency.

In fact very considerable 1.mprovements have been made in wage rates and fri_nge benefits and i.n addttion the .
Association agreed · to pay and paid $13.7M 1.n Once-for-All bonuses in- these years when pri.ces and profitability made this possible.

(e) In the light of the drop in producti_on and extremely poor marketing prospects, further improvem'ents cannot now be made without endangeri_ng the viabil-tty, indeed the very life, of the sugar industry.
(f) Ove.r the years, the returns on capital employed have been modest, and in the years with which the Com..rnittee is con cerned, have fallen, in 1964 to a totally 'unacceptable level.

the sugar industry anticipates a seri ous loss.

In 1965, (g) The industry's estimates for 1966/68 provide an equally disturbing picture.

(h) ~uite apart from the marketing and.


financial position, the effects of drought, arson and sabotage in 196li_, with - resultant additional costs, will be felt not only i.n 1964 but for many y ears to come .

(i) The Associ.atj_on 1 s policy is one of balanced respons1b'i.lity to employees_, .

shareholders, the country·· ahd customers.


To meet - thes·e res pons i bll i ties, its first responsi.b1lity ts in fact to stay in - business as a viable concern ;n a i_s harshly compe titiv e wor l d and thi s pre ci.s e ly what it i_s· strugg ling to do .

(l) 'rRi ROLB or SUGAR IN THI COUllTRT'S ECONOMY - l) - The augar illd11t1t1"7 baa alwa)'a ·played a major role in the econom:r of Britiab Guiana.
I t proYidea e11plo:rment for approxiaate17 .19,000 peraorus in the-oanefielda and s11gar factories during tbe crop season and is a major source of inoome for some cane far .

.

ra.

Table I sbowa tbe lndustrr•a contribution to the countr:r'• ecODOlllJ' dlll'ing tbe ;rear 1963.

(1) (2) (3) (4) (5) (6) (?)


(8) '(9) ~ Estimated Tot.al Population Labour Force Elaplo:rnaent in Sugar lnd\18 tr:r 1963 Wages in the Sugar !ndustr:r Total Groaa Domestic Product Value of Sugar Rum asad Mo lass ea Produced Per Caput ,, National Income Total value of all vieible Exports .

(~ ·" __ ,._- l j Tota'l v.alue of Exports of Sugar Rum~ ud Molaases I 621,390 !

1193,000 !lo.

of ¥orkera ,; of (2) 19,000 · .

9.B Per Ca put $ Amount s 34,142,000 I 1,79?


ll $ 1' of 151 275,927,000 72,600,000 26 s 374 $ Amount.

$ ·" ot (8) 163,389,000 65 , 498,000 40 ..

.

;.!

• - 34 - The wage figures exclude salaried stafr, and represent the minimum weekly average employed.

At peak season of harvesting the employment figures are much higher.

The estimated total l abour force in column (2) includes persons who are unemployed.
Column (3) represents direct employment by the sugar industry; the figures take no account of employment provided by the sugar j_ndustry indirectly j_n,_ the tri;;i.nsport, shipping, dis t,rtbu tive trades , s h opke_;3pers , etc.
With the I ever-incr.easing population pressure ,and the unemployment situation in the area, it is vital that the sugar industry, by increased outlets for new sugar and expansion of produc- -..... tion where this is po ssi~l e , should be able at l east to main tain the present level of employment.
It is expec ted that an important contribution to the country's economy and unemp loyment problem Will be made when the Government and the industry 's proposals for the implementation of a peasant cane-farming scheme gets underway.
Already in 1963 2,500 cane-farmers and small holders received $748,000 as payment for caneso From Table I it will be observed that in 1963 the industry provided work fo r approxima t ely l o% of the country's -:~o ta l estimated labour forc e , and paid out in wages $3~,-142 , 000.

Suga r and its by-products form 26°/o oQ • .. " - 35 - 26% of the country's gross domost le produ ct ·· and 40% of the value of the country's exports.
· The industry makes by far the largest sing le c on- tribut1on to the Colon~'s reyen~e.

Over and above this, very large sums are paid 1n indi.rect taxat-ton - customs duties, bill-of-entry taxes, tonnage and light dues levied on s hipplng.

Moreover, in addi.
Moreover, in addi.

t1-on to thos e taxes the industry has made a direct financi.al contribution to the public purse by the losses it has incurred through the sale of sugar in the local market at a price below that obtainable for exports and, indeed, well below th_e ·price received by sugar_ producers in the other main Wes t Indian Colonies.
It Will be s een from Table II hereunder that during the period 1956-1964 the accumulated loss to the industry through this form of subsid'i_ s _~ti o n hus ...l.n.ount c : to $6,612,429.65.

Table II •.. _, 1 ' I I ' ' ' i ,.. \ } . '

., '.j i .

i I - 36 - TABLE II BRITISH GUIANA SUGAR INDUS TRY LOCAL S£LBS OF SUGAR (1956 - 1964) - - --- Year Tons Su8"ar Sold .
- - ·---·-··- ------.· Average Production Cost $ per ton 1956 19,881 158.82 1957 1958 I 18,142 I 19,355 I I 1959 18,518 163.95 159.98 164,.47 1960 18,478 156.67 11961 21,218 163 .. 49 1~ verage Sales Price per ton Difference $ <ti: {!'

-··---- --- ·--- r--·- -- - - - - --- -- 130.91 135~25 131.75 • 133~67 132.86 133.81 I l 27.91 28970 28.,23 30.80 23.81 ·. '

29.68 Total J;,oss on production ' ' ' Cost $ 554,878.71 520,675.40 ' ' ' ---------- ----··---- - -1 ' t ' ' • ' ' i ' ' ' ( r I ~ ! '
l 570,354..,40 439,961.,18 546,::rn1..,65 629,750024 1962 19,863 154.82 I 130.00 24.82 492,999.,66 1963 21,520 182·.,07 1964 24,519 204.,19 ,, .

.

132.68 131.00 49.:39 1,062,872080 73.19 1,794,545.,61 181,494 6,612,4,290 6 5 I \ ( i i l ' ,.

i ~ ' l <.

..... ... ' ,, ', • .. ... 37 - l~.. DEVELOPMENT, 19$6-1964 Sugar is produced by eigh ·~, conipani_es operating eleven factories.

The re la ti_ve' posi.


tion of t h e companies in terms of sugar produced in 1964 was as follows: Bookers Sugar Estates Ltd. Blairmont Estates Ltd. Demerara Company Ltd. .

Enmore Estate s Ltd.

Le Ressouvenir Estateg Ltd. Bookers Demerara Sugar Estates Ltd. Versailles & Schoonord Ltd. West Bank Estates Ltd. .

.. .

.

.. 18,400 22,054 48,04.7 26~450 25,175 87,835 9,147 .

21,270 - Total 258.9378 .,These figures include 'farmers t · canes ground by · sori:te ' of the Companies.
The development of the industry,_ since 1956 is summarised :tn Table III which a ppears hereunder: Table III •.• "JS1 - 38 - TABLE III PRODUCTION SA.LIB & P RIC2.S: 1956-1964 Total tons Canes Ground ( Estates) Total Tons Sugar Pr.o- duced (gstat es) ,.

Tons Canes Per ton Suga r ( Est a tes) Tons Sugar produced from farm- ers' Canes Indus t ry total tons suga r sold Frees Proceeds Average Selling from Sugar Sales Price per ton of Sugar (b) (c) (d)=(b)+(c) (e) (f )=(c}.s.
(e) - I 2,800,576.93 2,926,062.97 ';423,727.44 3~167,897.07 3,678,711.92 3,506,520 .• 48 3,383,225•36 3j352,686.88 2,936;213.22 260,035 281,623 301,916 280,097 3 29,044 319,938 320,381 311,588 253,55 9 10.77 10.39 11.34 11.31 1 1 .18 10,96 10.56 10.76 1 1 .58 3,298 3,350 4 , 445 4 ,328 5~397 4,807 5,642 5,549 4 ; 8 19 263 ~ 333 284 , 973 306 ~ 361 284 ~ 42 5 334 , 441 3 24 ~745 3 26 , 0 23 317, 137 258 , 378 44~600 ~108 54 ~075 ~842 53~107,667 50 ,003~6 47 57~590 , 033 59,761 ,138 58 ' ~ 117 ' 995 7 3 , 516 , 493 5 2 , 4 4 8 ,625 169.37 189.76 173,,35 175.81 172.20 184 .02 129.18 231.81 20 2 .99 Year (a) 1956 1.957 1958 1959 1960 1961 1962 1963 1964 Note: Total tonnages of Farmers' dnpes and tons c ane per t on of s uga r f or f a r mers' c an es are not available.
\ l .f .. l r. 7';)_ .. .. .. - 39 - It Will be observed that ' the producti.on in 1956 was 263,333 tons.

There was an i.ncrease to 284,973 tons in 1957, a further increase to 306,361 tons in 1958; there was a drop back tb 284,425 tons in .1959, an increase to ;31+, 441 tons in 1960.

This production o:f just a little over 300,000 tons was maintained during 1961, 1962 and 1963.

In 1964 production dropped to 258,378 tons, the lowest figure during the period under review.
It can therefore be said that with the exception of the years 1959 and 1964 there was a heal thy growth 1_n the lndustry 1 s production.

The average growth over the period under review was approximately 21%.

Gross proceeds from sugar sales rose from $1+4 .. 6M i.n 1956 to an all-time high of ~~ 73.5M ln 1963 but then there was a drop in 1964 to $52 .. 4IJJ:.
It must be observed, however, that the cost of production fluctuated during .the period under review and rose from $1.58.82 per ton ln 1956 to 204.19 per ton in 1964.

The admitted improvements in various areas of the industry 1 s operations were, in the face of rising costs and uncer tain fluctuating markets, essential for the survival of the industry.

Table rv is a comparison of factory and field data 1.n the year 1952 and the year 1963.
Table TV ••• - 40 - TABLE JI.V TEE SUGAR INDUSTRY" IN 3..R.ITISR GUI.ANA CONPJl_,_1\ISON OF FACTORY DATA I ._,_ 195?

1963 % Difference - i t. Mean number of weeks grinding 2.

Mean time grinding per week - hours 31 106 32 ~i: '~ ') 120 3.

Mean total hours grinding (1 x 2) 3,286 3,840 4. mean hours lost per week - factory stoppages, week-end stoppages, etc.

62 48 5.

Total tons cane ground 2,672,493 3,416,929 6.

Tons sugar 242,692 317,137 7.


Tons cane per ton sugar (5 1- 6) 11.01 10.77 + + + - + + - 3.22 13 •.

21 16 .. 86 22.58 27.&5 30.67 .

2.18 , 8.

FACTORY C.AP,\CITY - i.e.

tons cane per hour (5 ~ 3) 813 890 + 9.47 COMPARISON OF FIELD DATA 1 ~ Tons cane reaped 2.
T6ns cane per ptint load 2,672,493 4.89 + + 27.~5 26.99 From th is it Will be observed that in the .field cutting and loading operati..on~ increased by 27,,85 and 26.99 per ~ent respectlvE;lly, while factory c~pacity production increased by_9.47 per cent.

This 1.s obviously due to improv_ed eguipment in :the factory and r:rnme degree of mechanisa tign in the field.
Wh"l le i_ t i_s true that mechani sation and improved factory egui_pment have resulted i.n a reduct:ion of · the labour force, the evidence before us .

seems to establish that those now employed have more work avail able to them.

This modernisation of factory equipment and· mechanisa ti.on of some field operations is the result of the implementations of the recommendations of the Venn Com mission, and is in keeping with trends all over the world and indeed with common sense • .
Although the social effects of retrenchment must be considered and efforts made to re-distribute retrenched workers, neverthe l e ss the st e ps taken by the industry to incre~se its productivity were, .

and continue to be, essen ttal if the industry is to survive in an ~tmosphere of risj_ng costs, unc erta i n fluctuating and highly compe titive marketa.

5.
5.

MARKETTI~G AND SALES Four markets are ava1.lable to Br1tish Guiana for the sale of j_ ts sugar: ( 1) (2) ( 3) (4) The Negotiated Price The U.S.A. Market The Free Market The Local Market Quota M~rket - N.P.Q.

- U.S. A.

- Frees.

- Local.

Table V summarizes the "Sales Mix" for the· p eriod under review .
.. • .,., /• I \ I .. - l.2 - ~ MAllltZTS ,l!IJ) S ALl::S I T~ns 195• Jvorsge Pric.o Ya.lite I 'l'o1'lJ 1 es '1 .t.·erage Price l 9 5 8 V.alue $ Toas A~era.i;e Prtcoe Value S Toms I 9 S 9 lwe~ Price 1 g 6 0 \!

'.alue S Too" A'Vt.>I'~ l"ri.ce V.al\1~ & N.P.Q.

162 ,607 U.S.A. Freea 80.,845 Locnls 19,881 1183.38 l 150~64 l 130.91 29,819,043 153, 181 12,178,455 ll3,650 1191.71 I - t 195.63 I 29,366,3~9 1154,561 I !

- !
- !

22 .. 255,007 1132,HS 199.09 1149~36 l!,602,610 16, 142 135.25 2,453,70& Jll,355 1131.-:-S .

:W, 772 0 4U 1 I - 19.

785 ,:zz:s I 1 2.,5.SD,o:.n 159,~:ro 20$.

'70 l:IB.24 32~835,690 i I H,6:2.:S6S I 2,475 ,192 1167,724 I 29,S?l l I us,668 I l lti,478 ~02.00 :JJ~eso,;::;7::; ~ 201.1:; 5194.7,752 128.98 l!

'<,l-06,358 132.

P<G 2 .. ~55 ,050 ~.06,2"17 IS,'!t18 133.-67 TOTAL 263,333 169.37 44,GOO,108.

28~,973 189.
28~,973 189.

76 54,075,842 300,361 17.l.35 I ~ 53,107.,ti67 2e4 1 4.2~ 175,.SJ 50,003 , 6-t 'i 334 ' 441 17::!.20 ri?,590,033 1~ I l I i Averai;~ --, Price Tons Value S N.P.Q.

166,075 1207.25 u.s.A. 80.145 190.78 Frees 57,307 125.85 Loe ala 21,218 133.81 1 I 34,·Ufi,585 IS,289,985 7,212,340 2,839,228 I • Averag-e Price: Tons Value S Tt'ns A,· er~p.• Price 165,966 2u.01 65,180 182.10 I I 3:s,020 (5n7 j 11,BG9,256 l I 166,Cl.9 : ·.:19.
2{· 36,158 232.00 75,014 119.26 I B,946,119 9:i,440 19,863 130.00 2,ss2,02::s !

21 .. s20 I i294.60 j 132.68 TOTAL 324 , 745 184.02 59, 761,138 326,023 179.lB 58,417,995 1317,1:!7 231.81 52,4-48 , <-25 1306, 145 181.42 55, 5:>~,952 - 43 - .. N.P.Q.

The N.P.Q.

market ;_s a result of the Commonwe~lth Sugar Agreement signed in 1951, and at pres ent running to 31st Dec e mber, 1972.
This Agreement wa s executed by the Mintster of Food on b ehalf of Her Majesty's Government i_n the United Kingdom and the Sugar Producers' Associations of t"1e followtng territori.es: (a) Australia.

- f (b) Union of' _ South Af'rica.

(c) British West Indies (Antigua> Barbados, British Guiana, Jamaica, St. Kitts, St. Lucia and Trinidad).

( d) Mauri tiu;:i.
( d) Mauri tiu;:i.

Und er the Agreement the United Kingdom currently pays the n egotiated price for a total of 1,692,500 tons a year from Commonwealth expor t ers, of whtch British Guiana's basic allocation for 1965 is 181, 80.5 tons.

These quantities hav e shown an increase over rec ent years, partly to r efle ct increas e s i_n U .K.
consump t i on and partly b ecause of re - allocations of quotas followin g South Africa'~ leaving the Commonwealth (and the Commonwealth Sugar Agr eement) and because St. Lucl a no longer exports s ugar.

The total of the negotiated price quotas and the sugar deri ved from U .K.

bee t now r e presents some 97% of U .K.


consumption, and for technical and political r easons another 2% or so ha s to be r e s erv ed for f ore i gn import s. Moreover, • U .K ••.• f - 44 - U.K. consumption Ul now virtually s-catic, so that the prospects are negligible for any in t.rease in the total of' the nego tiated price quotas.
The Agr eement p rovid es for the purchas e by the United Kingdom Government of the quantities of the Nego tiated Price Quota annually at a Ne go tiated Price nreas on- ably remunerative to effici ent ·produc ers n a nd stipul ate s a single price applicable to all Commonwealth Expo1"ting t erri- tories.

The p rtce-f ~xing me thod l s s et out in the Agr eement and provides for a n i ndex t o b e comp iled of wages and pr ices of goods and servi_ces enter'i_ng into the costs of production .
The basj_c conc ept underlying the a gr eement was the estab- l ishment of a pric e that would pre s erv e t h e pur chas i ng power of a sac k of sugar in t e rms of imported g oods u_?

ed in the sugar industry an d of import ed foo dstuffs; clothing, e tc., consumed by sugar worker s .

The Agreement e stablis he d a b ~si c pr ice f or 1950 of $146.40 per ton, which was acc ep ted as a reasonable b ase - by the parties to the Agreement; and provided for annual -- - .
pric e n egotiations a imed at achieving a n ow singl e p ri ce to r eflect changes in the l ev e ls of wages and other c ost factors relating t o export sugar .

In ac cordanc e Wi th the provisions of the Agreement the work ing of t he p ric e - fix~ng s ystem was i n f ar m.ally .

.. • .. ... - 45 - informally reviewed at the request of the Ministr.y of Food in 1955 and 19.59 and new prices were established.

These exercises are termed ttFormula Reviews".


Pric e movements between the base years - called the Price Index - are deter- mined along the lines of a formula set out in an appendix to the Agreement whlch measures changes in price, entering -· into the costs under the th..ree main headi.ngs of' (1) wages -· ~ -- - .

and salaries; (2) supplies; (3) other charges.


The Nego tiated Price rose steadily from $160.40 per ton for 1950 to $223., 20 for 1964, the avel"age price for 1964 being $208.95, which is just $4.76 above the cost of production.
The Committee was fortunate to receive, in the course of the preparation of its report, th e results of the 1965 Commonwea lth Sugar Agreement ne gotiations, the effect of which is as follows: Tn 19 6.5 the industry will rec eive for approxi- mately 185,000 tons of its sugar sold under the N.P.Q.

- Bt?.,sic Fixed amount in lieu of Colonial Preference •• Speci.al payment for develop ing territories ~~201.
60 6.,36 $207.96 1_5,.60 $223.56 These ••• - 46 These are fixed amounts 1iJh1ch b0ar no rolat1.on co world market prices.

.. Under_ the new price arrangements which come into effect in 1966 and are operative to 1968 the position is as follows: Bas j_c Fixed am.aunt in lieu of Colonial Preferenc~ Variable fer developing territories $208.80 7.20 12.00 - Maximum $228.00 The variable amount of $12 referred to above is now related to the world price .
of sugar and this amount decreases ~s the world price of sugar increases.

The fol- lowing tabulation sets out the variable amount linked to world prices World Prices S.upplement Under i l48.80 $148.00 - ·:?158.30 $158.40 - $167.98 $177.58 $168.00 $187.18 $177.60 $187.20 and over $12.00 10.80 9.60 8.~.0 7.20 nil The world price is determined for any particular year by taking .the average wor ld price for the 12-month peri8d previous to 31st March of that year.
Hence j_n 1966 the world •.• world price would be th~ average or the 12- month period 1st April, 1965, to 31st March, 1966, so that the price for our 1966 Negotiated Price Sugar Will not be finalised until April 1966.

If world prices remain as in 1965 the industry Wi ll receive $4.44 per ton (the difference between $228.00 - and $223.56) more on Negotiate d Price Quota sugar in 1966, yielding a maximum gross benefit of some ~~820, OOOon a Nego- ~ - tiated Price Quota of approximately 185,000 tons.
However, this figur e ($4.44 per ton) decr e ases when world pric es increase, and current world prices would have to double in order to cover the industry 1 s present c0s t of production.
Since the bulk of the difference be tween the Negotiated Price Quota and British Guiana's total exports must be sold at prices based on th e world pric e , we a gr e e with the warning on total rev enue by Sir Robert Kirkwood, Chairma n of the British We st Indies Sugar Association , when commenting on 1st December on the new arrangements: .. - "I wish to utter a wo~d of warning .
The incre as ed- take-home pric e for our n egotiate d pric e suga~ wi ll n ot , I r ~ p eat n ot, offset the fall ift th e world price of sugar sj_nce· the beglnning of 1965. fact we estimat e that in spit e of the incr eas e ih t he NPQ take-home price the average pric e of our 1966 crop sale s - on In th e ~ .

.

- 48 - the basts of the present ",J")!lld sugar price will.

definitely be less thr:n for the 1965 crop.n Notwithstanding this, it is clear that the indus.:.
try now has for 60% of its sugar through sales at NPQ.

prtces a guaranteed market at a guaranteed price which · is not only reasonably remunerative to the efficient produ- cer but goes some way - although not all the way - towards offsetting the loss on the world market.
U • s oP~r The sugar arrangements within the U.S.A. are deter- mined by legislation and the Government deci.sions Which lay down the proportion of U.S. requirements to be met - - - from ~fomes tic production and from imports from various areas, · and also lay down the mechanism by which the prices for domestic producti.on and imports are determined.

The U.S. Administration is continuously subject to great pressure.
to grant increased quotas for domes tic producers and for overseas countries, particularly Latin- American countrie s who can argu e tha t the y ben efit from no protective arrangements els ewher e .

The price of sugar sold to the U.S. A. is cur- r ently det ermined by the r e l ationship be twe en Uo S. consumption ..• .. - 49 - .

consumption and the to·ta.l of' the quotas permitted by the administration.
This year," the average price to British Guiana is estimated to be $203.40 per ton and the quota allocated to British Guiana approximately 30,000 tons.

which would yield a sales revenue of $5,900,000.

Having regard to .

the cost of production of $184,.89 per ton, the nett gain from U.S. sales will be $555,JOO.

The Free Market (Frees).

