$2 billion flows into Government coffers from bauxite levy
Minister of Finance and the Public Service Dr Nigel Clarke has indicated that Jamaica collected $2 billion from the bauxite levy in late 2021.
Clarke, who was responding to questions raised by the Opposition's spokesman on mining Phillip Paulwell in the House of Representatives on Tuesday, suggested that the figure may have been missed as a line item in the Government's revenue package.
According to Clarke, the levy payments were due to the efforts of the former Minister of Mining Robert Montague, who was removed from that ministry in the recent Cabinet shuffle.
“It was due to the good work of that former minister that we collected $2 billion in bauxite levy in the last few months,” Clarke said.
Montague, who is now in the Ministry of Economic Growth and Job Creation, said that the finance minister would not have been familiar with the details of the payments, while answering questions in the House.
He explained that the $2 billion included US$13.7 million paid by UC Rusal in December and that an asset usage fee debt of US$3.4 million, owed to Jamaica Bauxite Mines by New Day/Noranda Bauxite, has been paid in full by Concord Resources Limited. UC Rusal operates from Ewarton Works, Swallenberg, Port Esquivel, and Kirkvine.
Concord Resources Limited, which is headquartered in London, acquired 49 per cent shares of New Day Aluminium (Jamaica) in July, 2021.
The former mining minister said that, in addition to the $2 billion, UC Rusal agreed to pay off the backlog over the next 30 months, while giving an undertaking to keep current levy payments up to date.
“Whatever is due currently has to be paid on time. However, the payments are being made to the Ministry of Finance not the Ministry of Mining,” Montague pointed out.
The issue of the lack of payment of the levy by the bauxite/alumina companies operating in Jamaica, which resulted in no payments being made for several years up to last December, has probably been the most controversial issue for Government and Opposition Members of Parliament (MPs), arising from questions which had been tabled by Opposition spokesman on finance Julian Robinson.
Clarke informed the House that there was an evaporation of support for the levy by the bauxite industry, which was linked to the fact that the communities in proximity to the bauxite mining and production areas continue to be “communities in need” despite their efforts.
“The Government is prepared to address that. That is something that we ought to do. But, as minister of finance, I disagree with any form of air-marketing, which often lead to wastage, and over the last couple of decades we have seen examples of that,” Clarke told the House.
“What I think is absolutely necessary, is that, as the bauxite levy revenues come in and a concerted effort is made to ensure that the communities from which this precious resource flows, that if their needs are with respect to water, for example, these needs are addressed,” added Clarke.
Paulwell requested that a committee comprised of MPs who represent bauxite mining areas be appointed to deal with the industry in their constituencies because their needs do not only centre around water.
“There are various other infrastructural problems associated with it,” Paulwell noted.
“I am making the point that the Jamaican people are upset with the industry, not only because of the Cockpit Country issue, but because of not seeing the real benefits. So, if you could establish a committee of parliamentarians who are directly affected, then it would satisfy my concerns at this time,” added Paulwell.
But Clarke noted that the same point has often been raised by Government MPs, who want to accelerate how the matter is addressed.
“We can't solve these problems overnight, but you are going to see an effort made to accelerate improvements,” declared the finance minister.