The word 'freest r efers to that part of British Guiana exports which is sold a t prices directly rela ted to the free world market price.
The frees from British Guiana are sold almost entirely 1-n Canada i.n order to take advantage of the tariff preferenc e grant ed by Canada to Commonwealth producers (and still to South Africa).

The Canadian market is under great pressure from tradi tional Commonwealth s uppliers, from t~ e new members of the ?ommonwealth Sugar Agreeme::-t (Ind-ta, Rhode~ia and Swaziland), and from South Afr·i.ca.
Against this compe tition it is a tough struggle to maintain British Gv.iana 1 s share of it - and no other market, e ven if it were acces sible to British Guiana, provides comparable preference.

The pric e r e c eive d by British Guiana for sales to Canada i s .•.

.1 - 50 - is the world pr1.ce plus a part of t h e Canadian pre.fe rence, .. which is $36 per ton.
The greater the pressure on t he Canadian market, the greater the erosion of the premium whic h Commonwealth exporters can obtain from Canada b y virtue of the pref~rence.

Free quota prices are based on world prices wh.ich, as can be seen from Table VI hereunder, have been the very opposite o.f steady.

TABT.JE VI LONDON DAILY PRICE (Annual Average CIF U .Ko) Year $ per ton Index (1956 ::: 100) 19.56 1957 1958 1959 1960 1961 1962 1963 1964 1965 (first half year) 168.oo 225.;.50 150~62 131-09 136.
70 123;26 122.

8.3- 344016 245.35 111.33 100 134 90 78 81 73 73 205 146 66 Even with the Canadian preference of $36 per ton this price is below the cost of _productlono .

At no time si.nce the war have the market prospects for •.• .. ,, - 51 - for - 11 f'rees 1 be·en worse than those con:fr.onting the indus- try today.

-We ·quote the following extracts from a .


report published in the Gt1iana Graphic of August Jrd, 1965, which sets out the current sugar world market situation very clearly: 0 sugar prices on the free world market are lower than at any time since the end of the Second World War, and produci.ng countries largely dependent on the free World market · are in an extremely difficult situation, according to the Pood and Agr J. culture Organi sation's leading authority on the sugar economy.

}1r.
}1r.

A. Vi_ ton, Chi_ef of FAO' s Suga~ · .and Beverages Sec ti on, said in Rome that this year's sugar harvest was expected to be elght to ten million tons above last year's crop of 54e5 million tons •...... ·" .· tThe world market is demoralized,' he said si_nce t:rices on the free mar ket •••••• had never been so low .•...

In terms of purchasing power, · the pres ent free market price is 10 to 25 per cent lower than even during the pre-war depres- s ion years 1934-38."
The evidence before us confirms this view.

In the absence of an effective -tnternational sugar agreement there is no indication of any increase in world prices above the present levels.

A conference to nego tiate such an agreement was held in September 1965, but no ••.

... .. - )2 - no decl s lon was reached.


Even i f and when an a greement is reached, it can only be effecti7e 1n raising the world price if i t achieves a drastic cut in sales on th e world market, and thi.s cannot fail to include a cut in sales from Brit j_sh Guiana.

Any cut in British Guiana total sales would increase the unit costs of production and thus exacer bate the industry's serious losses.
It seems, therefore, that the industry cannot look for any relief by way of any substantial improvement in the current low free world market price, and although the cushion arranged under the new Cornmonwealth Agreement Will in some way mitigate the loss Which must be an ticipated, it will by no mean s off set it.

The Lo cal Market Over 22,000 tons of sugar are sold on the local market at Government controlled prices wh ~i.ch are co n s l d erably less than the cost of produci.ng the sugar.
The controlled prices for the various grades of sugar sold on the local market are: 53 - Type of' Sugar D.,C.

('Raws 1) U oC .. ( t Yellows;) C~Wo ('Whites') Retail Prices (per lb.)

tfuolesalers 1 Prices (per ton) Producers' Prices (per ton) Tons ·Sold 1964 6t¢' $129.92 ,!

!-.-, 2/ r::' / <P~ o.;:;o 196.00 192.64 19,416 ( 86.416~) \ .

.

212 (0.944%) 2;840 ( 12.

64ofo) These prices were fixed as from 29th Septernber 3 1951.
The amount of sugar from each year's production sold on the local market has risen .frorr.. a little more than 16,000 tons in 1951 to 24,500 tons tn 1964 .

(See Table JI).

It w1.ll be s een that the bulk of the sugar con su..med locally ls D.C. sugar whi.ch in 1964 comprised more than 86% of the total consumption.

The diff erence between selling price and total cost per ton is now in the vicinity of $7.5.00 per ton.

Over the l a st two years, even C.W.


sugar (th e highest-priced grade) has had to be sold locally at less than the cost of production.

Conse quently this market can contl''ibute nothing t o the indus- try's profitability unless a cushion i s provid ed by way of an increase on local sales.

ACCORDINGLY WE RECOMMEND an j.ncreas e of 25;¢' on t he ••• > · .

... - 54 - the local selling prj_ce of D.C. s ~:.gar with appropriate adjustments on the other grades .

.

.

~- ·· 6.
.

.

~- ·· 6.

THE FINANCES OF THE SUGAR TNDUSTRY.

In orde.r to comply with its terms of reference it became incumbent upon the Committee to examin e the finances of the companie s comprising the Association.

To this end the Committee examined detailed consolidated statements of t he industry's accounts covering the years 1956-1964, inclusive, and estimates for the year 1965 pre- par ed for purposes of the enquiry and tender ed i.n evidence thereat.
The Committee also requested and obtaine d from the Association supplementary information and explanation which enab l ed it to analyse and int erpret the ma ter ial tendered .

We set out below t o.blc s Vrf to XVI: · Ta.ble VII compr -i_s os the Consolidated Balance Sheets of the companies in the sugar i npustry as at 31st __ De c ember, 1956, to 1964, submitted by the Associa tion .
Table VITI shows a break down of other ass ets included i n 'fabl e VII Table IX iss: Cons ol idated statement of Prdfit and Loss and Appropri.a ti ons th er e of of the compan i es .... comprising .. .

- 55 compr·1a:i.ng tho 3ugn :r. :i.n.dus try- as subrn1 ttod by the Asso ciation.

Table X shows Consolidated Statements of' Revenue and Expenditure of the industry for the years 1956 to 1964 submitted by the Association.
Table XI is an Analysis of' Tncome from Invest ments by the j_ndustry in other assets, included in Table IX.

Table XII shows the Revenue and Expenditure of the sugar industry, expr§ssed ln costs per tog.

for the years 1956-1964, as submitted by t he Associat ion • Table ~III shows part"i_culars of Retllrns on Oapj_ tal ~mployed in the _ sug~r industry (exclusive of the pro duction of raw spi_ri ts).
Table XIV is a Reconciliation of the Global Pro- fits, as s ubmitt ed by the Association, with profits adjusted for taxation purposes.

Table y:.J shows the Net Book Value of Land (exclud ing Demerara Co 0 Ltd.) included in Net Book Value of Fixed Assets.

Table XVI shows the rate of Depreciation applied within the industry .

l J.

... .. \ I " ,,.

l .. ~ - 56 - T~IlLE VII CCliSCLillATED J!AIMIC:: ;:=~s OF T!

!E CGiPJ,;II!

:S COMPRISING '!

'!E srr:;u1 r::D"JS';:F.Y r;l iHITISl!

(lUI/+.


'!A AT }15'1' ilECE!oG"..R 1956 TO 1964 ( --- SUGAR PaODUCTIC!l once 10'<7 once ' ncn ~~· l"O o~ o~• v• Fixed Assets at Cost le3s Depreciati.on SJ0.906,926 $33 ,110.

501 535,251,056 :}6,515,755 $39,153, 797 $40,150, 550 #39, 329,136 $40,277 ,611 $44.

540.,894 Current Assets Stock & Stores t'n.sold.

Produce Debtors Cash ~: Creditors Net Current Assets B.G.
De-velopr.ent Bonds $ 5 ,672,i:'A5 7,341,960 1,511,342 165,830 i 4 ,864,'300 7,051,145 a62,944 211,a2s ' 4,458,15"- 5,217 ,216 1,729,003 158,173 $ 4 ,345 ,0'75 50146,982 1,721,280 116,899 s 4,820,400 6,612,370 2,C85,120 154,166 $ 4,808,933 6,875,750 2,500,478 79,037 s 3,982,315 s 5,071,949 8,671,099 8,019,432 90,643 4,507 ,814 3,023,554 70,502 $ 4 ,630, 757 3,893,266 3.396,734 97 ,022 Sl4,691,1TI 2,257 ,60} $12,490,51') I Ul,572,5'16 3 ,661,4.1.C 3 ,382 ,562 $11,330,236 2,355,830 $13,675,056 5,663,438 Sl4,264,198 Ul,58t,185 S2l,853 ,123 9,919,176 7,236,298 7 ,861,589 $12,017,779 :;;®6,635 U2,433,574 g 9,3<3,179 ~ B,18';,684 s 8,974,406 s 8,011,618 $ 6,402,609 $ 4,347,887 $11,933,947 t 8,211,144 s - • - ~ - • - s - s - s 332,453 : 2,315,203 $ 2,000, 200 Total Swqr Assets $43,3.\0,500 S42,433,C50 ~.!
;,440, 740 $45,490,161 S47,165 ,415 $46,553,159 $44,009,476 S54, 526, 761 854,832,238 H-c-.r.

:.STM~J'IS IN C'TE~ P..S~3'!S s 7,047,480 s 8,896,224 U0,CB3,424 $10,390,007 012,197,894 U4,732,B32 s 7,967 ,381 s 9,009,m !S 6,485,558 BAL..~.uc~ WI'!

'H ?7..J:.LC\f ~ID!A?..IES $( 5.

702,107) s 2,085,925 .$ 4,224,014 $ 5,297,621 $ 8,819,363 $11,639,957 '16, 771,363 '12,845,018 812,232,321 ' $44,685,873 $53,422,829 '57, 75"3 ,178 $61,677,849 $68,182,672 S72,92S,948 $68, 748,220 S76.

981, 556 rn,sso,111 ..


I LL-\iill..CT IES ••• .•c;;: -~~-- ~ ..... l" "' .- .. "' TABLE YtI :ClllfSlI.IDArli> llAI.Alc6 .sams OF nm IIiKPAllllS OOMPRISma : .

.

.

57.

Tllll SUGAR DIDtaRY Di lP-Xr'.Isl GUL\NA Kl 31.st.

!

!%':!!!51!

1256 ro 1964 LIABILITIES --- -- Capital and Rese~;; Is1111ed Share Capital Capital.

Be"'11"18S; beings- ~.

i "" Sugar Industey Bebabili1i&tion (exclmting Da112rara Compaq l.td.)

Other (including llelle:rara CoJllPlllV .LW.


!ehabilitation) Replacement Beserves Revenue Beservess- General I Unappropriated Profits DS6 lN ma 1959 ;J.5!60 'l:96l ~ "296.3 l96h :c 01 ~-si.1,SOP 111.m .-soo ; tl.T.

505,000 il7,5GS,A:l0 i2l,'0$.,J,9J $32,92B,9SO $ )2, 89412:.JZ $32,656,248 .

$32,-656,248 5,,j!J.U!i:.

6.~304 ·a .. JS9,867 9~8l4,S07 ll,<J'IJ.


;435 2,6SS,6.38 4,278,067 5,93S,B99 7.353..710 · 6_.SSj;B~ 91 9151 63$ 9,0JS.6o6 12,175,666 6,624,459 8,0'lJ..800 11,988~ 9~~7 J.0.,177,416 9,)J.1,1D3 5,769,875 7,4.51,554 5,906,146 ·' 9,l.16,)87 +: B, 13$,1SB n 7,9l4>893 .

10,221, 797.

1.926,874 6.185,986 6.!I00,787 6_.

;ifl4,l27 11,SSO,ti64 9,096, 31!4 10,088,8!


)6 5,862,326 S,6S7,-BOS S,86.7 ,808 · 2,011,723 2;169.611] 2_,777,641 4,021,381 4,ol6, S'7 3 3,82S,974 4,07 3,634 4,772,6'1 3,319 ,191 $45,167 ,l.32 $50,014,699 $$,232,732 $59,985,003 $63,592,894 $67 ,464, 959 $63,334,272 $66,$17,6~" $67 ,966,Bll ' &.cess of Cost over Par Ya1ne of Shares in S.\bsidi!Ui eom;pil?lfis ( 7.~.4n) ( 7.

306.411) { 7, 3l3.5Jl) ( 7, 313,5J:>) ( 5,478,026) ( 3,829,507) ( 3,814,80$) ( 3, 706, 238) { 3, 706,23tl) i3?
,860, 721 $42,708,286 &hi#9l9,202 ~52,671,47 3 $58,114,868 $63,6.35,452 359,569,467 $62' 81.l, 366 $64,26o,573 . '

Loan St.ock & 432,000 $ 408,000 $ 384,000 $ 360,ooo ~ 3)5,000 $ 312,000 Liabilities and Provisions Taxation Dividends Pensions lJilnlc Loans - - - ·~ - • $ 5,022, 261 .$ 0 0611 ,aJ!.
$ 1.2~,869 ~ 6;,523, 795 ~ ,7,2J/,987 $ 7, 395,523 $ 7 ,627,906 $12,048,605 $ 8,235,643 6oo;374 780,5J.7 - 757,643 591,581 591,586 855,250 984,590 1,035,123 l,6o9,416 698,155 870,a64 - 1,459,420, 1.68,106 ~- l,SJJ,995 - J,,638,567 557,569 495,673 - 40,8lli 19,0.51 483,585 .

28~584 .

355,746 ,.

- ' & 6,393, l.$2 il.0,))6,541 i 9,449,976 .


$ 8,646, J/6 ~ 9, 731,804 $ B,978,4% $ 9,178,753 $1.4,170~190 $ 9,269,~ '4/i,685, 87 3 $5.3,422,829 $57,753,176 $61,677,849 .. •:1• .- $68,iB2,672 $72, 925, 94d I $66, 748, 220 ~·r6, 981, 5'6 li\7 3,550,u7 - / .. TABLE VITT THE SUGAR INDUSTRY IN BRITISH GUIANA 58.

ANALYSIS OF CY.rfIB!


ASSETS 1956 to 1964 771 19?6 195'f 1958 1959 1960 1961 1Q64 1963 1964 Rum Other Total per Consolidation $ 1,459,613 $ 5?587,867 $ 7,047,,480 $ 2,131,051 $ 6,765,173 ' $ 8,896,224 $ 2,640,000 $ 7r448,424 $10,008,424 $ 1,518,400 $ 9,371,659 $10 ,890 ,,C67 $ 1,595,198 $10,602,696 $12,197,,894 $ 1,679,846 $13,05,:Z,986 $14,732,832 $.
1,877 ,81-8 $ 6,0091563 ~ 7t967,3B1- $ 1,741,051 $ 7,868,726 $ 9 ,6<.,g, 777 $ 1,815 t240 $ 4,670,318 $ 6,485, 558 316,458,225 $71,457,412 SS87,915,637 i -· ·.;;.

.

'· ~.

'i.-'l it:.·i ·"' ·-S9- -~ C-OllSoJDlD!I) STATEMENTS OF PROFIT & I.ASS -& APPROPRUTI811S mBRJ!lll!'

OF DE COMPANIES COMPRISING 'lllE S UGAR INDUSTllY DI BR!

'IISB GUIANA FOR 1'llE YEAllS 195 6 !

'O 1964 ·" .,.

C-Olidated Sugar Po::o1'its per Globa:hl $ 890.622 IS.3'1501166 $2,401!,310 ta.asn • .slllO .
h.461.296 S2,4&9,528 $ 3 0'1'11 0 896 $6 , 557,716 s 1,177,376 19156 D57 1958 IJl59 ll.960 1961 1982 1963 1964 Alkt.t- Items not relevant to S3ar Globals;- (Los&es in brackets) Sale of Fixed Assets Bartica Electricit,r Works h.come .f'rOD Iavestaents in other aa&eta Sale of Investaents transfers rroa lteserves:- ~ Replacement General Capital Subsidiary Companies profit& less U.K. tax (Demerara Co.) Transfer by De .... rar<• Co. of accll!l!U:la'ted losses of subsidiar)' cORpan.iea to the aecOnnts of those com:pan.i.es Over and under prorisicns o~ "taxation and other items (net:) ; ~· I' :.0 :$ 85,17.!
$( 26,737) $ ( ( H~s:53) 7!113.587 2.1.55 l2,.21J.)

682,591 273 14,837 e 208,963 s 181.,15§9 $ 4&~526 .2,510 liD&,4'18 ll,ll95 5S2,:S49 3 0 2113 '122~'798 ( 10,ll87 865,720 ( s 189,329 5,45:1 500,950 SC 314,458l s ( 7,07:1 274,177 27,249 31K 474,071 81,726 1-ns,aaz 21.9,38& 313,262 4.336,963 2,805,115 ( 10,000) ( 588] a.i.s,&GD s 865,:500 12.-.aH 54,259-266 $3,279,480 13,1:>93,979 ii 87-0,170 Sl,053,1'19 s 897,730 .

1 970,926 i3,359,-G26 $3,440,452 1111.309.


708 S6 1 510,3BO Sl 1679,o80 &7,837,812 $( 47,356 ll 501;7-0A Less:- Iteas no't releTant 'to Sue Glohala:- Dhidends Transfers 'to ReaerTes 1- G>!nera.1 lnvest:aent Loan Stock Redeaption Expenses of Increasing Sba.,.
Capital Expenses or Increasing Inv e s - 0..er arid huller) provision& of' °""9 For All Bcnus CapitalisatiOA by Bonus Issue Profit & Loss Account:- Balance at the beginning of the ~aJ> Bala.nee carried to Balance Sheet at ~h~ end or the year Sl~;41611 S50 095,382 Sl,697,920 111,3:59,23~.

$2,609,857 S2.13:~m,124 $11,aoo,495 $61128,747 s2.1s9,51s 33.1,211Kl ?.14,SOO 1,223,'726 480,..0UCI 40,eao -m_ooo 40,000 40,000 6113,977 50,000 40 9000 1,022,472 .
;.01000 143,0Cl4 110,431 '26,000 4,593 4,354 trJ,794 1.657 ( 82,471) ( 921,964) 913,231 $19 6!ll.

'J1 8!

!6 s ~QB $ 3'18,084 $ 317,834 Sl,243,74D $( ss,«ll,A32 $2,961,646 $1,850,239 $3 ,363,8'34 113,631,0?.ll 4,808) ii ( 190.
599) SU,os2,048 $5,811,137 $3 1072,746 s 247,660 $ 699,223 s (1,393,666) Sl,729,2911 $:2st171,723 '2,459,807 $2 .. 177,641 $4,021,381 $4,016,573 $3,825,974 $4,073,634 M,772 1857 $2,071,723 $2,459,807 $2,777,641 &4,021,381 114,016,573 $3,825,974 $4,073,634 $4,772,857 $3,379,191 .. \ I \ \ ) I I' ... ... .. .. } } 1 iii:.

; cmsowaTED STATEMEf1rS OF REVENOE 8: EXPERDITtJRE OF THE SUGAR Ill!XlSTRY IN Jl"RITISH GUIANA FQR W YEARS 1956 TO 1964 ~ l!l2§.

~ ~ l9.2l!

~ ~ ~ 12!!!!

~ 12!!!!

~ ~ ~ ~ .I2I!!

I.lm!!.


~ I.lm!!.
I.lm!!.

~ I.lm!!.

Colmiy ProductiClllB 263,333 284,973 306,361 284,425 334,441 324,745 326,023 317,137 258,378 Sugar Revenue $44,600,108 $54 ,075 ,842 $53 ;107 ,667 $50,003, 647 $57 ,590,033 $59, 761 ,138 S58,417,995 373,516,493 $52 ,448,625 Cost of Productian 37,023,316 42,760,310 43,467,902 42,239,101 48,085,042 51,083,927 Net Jmvemie $ 7,576,792 $11,315,532 $ 9,639,765 s 7,764,546 $ 9,504,991 $ 8,677,211 48,250,279 ' $10,167, 716 58,385,286 46,959,200 315,131,207 $ 5,489,425 Molasses li!!
'rel!t".e Sundry Revetlll9 $ 1,800,296 s 3,4ll,873 s 2,876,245 s 2,738,445 $ 1,951,392 g 2,594,077 $ 2,865,141 II 5,838,250 $ 4,152,398 2,139,408 2,266,612 2,543,301 2,008,143 2,795,514 2, 147,163 1,816,617 1,899,581 2,836,622 I Total Other J!eveiwe $ 3,939,704 $ 5,678,485 $ 5,419,546 s 4,746,588 $ 4,746,906 $ 4,741,240 $ 4,681,758 ' 7,737,831 ll 6,989,020 S'.lndry Expeoditure 1,983,401 2,262,559 2,555,928 2,222,012 2,945,401 2,303,200 1,740,475 1,862,966 2,090,285 ll"t Othex l!evenue s 1,956,303 $ 3,415,926 $ 2,863,618 s 2,524,576 s 1,801,505 $ 2,438,040 $ 2,941,283 s 5,874,865 $ 4,898,735 Interest Audit Fees $ 425,290 $( 950) - - I ( 197,342) $( 280,156) $( 532,757) - - - $( 509,035) $( 562,190) $( 52,498) ~ ( 73,714) 14,050 21,741 25,729 26,242 Depreciatian ll: Hepla<:e:!>nt Reserve 4,369,508 4,509,363.
4,545,475 3,941,218 4,468 ,071 4,376,516 4,297.978 4,287,173 4,806,077 Pensians 429,711 452,954 997,627 596,746 739,146 630,847 m,010 1,069,593 993,0ll Taxation (Including prier year Adjustments) Inc...., Property 3,417,964 - 6,394,125 - 4,748,313 - 4,000,414 - 4,170,740 - 4,133,347 - 4,809,331 8,607,452 2,929,560 293,233 510,907 529,608 Total Fa,pnents and Provisions $ 6,642,473 Sll,355,492 lll0 ,094,073 $ 8,258,322 $ 8,845,200 l'; 8,645,725 $ 9,637,103 $14,448,356 s 9,210,784 SUliPLll5 s 890,622 $ 3,375,966 s 2.409,310 g 2,030,800 $ 2,461,296 $ 2,469,526 8 3,471,896 " $ 6,557,716 s 1,177,376 - 61 - TABLE XI AH ALYS IS OF Income From Investr"ents in Other J'..ssets i -1 Year num Other 1956 1957 1958 1959 1960 1S6l 1962 1963 1964 - ·· $ 739,304 $ 54,283 !
I 573 1 76G 108,825 756,167 109 , 553 464,495 642,913 I I I I 403 , 255 487,820 I I I 184 , 228 330 1575 87 ,854 79q885 18,658 97,695 89 , 949 143 , 496 I I .. - ..i!.otal per Consolid ation 1 $ 793,587 :582 , 591 865 , 720 552,349 722,798 506,4-78 500 , 9!30 274 ,177 474 , 071 i I I I Total $4,582 ,523 $ 790 ,198 '.M , 372,721 '• ... • /' -.
Colony Production - Tons 3upr Revmlll9 ~· l!DDDS) Cost or &adw:tion (hcl, Once For All Depreciatian & Replacement Resene Pensions TCUL CCST OF PRODUCTION llET REVEllUK - SUGAR Molasses ReTetme Sundry ReTemHt TOTAL OTllER BEVERllE Sundry .kpendi tum NET OTHER JJEVEmlE Surplus Before Taxation Taxation (Incl.

Prior Year Adjustment, but not tax .


en Once for All Bonus) lncOlllS Property 1' TOTAL TAXATION Surplus After Taxation ~: Once For .All ll<mwl Le.ss: Tax on Jlonlls m COST OF 01lCE FOR A.LL llONllS SurplUll t o Industr)- Deduct: Intettst Paid/(Beuai Ted) Audit~ &rplua As Per .llldi1ied Glohalll T!M.l( XU CONSffiJDATED STATEMENT OF l!EVEl!l!E .AND ji!PENDIT!J!

!B OF .TBE SUGAR INDUSTRY IN l!!

!lTlSH §!!

!W FOR THE YEARS 195§ - 1964 (tm>!


!f.SSED AS COST PER TON) :1"""' -,,,:;"l_TI'I l' .... - - ~ i 169.:5'7 l.40.60 l.6.59 1.63 ., r;A_l<I?

in= £.84 A_l?

14-96 7 .~ 7.

A'< 17"" 12.98 - ,., "" 5.00 - - - - 5.00 1.62 3.38 ' lQ<;'.7 ?RA .

'lT1 }'p,. "

' - .s ~ 189•76 1AA .fY'I J.46.56 15.82 1.59 = '70 llo97 iy_Qc; · 19.92 7_QA ,, -"" ...., ....

,.,..., "IM "<61 P..r '!

'on ·'S e 173.35 141.88 14.64 3.26 .1'c:o .QR l"I"" 9.

39 """ 17.69 8.

'IA o_...., '>'>,7?

-ioo;a '.>All.


A?<; P"r"'- i 175.81 $ 148.51 13.86 2.JD 1f;A-'l"f '1 .

'<A I 9.

63 7_ni; 1£.69 ...... 7.81 .,,., ..,., ,.,..0 TIA AAl p,,,.

Tnn ·e :s 172.

'20 J.41..12 13.~ 2.21 ,..,, _l';'Q ,~_.,, 5.83 A.% :u.19 B.Bl l::.

'<A .......... 1061 "i?A.7At; Per T"" $ e 184.02 .148.12 .lJ,.48 l..94 ll>'IC..,_ ''>t\ AA 7.99 £.1'1 14.60 7.09 ., ·i<i "'7_QQ ., 24.m - ?Am 13.76 ' 3.49 , .rn 1.M ll.B4 - - ll.84 15.50 - is;.r;o 7.22 - - - 7.22 .64) - ( 14.oG ,.

06 6..16 - - - - 6.16 .


gs) - ( 7.B6 7.14 13.66 - , ... 66 7.23 2.66 1 ""' 1 A£ 5.77 { 1.59) - 7.36 1~.86 - 16 .AI: ll.13 9.18 4,10 """ £ .08 ( 1.57) .CIA 7.61 · • '""" 326.0?

'I "~- "'~- .,/.

:.J: :1'79~lll 139.3'2' ;:aa 2.38 '1.QJJA :>4 -..n fl.

"731 "' '""' 14.

"6 <;.}4.

0,,., ·~"I?

18.66 _ Q(I }Q .

.o;I; U.76 B.67 ") ·on ._.,., a.99 ( i.72) -""" 10.65 ,., .. , "i17 131 PA,.

Ton e .231.81 I .l65.31 13.52 3,37 1A,_'2\ AO 61 18,41 "J'lO.
24.40 5.87 ,.., ..... 6A U 35.59 1 ... 6:> ~ ,,, 30.9' lB.79 B " " "'.

'14 20.59 .16) _,,,.

{ ' ,Illa ?

"ifl.

'178 ..

Per"'~- · s 202.99 181..75 .J:a.60 :1.84 """.lQ ( , .

"'1 16.<n ,,, "" 21.05 S<09 ,., .a,; 17.71' ll.34 "··"" , .,.

.

'IQ .. 4JT - - .28) ' .1-0 4.37 ( .
JAB/ 4.55 l .-; ~-~~ - 6J - TABLE; XIII PORTRAYAL OF REWRN Oli CAPITAL E:MPLOYED IN THE SUGAR TIIDUSTRY {EXCLUSIVE OF HAW SPIRITS} I 1956 1957 1958 1959 1960 1961 1962 1963 1964 7g - ~'}1 • t 143,340,500 s 890,622 $42,439,680 $43 ,440,740 $ 3,375,966 s 2,409,310 $ 2,030,800 $ 2,461,296 $ 2,469,526 1$45,490,161 847 ,165,415 $46,553,159 S44,C09,476 S54,526,76l $54,832,238 $ 3,471,896 s 6,557,716 s i.m , 376 I I 12.03 7.89 2.14 2.05 7.95 5.57 4.48 5.22 5.28 Note: Average for 8 year3, 1956 - l q63 - - Actual f or l year, 196<1 6.4% 2.1% ,.. .f' .. ' .
Capital Profits after Tax Return% 6 • ~ .. ~ .. ~· ,,,.

.. ,;.., T .... ··•··· 1;?;.

~ ~ • ~ .. .... .. ~. '""'

11'9 - 64 - TABLE XIV BRITISH GUI/\Nh SUG.\R INllJSTRY BECONCU.IATION OF CLOBtiL PROFITS WITH PRoFITS ADJUSTED EOR TAXATION PURPoSF.

'3 1960 TO 1964 'ID NEl\REST $1,000 ill o; A " CB.obal.
Profits ~s- Provision for Incone Tax Provision for Property Tax Ilepreciat:iDn and Beplacenent Beserves charged :in Provisions for c:lisa1JDwable eiwenditure and other Accounts adjustments Dif.ference between l'ensions charged in Accounts and Pensions al.

:)oved .for Taxation PJrposes ll1ITent year losses (in respect 0£ which no twlatiol.l rel.i:e:f obtained) \ ~- t 1 r '1.- i ( .

\ ~~- /'!'

~.
\ ~~- /'!'

~.

·~_.~ 1960 1961 1962 1963 1964 $ 2,461,000 $ 2,470,000 $ 3,472,000 $ 6,558,ooo $ l,177 ,ooo 4,171,000 - 4,133,000 - 4,8o9,000 293,000 8,607 ,ooo .su,ooo 2,930,000 529,000 4,468,000 4,Jl7,000 4,298,ooo 4,287,000 4,8o6,ooo 611,000 382,000 495,000 903,000 459,000 ll6,000 - ( 126,ooo) 66,ooo < 165,000) - 106,ooo - ( lll,000) - $11, 827 ,ooo $11,312,000 $13,199 ,ooo $20,972,000 $ 9,79P~ooo ~ ~s- Wear and 'T.ear and Bepl'lcement allowed £or taxation puposes .
Prior year losses brouf!il t :forward .. -_p( ··.

t"';..

..;.

't ~- $ 2,535,000 23,000 $ 2,164,000 - $ 2,-031,000 102,000 $ l,825,000· 5,ooo $ 3,094,000 -: $ 2,558,000 $ 2,164,000 $ 2,132, 000 $ l,83),000 $ 3,094,000 Pro£1ts adjusted £or '.lluation pirposes $ 9,269,000 $ 9,1JB,ooo $ll,067 ,ooo $19,142,000 $ 6,696,ooo Income Tax Provision per Global figures Prior ,y;ear Tax Adjustments - Credit .
{~bit) Income Tax charged £or Current Year Incone Tax charge grossed @ L.5.% ' ' •,I .., l ~ '- .. , ' ~.... " .. , .. ,• ' .. ,.

•.

_,,._ 11;.-,.

~' ~ ,/ ,I( .

c. <k .. '.

· ~· ; ~~"··, .

a'j:,.

;' ».

.. : h;' ~~;..' ;;/' • .\.

'I f., • • •.

· ~, .• _ .. -~.~· J.. -1 .. : .


... :~ .. $ 4,i1i,oo::i -- $ 4,111.000 - $ 4,133,000 ( 21,ooo> .. $ 4,112,000 $ 4,809,000 171,000 - $ 8,6o7 ,ooo 7,000 - $ 2,931,000 83,000 - $ 4,980,000 $ 8,614,000 $ 3,013,000 .. $ 9,269,000 $ 9 ,lj.l, 000 $11,067 ,ooo $19,142,000 $ 6,696,000 t: -.. ... '"'- .., rt .

:..

; 65 TABLE XV 65.

THE S UGJ:.


R INDUSTRY I H BRil'ISH GUIP,NA 'L AND NET BOOK VALUE ( EXCLUDING DEDJEitAHA C0 0 LTD.) .A.mount $ 3,342,115 3,456,546 3,527,107 3,792,069 3,939,94 9 4,227,096 I l I I Year I 1956 1957 1958 1959 \ 1960 1961 11962 1963 1964 Note: , - JI Land h eld by the Demerara Co. Ltd. has not been included in the above ficures because it is impossible to ascertain it's original cost.

The accounts of the Company show one composite item viz.
"Real estate in Demerara including Buildings~ Machinery etc.

at the net amount standing in the Company's books at lst January,_ l~'xJ.
11 ... f - bb - TABLE XVI • THE SUGL..R IIJBUS'l'Ril H ' BlU'l'ISH GUIANA rlhT:~S OF DEPRECIATION l~P?LIED WITHIN TH8 INDUSTRY PercentagES\ Applied Freehold Buildings ~rainage and Irrigation Plant and Machinery Electrical Plant Office Plant and Mac hinery Office Furnitur e Fixtures and Fittings Agri c ultural Equipment Pun.ts Sundry Craft Aircra ft Railways and Rolling Stock .Artesian ~Jells Motor Vehicles Lorries and Trucks Cars Mecha nical Hand ling Equi pment 2 10 10 10 10 20 10 10:33-1/3 I 3 3 - 1/3 \ I I 10 25 25 25 These percent ages are ap9 lied to hss ets under a "Straie;ht" Line ' Basis - - --~-- - 67 - SUBSCRIBED SHARE CAPITAL & BONUS SR~RES • TABLE XVII.
Share Capital Subscribed And Capital Employed.

Table ~_XVI1 sets out the Share Capital subscribed as well as the Capital employed ~a) in.clus,ive of distilleries; (b) exclusive of distilleries.

·· The ••• .. .. - 68 - The Subscribed Share Capita l of' the Industry, exclusive_ of dj_~tilleries, remained static f~r the period 19.56-59, inclusive.

For '1960 there was an increase of .


- - $3 ... 6 million and in 1961 an additional $11.8 million aggre gating $32.9 million, which remained more or less stable up to the end of 1964 when the figure subscribed was $32.7 .

million; the average Sub.

:icribed Share Capital over the -· ~ ·- - -· -- - per:tod of nine years bei~g $24 .. 7 million.

The rise in 1960 and 1961 was due to the issue of Bonus Shares by many of the Sugar Producing Companies.
f.D:Rfto.l Employer} It will also be observed that this was reasonably stable from 19.56-62 with moderate fluctuations, wi th a low of $44.6 million to a high of $48.8 million, subsiding to $45.9 million in 1962 and ending in 1964 with $5606 million.

In 1963, as compared with 1956, the increase of $10oS mil- lion is accounted for by ' an increase in the nett current .. -- - .

- assets of $7.6 million and investment of $ 2. million.
Par- tially contributing to t hi s situation wa s the need to hold fair quant ities of produce unsold for better pr ices ·and ~ - · -- the consequential covering deposits made with broke rs as well as the compulsory investment in Nationa l Development Savings Bonds .

Throughout •.. - 69 - Throughout the p eriod t t1B actua l capital employed was well in excess of the· share capital subscribed.

This dif'ference is accounted for by the utilisation of accumu- lated reserves in the industry.

Bonus Shares.
Bonus Shares.

The Associat~on submitted a statement of the Bonus Share Ts sues made by the 1.ndus try and affirmed t hat during the period under review such issues were made only in the years 1960 and 1961.

The sourc es of' these Bonus Share Issues were as shown in Table XVIII: TABLE XVIII Sources of Bonus Shar es.
Total Property Reserve (Ex cess of' Valu- ation) Sugar Industry Re- habilitation Fund 312,495 2,523,346 2,835, 841 1,798,455 10,574,860 12,373,315 Reserve for Replace ment of Fi xed Asse ts 1,369 , 596 4,163,846 5,533, 442 Gen e r a l Rev enue Reserves .
Capital Reserves Unappropriated Profits 118,454 1,825,200 30, 000 12,506,839 1,657 .-148,454 14,332, 039 1,657 ----~---_;_---~~~~~~~~~_;.....~~~ $5,424, 200 $29,800,748 $35, 224,748 .. .. .. - 70 - The Subscribed Share 9ap_1-tal of tb.e j_ndus try in 1959 was $17,505,000.

From thi3 it follows that Bonus Shares to more than double the value of the previou3 paid-up Share Capital were issued in the two years.

Balance Sheet3 of the Indus trv.


The rise in the paid-up Share Capital as between 1959 and 1961 in the Consolidated Balance Sheet is a3 fol- lows: 1960 1961 $ 3,550,193 11,873,757 $15,423,950 The difference between this and the total of the Bonus Share Is3ues 3hown i_n the sum of $35,224,748 is $19,800,798.
Thi3 is accounted for by "Consolidation Adjustment3 11 which show t~cso for the years 1960 and 1961 as as $ 1,874,007 17,926,791 $19, 800, 798 We cannot agree that the various issues of Bonus Share3 were instrum.ent3 of diversion of profits.

We are of the opinion that the capitalisation of the various reserves, used for this purpose, merely transferred to shareholders •.. 797 - 71 - shareholders the title to these reserves which they already owned.
Depreciati..on, Replacement Reserves and the Rehab"llltatton Fund.

We set out ln Table XIX particulars of the Unde- preciated Valuations of the Fixed Assets, the Annual Depreciation and Replacement Reserve Provisions.

The com- bined percentages of reserves to the adjusted valuations are clearly shown, varying from 6e97foin 1963 to 11.63% in 19.56.

They do not app ear to be excessive.


Depreciation charges vary from 4o41 to 6033% of costs and Annual Provi.sion to Replacement Reserves varies from 2.07 to S.35%.

Table XTX •.• \ .

(' .,/ .. " STATEMENT SBOYl!IG "lll!

:PRlJC'IA'lIO!I AND REPLACEMENT RFBERVES IN -,:JlEi.ATION TO VALUE -OF COST -OF FIXED ASSETS (EXCLUSIVE 01" I..lll1J) " .

)I;.

... ~/:, } ...... .-, .

'!'

~'.-I "' ',I ~~ ,.

~- . "

~.

c 1956 1957 1938 11159 ·:1900 19U 'UJ62 1963 1964 (1) P.bcd .. .
&e.t• at Coat le- ·Jlepl!9Ci.atioa S3o ,-906, 926 533,110,:SOl $35,251,056 .$36 ,5l5,, 755 -"39.-153.

797 $40,Ui0,550 ~9.,329,13§ S40,227 ,611 S44,540,8lM '{2' llffuot coat -0t l.ii4 3,299,570 3,326,022 3,342,115 3,456.,546 '3';527,107 3,646,409 3.,702;069 39~9,949 4,227.095 ~ ·~} 11ep....,ta·t.d Talue ot tiJ<ed &sseta (excludinc land) 27,607,356 29,784,479 :u,0089901 ·33,059,209 ·35_ .

.
.

126,690 36,504,141 35.537,067 ' 3&,327.,662 40,:n3;:,1os (4) Add: accrued depreciatioa 9,9'8,014 11,958, 763. n,ua,-s21 16,208,760 ·t,8'805,,488 20,iKS,928 2" ;586 '403 25,217,770 27.

754,512 .. {5) Uadepreciated Talue of fixed assets (excluding land).

37,555,370 41,473,242 45,82'7,4'2 '49,267.
969 - '54"'13~:178 57,-45(1,069 llD,123,470 61,545,432 68,068,310 ' (6) Annual depreciation 2,380,800 2,275,200 2, llSlli 400 ' 2,668,800 2~71K.,'300 2,>1128~000- ·::st-027,000 2,9tl6,400 3,000,000· _, (7) Percentace of annual depreci ,zioa( 6) to undeprec iated values of fixed asaeta (excluding land) (5) (8) •Annual proYisioa to Replaceaeat ReserTes (9) -.erceatage of annual -proYision to ·lleplaceaent Reserve to Uadepreciated -value of £ixed as ~ ets (excluding land) (5) {10) Aanual depreciatiOD a.ad Replacement ReaerTe (11) Percentage of annual depreciation and Replacement Reser~• (10) to undepreciated -.-alue of fixed asaeta (.llClndiac land) (S).
6.3~ 5.45% s~ 5.42% 'S..;L• - -s •.

1'$ s.~ 4,82% 4.411' 1,988,708 2,234,163 1,987,07'5 1,272,418 ·l,684.

'"1 ~----516 L_,.225,978 1,320, 773 l,~077 "•fl'', .. • [ .. - ~~:~(:,!

;I ' )".• ~· ,,· r\.

'""~; ~- S,3°" s.3~ 4.34% 2.58" 3.11% ~-" " ~ ".I.

2~!12% 2.07'% .

:2.13% 2.651' 4,'369,508 4,509,363 4.,545,475 3,941,218 4,468,071 .

~~~ :; ·~ ~ ~ 11.63% 10.80% 9.92% 8.04)!

; 8,,25% • llot9 (8) is the dif'ferellce between (10) and (6).

4,37&.516 49297,978 -.·4 1 287_, 173 4,806,077.'

~~~ .. ~.~.

,.
~~~ .. ~.~.

,.

! '

.

,- '· ' 7.62% 7.

'27" 6.9"" 7,06"' .J • :5rtTF.IENT ·'SHOllIIG DEPRECLTI-ON -RESERVllS JN REL.IT!

; <"[ ;t.i THE ';CQST -OF nllZll ~ .u!St:TS ;;xcLUS TV!!

Of' L ;\ND ·H.Jutd "-M!

at Coat Leas de.preciat:i1 '36.

;906,1126 lleikKtc C-t of Land Diqoreclat_,.

Value of Fixed Aaseta esclaai1re of , hnd Ad<!'

Accnaed D<1preciatioo .1 9 299,.57-0 l '27,607_,ll!lll 9 9 9'18.,0M Perceut<agee of Reserve to Valuati1'1ui l -26.49 " •>: 1956 1.937 !
1956 1 -l~l i UHi: I 1'963 I is.&4 I Hl59 4 1960 3~325,02:.I 33.110.so~ 1 ;is,2s1,os61-36•5l5 ·--~:; l .3,4516,:546 i t _, ~9•78& .. '711131,908,Ml t .33,059, lin~ l •;!

3,342,115 ... -I 11.958~763 13,916.,521 J.6,208.l'jj" l 1 j 36~7 ~ 3_2,,'90 ,;&,153,7971 ~,150,':150'139.,U9,1~$1 3 ,s21, iov ~-.641,401 3 .~:a,-01u1 3.;:Mt.,94!i'j ..\,,227 , 0 116 -40,22'1,611·1 44.,540,B94 I l '.

;i5,'6.a6;490l 36,'504,Hl I 35,:337,-111171 lS,505 1488 ,20 9 945,Jr.

!8j .23,-58.6 / 6().3 3 •1.19 I 36,!16 l 39.


"89 .l I I !

'56 ;-u1 ,96 ~ !

40 , ~ms • 798 I as,217, 11a l -27 , '754 ,512 I I I 40.-07 I 40.77 - r; I ., ~· ... .,, ·.· ,......,1· • '"'•.,yt · ' • .. .

,.

'f t "'-· '"'\ta.·~· .

,, ... ... -~ ,,;.

.., .

, .

i ,!- ......... •• t". '

1 • ... .. lr - 74 - In Table :x'.x we show the percentages of' reserves as at the end of each year to the adjusted valuati_ons of the Fixed Assets at that t-tme.
The ~ercentages which amounted to 26.49 i_n 1956 rose to 40.

77fo in 1964 ..

It must be borne in mind that the j_ndustry is still l a rgely dependent on comparatively old plant in a number of its mills and the ratios of Reserves to Assets, in our view, are not inord i..na te.

Table XXI sets out the withdrawals from the Rehabilitation Fund, Replacement Reserves, Depreciation and Capital Expenditure.

Table XXI ••• ·2:~~· .

""!ir - 75 - .


TABLE XXI THE SUGAR INIXJSTRY OF BRITISH GUIANA WITHDRAWALS FROM REHABIL!T4TION FUND, REPLACEMENr RESERVES DEPRECIATION A..1'lll CAPITAL EXPENDITURE •ooo• Omitted .,, .... 4 ~ ·-· .
~oJ ,> .. ... ,_ "' :t-.r J Year l Rehabilitation Fund Withdrawals 2 c 1950 Actual 1951 • " 1952 " " " 1954 1953 It It 1955 1956 1957 1958 " .. 1959 l~O " " 1961 " " " 1962 1964 1963 1966 1967 1965 Estimated " .. " " 1969 1968 79 160 143 171 182 159 3T7 358 379 437 705 584 363 374 554 542 4TI 481 457 449 Replacement Reserves Denreciation 3 s; 100 161 118 142 TI 144 414 465 414 265 351 302 255 275 376 421 216 110 281 81 4 £.
316 311 400 386 451 454 496 474 533 556 580 610 640 618 625 650 675 700 725 750 7 AA.7 $"1<; 7AI: A. Qful.

S2'1.827 10.G'iO :$"i2.

"60 Jt(Yl'ES: Total Self Generated Funds '5 .

£.

Capital Exnendi ture 6 £.

495 632 661 699 706 757 1,287 1,297 1,326 1,258 1,636 1,496 1,278 1,267 1,555 1,613 ) ) 1,364 ) i,291 ) ) 1, 463 ) , ,280 ) ?

'!

.

'161 SU:> Pl'I "• \ 577 528 7CY7 636 665 836 1,179 lt089 1,112 956 1,267 1,010 609 1,410 1,435 ) ) ) 10,000 ) ) ) ) .,, 016 Ul'5 .277 Comparison Cols.
5 &: 6 {Deficit Financirud 7 £.

( 82) 104 ( 46) 63 41 ( 79) 108 200 214 302 369 486 669 ( 143) 120 .

(2,989) ( 6<;<;) (S'!

lilit) 1.

The figures for 1950 - 1955 relate to the B.S.E.

Group and Associa ted Companies only, the figures for the Demerara Company being unavailable.

2.

The figures included in column 2 for 1956 - 1964 for tm Demerara Company are the amounts taken to credit in the audited accounts of that Company; but have been reconciled with the cash withdrawals from the Rehabilitation Fund.
they differ from, 3.

The figures for 1965 to 1969 are estimates taken from the Capital Expenditure plans of tm B.S .• E. Group and the Demerara Company.

No figures have ~~ included for Versailles end Houston.

.

.. •• - 76 - Thj_s Fund was 1.n tenr'i o d to k e ep the i ndustry's productive aaseta up to the highest level of t e chno- logical efficiency ao as to maintain and increase ita competitive efficiency via-a-via the sugar industry in other parts of the world.
To thia end, withdrawals .from the Fund have been uaed :for the followin g purposes: (a) Additions and improvements to the induatryra productive ?-aaeta.

(b) Providing t h e differen c e between the orig inal cos t of an asset and ita actual r ep l a c ement value ; latt e r be ing un der normal condi tions higher than the form er.

t h e It i s not e d that i_n r e cent years the i n dustry has b een incurring ca pital expend:i.ture annua lly of the order of $ ~M.
At tte same time the- induptry's contri- bution to the Rehabi_litatl.

on Fund has amolmted to some $2~3M annually and t ts withdr awals from that Fund have averaged $lo8M per annum.

It is clear, the r efore , t hat both t he contri- bution into the Fund a s we ll a a wi thdr a wa ls t h er efrom hav e been auba tantia lly lower tha n t h e indu a try 1 a annua l cQ1:i ital exn on diture. '

· • • .I,.

, On the othe r h and the industry's annual provis i on f c.r .•• ~r/( - .. - 77 - r. 1 \ . '

'. '
'. '

~, I ; ·, fo'r · Deprecl.ation 'and Re placemen,t Re3erve ha3 am~unted to $4 •.

4 million wh~ ch has been nt~ 1 t::L.d ior: bapital expendi- ture.

·.Such unexpended amounts as now .

r~ma in on these ieserves would be wholly consumed by increased capital expenditure planned for the perind up to 19690 In fact, these reserves as well as withdrawals from the Re.habili- tation Fund are expected to be inadequate to offset the ·, projected: .
expenditure ahd the industry will have to find $3G3 million from other sources.

We conclude, therefore, that both the Rehabili- tat1.on Fund as well as the Depreci.ation and Replacement Reserves have been serving the purposes for which they .
_, were intended and that the Rehab-tlitation Fund is neither a substitute for these res erv e s nor an unnecessary add j_- tlon; in fact · in the absence of the Rehabllitatlon Fund - the 1nd1-ls .try would not have met its c orrnni tmen ts for capital expenditure and would not have been able to incre·ase and improve its assets to the extent which undoubtedly must have contributed to its survival.
Coi:nmis s ions repor.ting on the :s-\yuation : regard- ing the use of this Fund in both Trinidad and·Jamaica -._have treated '· the i..tithdrawals therefrom a,s r .E:lvenue.

In .

.. - 78 - ..

In British Guiana no wi tllc.lPawals f'r•om the Fund are per- mitted until such time as the counterpart expenditure had already been made in the factory or' field as the case might be, and after proof of such expenditure is accepted by the Rehab .~11.tation Committee.
We are satis fied that on thi_s basis the withdrawals from.

the FUnd were fully supported by the equivalent expenditure by the industPy on Capital Assets.
It i_s true, however, that the financtal statements of the industry disclosed that the accounts to which these wtthdrawals were credi ted were partially utilized in the issue of Bonus Shares, but in the light of our finding that the actual with drawals from the Fund were used for exp en di ture :in Capital Assets, we regard this as a mere accounting convenience.

It ls noted that the industry derives a definite advantage from the Fund through the improvement of its assets.
We consider that such improvements repre- sent an unearned benefit to the Companies and, accord ingly, should be treated as income.

We have measured this benefit from the .

Fund, that is, the extent of this improvement as equal to 10% of total capital expenditure from self-generated funds of the j_ndustry and we have so treated 1.t ~n Table XXII.
We •• Cl - 79 - We recommend that as fron l964 this rate should be applied · and the result be trea i.3d as revenue in deter- mining the profitab1.lity of the i_ndustry.

TABLE XXIT RECEIPTS FROM REI-IABILITATJON FUND CONSIDERED TO BE REVENUE TO THE TNDUSTRY.

Capital Expenditure Element of Improvement 10% considere d as Revenue £ 000 .

£ 000 Dollars 1956 1957 1958 1959 1960 1961 1962 1963 1964 1,179 1,089 1,112 956 1,267 1,010 609 1,410 I 1, 435 .

117.9 108.9 111.2 9So6 126.7 101.0 60.9 1L~1.

o 143.
o 143.

5 565,920 522,720 5335)760 458r;88o 608 ,160 484, 800 292,320 676 ,800 638,800 Total 10,067 1006.7 4,832,160 - 80 Price of Molnss_es tQ_ Dist.illeries.

, The policy of the sugar producers b.aa boen to avoid violent fluctuati.ons tn the price of rum by main~ - - taining a steady price for molasses to the distilleries.

While, therefore, the prtce to the dist-:tlleI'ies has remained fairly constant over the years, there has been violent fluctuation i..n the export price of molasses.
From 1958-1960 the price per gallon of molasses to the distilleries exceeded the price of molasses for • export, but from 1961-1964. it was less.

At present - 1965 - the price of 17.2 cents per gallon to the dis- tilleries is more than t wice the export price of 7.2 cents per gallon.

The evidence, therefore, does not support the Union's allegations with respect to this item.
· Tn an y ev~nt, ou r r ec omm~ ndat1ons b elo1tJ on t h e treatment of profi t s on raw sp}.rjts wou ld, i.f i mple- mented, resolve this ques tion.

Raw Spirits We appreciat e tha t the profits from the sale of blended and bottled rum sold in local and for e i gn mar k e ts are the d irect r e sult of activiti es ex ert ed f a r beyond • .

• - 81 - beyond the state of ttraw spiritsn manufactured at the factories and consequently do not ;onsider that they are within the scope of this enquiry.
We do, however, feel strongly that as the manufacture of raw spirits is so proximate and -tn fact so j_nextrlcably bound up w-tth the manufacture of sugar, and the rum companies in this country are so closely interrelated with the sugar com panies that prof1_ts from the sale of thi.s commodity must inevi.tably be considered as profi..ts within the sugar i.ndus try.

ACCORDTNGLY WE SO RECOMMEND.


Profits .. We do not agree wj_th the view that profits before tax are the true measure of the industryts profitability and here again, similar to our conclusions in respect of the returns of capital employed, we consider that profits after tax reflect the tPue surplus ava1-lable for distribution.
Including raw sp-trits, but excluding that portion of revenue which we attri_bute to receipts from the Rehabllitation Fund, the average yield on Share Capital subscribed over the peri9d -ts 14.97%.

With the inclus i_on of the portion of receipts from.

the Rehablli ta t·ton Fund , which we are of the opi.ni_on should be considered ... - 82 ~ considered as ,rev e nue for t he p urpoBes of determining the sugar globals surplus, the average yield is of' the order of 16~L~l%.
In assessing the level of profits wi de varia- tions in the nett returns to t he "Lndustry during the years 1956-1964 must be borne in min d .

In the years of high prices, i.e.

1957, 1960, 1961 , 1962 and 1963, substant1.al prof"Lts were made 9 but also in · these years substantial Once-for-All Bonuses were paid to the work- ers.
From our analysis ,of the accounts submitted, we do not find any support for the Unionts contention tha~ there we~e deliberate div e rsions of profits either through the various Reserves or by means of .

Bonus Shares.

We show in Table XXIII the profits of the indus try (exclusive of raw spirits) before t ax.

The return on capital employed was low in each of the years at the extr emes of the period under review - 9.9S% :in 1956 and 8.,L~6% tn 196L~.
With th e exception of the years 1957, 1962 and 1963 when wor ld pr1 ces were extraorcHnari ly high, the average return in the otheP years could be sa i_d to have hovered around ••.

- 83 - around 149t.

just under 2($ and in 1963 appro.

::c;mately 29%.

In the year 19S7 the y reached 23%, in 196?

TABLE X:X:JII Profits of tndustry oe:fore Tax (Exclusive of Raw Spirtts.
Yeap Amount 1956 1957 1958 1959 1960 1961 1962 1963 1961+ · Average $4,308,586 9,770,091 7, 157' 623 6, 031, 214 6,632,036 8,602,873 8,574,460 15,676;075 4, 63 6, S44 7,709,945 Per Ton of Sugar Produced % Return on Capital Em ployed (2) 16.46 34028 23.36 21.21 19 .83 20.33 26.30 49.42 17.95 9.9S 23.04 16.49 13.26 14.oS 14.20 19.49 28~ 76 8~46 It will be observed that while the return on capitgl employed before tax averaged 18.64% for the period only in six of the nine years under review was the return on gapital after tax more .than 6%.
capital after .

tax was no b.igher than 7.2% and only 1.n 1963 due to high world pr·1ces did the i_ndus try ge t a Th~ average return on return of over lo%.

The 1957 an d 1962 rates of 9,29% and 9.25% were due to the Suez Crisis and the allocation of a U.S. quota respectively.

The average of 7.2% for the 9-year period under revi ew is, in our view, low.

In Table XXIVwe set out the return to the indus try including profits on raw spirits both before and after tax. "
- 84 - TA3LE XXIV RZTURNS ON CAP l'.,;.

'AL INCLUSIVJ~ OF P ROFITS ON RP..W S P IRITS B E F 0 R E T A X __ .. ,- .

A F T Z R 1!

Ii X Profits On Share Capital Subscribed On Capital Employed Profi ts On Share Capital Subscribed On Capita l Employed ~/~ i .~: ; ; .. .. i ,,, 1956 195 7 '1958 1959 1960 4'91U 1.9ff2 1963 1964 .

T.OTA:LS Y E A R $M.

$M.

% .

$M.. % $M.


-··· ... 6.056 .. 11.oos 8.970 7.306 8.018 7.624 9.913 16.302 5.910 17.5 17.5 17~5 17.5 21.1 32.9 32.9 32.7 32.7 34.61 52.91 51.26 41 .• 75 38.00 23.17 30.13 4 9.85 18.07 - 4 5 .• 8 44.6 46 .1 4?
.o 48 .8 -48.2 4 5.9 : 56.3 ' -56.6 13.22 24.68 19.46 15.54 1s;43 15.02 21.60 28.-96 10.44 1.936 4 .14 3 3.492 2,.701 3.266 3.160 4 .245 6 .862 1.848 81.107 222.3 409.3 31.653 % - 21.06 23.67 19.95 15.43 15.4 8 9.60 12.90 20.98 5.65 % 4 .23 9.29 7.57 5.75 6.69 6 ~57 9.25 12·.19 3.27 ".

AVERAGF.8 ~ 9.012 24.7 36.49 .

"~ ., .

~ ... 4~ .. ~ .. .

.

..,_lf3.

~ ~J) ( ;:?~ ~;J.'.?

.

... .

., - - 14.97 7 .

20 ..

I .

.

- C5 - In ke ep'lng with our vi.


ew that , for the purposes of det ermining the profitability of the industr y , recei.pts from the Rehabil1.tati on Fund equivalent to the element of improvement in capi_ tal as sets fi.
nB.nced from the i_ntegrated funds (that i_s to say, the Rehabll"Lta tion, Depreciatlon and ReplPcement Reserve) should be considered as r evenu e to the industry, we set out in Tables YJ..'V and XXVI the return on capital employed when revenues from sugar, raw s'pirits and the Re habilitation Fund are taken into account, before and after deduction of Once-for-All Bonuses .

Table·s XV & -XVI ..... t.1 ... ' ., • fl - ll6- '::cA.BLE rx.v .1rnl'URN ON CAPITAL DlPLO!ED COMBINING REVENUE FROM SUGAR.
RAW SPIRITS AND REHABILITATION FUND BEFClHE CHARGING ONCE-FOR-ALL BONUS Capital Dnployed (Million Dollars) 45.e 1956 1957 44 .6 1958 46.l 1959 #;7.0 1960 48.B 1961 48.2 1962 45,9 1963 56.3 1964 56.6 Profits after tsx:- Sugar Raw Spirits* Rehabilitation Total Return % s 890,622 $ 3,923,744 s 2,409,310 l,063,194 766,631 1,045,070 522,720 533,760 565,920 IS 2,030,000 670,693 458,880 IS 5 ,2J.3.

095 !I 40026 '264 s 3,160,373 $ 2,501.612 805,014 608,160 $ 2,950,883 .
s 4,109,765 690,414 484,800 ~ 4,364,057 s 5,284,979 $ 5,027,386 772,704 292,320 9,834,974 s l,177,Yl6 670,587 688,800 304, 715 676,800 • 6,092,410 s 10,816,489 s 2,536,763 5.5 u.7 a.1 6.B 9.0 11~0 D.3 19.2 4,4 ATerage return on average capital employed - 10.0 ATerage return on average capital subscribed - 19,8 * '?he amount of Once-~ Bonus which vas not ascertained ha!!

not been excluded from these figures.

,.


f~J - 87 - TABLE XXVI RE'lURN ON CAPITAL EMPLOYED COMBINING REVENUE FROM SUGAR, RAW SPIRITS AND RE!IABILITATION, FUND WER CHARGING ONCE FOR ALL BONUS Capital Employed (Million Doll.are) ' 1956 45.8 1957 .4.6 1958 46.1 1959 47.0 1960 48.8 1961 48.2 1962 45.9 ' , .
1963 56.3 1964 • 56.6 Profits after tax:- Sugar Raw Spirits Rehabilitation Total Return on Capital Employed % Average Return on Average Capital employed Average Return on Average Capital subscribed - $ 890,622 s 3,375,966 766,631 1,045,070 565,920 522,720 $2,4p9,310 ~2,030,800 .670,693 1,083,194 458,880 533,760 ~ 2,461,296 805,014 608,160 $2,469,526 690,414 484,800 $ 3,471,896 772,704 292,320 $ 6,557,716 304,715 676,800 $ 1,177,376 670,587 688,800 $ 4,665,317 $ 4,026,264 ~ 3,160,373 ~ 3,874,470 ~ 3,644,740 $ 4,536,920 $ 7,539,231 $ 2,536,763 10.
'i 8.7 6.8 8.0 7.7 q,9 1'3.3 4.4 $ 2,501,612 c;,c; 8.3 % 16.41.% * Before charging any Once-for-All Bonus; if all1'• ' -- f. - 88 - Dividends.

The Unj_on sought· to show the accretion tn the value of the original investments as a measure of the wealth accruing to shareholders.
Until, however, there is a realisation ~n some form of the assets, and a dis tribution of the proceeds by way of liqu1dation, the gain i.n as sets can never fi.nd · ; ts way i_nto shareholders' hands and the only t:t;>ue measure of return qn_Share Capital subscribed must be the average annual returns over the period on the averag e Share Capital subscribed.

We set out in Table XXVII tµe details of such returns for the period 1956-1964.

As a percentage of capital employed dividends declared .
were in four years well below .5%.

In two years they were approximately 5% and only" in years of exceptional good fortune were they around 8% or over.

In 1963 alone did they exceed 10% and the average over the period under r eview was 5."77%.

· Table XXVTI ••.

8 ~ - · .. -, TABLE XXVTI Average Annual Return on Average Share Capital Subscribed.
Appropriated (Millions) $ Rates % Nett Grossed-up % of Annual Prof"i.ts % on Capital Employed (Ex clusive of dist j_lleries 1956 1957 1958 1959 1960 1961 1962 1963 1964 111323 3.096 1.

698 1.330 2.610 2.330 '{ 3 .466 ( 3.

538 ~~ 6.729 2.160 32,280 13.

73 32.1_5 17.64 13 .

82 12.87 19.18 41.,64 37 .. ~_6 12002 17.68 9.70 7.60 12.40 7.08 l0.55 22.90 20.60 6.61 65.0 73 .. 0 51 .. 8 43 .o 77.7 67 0 7 83ol 3 e 06 7 .,30 3.91 2.,92 S.S3 5.

01 7.87 ,_ 103.3 128.6 12.35 3.94 13.63 24.78 77.


* This figure is the value of shares in its subsidiaries owned by the Demerara- co. Lt d .

transferred to Demerara Holdings Ltd. in specie, by way of a Dividend.

The Union essayed the proposal that the grossed up dividends should be the measure of the remTu.
"'1.era tlon recelv.ed by the shareholder on his investment and pro duced a number of calculations in an endeavour to estab lish that the dividends paid dD;ring the period 1952-·to 1961~ were considerable and excessive.

It must be borne in mind, however, that a dividend, whether "Less T.9....;;:" or "Free of' Tax", must result in the reclpient paying income tax on it.

Had the dividend· not been declared and received, the recipient would not .be taxable on it.
It is, therefore, erroneous to conclude that Free of' Tax Dividends, ngrossed-upn, represent the true "Taxed In comen of the reci..pient.

It is factual, however, to accept that the 1'grossed-up 11 sum less tax at the rate applicable .to the reciplent is the nett i.ncome in his or their hands.
In addition to the portrayal of the rates of' dividends in their relation to Subscribed Share Capital, Annual Profits on Capital Employed, we set out in Tables XXVITI and XXIX the apparent sources f'rom which the dividends were paid and a proportionate allocation of the dividends to these sources.

TablesXXVIII & XXIX •• - 91- TABLE XXVIII FUN DS FROM '.
:!IHCU ;::;:[ v:rn:t:::J DS PAID rYear Annual Sugar Profits !mn ual Other Inc ome* 1956 890,622 1957 3 , 375 , 966 I 1,145,669 863,300 1958 2 , 409 , 310 870,170 1959 2 , 030 , 800 1 , 063,170 1960 2,461 , 296 1961 2 , 469 , 526 1962(!)

3 , 471 , 8 96 1963 I 6 , 5 5 7 , 716 1964 1,177 , 376 Total 24 844 ' 508 897?730 970,926 695,734 - 47,356 I 501,704 I [ 6 ' 961 056 I i P rofits I Undistributed - - - - - - - I 171, o ;n 430,435 ' I I I I I .. 651 466 l * Inc ludes Profits from sale of Fixed Assets .
(1) Does not includ e a mount t ransf ~::rred from Reserves re Divi dend settled ln specie~ - 92 - ALLOCLTION OF uIVI ::.J::~HDS Ffi.ID TO SOURCSS * .

i , ·- -+ I -i- ,Ye~r I Dividend -·--- 1956 I 1,333,566 3, 0 96 , 382 1957 1958 1,697,920 1959 1,330,239 1950 2,609,85?

19Gl 2~330,124 1962 3,_464,637 J .

!

I l~r.

:ount Sugar Profits Other Profits 1 - - , - - j % j Amount i '~c' & ' I 74<~~':i 177_ 578,489 I I % I F?

I _,., '"?

0 56,.3 I 450,516 873,130 65.,61 457,109 .

i 1,.,2t.

'.J:7 ~ '~QL_:]; !


2, 465~ 8~~7 i 79a6l 630,555 7"' ~I I V"'-'I I !

1 3 ~H2,350 I 73.31 697,507 I I 1,672,531 l T' '"I G57s593 2,886,301 l 83o3 578;386 ..... o I I !

I l 20.4 3Gc5 34.4 26 "7 28@'2 I lG.,7 ! '

I I I 23A2 I 171,o;:n 480,435 1963 6~720,7.

'.i,7 I G~55"?,716 I 87.,51 196L1 I 2' 159, 515 l l ~ 177, 376 i "'!.l I r.;1 501,70~ i.J :i!

:c v!

I r 5 I ' - .

I 19 371 1% 1 j,, 717 ~"7 !

otal ,~~,140 1 107 __ , - ,-.~ ... , ~- -I '"ll ,.,, .

L. , ~, .. !

.
L. , ~, .. !

.

~__,_ _ l l __,_ __ _..__ ___ J_ 051,496 Allocated in propnrtion to Annual Prof itso .. - 93 - It will be seen that some appreciable proportion accrue from sources outside of the sugar industry and this undoubtedly accounts for the ability of the indus try to declare dividends in 1963 and 1964 .in excess of the industry 1 s .ll.nnus.l :i?ro:E.'its .
From this point of view, in diversifying this irrvestment , therefore, the industry has acted prudently rather than with the deliberate intention of diverting profits .

Indeed., should the boom years of 1957 and 1963 be excluded, the average dividends for the remaining seven years would be considerably reduced.
In the light of this examination and taking into cons i deration dividends paid in other industries where less risk is involved, we do not consider the dividends paid during the period under revievr excessive or unfair.

~.arketi:g.g_Comrnission _on Sales.

The evidence revealed that commission paid to a certa i n Company as managing agents was as follows: 2% on first £1,500,000 sales 1/f% on next i~ 300, 000 1% on next £ 600,000 ii II If% on balance of sales.
., In ... o - 94 - In addition, thB principals paid to another Com pany as marketing a g·2J:1ts 17c· on sales.

The managing agents were, apart from comm:i.,ssion, reimbursed v;_ri th the travelling expenses of al l their London staff visiting the country of operation of the former Company and their fu l l employment expenses when on short or longer term secondments .

This arran gement is one at arms length and has been approved of by the country's Government who are par ticipants in the company.
The charge of a commission of 2~t by Booke r s Sugar Company in London in respect of the export of sugar from the Booker sugar compani es in this country i s in real ity a charge for services i n connection with marketing, wi th staff tra i ning, with technical services , indeed with a who l e range of administrative servic2s supplied in the United Kingdom.
In the case o:f British Guiana, the travelling expenses of Bookers London staff visiting British Guiana and the employment expenses when these sta.ff are on short term secondment are borne by the employing company i n Londono In tte circumstances the commission of' 25'.. is not .•• - 95,.

- not considered to be excessive.

Nevertheless, i.n view of the fa~t that N.P.Q.


sales are straightforwax•d and requ-tre less serv1.8i.ng than sales to Canada and the U.S.A. , iJiie are of the vlew that a market- ing c OltL.

'1'.lJ ss i.on not ezceeding 1% s '1.ould be charged on U o K. sales and an amount not e.xceadi.ng 2% on sales to Canada and the U.S .

A.
A.

The cost of other services, in addition to mar- keting, e .. g. staff tr8;ining, welfare arrangements, for staff in the United Kingdom should, in our opinion, be charged for separately and should not be included as a -- -·- constituent of the market1.ng commission nor calculated on the basis of tons of sugar exported.

Hedp:ing .

Table XXX sets out the 1-nvestments ma de by Booker Bros.; McConnell & Compa ny outside of Br i tish Guiana from 1954 to 1965.
It w~ll be observed that except for £0ol million ($ 480,000), a ll the mone y i eri ve d fro m s ources out s i de of Br it j_s h Gu ~tana .

We fin d, t h er efor e , no e vi dence of diversion of funds from this country, in this r espect.

Tab l e XXX ••• .. ~ TABLE XX.A TAllLE SHOWING ACQUISITIONS OF NEW EUSINEiJSES OUTSIDE BRITISH mJIANA 1955/l.964 AND !
!ELEASES OF FIN&'ICE THEREFOR ...... ~~ I C1llllltry ~ Shipping I Acquisi ticma Shops and Wholesale DiBtribution Engineering Rum and Produce Tropical A8ri- culture .. a.. .l'.U...l..L.&.\)T\W Funds Rel.eased ,,,,.~~';.· .

• ..,f k~~· .

Printing Total Year Source of Funds AJnount • O.l.

1.0 1.2 o.05 0.2 1.7 ~ llritain Belgiua l:ndia Jligeria Canada Jamaica 'l'rinidad ~~'-~~ \•;f .

-tF:~~ ~- ~i~ ~ · t~ ;;t,:-.

~~ 1}.

''"'\' ,,.

.... 0.05 j 2.35 1964 0.3 ' 0.J.5 0.45 0.2 0.05 0.2 0.3 1.7 .
0.6 0.2 ... l 1955/ 64 Sale of 49% United Rum Merchants - Britain Increase in Bank OTer- .

draf't and Deposits in United Kingdan - 3.6 0.5 Lese Reduction in teD!lll of LOBDB - 0.6 3.0 ~ 64 1960/ Sale in B.G.

of Guiana.

Industrial and Commer- cial investments Issue of l,311,776 new shares B.B.McC.& Co# Ltd. 1.3 1961 0.1 1962 1963 Sale of Pelletier in Northern Rodesia Redemption of Preference shares in Campbell Booke1 Carter (c. Africa) held by B.
B. McC.& !lo .• Ltd. 1964 Increases in Share Capi- tel of United Rum Me:r- chante 1965 Sale of Richard Bondy in U.K. 0.2 0.15 0.25 o.os 5.5 0.1 2.9 1045 0.2 0.75 0.2 5.4 It,, ~,.

;;_ ·,.

~ ,.

f~~' .... .

• 97 7.

SUGAR I NDUSTRY SPECIAL FUNDS.

From the outbreak of war in 1939 until the end of 1952 all Commonwealth-produced sugar for export was sol d to the United Kingdom Ministry of Food at a single uniform pr ice ne gotiate d o..nnually.
Betwe.en 1945 and 1952 limit ed world sugar production, owing to the after- effects of the war, sustained the world free market sugar - - - price at levels appreci~bly higher than the Unite d King dom Mintstry of Food pric es.

In 1947 the 'Min1stry of Food increased the price pa i c1 to the commonweal th terri tori_ es from $93 e 60 per ton to $116.40 per ton - an increase of ~~22~80.
This increase was granted to all Commonwealth sugar exporting terri- tories, but in the case of' the Bx'itish West Indies the Ministry made a special stipulation that a proportion of the increase - $13.

20 - should be set aside to es tab- lish three funds - a Price Stabilisation Fund, a Rehabi- litation Fund and a Labour Welfare Fund.

The Sugar Industry Special Funds Ordinance, Chapter 248, together with the undermentioned subsi- diary legislation, provide for the administration of these funds.
- 98 - Orders-in-Councl.l No.

38 of 1957 No.

5 of 1956 .. dated 31.7.57. dated 18.1.56 (Sugar Indus try Special Funds - Temporary Variation of Agreed Proportions of Allocation - Order).

No.

75 of 19.53 dated 7.11 .. 53., Regulations (a) Rehabilitation and Price Stabilisation.

No.

28 of 19!.+7 No.

3 of 19L~9 The Sugar Industry (Rehabilttation & Price Stabilisation .

Committee Regula tions).

The Sugar Inaustry (Rehabilitation Fund) Regulations.

No.

8 of 19.56 do.

(b) Labour Welfare No.


25 of 1947 ·The Sugar Indus try (Labour Welfare Fund) Regulations.

No.

3 o f 1950 do.

The .... " .

- 9.9 ..

The levies were establisheg initially at the following rates: Price Stabilisation Rehabilitation Labour Welfare \l, 6 '.jf .00 4.80 2o40 $13.

20 In 1953 the Mini~try ceased to pu~chase ioofo of th e Commonwealth export production, and left pro ducers to sell between one-quarter and one~third of their exports at.

the free market price.


The latt er had unf ortunately f allen towards the end of 1952 to a value well below the negotiated price = a sltuatj_on which has obtained since, wj_th the exception of the years 1957, 1963 and 1964.
Accordingly, since the orlg1-nal concept-:i_on of the funds was a levy on the negotiated prjce, when Commonwealth territories wer e left to export a substantial portion of their sugar at the - normally lower - free market price , some West Indian territories took occasion to relieve their industries of the burden of paying the Special Funds out of thoir free market sales..

In Jamaica and Antigua the levies are no longer deducted from free sugar sales or TJ.S.
sales when these prices are below the negotiated pr:i.ce; and ~n Trin'S_- dad the Price Stabilisation Fund is used to augment the price •.. -1,tD- price of free sugar when this is below the negotiated price.

The fo llowin g i.s an extra ~ t fron:-.. t he Go l denber g Report of the Board of Inquiry in to a Trade Dj_spute in the Sugar Ind1rntry of Tr5,n i dad, 1 960 : "In TrinJ.dad the pr i_ce i.
"'eceived for exportable sugar sold otherwi so than under the Negottated Pri_ee Quota, that is, Free _Quota Sugar an d any sugar which may be sold on the world market, is supplemented under the Sugar Industry (Price Stabilisation Fund) Regulations, 1954, which pro vide that, com mencing in 1954 and in each year thereafter, t he annual amount paid i nto the Stabilis a tion Fund should be utilised to au;iment the price of Free Sugar when that price is below the lif .P.Qo price.
.Accordingly in each year since 1954, except 1957 when the world · pric~ rose above the N.P .

Q. price, the Sta bilisation Fund has been U3ed to bring the price of Free Sugar as n ear to the N. P .

Q. price· as the ·annual payments into the -·Fund allow.

Under the Sugar Industry Special Funds Ordj_nance, 191+8, the Fund 1.s financed by a c ess of $6000 on ev ery ton of sugar manufactured and exported .

The F\md showed a balance of more than $2, 200,000 in 19S9.
11 British Gu1.aha sti.11 pays· the l evies on all its expor t sugar.

There have also been variatlons i.n the d:i..vision of the levi es between the three different funds .

Jn British Guiana the Pr·tce Stabilisa ti.on Fund levy has been re duc e d from .th e original rate of $6.00 per ton to $ 1~20, the balance of $4 0 80 having b een divided equally betwee·n th.e Rehabilita tion Fund and Labour Welfare Fund.
The l evies accordingly are ••• are now as follows:- Price Stabilisation Rehabilitation Labour Welfare $1_20 per ton $7.20 $4.80 I! "

II It In addition to this div~rsion of $4.80 per ton from the Price Stabilisation Fund levy to the other two funds, there have been substantjal ncapital 11 diversions .

- - from _ the accumulated_ba~ances in_the Pric ~ Stab:Ilisati on Fund.

In 1953 $2~ .

ml1li o n was di.verted from the Price Sta- bilisation Fund to the Labour Welfare Fund, and a further $2!
million was diverted to the Labour Welfare Fund in 1956.

In 1957 a diversion of just over $5 million, equivalent to the total already transferred to the Labour Welfare Fund, was t1"ansferred from the Price · Stabilisation Fund to the Rehabilitation Fund.
As a result of discussions between the Sugar Pro- ducers 1 Association and the Unions over the proposed Sugar Industry Penston Scheme, it has subsequently been agreed that the total balance accumulated in the Price Stabilisa- tion Fund, and the fut.ure levies of $lo20 per ton in respect of the Price Stabilisation Fund, should both be used to assist in the fundlng of the Pension Scheme; but this is subject to GovernmGnt approval which has not yet been obtained ••.

--1.02 - obtained.
--1.02 - obtained.

It has also been a greed that $5 million lent by the Rehabilitation Fund to Demerari Sugar Terminals Ltd .
should be passed over t o the p ropos e d Sugar I n dustry Pen- sion Scheme as the money 1.s repa i d. The balances ln the Funds a s at 31s t Decembe r, 1963, we re as follows: Price Stabilisation Rehabilitat i on Labour Welfare iP /~ 6 I. , 31..j-7, 996 7,664,825 9,828, 340 The Labour Welfare Fund is adminis t ered by a Com- mittee consisting of r epresentat i ves of the Gov er nmen t , the Sugar Producers' As soc i at ion an d the Unions; whil e the Price Stabilisation Ftm d and the Rehabj_litation Fund are administ e red by a Coram.i t tee con sist i ng of represen t a t ives of Go vernmen t and the Sugar Pr oduc ers' As s ocia tion .
From 194 7, t h e year of t he i ns ti tu t i on of the · special levies , to 1963 , t hese amount ed t o $52, 897,043 096 (in cluding dlver sion s ) all oca t ed a s f ollows: Price Stab i lisation Rehabilitation F\,L~d Lab our We lfare ~~4 ;336,3 63 .65 ( 8of2% ) (55.,2%) ·· 29,161,3 96 .

62 19 ,399, 283 .69 (36 .

6%) Amoun ts paid t o pr oduc ers out of t he Re ha bili tation Fund a ggregate $2S,010,007.28.
Charges to the Labour ••• - 10) - Labour Welfare Fund during the period amounted to $18,,507,143.80.

Of this amount loans to workers (inter est free) to build their own houses totalled $9,927,243.13.

It should be noted that to the extent of the loans the fund is a revolving one.

Apart from these, however, which are repayable, permanent communal .benefits to workers (including administration expenses of the Labour Welfare - - .. Fund) exceeded $ 8,000,000.
We feel compelled to observe that the partici- pants 'in the industry and the community· have benefited from these levies; Labour and their immediate community through the Labour Welfare Fund, the shareholders by the ownership of the assets acquir ~ d from withdr-awals from the Rehabilitation Fund, and the shareholders, Labour and the community at large by the increase in efficiency resultant from _ the improvements and replacements made pos- _ sible through the Rehabilitation Fund.
The ... Price Stabilisation Fund.

The followi.ng extra:cts from the Of:fj_cial Report and .

Index of the Debates of the Twe lfth Session of the Third Legislative Council, 15th May, 1946 - 24th October, 1947, reveal Governrnent 1 s understanding of the use to which the Price Stabilisation Fund was to be put: Sugar Industry Special Funds and ExDort Duty Bills.
The second reading of the following Bills was then considered by the Council: A Bill intituled 1An Ordinance to make provision for the establishment in respect of the sugar industry of a ··price stabilisation fund, a rehabi litation fund and a labour welfare fund, · and .

for purposes connected therew5.th.

1 .. .

.

.

}'IR,.

SEAFORD: .

.

.

.

.

.

.

.

.
.

.

.

.

In dealing Wi th the Bill its e lf T would like to r e f er to para graph 5 of the Objects and Reasons which reads: nThe purpose of the· Pp ice Stabili sation .Fund is .to provide a reserve which can be utilized, if n e cessary, to mitigate th e adverse eff ect of a reduction in the price of sugar •.. 11 lifuen the dis ·cus 3 ions wer e in progress with the Colonial Office and the Se cretary of State this Gov ernment obtaj_ned fop the Home Government figur es w-tth regard to th e cost ... - 105.
- cost of production of sµgar in the Caribbean area, and in fixing the price of sugar they took into consideration the cost of .produc tion.

Now this stabilisation Fundis being provided so that the same conditions may exist in the future as exist nowo That is to say, that should the cost of production be above or equal to the price of sugar this Stabilisation ~Jnd would come into effect.
In other words, if the cost of production rises considerably, as well it may through various causes - for instance the cost of supplies may go upj or- -the out put of sugar may be curtailed considerably through lack of fertil5_zers - the -Stabili sation Fund would be drawn uuon so as to provide a cushion ~etween the cost of pro~ duction and the price 6f sugar.

that when this -paragraph was drafted it was not reali_zed wl:ia t was the effect· of its I think the Stabilisation Fund wording.
is to provide for the difference · between the cost of proauction and the prtce of su>Zar when required.

I feel THE COLONIAL TREASURER: ••.•.•..•.•....

The · directions with regard to the Stabilisation Reserve read thus: "The circumstances and conditions under which funds Will be made avail able will be a matter for further con sultation with the producers, but the intention is to commence now to build up a fund which would provide a cushion against any future considerable fall in the sugar £rice.

.. .
.. .

.

.

.

.

THE COLONIAL TREASURER: price falls but the cost of · product-:lon remains, a --condition w-tll have arisen which woula justify; disbu.rsements f'rom the Price · ·.

Stabilisation Fund -~ : . '

' .

• .

.••.•..


If' the ' ;· ' .· It ••• - 106 - It is in our view quite clear n~N that ~he New Commonwealth Agreement has provided a satisfac~ory · guarantee~ market at a guaranteed price for app roximately 60% of the country's production - at least for the next three years - that the uncertainty and any ad~erse fluctuation on the other mark ets can be countered by the proper application of the Price Stabilisation Fund in accordance with the specific purpose for wh ich it.
was expres~ly created.

Ne cann ot unde r stand why it was n ot utilised h e re as it h a s been in Trinida d; moreov er, it see ras to us illogical to levy a cess on sugar which is being sold at a loss and to leave th a t cess in a fund which so far is servi ng no us eful purpose whatever.

The only justi- fication for the levy is its utilisation for the p urpose for which it was created.
If the cess were not levied that amount \·1o u ld h a ve been shown as revenue and t h e ind ustry's p rofi t ability and its conseq uent abi l ity to pay high e r wages thereby enhanced.

ACCORDINGL Y 'JE R2COMMEND (i) That th e prop osa l to use the b alance stand ing to the cred it of t h is Fund as well as f u ture levies £or th~ p urpos~ ~f p~nsions .

shoul d be aba n d oned and ·· the Fund u sed in ~ccor dance with its ·orig inal sta tutory objectives •••• .,.
- 107> -~ objectives with effect from 1st January, 1964., (ii) That the original allocation of $6.oo per ton of sugar exported should be restored to the Fund with effect from 1st January, 1964.

The original levies of $4.

80 to the Rehabilitation fund and $1.20 to the Labour Welfare Fund should be similarly restored from that· date.
(iii) Th~t in view of the unusual and unpre cedented adverse circumstances affect ing the industry in low production, increased cost and the d.epressed prices in· the U.S. market during 1964, a withdrawal of $929,137 from the Price Stabil:i.sati_on Fund be made for payment into the industry's revenue: ThJ_s sum would eqila te the u.s. price to the N.P.Q,.

price for that year>.

Wh~_ le -the price for frees was higher than the N.P.Q.
price in 1964, it is recognised that the abnormal circum stances affecting the industry - in particular the prolonged strike, arson and intimidation of workers - frustrated the industry from effect ing greater sales to this market and as a result reduced its overall profitability to the lowest level for more than a decade.

A withdrawal from tne.

Price Stabilisation Fund is 1ustified in these circumstances so ;_s to maintain the inaustry at a level of reasonable viability.
At the same time, implementation of this re commendation would provide the only plausible basis for the payment to workers of a once-for-all bonus to which, as we find further on in this report, they are morally entitled but •.• - 1013 - but which the industry cannot otb.er wl.se afford.

(iv) That for the year 19o5 and.


onwards, one of three alternative formulae should be applied by the Committee controlling the Price Stabilisation Fund to determine the quantum of withdrawal from the Fund in order to assist the industry in offsetting losses from selling sugar to foreign markets other than N.P.IQ;..
The for mula to be applied for a particular year should be related to the strength of the Fund, circumstances affecting product1.on and the amount of wi_ thdrawals wh lc h may be envi saged for the future, having regard to m:arket forecasts.

The formulae are as follows, in order of rela tionship to the strength of the Fund, E1ther (1) Withdrawals should be equal to the loss sustained from selling sugar- to foreign non-N.P.Q.

markets at- prices lower than the N.P.

Q. pr1ce.


Nett revenue from sales to any market in excess of the N.PoQ• prtce to be set off a gal.nst loss e s fro~ sales below the N,P.Q.

pric e .

Or (2) Withdrawals should be equal to the loss sustained by selling sugar to foreign non-N.P.Q~ markets below the average cost of production.

Nett revenue from sales to any market in excess of the cost of production should be set off against losses from sales below the cost of produc tion.
(3) Withdrawals from the Fund Or -should oe eaual to · the loss sustained by selling to for e i gn non-N.P.Q.

mar kets at prices lower than the normal ... world ••• 109 .. - -~ ~ ~· - world price , i.ee the average price for "Freesn for the period 1956 to 1962.

Nett revenue earned from sales above the normal world price, as defined above, should be set off against the loss from selling below that priceo It is the vt ew of the Cammi.
ttee that the most practical formula for 1965 and onwards would be the third, that is, equating sales to foreign non-N.P.Q.

mar- kets to the average normal world price.
This average normal world prtce .for the pertod 1956 to 1962 is $ 14~- per ton and on the basis proposed, the tndustry 1 s pay- men ts lnto tli.e fund compared w-i th t ts withdrawals there- from for 1965 and as estimated for 1966 will be approxi- mately as follows: 1965 Amount of levy 1965 Amount of withdrawal 1966 Amount of levy $1.s million $1.,3 million $1.8 million 1966 Amount of withdrawal $3.3 million Excess of withdrawal over levy for 1965' & 1966 == $lo3 million.
Taking into account the balance to the credit of this Fund as at 31st December, 1963, the special withdrawal proposed for 1964 and the levy to be paid i.nto the Fund for 1964, the balance to the cred1t of this Fund at the end ••.

Q b - lJ.0- - end of 1966 should be of the order of $5.5 mi_llion.

Th1-s amount, considered )n the ltg'.lt of possible future prices for sugar should suffice to malnta1-n the Fund at a us.eful leve 1 for a reasonable number of years.
The Committee wishes to emphasize strongly that the use of the Pr ice Stabilisation Fund as proposed is intended to maintain the viability of the industry and at the same time permit continued · improvement of wages and conditions of employment of sugar workers.

We ar>e · of the opinion that the dismal market situa tion of the i n dustry and 'Lts weakened financial resources · do not provide a basis for betterment of the position of sugar workers in the abs~nc s of this device .
Since use of the Price Stab illsati.on Fund wi 11 augment the i_ndustryt s surplus, the wor>ker wi_ll be entoi.

tled to h 1 s fair s hare from any improved surplus in t he form of hlgher wages and bett er conditions of employment.

l·foreover, the introduction of a profit-shar:lng sch eme , which has been recommended e ls ewhere in this report, would also provide an additional opportuni ty whereby the worke rs ' l ot may be advanced still further with corre sponding enhancement in industrial r e lations.
... [l.;7 - lll - The Labour Welfare Fund.

The Committee notes that the Sugar Industry Labour Welfare· Fund - has been used largely for housing an0 the physical facilities and communal amenities con- nected therewith.

We consider that in future the Fund should em.brace other matters of a welfare nature, e.g.

pensions and medi- cal faci.lities.


ACCORDINGLY, 1rJE RECOM11/fEND TJIAT negotiation for the demands of the Union unc1er the following heads: ,_,--r--,.4:.· (1) Pensions, -?,; ( 2f-f' Me·d1.cal fac i 1 ; ·ties, be taken up by the Un1.on with the Sugar Tndustry Labour Welfare Fund Committee as early as pract:icable; , and if and when agreed upon, be sa t isfi_ed from the Sugar Indus try Labour Welfare Fund'!

8.

THE UNION TS DE!Jr.ANDS.

A.

The Annual Production Bonus for 1964 .


The Annual Production Bonus was introduced in 1952 "to di.scourage avoidable absenteeism and to encourage production at times when cont-tnuity was ne c es sary _for the efflci.en t running of the factori e sn ( S oP .

iLc memo randum .

.

.

- 1.J..2 - memorandum to Comm itte e ).

The Union in its memorandum to the Co mmittee has emphasi.zed th ·,.t the bonus was inten- dec1 to encoura g e attendance and "increase the pr oduct·ton."
The bonus was fixed at levels of 6 days, 7 days, and 8 days aggregate wages r e sp e ctiv e ly, for thre e levels of productj_on, the lowest b e ing for 6 days and the high est at 8 days.
From 1956 to 1963 the bonus payments were baaed on the following targets: Year 1952 1953 1954 1955 1956 1957 1958 1959 1960 1961 1962 1963 ~~ ~~~~ 6 daysr pay 7 days' pay 8 days 1 pay Actual Pro:- duct ion 230, 000 23 o, 000 235,000 245,000 2SJ;OOO 263,000 28_0, 000 260,000 317,000 306' 000 300,000 290$000 248,000 258; 000 260,000 285;000 272,000 321, 000 310,000 3 04, 000 294,000 250,000 260,000 273,000 290;000 275;000 326,000 315;000 309' 000 297,000 11 11 II It ll 242,692 tons 240,176 238' 922 2so,111 263,333 284,973 306,651 284,425 334, l-t41 324;745 326,023 317' 137 II II !
!

i: 11 11 * 9 days' pay was giv e n for reachin~ the 300,000 ton mark.

-lH~ Note: In 1963 a 9-dayat p o.y targe t .was f i xe d for 302, 000 tons.

In •.• "' - .. 3 .l:.i.

.

~ .

- In add ttion to ···the Colony produ.

c t!.on t; a~ 6 ot:=i • . '

-····-- .

.

.

each estate sets its· bwh target based on .the share allot- ted to it of' the total colony production.

Finally in order to earn the bonus, a worker had to achieve a mini- mum attendance of 821.!% of the work days available to him.
Absence f'rom work due to injury was not penalised, but absence due to participation in unof'f'lclal str-:tkes dis- qualified the worker from being el'i.gible for the bonus.

On 4th December, 1964; agreement was reached between M.P.C .. A. and S.P.

A. for the 1964 Annual Produc- .. tion Bonuses as follows~ (a) A bonus equal to 3 days' pay if the estate on which he worked achieved its target.

(b) A further bonus of 3 days' pay if' the industry's production was 2b0, 000 tons.
(c) A further bonus of 1 day 1 s pay if the industry's production was 263,000 tons.

And (d) A further bonus of 1 day's pay if the industry's pro duct-5on was 265,000 tons.

We now proceed to examine the evid ence relating to the Un-ton's allegations on thi.s claim seriatim: ( 1) ••• ( :t) "M1s.

:.reprcscntiLtion o,t estimates of · production which were: used as a basis fo~ .

th~ targets~" The estimate of production on which th'e tar- gets were fixed was 272,000 tons of sugar.
The targets actually set were: 260,000 t.ons 263' 000 tons 265,000 tons 3 days' .bonus (plus 3 dayst estate bonus) 4 days t bonus · (plus 3 ·days' estate bonus) .5 days' bonus (plus 3 days' estate bonus).

\ The actual tonnage made was 258,378.


The es tima t .ed acreage to be reaped was 91, 725 acres while the actual acreage r eaped was 88,622 acreso However, the actual Colony production for the year was 258,378 tons, or 1,622 tons less than the tar get of 260,000 tons for a bonus of 3 days' pay; or 4,622 tons less than the 263,000 tons target, or 6,622 tons less than the target of 265,000 .

tons.

In add1tion, four estat e s, 1.e.


Enmore~ La Bonne Intention, Leonora and Uitvlugt failed to reacq their respective targets by 800 tons, 2,075 tons, 1 1 575 tons and q.13 tons, r es p e ct j_vely, ther eby disguali_fyi..ng t he-tr workers ••.

-115 workers from any _bonus.

Fa i_lure to achieve both_ the targets on these estates aa well as the total Colony pro- duction target gave rise to the dispute be~ween the M.P.C~A.
and the S.P.A. At the meet 4 ng held between the S.P.A. and the Unlon on 4th December, at whi_ch the taTgeta were agreed the follow-lng was the his tori cal order· of' proposals for bonus leading to the agreement: A. S.P.A. crop estimate: 91,725 acres to produce 272,000 tons Note: Production up to 28th November - - was 234.,1~91 tons.

B.
B.

Proposed by S.P.A.: Targets of 265,;000 tons - 6 days' pay It 269, 000 tons - 7 days' pay " 272,000 tons - 8 days' pay C. Following further proposals and counter " tt propoaals targets were eventually fixed, in accordance with a suggestion from the Union, as follows: 260,000 tons 263; 000 tons 265,000 tons 6 days' pay 7 days' pay 8 days' pay.
Wi__ th respect to t h e es ti.mate of 272, 000 tona which was considered at the meeting of 4th December, it ... - l.:Lb - it should be noted that on the 3rd October, 1964,. an estimate entitled nsacrifici_al" wa:.

prepared by.

Bookers Sugar Estates Ltd. for the S~P.A.

fo~ecasting the Colony's production at 265,Lfll tons, i.e" approximately equal to the maximum Colony's target whi.ch was subse quently fixed on 4th December at 265,000 tons and only s,411 tons above the minimum target of .260,000.tons.
There is no evidence that thi.s estimate of the 3rd October - 265,411 tons - was disclosed to the Union.

If it was, then the Union would have been guilty of .. naivete and indiscretion to have accepted a target (265,ooo tons) equal to the estimate of yield (265,411 tons) as they would not have allowed workers any room for• manoeuvre.

The employers ought to have brought the October estimate to the attention of the Union; had this been done, then, having regard to the pattern of relation.
ship of targets to estimates in previou.s years, j_ t seems reasonable to assume that lower targets would have been fixed which would most probably have been attained by workers.
The actual tonnage reaped from a total of 88,622 acres was, as prev1_ously stated, 258,378 tonso However, the crop was not completed at Enmore, L.BoI., Leonora ••• .- - ll7 - Leonora and Ultvlugt, whe re the canes est-tmated to have been capable of producing 6,820 tons were ca~ried over to the Spr-tng Crop and eventually produced 5,585 tons of sugar.
It is clear, therefore, that the maximum pro- duction which was possible from the Autumn Crop was: 258,378 tons reaped + 6,820 tons carried forwar d. 6,820 tons carried .forward ::: 265,198 tons.

Alternatively-, if grinding had continued without inter- ruption into the normal Spring season in order to grind off the autumn crop (which the Union claimed was origin ally intended) the maximum possible yield would have been: 258,378 tons reaped+ 5 ,585 tons :::: 263,963 tons.
The two .fi gures - 265,198 and 263,963 tons - when com pared with the es timate of 3rd October - 26.5,411 tons - show: (a) (b) (c) that the estimate of 3rd October was more accurate than the estimate of 272,000 tons which was gi ven to the Union on 4th December; that based on the actual results it was impossible to realise a yield of 272,000 tons from the Autumn Cro p ; that based on the actual results the maximum target of 265,000 tons would have be en unattainable.
We ••• :118- We agree with the Union that the estimate of 272,000 tons should not have been ised for fixing the targets and that the October estimate of 2,_5,000- tons should have been used.

In any event had the practice of previous years been followed, the targets would have been fixed much earlier than December, when the October or an earlier estimate would bave been used.

(ii) "Failure by the Su.

!Zar Producers' As s a- .

ciat-lon to continue gr)_ndi_pg:__untj_l the targets were reached.
Ir The records are not specific on whether or not there was an undertaking by S.P.

A. to grind cane until the targe ts were achi.eved .

However, at the rne~t ing of 4th Decembe r, 1964, between M. P.C.A.

and S.P.A. it is recorded that - 11Mr.

Grtffjn (who represented the S.P.

A.)

s a id that 19 64 was an abnormal year and everything should be done to make as much sugar as possible.

11 All estates achieved the ir targets with the exception , of Enmore, L'"B.Io, Uitvlugt and Leonora .
A most signi- ficant and sugges tive incident took place at L.B.I.

when the Factory Manag er posted a notice on 5th January, 1965, to the effect that the estate would re - start grinding .. .

.. .. - lJ.~9 - grinding until .all autumn.

car;es were ground off within three to four .weeks, thereby enabltng the factory to make "its target for 3 days' bonus 1t.
Aga1n, · at a meeting of the estate joint committee at Enmore, Management expressed the vi.ew that the Autumn Crop would last until January 2, and possi_bly January 9, 1965.

However, grmding stopped on 30th De cember, 1964.

The dates on which the estates began and finished grinding the Auturr..n Crop were as follows: Skeldon Albion/P.M.

Rose Hall Blai_rmont Enrnore L.B .. T .. /Ogle Wales.
Versa i.lles Uitvlugt Diamond Leonora Date Com..:n:enc ed Date Ended 17.8 .. 64 13.7.64 13 .. 8064 18.8.64 20.s.64 10.8.,64 18 .. 8.64 4 .. 8 .. 6~.

29.7.64 3 o.

7.

6L~ 21.8.64 i2~12.64 Jlol2o64 1.

1.65 31 .. 12.6u 31.12 .64 31.12.64 s~12.64 20.11.64 31.t2.64 6.12v64 2.

1.65 The dates on which grinding was restarted for the Spring Crop were: - 126' - Date Commenced Skeldon Albion/P oJVT • Rose Hall Blairmont Enmore L.B.I./Ogle Wales Versailles Uitvlug t Diamond Leonora 22;.

2.;· '6~5 .

.. .
2.;· '6~5 .

.. .

·-- 18·2·6c; 3 .J.

6S 17.2.65 19.2.65 6.1.6.5 2.3.65 14 .. 3 .. 65 9.2 .. 65 24.2.65 4Ql.65 The narrow interval of five days at L.B.I.

and of one ... day at Leonora between the elose of the Autum.

"'1 Crop and the commencement of the Spring Crop would indic a te that, on th e s e e states, for practical purpos es , the Autumn Crop continued into the Spring Crop and the close of one crop and the commencement of a n o.t h er wa s es s entia lly a rbitrary - ~ .

and i n explicable .


Howev er, a lth ough cane :ts li_st ed as ha ving b e en ca rri..e d :forward from t he Autumn Cr op i nto the Spr1ng Crop at L.B.T., none has b een listed at Leo- nora.

The fo llowing canes cl a ss if i ed as Au t umn Crop canes were carried into the Spring Crop: En.mor e •.• - l21 - .

Enmore L .. B .. T. Uitvlugt Total -· 1,085 tons Spring Yield :::: 1,300 tons -in autumn 2,370 tons Sprlng Yield = 3,340 1,770 tons Spring Yield = 2,160 5,585 6,820 II l!

fl I!
fl I!

It II Had these canes been reaped for the autumn of 1964 the - - estlmated _tonnage would have been 6,820 tons, i.,e.

enough to a tta-i_n the target.

Moreover, had the Factory Y.lfl.nager at L.B.I.

carried out his plan to gri.nd off the autumn crop in January 1965, that factory would have produced an additional 3,340 tons and the Colony target would have been achieved on the basis of this additional production on this estate alone..
However, the sudden withdrawal of the notice to this effect on this estate was, to say the least, most sinister.

Equally sinister was the early start of grinding the Spring Crop at th.ls estate and Leonora.

On the other hand, previous agreements between H.P.Q.

and M.P.C.A., e. g .

the agreement signed on 5th November, 1964, defined the autumn crop as embracing the peri_od July to 3 lst December.

Under th is agreement canes ground in January 1965 would not have been treated as Autum.--i.

Crop 1964.
Crop 1964.

However, another agreement between the ••• .. .. - -122- the M.P.C.A.

and the S.P.A. - that of 1952 - re holidays with pay, stated that~ neach crop :'!

: :~all stand by itself.

Each crop season shall be the period between the date on which the factory starts to grind and the date on which the factory ceases to grind unless grinding is interrupted owj_ng to lac k of ripe cane 1_n 1'1-h ich case such period_of 1-nterruption shall be excluded from the crop season."
Th5s is a better definition of a 1 crop' from an agricultural point of view, especially taking into account local conditions (notably rainfall) as they affect the crop cycle and field and factory opera- tions.

It seems, therefore , that if the employers were genuinely interested in carrying out the intention (Mr. Griffin at the meeting of 4th De cember) that llevery th ing should be d0ne to make as much sugar as possible 11 , the targets could well have b een ach i eved.
by grinding out the autumn crop, b y continuing factory operations without interruption into January 1965, because the canes were avail able on those e sta tes which did not reach the-tr targ ets at the end of December 1964 ..

The emp]-oyers have clai_med that although cane was avai_l a ble in December to enabl e the tar g~ ts to be achieved •.• .. - I23 achieved by year end, the ·workers were _not avR.i lable owi .. ng to a bsenteeism.
The Peturns f'or t he estates Which did not reach their targets show the following position: L.B.

I.

(November 25-December 30).

Work Ava i_lable -(man days) Turn-out Punts Avd.ilable Punts Loaded 23,000 11,450 8,601 I+, 889 Ratio: Work available to punts available = 23, 000 8, 601 .

:::: 1 punt to 2.67 workers Ratio: Turn- out to punts loaded == 11,450 = 1 punt to 2.34 workers 4,889 Ratio: Tur n-out t?

punts available == 11:450 8,601 l punt to 1.33 workers .

Leonora (November 30-December 31).


Work Available (man days ) 16,740 Turn - out Punts A va:tlable Punts Loaded 8,634 7' 113 3, 718 Ra tio: Work available to punts available= 16;740 7' 113 == l .punt to 2.35 workers Ratio •.• 0 l2L~ ..

Ratio: Turn-out to punts loaded :::: 8; 631+ 3,718 ·- .. 1 punt tc 2:32 workers Ratio: Turn-out to punts available :::: 8.i 634 7,113 :::: 1 punt to 1.21 workers Ui tvlugt (November 29-Dec ember 30).

Work Available ( rn..an .


days) Turn-out Punts Ava'tlable Punts Loaded 29' 93 6 - 12,233 9,218 4, 637 Ratio: Work available to punts available :::: 29, 936 9,218 1 punt to 3~25 workers Ratio: Turn-out to pun ts loaded :::: 12,233 4, 637 :::: 1 punt to 2.64 workers Ratio: Turn-out to punts available == 12,233 9,218 1 punt to 1.33 workers Enmore (November 29-D ecembe r '30) Work Available (man days) Turn-out Punts Ava1-lable Punts Loaded 23 '748 17, 237 11;708 6, 045 Ratio ••• ... S I .... .
�-Ratio: Wo�k· avaj,lable 2327�8 = l 11,708 punt to 2.03 workers to p unts ava.

ila.ble == Ra'\.,1.0: Turn-out to punts loaded· .

:::::: 11.z2Tf J 6,045 ount to 2.85 workers Ratio: Turn-out to punts available :::: 11.2237 :::: .11,708 1 punt to 1.47 workers.

The c onclusions to be drawn from the_foregoing statistics a.re that at La �onne Intention, and Uitv-luf.

!t Enmore: ·(a) The number of· men required to· l oad one punt of cane varied from 2.32 t o 2.85 or an average of one·punt to 2.5 men.
This figure was affirmed by the Union in evidence, as the normal requirement.

to punts (b)· The ratio of work available available is useful to check the accu­ figure racy of the actual performance under {a), i.e.

one punt to 2.5 men.

The ratio of work available to punts varied from 1 punt to 2.03 available workers, to 1 punt to 3.25 workers; i.e.

an average of 1 punt to 2.57 men.

The returns with respect to these fac­ tors, therefore, may be regarded accurate.
as (c)The turn-out available in relation to work {"punts").

varied from le21 men per punt to ••• .. .. ,.

- 1.26 to 1.47 men per punt or an average of' 1.31+- men to each pun-:; of" work avail able.

When this figrre is compared witq the normal work output of 2.5 men to each punt, then it can be calculated that the labour force fell short· by- 4604%· of the work avai.lablen This represents absenteeism or under- supply of labour of a high order.

"Rainfall affected attendance".


Rainfall has an adverse effect on the attend- ( • • 0 1 1.

)_ ) ance o:f workers at work.

The returns from the Estates relating to .ttendanc e of workers and work done , contain remarks by Management in connect1-on wi_ th days of poor turn-out such as "rain affected turn-outn, 11 heavy rain drove cutters home 11 , 11poor turn-out due to Painfall 11 , etc.
The returns show that heavy rainfall tad its most strikingly adver·se effect at Enmore and at La Bonne Intention, where the turn-out was seriously reduced on nine days and six days, res pe ctiv ely of th e thir ty~two -days of work available.

In addition, two days were lost at Leonora and three days at Uitvlugt , or an average of five days for _those estates which d id not reach their targets .
The poor attendance and consequent los s o.f proc'luctlon on these estates as a result of heavy- rain- fall, was ther efore si gnificant.

Based on the average of •.

o - 127 � ' .

of five days when work was seri.ously reduced on the four esta tea which did not reach their targets, ·it ia calcu-· lated that the loss of product1-on was of the order of' 2,000 tona (400 tons per day) as a result of excessive rainfall on the estates which did not reach their tar­ gets.
The workers must be absolved from blame in theae circumstances.

Indeed, the M.P.C.A,./S.P.A .. agreemer.1t relating to wages and conditlons or work, signed on 29th .

.

March,.

1963, frees the worker from liability in the event of factory breakdown, weather and stoppages due to strikes by the workers.

(iv)"Absenteeism was ma inly u_-r1avoidable.


11 Absenteeism on the estates wh5ch did not reach the1.r targets m.ay be attr1.buted as f'ollows, from the datu s upplied to the Committee by the employers: Cause No.

of' Days L.B.I.Leonora Uitvlugt Enmore Election effects 4 5 Sunday 9 Rain.
2 Holidays:- Labour Dispute 3 6 5 2 2 4 5 3 2 6 5 6 2 Total Days AvaiJable 23 15 14 19 32 32 32 32 - VB - From the above table, it is clear that poor attend- ance caused by some factor Which w.· __ s known to the Manage- ment occurred dur1-ng the last month of the crop on about ····' ' • .

half of the days on which work was available.

Of the days .

of poor at ten.dance, the following days should be regarded as days of unavoidable absenteeism j_n the cir- c11mstances of Br'Lti_sh Gui.ana.
~<- Electi_on effects - 2 days (day of voting and day of results; days in excess of these 2 days are not regarded as days of unavoidable absentee ism).

Sundays - 5 days (traditionally a day when work is avoided).

Holidays - 2 days (Gr1ristmas and Box Total .. i!lg Day) 9 days Of the nine days, if Sundays' are excluded, then four days will remain which would be equal to l oss of produc- .. tion of fr?m .

?~900 .to 3~000 ton~ .p .

0.L sugar a - ..


If the holi- days were excluded, then between 1,000 to 1,.500 tons were lost .as a r esult ·of ne-1 ectlon e ff e cts".

There ~s no evidence that l oss of production due to the electlons was t a ken into c ons lderatlon , at the t lnie ••• --129 - time of fixing the targets.

Thls would be equal to from 1,000 tons ... 1,,500 tons of sugar.

This should have been considered.


-:~ Imputed from a.ctua.l attendance (benefit of doubt given to effects of elections rather than to rainfall where these two factors were coupled as a reason for shortage of workers), or stated specif!- , cally as t:Juch by Management~ "Election effects" .includes .

the days of polling, the day of results and the subsequent days of chaos which followed the announce ment of results which did not favour the political party for which it is believed most sugar workers voted.
(v) Low Yield of Sugar per acre for the year.

The yield of sugar per acre j_n 1964 in the indus- try was the lowest on record for many years.

The follow ing table shows the yield for the period 1956-196L~ expressed in tons cane per ton sugar and tons sugar per acre: Year - 1956 1957 1958 1959 1960 .
1961 1962 1963 1964 per ton Sugar Tons Cane - 10•77 10.o39 lle34 11.31 11.18 10.96 10o56 10.76 11.58 Tons Sugar uer Acre 3.67 3.62 3.73 3•37 3a59 3.18 3.41 3.44 2.86 The ••• 1 The low yield i.n 1964 was due principally to adverse agrlcul tural conditions.

::ow ra ·tnfall was a major factor durjng the greater part of the growing season but ' the prolonged ci.vil d1sturbances and labour unrest in the 1.ndustry were contrj_butory factors.
During the last month of the autum.~ crop there was a significant fallin g off of the yield on most estates and in particular on those which did not reach their targets.

The heavy rainfall during December was the main reason for this decline, although there was some evidence that the reaping of over-ripe cane and of the least productive fields were also contributory- i'ac- tors.
The unusually low ratnfall during the growing season, theunusually high rainfall during the harvest season, as well as the subnormal yi.eld may well have frustrated the calculations of the Union as to the ability of the workers to achieve the targets.

(vi) 11 Tho Su:.

::ar Pro dueors stoo d to g ain if the target ~as not reachedr1.
The cost of proc1uc t ion of sur:sar in 1 ~64 was dis-· closed to t he Committ o e •1urln~ the course ::i f t '.l.e enquiry as $186.49 per tono Mr8 Griffin (SPA) at a meeting on 12tho • < - 131 - 12th February, 1965, contended that the sugar which had not b een made had been scheduled to be shipped to the United Kingdom at £45 per ton.

The profit marg in on the sugar not produced and not shipped would have been there- fore $29.50 per ton.
The tonnag e of sugar not made, in relation to targ ets, loss of profits and b onuses, were as follows: 1.

1,622 tons (target 260,000 tons an d bonus 3 days' pal) at $29~50 per ton= loss of profi.t of <fi>49,849.00 , compared with b onus of $451,680 nsaved 11 by not making 263,000 tons.

2.

3.

622 tons (target 263,000 tons, bonus of days' pay) ~t $29.SO per ton = loss of rrofit of ~ 13,3~9 compared with bonus of $562,780 "saved' by not making 263,000 tons.
6,622 tons (target of 26S,OOO tons, bonus of S days' pay) at $29.50 per ton= loss of profit of $19S,349.00 compared with bonus of $673,880 "saved" by not making 265,000 t ons.

Included in the above sums "saved" by t he non- .. payment of t h e bonus es under l, _2 an d 3 i s ' the esta t e .

.

., .. bonus of 3 days whi ch was s a v ed on f our estates as < follows: Enmore ••• .

.... - 142: -.... ...r · 1\ .

Enmore LoB.I.

Leonora di> 40,000 ·1j: (-1> ~?


27 ,300 & ~~ 24,100 Uitvlugt ~ ,, 27,000 $ 118!1400 It is clear that the employers have "saved 11 con- siderable sums by the failure of tf-ie workers to reach the !arge~s, and had the targets been made the additional profit which would have accrued to the industry would no t have offset the additional expenditure due to pay- ment of bonuses.
However, the evidence does not in our view establish the allegation that the estates intention- ally deprived th<:i workers of the opportunity to achieve ~-· the targets. '

~\ ,, This analysis of the evidence reveals that - (1) The maximum target for 8 dayst pay (265,000 tons) was fjjted at an un attainable level, having regard to the actual results.

(2) In relation to the actual results "'" 258,378 tons reaped and 5,585 tons carried ••• - J..JJ - carriedforwaru, i.e.

a poaaible.
a poaaible.

total crop of 263,963 tons - the intermediate target of 263,000 tons (7 days' pay as a bonus) was set at a level wf.dch was a.ttainable, but barely so.

· The October estimate of 265~411 tons Ei:nd not the December estimate of 265,411 tons snould have been used as a basis for f'ix1-ng the targets.

(3) ThB .

only target which was attainable · and which allowed for a r.easonable marg'Ln between · target and possible yield was the target for 6 days' pa~ i.e.

260,000 tons.

.
260,000 tons.

.

· (4) Had the intentions of the Factory Manager at L.B.I.

beBn carried out, i.e.

to grind off the Autumn Crop in January, then the additional tonnage of 3 .340 tons (estimated Autumn yield~ or 2 370 tons (esti mated Spring yield) woula have been made.

This would have given an autumn crop of 261,718 tons or 260,748 tons (based on the estimated yield of the crop carried over into the Spring).

On this basis the tar get of 260,000 tons equal to 6 days' pay would have been made.
(5) Absenteeism was at a high level.

Much of thi.s was avo.ida'ble - a.s it was with in the power and abi.li ty of the work ers to attend regularly at least on hal"f" of the .work-days whtch were ava.i.lable to them..

However, work lost due to avoidable absenteeism was about · equal to : work lost (or the low tonnag~ of cane cut) as a result of circumstances outside of the control of ••• .

· In this connection, the of the worke~s, e_g.

hea~y r~infall, ahd the reaping of' ~.


ow- yielding flelds at the end o.:.·· , the crop.

The mitri.mum target of 200, 000 tons would have been made if the weather had been more favourable, even if avoid able absenteeism was taken into a c count.

worker ought.not to be penalised for non-attainment of the targets due to circumstances beyond his con trol.

The minimum target would have been exceeded if there was better attendance at work by the wo rk ers on · the days when they tLad no reason for absence.
.The estimates tonnage (in terms of sugar) not reaped--as a result of unavoidable absenteeism on the e-sta tea wh:J ch did not reach their targets amounted to about 3,000 tons (l,000 tons from nelection effects 11 and 2,000 tons from excessive rain fall).

(6) Since the intr'oducti on ih 1952 of the Colon y annual ~r e duction bonus, 1964 was the :Li.rs t and only year· that the tar:get was not achieved .

This, .naturally, led to widespread dis gruntlement on Vie .
part of sugar workers who, appar ently, had come to I'e gard the ann ual production bonus as an annual ri ght and as part of normal wages .

( 7) .

The fj_xing of th e targets on 4th Dec ~m­ =ber r epr ~sents the latest date in _any year on which t a r ge ts wer e fixed and l eft little r oom for workers to ma ke up f or a ny lost ground or to make a special effort to attain the targets under conditions which, later, b e came unfavourable for cane cutting , e. g .
excessive r a5nTall, r es idual fe a r• a nd tens ion a rising from t he disturbances and the- year-end holidays •.• .. - 135 - holidays and post-elections reactions.

(8) Some estates had ~lready completed or were _ about to complete the-tr autumn crops when the targets were fixed.
( 9} There were no reserva t'lons ~- n the agree ment between the Union and the S.P.A. for a r~view of the targets in the event of force majeure and other cir cumstances which may have made it impossible for the targets to be reached.

(10) The Union having agreed to the targets without any reservations, the S.P.A. felt that it was under no obligation to pay a bonus which was outside the agreement.
ACCORDINGLY WE RECO'iYIMEND lo That a bonus equal to 6 days' pay (260,000- ton target) be paid, that is, a Colony production bonus of 3 days t pay; and an estate bonus or·3 days f pay on those estates which .. did not reach their targets.

This payment is equal to $451,680 includ tfi.g the following· sums on estates which did not reach their targets: Enmore L.B.
I. Leonora · Uitvlugt $ 40;000 27,000 24;000 27,000 $118,000 N .. B.: The payment of an annual production bonus uninterru,ptedly for a continous period ••• 7 period o:f i2-·years has produced a general feeling amcng sugar workers the "bonus is an inte._,:ral part of tneir wages and to whlch they have a right -; The interruption of this pay ment i_n 1964 as a result of conditions over whi..ch the workers had no control has created much resentment and antagontsm among workers.

2.
2.

The Colony production bonus should be abandoned and, instead, targets sh6uld be set for individual estates only, at the level of payment of 3 days, 6 days and 8 days, in relation to increasing levels of production.

The r eason for this recommendation is that the prin ciple of an incentive should be con fine d to circumstances over which the worker or a particular group of work ers would have complete control.
How ever, this criterion for an inc ent ive payment is not sa tisf'ie d by the "colony productlon bonus 11 o Thus, the worker on any particular estate nas no control over and no interest in the performance of sugar workers gen erally th~oughout the l ength and breadth of Br].

tish Guiana.

The work ers on a narticular es tate ar e int er- · ested in the-tr owT1 perfor!
'11ance within the-tr owii area o Tn the dispute b e fore the Committee the workers on the majority of the estates where the tar ge ts were reached and- who were expect [ng a t least an add j t~onal 3 dayst pay for the achievement of the Colony's .

target, as had happe ned for the pre vious 12 ye~ rs had the lr hopes dashed b e cau se a minority of estat es (4) ·railed td achieve their targets.

3.

Targets for fixed at crop and 3 months production bonuses should be the commenc ement of the au tum.'1.
in any ev ent not l ater than before the end of the cro p o 4o • • • -137 4.

Written an d si..gned esti_mate s of production for each esta t e for tb.e crop should be maae -·avai.lable to tl-ie Union at the time of fixi.n g of the targets.

B.

The Once-for-All Bonus for 1964 Backp:round.


Wage rates in the sugar industry constitute a permanent commitment to pay at agreed levels for work done and are negotiated with the Union on the basis of improving efficiency and productivity, guaranteed long- term tnarkets and es timated proceeds for sugar, having regard to preva i.ling rates in comparable industries and the rise in the cost of living .
In 1957, however, as a r e sult of the high world price receive d, th.e "i.ndustry agreed to pay .to workers a special bonus, called a 'Once-for-All Bonus' as a share - of the increased revenue arising from favourable prices - - received on the sale · of sugar on the 1~rorld Market.

In 1960 the West Indies· and British .

Guiana were awarded a favourably priced quota to the United States Market, which added substantia lly to proceeds and profitability.
Bonuses have also been paid for 1961, 1962 and 1963 aris- ing frora further favourable pr ic es and profitability in these years.

Se t ••• Set out below is a summs.ry of' the amounts agreed upon between the Association and t :-:.e Union and paid to workers for the years 1957, 1960, 1961, 1962 and l963: : Year .

1957 1960 1961 196.2 1963 Agreed Amounts For All Employees $1,,000,000 $ .
894,709 $3;000,000 $2,849,763 $6,000,000 The Once-for-All Bonus is really a temporary wage increase justi_fi_ed by favourable prevai.ling conditions which may or may not last.

It ensures to the worker an increase in wages while at th e same time not committ ing the industry to a permanent wage increase which might eventually cripple the industry if prices declined and/ or costs went up.
The nomenclature of the devi c e is unfQrtunate because workers have come to look upon this as they do U:pon the oth er bonuses .pa_id in the industry, e.g.

the Annual Production Bonus.

; It should be described as profit-sharing, which in effect it is.
Once an amount is agreed upon between the Associa- tion and the Union for distribution to the workers the followtng ... --139_ .. followj_ng procedure is at present adopted: The amount is d1.vided by the total tcmnage of sugar produced in the Colony and the bonus per ton is then arr1.

ved at.

Th; s bonus per ton i. s then multi plied by the number of tons produced on each sugar estate, and the amount arrived at then is the amount available as Once-for-All Bonus for that part1.cular estate.
The total wages for all the workers entitled on that particular estate is then divided into the amount available and the factor is arrived at.

·The ind:i.vidual worker's earnings for that year are then multi.plied by this factor and thus the amount due to each worker as Once-for-All Bonus is arrived at.

11\lhere the factor -;_s higher on one es tate than anoth~r it is indicative of the fact that the yield per acre was good on that particular estate or, in other words, that the pro due ti_ on was high.
Consequently, the followin g formula i_s applied: a e c b x d x 1 x a b c. d e X Total amount available as Onc e-for-All Bonus .

Total tonnage of sugar produced in the Colony.

Number of tons produced on each sugar estate.

Total wage s of workers on each estate.

Individual worker's ffarnin~ s for the year.

Workers' On ce-for-All Bonus.

By••• By this system, the bonus is at all t;mes related to the estate's production or the indivlch.

:_al's earnings.
:_al's earnings.

The Committee spent a great deal of time listen- i_ng to ev1_dence and examining minutes by wh :lch the Unlon sought to establish the ex-ts tence of the alleged formula whi_ch they urged should be appli_ed w1-th respect to the 1964 claim.

Analysis of th,ts ev;_dence, however, reveals that Ct) Mr. Tshmael admi_t ted, and lndeed empha- si_zed t hat the amount of once-for-all bonupes was agreed upon as a result of .

'horse-tradlng' between the Un ton and the SPA.


(ii) The records of negot'lati_ons and of the .

conciliatory talks from 1957-1964 verify that 1 horse-trad'Lng', i.e.

crude bargaining and compromise, was the most important factor involved in the payment of once-for-all bonuses and that the Union was either incon sistent in the use of its alleged "formula" or did not use it .

at all.
at all.

(iii) No conslstent basis of computing the once-for-all bonus can be found by analysing the amounts actually paid out during the peri_od.

1956-1964.

In par t lcular, the Union's alleged formula when applied to actual once for-all payments do es not yield, in any case a product whi_ch ts equal to, or bears any compar'json With the actual once-for-all bonuses agreed to or actually pa i_d out in any year from 1957 to 1963.

( j_v) • •• ... .. - 1.41.
- (j_v) · Tn r eply to a letter ft>om the S.P.A. dated 20th March, 1963, the Uni.on in a letter dated 3rd April, 1963, abandoned again t.hei r alleged for mula base d on a price of $115' per ton for sugar on the free market i..n 1956, stating: "We shall continue to hold the view that discussions on a once-for-all bonus arising out 'of the sale of sugar to the U.S. should be made on the consideration of the prevailing world pr:tce and the price at which the sugar was sold to the U.S. and also any excess_ where the prevailing world price is higher than what is considered normal; this difference is an · important factor.
11 ( v) In thei_r l et ter to the employers dated In thei.r 28th June, 1965, setting out wages and other demands for 1965 (page 1 sect-ton 2 of the Union's memorandum, the Union demonstrated further incon sistency by abandoning the formula which they had pressed upon the Com m'i.tt ee .

l etter of demand for a once-for-all Bonus for 1965, the Union described such a bonus as "arising out of the sale of sugar to the United States of Ameri_ca wh 1-ch woulc'l.
normally have be en sold on tt;;e World Market at an average of £21'' per world prices of sugar which may occur duri..ng t he year 1965, the lncrease being relevant to and to be compared w1.th the world price wh'ich has been prevailing in the free sugar markets during the past year s, excluding the years 1963 and 1964 when the price -had climbed to unusually hj_gh l e vels.

n toti; from any increase i..n the -i~ This was the price current at the time in 196S.
(vi) •.. (vi) In the cone ilia tory tel ks of 20th October, 1964, the Union (Mr. Sankar) again demonstrated ::.nconsis tency by using inter alia prevailing ~rices for sugar compared 1~ith tpe cost of producti9n, and by making reference to earnings in exeess of normal pro fits.

(vii) Although the employers claimed that profi_tability was the main criterion for determining bonus, they demonstrated lnconsis"'!

tency equal to that shown by the Union i.n their applicati_on of this bas is.
a once-for-all (viii) Despite evidence in support of their claim that profitability or the industry's profit level was the cri.terton for agreei.ng to the pay ment of a once-for-all bonus, the S.P.A. was itself gui.lty of incon sistency when their negotiator - Mr. Thomasson - stated at the con ciliatory di.scussion of 20th October, 1964, as follows: "The Assoctat1-on 1 s view was tha.
t the fi gµr e that ought to be discuss.ed was the sum of $8,796,402 which was derived by comparing the proceeds between the sale of sugar to the U.S. and on the free mar ket With the sale at N.P.Q.

rates."

· This statement appeared to introduce yet another formula for the issue of a once-for-all bonus.

(ix) Yet another example of 1.nconsi..stency 1.n the S.P.A. 's formula of nprofit ability" is revealed in the S.P.A. 1 a letter ••.
- ..143- letter to the Union of 28th March, 1963, when they referred to the bonus payment of 1962 as having · been ma d e un of $ 1 • .5 mi .. lllon as a result of "sales of sugar to the U.S.A. and t he b.alance - from the ind us try surplus."

It is, therefore, clear that the evidence does not disclose th e existence of any formula agreed upon between the Association and the Union for arriving at the figure available for distribution as a once-for-all bonus.

It may well be that .


Mr. Ishmael commenced dis- cuss ions wjt h the 19.56 p ric e - which he consider ed to be $11.5 per ton - as a base in his mind , but th is was never at any time accepted or even c onsci..ously appre- ciate d by the Association .

Although the bonus was paid on the occasi.on of the realisation of unexpected and unusually h-tgh profj_ts accruing to the l.ndustry as a result ' of unforeseen h'.i.gh pri.ces from sales of sugar to the U.S. and on the world market (mainly Canada.
), it is equally clear - whatever might have been the arguments, concesslons and horse--trading - that the Association always had its eye on the overall profitability of the industry an.d only paid a once-for-all bonus whe re this justified i t. Indeed, it would have been unbusiness- like and irresponsible to have done otherwis e .

Table XXXI Table .XXXT .portrays the once-ior-all bonus paid in relation to the hett aurplus rernain~_ng to the 1-ndus- .

.
.

try and its perce~tage · ~eturn on the capital e mployed dur i ng the period under review; TABLE XXXT Once-for-All Bonus in relation to Capital Employed.

- Year 1956 1957 1958 1959 ·1960 1961 .

1962 1963 1964 Once-for-All $ Net Surplus to Indus tr~ ... ' $ Return on Cap1- tal Employed.

fa 995,960 890,156 · 2,982,253 2,828,163 5,958,650 890, 622 3,375,966 .
2,409 ,310 2, 030, 800 2,461,296 2,469,526 3,471,896 6,557,716 1,177,376 2.5 7.9 5.6 4.5 5.3 5.3 7.9 1 2.2 2.1 It will ~e observed that: (a) The Un ion dl d not clai.

m a bonus l n 1958 and 1959 when t he returns on capita l wa s 5.6% and 4.5%, -r esp e ctl ve ly, but that they cla 1.med.

e_nd wer e pa td bonuses ~n 1960 and 1961 when the return onca.p1tal (af.ter payment of the bonus) was 5.3%.

The return on capital for .


1964 ... 2.1% - is th e lowest ... .. -145 - (b) lowest Since the introduction of the once-f'or-all bonus and for the period under review.

The years 1957 and 1963 m.ust be regarded as years of extraordtnary bouyancy on the markets for this country's sugar and ought not to be taken i.nto con sideration for arriving at the indus try ts normal annual profit average for the period under review.
Leaving these years· and 1964 out, the average the period under annual pro:fit review is 5.2%.

Again leaving out the exceptional years and 1964, the average annual profit for the years in wh; ch onc e -for-all bonuses were pa id ls 6.

26/o .

fo r (c) The r e turn on capital employed ·:tn 1964 (2.16/o) was the lowest for the period 1956-1964 despite the non-payment of a once-for-all bonus or a colony annual prduction bonus.

production bonus is pa,id the return on capital employed would be about 16/o.
If an annual ( d) The nett surplus remaining to the indus try in each of the .years in which once for-all bonuses were paid from 1957- 1963, if considered as normal profit for the sugar j_nduatry, was far in excess (from two to stx times) of the ·nett surplus (wj thout once-for-all bonus) remaining to the industry in 1964.
The nett surplus remaining to the industry tn 1964 must therefore be considered as subnormal and does not, standi.ng alone , justify the pay ment of a once- for-all bonus, having regard t o the bas-ts on whi.

ch the bonus was discussed between the Un1.on and the Associ.ati on in previous years and to the overall profi.tab i.li.ty of the i ndustry.
In short, in 1964 th e 1.ndus try ••• - .J.4p - 1.ndus try did not ea:r·n an overall pro fit above the nom.al level from which a once-for-all bonu.J could be justi fi_e d. It &bould be observed, however, that had pro due- tion been maintained at the· level of the previous year - about 320,00Q tons - larger sales to the free market would have been poss i.ble, a.ddi M onal revenue would have been earned, and a once-for-all bonus 1rJOuld have been poss'.tble.

But 1964 was .

a very extraordinary year.


We quote, however, a statement made by Mr. G. s. Bishop, O.B.E., Deputy Chairman of Bookers Agricultural Holdings, Ltd., on 12th March, 1964 -~ "As has already been made clear in state ments by the B.G.

Sugar Producers• Association, the British Guiana Sugar Industry is now fac ing a most serious situation.

Not only has the 1964 crop been drastically reduced by drought, but a million dollars' worth of sugar has been lost through the deliberate burning of cane.
More recently, attempts have been made to sabotage factor1 e s and other estate installations; an unofficial strj_ke by some workers has be en accompanied by intimidation of those who wish to work; a:hd the resultant unrest has now led to · violence,: ~ wlt ~ tr"agtc los a · of life and injury.

The impllca ti ons of this state of e.ffa i r s ·for the count.ry, no less than for the industry, are obvi.ous.
We risk the loa a of established markets, through doubt, espe cially after the troubl es of la.at year, of our .•• .. in orc1er to establlsh the · best per ti_ me when every other sugar-producing our reliahili ty as a regular supplier.

Also, at _a country, particularly 1.n the West Jndies, is v1gorous ly and rapi__dly expandi_ng its produc tion - formance possible against the day when export quotas wi.11 be Unposed - B. G. left behind.
This could only have serious long-term consequences for the tndqstry' s current programme to expand production both by cane-farmers and by the estates.

rr.ay well b_e It i_s agai.nst this ·background that I am paying a brief visit to B.G.

in order to have personal consultations with the execu tives of Bookers Sugar Estates Ltd., and their colleagues in tne B.G.

Sugar Producers' Association.

opportunity to express our ·great appreciation of ·the efforts of all our employees Who are continuing to .
work under these very trymg conditions.

!

am also grateful for the In v'iew of (a) the high world prj_ce of frees i. n 196L~; (b) the severe and unprecedented adverse cir cumstances - unlikely ever to recur again in such devastn.tins combin<;',.

tion - which affected the industry ln 1964; ( c) our ~ecommendation to equate the 1964 U.S. price to the N.P.Q.
by an ade quate withdrawal from the Pr5_ ce Sta bi.l i sa ti.on Fund; (d) the employers' ·recognj_.tion of, and tribute to the loyalty of the ir workers who, in the face of v lolenc e and intl mida ti on, remained on the job and assisted in averM_ng what might have been an even more crippling result to the industry; and ( e) • •• .. 148 ·- (e) the strong ·probabili_ty that had the unusual circumstanc a s not occurred the es ti.mat ea pronuc-1-;1 on would have been achieved, resul ·L1ng i .. n a profit to justify the payment of suffi_ ci en t a once-for-all bonus, we cons5 der the workers morally entitled to a once-for- all bonus for 1964 .'
ACCORDil'JGLY WE REC OMJYJEND (i) subject to · the acceptance of our recom- mendations with regard to the use of the Price Stabilisation Fund for 1964, that the sum of $1,300,878.16 /31,783 tons x (24,9.58 - 20,89.SV which- repre sent s the excess of the sale of frees over t h e N.P.Q.
price for 1964 (see Table VI) be made avai.lable by the industry for dj_stri bution - 2/3 to the workers as a once-for-all bonus and 1/3 to the industry; (ii) that the once-for-all bonus be discon ti_nued but that a system of prof1_t shari_ng based on the return on capital employed be substituted therefor.

The level of the profit at wh 1-c h-- this would take place should in the fj_rst i_nstahce be the subject-matter of negotiation between the Ass ocla ti on and the Uni.on.
Having regard to our several recommendations, the 1964 surplus would be as follows: 1964 Surplus ••• ~ 149 - 1964 SURPLUS Surplus after tax: Sugar .. · Raw Spirits $1,177,376 · 670,587 $1,847,963 Add: From Pric e Stabilisa tion Fund 929, 137 Less ~nco me tax thereon __ 4=3=§ t 111 511,026 2,358,989 Less: Once-:for-All and Annual Producti_on Bonus - .
• 1,318, 932 Less jncome tax thereon 593' 518 .725,414 Add: Adjustment to Property Tax Add : Revenue attributed to Rehabili ta ti on Fund 1,633,575 1,948 1, 635,523 688,800 WAGES Table XXXTI shows the wag es paid in the lildustry from 1961-1963 and thos e demand ed :for 1964 and 1965, and sets out the wage ra tes in other industri_es in the country.

Tab l e XXXIT ••• .. ~t .. J.SO ... TABLE XX:?

:TT .
:TT .

- OOMPARATIVE MTI~IMUM WAGE - UNSKILLED SUGt\.R INDUSTRY per day per hour RICE DEVELOP- MENT CO. LTD. GOVERNMENT WATERFRONT DR.MBA REYNOLDS BUILD JN G 'IRADES WIETilJG & RICHTER SPROS'l'ONS BOOKERS S'IORES FOUNDRIES B.G.

ELECTRICITY CORP. 1961 - $3.00 37 .5 2 .84 35.5 3.04 38 3.82 47.8 ' 7 .20 90 7 .20 90 2.56 '• 32 -J.OL~ 38 3.76 lf7 ·- 3.76 47 3.76 47 * Under negotiations.

19.§.?.

1963 1964 1965 • 1'\"'tfP ., G,\ 4 00 50 * J.80 .

L.7.5 4.oo 50 4.92 61.5 B .. oo 1.00 s.oo 1.00 4.08 51 3.
JJ4 48 3.84 48 3.52 44 4.48 56 4.32 54 $3"J6 39.5 $3.4S 43.1 3.94 38 3.04 38 4.jo 53.7 B.oo l.oo 8.oo 1.00 3.52 44 3.28 41 3.8L~ 48 ·- 3.76 47 4.32 54 ,3.24 40.5 3.04 38 4.50 56.2 8.oo 1.00 8.oo i.oo 3.52 44 3.52 44 3.84 48 3.20 40 3.76 47 4.32 54 .

.

**4.5o 56.2 * 4.

)6 54.5 4.oo 50 5.04 63 9.20 :i.

•.

15 9.20 1.15 4.64 58 4.o;a 51 4.56 57 ?

?

?

?

5.20 65 " .... .... .. 7 - 151 - The figures in this table were submitted by the Union.
They show by and large that while the basic wage in the industry compared reasonably fair with those in Government and minor industrial undert a kings during the period 1961-1963, that in 1964 these latter rates in par ticular Governraent and the building trade rat~s, moved away substantially.

Over the same period (1961-1064) rates in the bauxite industry, the waterfront and the Electricity Corporation kept well ahead of the sugar industry.
This in our view is not abnormal having reeard to the f act that the sugar industry is substantially agricultural.

The compara tive wa ge rates shown in Table XXXIII were submitted by the .Associ a tion.
It will be observed from this that the basic wag es in industry compare :favourably with the others showno Table XXXIII ~ - 152 - TABLE 1GXIII COf!il'ARA'I'IVE ~JAGE R.A'I'ZS IN INDUS'.i'RIES Industry Vage Rates Rate per Day $ Remarks B.G~ Rice Development Co. Ltd. Sugar Industry Rates Mill Employees Unskilled Labour Semi-skilled Tradesmen Skilled Class II T~aqes men Skilled Class I Machine &hop Employees .
3 .20 3.52 4.32 .. 4~64 4.80 Unskilled $3.45-$3.65 Semi-skilled 3.59- 4.18 4.23- 4.94 Skilled Unskilled Labour Tradesmen Skilled Class II Tradesmen Class I 3.20 4 .32 - 4 .

80 5.04 - 5.21 Building Trade Unskilled L~b o ur Carpenters Masons Painters Comnercial Undertakings Clerks (ove r 18 yea rs) Porters Clothing Indus try Tailor Cutter Asst.
Cutter Asserter Exam iner Layer Presser s and Finishers Ma chinists Serai-skilled Uorkers Train ee Macl:linist :; Government Unskill e d Semi-Sk i l led Cla s s Semi-Skil l e d Cla s s I I I Tradesmen Skille d Class II Sk ille d Class Spec i al Grade Cl ass I I Specia l Grade Class I I 2.56 Prescribed r ate 3.20 3.68 - 3.92 3 • 20 - 3 • 60 " II 3.92 Prescr i bed Rate fl II 2 .78 2 .78 4 .45 3.91 3.55 3.55 2.94 2.66 3.00 3 .00 2.50 1.86 4 .00 4 .64 4 .

32 5.
32 5.

0 4 5.36 5 .76 6 .08 A dr a f t order propos e s to increase t he rate to $21.00 per week ($3 .

73 :pe r day ) .

These r at e s e re prescribed.

by L E:W e Rates effect ive f rom 1st Octobe r, 1964 Cinemas ••• Industry Cinemas 15:3 - .

.

.

.153. l:7ap;e Rates Rates per day $ Remarks · Operators - First Second Third General Staff .

(Over 18) Cashier Dtaff (Over 18) Guard ~ .

3.66 2.93 .

2.t72 .

2.53 2.53 2 ,.53 Draft Order proposes as Follows:- · Cinemas Group A GrouE.

B .
B .

Operators ~4.45 ·...:.

(;nor::~ ... 1 Staff C~::;.hi0ro Gunrds 2.83 -·2.83 2.83 $3.55 2.83 1.80 2.83 Motor Trans?ort Grade A (Dus Drivers) Grade L: Grade' ·c Mechanics Grade f. Grade 13 Grade C Servicemen Grade A Grade D Match Manufacturing Porter Splint Chop) er · , Splint ~ryer Assistant Chopper Machine Op~rator Main Saw Operator Small Saw Operator Head Case Ma!

{er Case Making lssi stant Fireman ...


Saw Mill Workers Unskilled Labourers Semi-skilled Labourers Skil i ed La bourers Grade I I Skilled Labourers Grade I 5.52 4.80 4~00 5.36 4.56 4 •.

so 4.00 4.00 3.71 3.46 3.71 4.7tJ 4~45 4.00 3.46 4 .75 ·3.so 3.74 3.91 4.2Q Hates effective f'rom 6th November, 1954 ., ~ta ees Regulation PropoH;~ls r.iade by the Saw Mill 1lor kers Uages Council 24th July, 1965 .. ' : Rates for comuiercial und ertakings are baoed on .. a '71,4-hour day.
Rat es f or the other industries are based on a n 8-hour d ay.

- 1$4 ~ .154.

We agree with the Association that in consider- ing the overall wage conditions prevailing in the industry regard must be had to .fninge benefits, and find that the - -· following exist in the s,ugar industry: 1.

Holidays-with-Pay.

2.

Annual Production Bonus.

3.

Free Medical Services.

4.

Sickness Benefit Scheme.

5.

House Lots.

6.

Interest-free loans for House Building.

7.

Week-end Cut and Load Bonus (Cane~cutters).


Plus on some estates - 8.

F:ree transportation to work.

9.

Rice Beds at nominal rental.

Plus in some years - 10.

Onc e-for-all Bonuses.

In additio n , on many estates modern amen5-ty blocks are .available providing canteen) toilet and washing fac i lities.

All estates, and most sections of the large estates, have Community Centres, Women's and Glrls 1 Clubs and Sports Gro unds built fr.om Sugs..t' Industry Labour Wel fare Funds.
The Welfare Officer and other staff of these Centres are paid from sugar revenue.

Safety Committee s, both field and factory, are in •.• -~5 - in operat'i.on on all.

e::it;at:e.s and annnal Safety Competitions are organised.

Tncreu.sing emphasis j_s be-!n<; p lac ed on Education and Training.
The scheme s in operation cover _ such matters as Apprentice Training, Job Training, Employee Information CouPses and an After-H::mr~-3 Study Scheme which provi.des financial assistance to employee s at all l eve ls to take correspondence and oth er courses.

Awards are mado to those who successfully compl ete their examinations.

The Indus try annually awards between 25 and 30 Secondary School Scholar.sh;_ps to ch~_ldren of regular employ ees.
The Scholarshlps are for S years, but i n suitable cases ext ens ion scholarships are awarded to enab l e childr en to continue to G.C.E.

11 A" - lev e l. Virtually all Foremen and Supervis6rs and an increasing number of managerial staff tn the· industry started life as Fi eld ant Factory workers.

TublG xxxrr compares the employment costs in the industry during the p e riod under• r eview .

It will be obsel'.
It will be obsel'.

'lrnd t a percen a g e-W J_a e un i~ w·a ,:;, av its highe st .i n 1956 - th t 51.7%, and at its lowes~ in 1964 4..., 9d /.J .

c_.

-I- '"' -.

_._, .

-::!

Tabl e )'JJC"v., •• - 1:56 - TABffi X.XX IV SUG\R INDUSTRY - Jl.MPLOYMENT COST EXCLUDilW JUNIOR AND SENIOR STAFF A. Employzrent r,,osts include: l. Wages 2.

Week-end Cut and Load Incengive Bonus 3.

Weekly Target Bonus ) up to 1960 when trase were 4.

Half-Yearly Bonus 5.

Holidays with Pay 6.

Annual Production Bonus ?


Once for JUl Bonus 8.

Workmen's Compensation 9.

Sickness Benefit - From 1957 ) merged into Wages.

B.

In addition the following approx:i.ma.te sums are spent annually: 1.

Medical Services 2.

Ex-gratia Pensions Labour Transport ,3.

4.

Workers ~Jelfare $500,000 575,000 68,ooo 350,000 ~1,493,000 .
(1) Year 1956 1957 1958 1959 1960 1961 1962 1963 1964 (2) l3J Total Cost of Employrrent costs Production 11A" above $41,822,53.5 47,722,627 49,011,044 46, 777 ,o65' 53,292,259 ' I 56,091,290 53,325,267 63, 742,052 52, 7 58,288 $21,603,515 22, 791, <Y)O 23,203,366 22,092,271 25,504,269 27,223,862 25,123,801 JJ,880,540 22,6;1+,8.57 t4} 3 as % of 2 51.7 47.8 47.3 47.2 4rt.

9 .
9 .

48.5 47 .1 48.4 42.9 ... 1$7 - Table XXXVJt is a comparison of the changes in the negotiated price with inci-•eases in the cane-cutting and loading rate and other piece wor•kers t rate from 1950, the ·year prior to the execution of the Commonwealth Agreement to 1964.

It will be observed that whereas the Negotiated Price rose by 51 points, the wages in those categories rose by 117 and 101 points.

N.P.1~.

Prices Com.pared with Wage Rates.


Negotiated Price 1950 == 100 Cane-cutting & Loading Rate 1950 == 100 Other Piece Workers 1 Rate 1950 == 100 1950 1951 1952 1953 1954 1955 1956 1957 1958 1959 1960 1961 1962 1963 1964 1 , 100 ioa 126 139 134 134 134 138 144 1)18 -r 146 148 150 151 151 . '

100 107 123 126 126 131 139 144 151 156 162 188 198 217 217 100 107 121 125 ~25 130 137 143 150 15.5 161 175 184 201 201 ·~ •Ir JZ_;>~ .. · Table XX:'.
:llt is a comparison of the e.Ter-age Annual · Wages wt th sugar produ ction and the revenue per ton of sugar received from the sale of sugar and molasses during the period under review.

It Will be obsrerved that while the average annual wages increased consistently every yea'i:' reaching 73 additional points in 1964, production increased gradually, reached its peak of 27 points in 1960 and dropped below the base year by two points in 1964.
Revenue fluctu ated during the period but only outstripped wages in 1957.

TABLE XY..XVI Su;.rar Product-ton, Revenue and Wages.

---·~~~~~-----~~~~~~----- Year 1956 1957 .

1958 1959 1960 1961 1962 196.3 1964 Average Average Annual 11ages Annual Wages 1956 == 100 $ 774 858 924 949 1,118 1, 253 1,311 1,616 1,339 100 111 119 123 l!~-4 162 169 209 173 Sugar -· Pro- duct ion.
1956 = 100 100 108 116 108 127 123 124 120 98 Sugar & Mola.a- ses Revenue per ton of sue:r 1956 = 100 100 114 104 105 101 109 107 142 124 As a result of mechanisation arid improved.,..effi- .- ciency the labour force is smaller than it was, but on the ••• • . '

, -159- the whole, over the years, tt1ose who have remained in employment have had more.

work available to them, not less.


To i_llustrate this:: the average mari-days worked of all worker•s, male and fanale, has risen from 226.3 in 19.56 to 252.4 'In 19.58 and has remained fai rly constant sinc e then at between 241.S and 255.2.

During this same period Average Annual Earning3 have rlsen from :$774 per annum in 1956 to $1,339 per annum in 1964, the previous highest be-ing $1,616 per annum in 1963, due to the very large once -for-all paid ln that year.
For th5 s purpose, Annual Average Earn1ngs include wages, Holidays.

;wj_th-Pay, Annual Production Bonus, Once- for-All Bonus and Workmen 's Compensation, but do not include other fringe benefits.

.. Table XXXVII ••• 16-0.,.

TABLE xmrI .

_ Consumer Price Index aa Related to Mlnimum Daily Wa ges.

Year Time Workers I"linimum Rate-Per Day Increase Rural Consumer Price Jhde.x.

1956 ' ,.

1957 1958 1959 1960 1961 1962 19~.3 1964 ~~2 06 'i?
~ 2.14 2.25 2~33 2.49 3,00 3.16 3 .L~S 3.45 100 103.9 109.2 113 .1 120.9 J.45,6 153.3 167.5 167.S 100 101.3 ' 100.8 3;-02"4 102.s 103.4 108.3 109.1 110.3 N.B.

: Of the total increase of wages, approximately 6 • .5% is o.ttributable to the merging of the Weekly Target and Half Yearly Bonuses into Wages in 1961.

The net increase excluding · this merger ·would therefore be 61%.

This table shows that the increase in minimum rate per day for time workers between 1956 and 1964 ii3 67.5 points.
This supports the results in Table XXXVI which re.fleets '':increases affecting all categories some of whom may well have received higher •.. - 16J, - higher increases than the mihimum.

We find, therefore, that since 1956 the earnings of workers in the sugar industry have increased steadily and substantially, far out-distancing both sugar produc- tion and revenue.
It should be noted, however, that this comparison takes no account of revenue from the sale of raw spirits and the -10 per cent of Cap ital Expenditure whi..ch we recommend should be included in sugar globals.

We fi.

nd, too, that while the Rural Con- sumer Pd ce Index rose by 10.3 .potnts between 1956 and 1 9 64, a. verage annual w~ge.s rose by 67.

S points.

Estimate of Costs.


The cost of the Union's wage and other demands, excluding the Once-for-All and the Annual Production Bonus, as submitted by the Association, is shown here- under: Wages Claims Only - 1964 & 1965 1964 1964 Employment Costs- (Exhibit 'FFF') - Union's · Cla1m $ 4~00 minimum unskilled rate, i.e.

increase of 15.9% To raise the minimum· of· the semi skillec1 rate to ~t .5.
00 per day would involve a percentage increase of 35 • .5% ;~22,634,857 3,598,942 To •.• I - 162 ... To raiae the minimum of the aemi-akilled rate to $5.00 per day would involve a per centage increase of 3.5 • .5% To raiae the minimum of the skilled rate to $6.00 per day would involve a percentage increaae of ~-1• 84% The add'itional cost to the 1.ndhatry would there fore be $3,598,942 plus the amount necessary to cover the increases in semi-skilled and akilled categories.
Esti_mated expenditure for the industry $56,602,900 Estlma te of employment cos ts based on exi.sting -wages - rates 50% of total expendi ture Union's clalm for minimum un skilled :r~te of $4.50 pe~ day is 30.43% increase 28,301,450 8' 612, 131 SUMMARY OF WAGES CLAJJ.VIS ONLY .

1964 $3,598,942 (in addition to higher % increases to skilled and semi-skilled grades) 8,612,131 $12,211,073 - i63 - •· B.. Other Claims 1965 Only~ 1.

... 603' 000 2.
... 603' 000 2.

Supplementary Unemployment Benefits (SPA 1 s memorandum page-22 ;;..nd Exhibit t TTTt submitted by SPA on 29th September, 1965 - page 2) 3.

Holj_days-with-Pay and Annual Production Bonus 4.

Medi.cal Facilj_tj_e s 5.

Sickness Benefit 6.

Gratuities 7.

Miscellaneous .

.

5,660,000 3l+5, 772 25,000 75,000 50, 000 25,000 (,> 6 783 77"' ·~ll c:.. ' ' 1964 1965 1965 _ __...____ Wages Claims Only ___.._ Wages Cla i ms Other Claim~ ,.

$ 3,)98,942 8' 612.,_131 6,783,772 $18,994,845 .

.
.

The est-tmated loss to the industry in 196.5 is $1,189,027.

-i64 - While fully appreciating the sooiologica1 aspects involved, and in particular the need :tor better living standards resulting from increased wages, we are ·of the _.. -~ opinio~ that improvements in wage rates leading to improve ments in s tar..dards of living anywhere in the world, whether "· in a.n under-developed or an advanced metropolitan country,, can only be derived from jncreased productivity.
After a careful examinatlon and comparison of the .
- · existing wage structure and the finances of the industry, we ar-o - of the unanimous opinion that because of (a) (b) (c) the ·low production 1.n 1964, fall in the 1964 U.S. and world prices, the continuing fall in world prices - estima t ed at $83 per ton for 1966, (d) the increased cost of production, (e) (f} (g) the consequent low return on capital invested, the continuing effects of the arson, sabotage, and other adverse circum stances in 1964, the rise in world consumption of beet sugar and the consequent trend towards over-production of cane sugar, ~he indu~ try, if it j 3 t".1 surviv e , c::.~rmC>t .s t::.
:.ncJ t'c.e ·wc.. :~ e incres.s es ,.., *·mn.n1.cr1 by the Uni.on for 1964- and l 96.S.

'"Iowever,, ~d'E ••• - 165 - WE RTI:COMMEND 1966 be negotiated by the Uriion and the employers as that the possibility of a wage increase for ·.

·, early as practicable in 1966 in the light of the marketing situa tion and the c onditions prevailing at that time, and taking into account the following recommenda tions of the C.ommittee which,.
if · i mplemented, will have a positive effect on the industry's surplus: (a) Use .

of the Price 3tabilisation Fund.

(b) Treatment of p rofits from raw spirits.

(c) Reduction in export marketing com- .. (d} Treatment of the revenue element assessed for the Rehabilitation Fund.

(e) Increase of local selling price of sugar.

D. Other Demands .
D. Other Demands .

It is to be observed from the history of the n~goti a tions t ha t neither at the joint conferences nor the conci liat ion meetings did the pa rties make any rea l effort to negotiate deraands other than wages', · a once-for- all bonus .

and an annual production bonus; and alth ough the memoranda of both parties set out arguments in sup- port of · a numbe r of those deraands i no evidence was: adduced and there was little, if any, discue ~ ion on ~hem during the.

0 • the hearing.
0 • the hearing.

We are firmly of the view that these items a.re therefore still open to negot1_ation.

ACCORDTNGLY 111rn; _ _:-·i::r1?CO~TD that di3CUSp:\_ons on those i_tems should be resumed between the Association and -the Union as early as practicable.

The Commi.ttee noted Wi.


th approbation that during the period under review collective bargaining be tween the Association and the Union was of a high order, as a result of which a healthy atmosphere pervaded negotia tions, and consequently much had been achieved for the workers during the period under revi:ew.
There was, how- ever, evi.dence of some degree of Su.spicton on the part of the Union when i_ t ttirried out on some occasions that the final industry surplus f 1gures after trading had closed for the pertinent year were in excess of the , .

- figures suppl i_ed to th e Un':i on for wage and other nego- tia ti.ons.

Whi.le acceptlng.
Whi.le acceptlng.

~u.nre-s erv~dly the Ass ociati ont a explanatton, WE RECOMMEND that tn future all negotia tions be conducted on the basis of audited statements of the industry's accounts, and that the minutes of all joint meetings should be fr~ely .

circulat e d between the; ,....rinr t3 e s and duly confirmed.

SUMMARY OF RECOMMENDATIONS 1.

ANNUAL PRODUCTION BONUS.

That the sum o f $4Sl,680 be paid as an Annual Production Bonus for 1964.

2.

ONCE-FOR -ALL BONUS.


That an a mount of $867,2S2 b e pa id by the Industry to the workers as a Once-for-All Bonus for 1964.

3.

I NTRODUCTION OF PR OF TT-SHARTNG SY3TEM .

That for t he futur-e a s ys t em o f pr o f i t sharing bas e d on the r e turn on capital employe d be substituted for the once-for-all bonus.

4.

LOC AL SE LLING PRICE OF SUGAR.


Removal o f t h e indu stry' s subs idy on the l oc a l se lling pric e of sugar by i ncreasing t h e l o c a l re t ail selling pric e of D.C. sugar by 2~i p er p ound and other grades be appropriately adjusted.

_ 5.

SPECIAL FUNDS , Res t o ra t i on of the origina l al locations of the levy for the Special Fund s as from 1st J a nuary, 1 9 64 .

A.

The Price Stabi l isation Fund .


( a ) A withdrawa l of $ 929 ,13 7 should be _ made from the Price Stabilisation Fund to reimburse the indus t ry for l o ss- susta ined by se ll l ng sugar t o f or eign mar kets other than the i_n 1964 and t a kin g Uito N. P .

Q. accoU:nt the fall of production ar-tsing from abnorma l conditions .
( b ) ••• ' 1 regard to the strength of (b) From 196$ on¥ard, the Fund should be used to assist the industry in off setting losses sus t ained on sales to foreign non-N.P.Q.

markets.

Having the Fund in 1965, withdrawals should be made equal to the loss on sales to foreign (non-N.P.Q.)

markrets at prices below the normal world price - i.e.

the average price for »Frees" for the period 1956-1962, income from U.S. sales in excess of that price to be set off against the loss.

B.

Rehabilitation Fund.


'rhe Committee has found that there exists a - revenue element in the application by ttie- industry of monies drawn from the Rehabil i.ta ti.on Fund.

This haa been a.ss·essed as equal to lafo of total capital expenditure from s ·elf-generated funds of the i.ndustry, tncl~ding w~thdrawals from the Fund.

Accord- 1.ngly, thj s amount should be so treated for the purpose of' determ1-nlng the surplus to the industry.

C. Labour Welfare Fund.


We recommend that the demands of the Union under the following heads: (1) Pensions, (2) .

Medical Facilities, sho.uld be satisfied from the Sugar Industry Labour Welfare Fund, and that the Union should approach the Com.mt ttee respons:tble f'or administering that Fund as early as practi_cable.

6.

• •• .. - 169 - 6 .. Rtr\1 SPIRITS.

Profits from raw spirits should be included in determining the industry•s surp lus.

7 • ;JA.GE UJC.RBASE.


The possibility of a wage increase should be examined as e a rly as practicable in 1966 in the event of the implementation of our recommen dations with regard to the treatment of the Special Funds and the profits derived from raw spirits, and/or in the light of conditions then prevail i ng.

The industry cannot afford an increase of wages at present.

8.

NEGOTIATIONS .
8.

NEGOTIATIONS .

All future negotiations between the Union and the Associa tion shoul d be cDnducted on the basis of audited statements.

Minutes of all joint meetings should be freely circ u ~ated between the parties and duly confirmed.

This Report is unanimous.

21st December , 1965.

Sgd .

Percival A. Cummings - Ch airman Sgd.

Gavin B. Kennard Sgd.

John Jardim Sgd.

F. Ramprashad Sgd.

w. G. Stoll - Member - Member - Member - Member Sgd.

F. A • Eyt le - Secretary