Why ‘Butch’ Stewart is so emotional about ATL Pension Scheme
BY DESMOND ALLEN Executive Editor - Special Assignment email@example.com
GORDON 'Butch' Stewart, the hard-nosed business mogul, speaks with a rare show of public emotion when the subject of the Appliance Traders Limited (ATL) Group Pension Scheme comes up.
"If I seem to be emotional about the pension scheme it's because I am. It's one of my most proud and personal achievements because it is for the benefit of the thousands of people who have participated in the creation, growth and development of this hugely successful business," Stewart, who is also chairman of this newspaper, said in an interview.
The scheme, established in 1983, now serves over 4,000 employees of the ATL/Sandals Group of Companies, with assets of $8.8 billion, much of which Stewart attributes to the high yields on investment in the tough mid-90s that gave birth to the Financial Sector Adjustment Company (Finsac).
Stewart had tried to get a scheme going in 1976 but the company, not yet the conglomerate it has since spawned, at the time lacked the administrative capacity to sustain a stable pension fund. But his concern, especially for the well-being of those who had retired, never waned.
"I'm glad I never listened to those people who were telling me that we could not sustain a proper pension scheme and wanted me to use an insurance company instead. My firm conviction from then was that no one who works for the company and retires should have to scrounge around for a living," Stewart said.
It's that same conviction that has caused the pension scheme to be at the heart of a bitter fraud trial of three former ATL executives who are accused of distributing $1.7 billion of pension fund surplus without the consent of Gorstew, the holding company for Stewart's group of companies.
The executives -- Patrick Lynch, former chairman of the pension fund; Jeffrey Pyne, former treasurer of Gorstew; and Catherine Barber, former general manager of the fund -- are also accused of forging four letters to show they had consent for their action. The trial resumes on November 6, 2013 in the Corporate Area Resident Magistrate's Court, Half-Way-Tree.
Upon suspicion of the alleged fraud, Stewart turned the matter over to the Police Fraud Squad, fearing that the stability of the pension fund might have been jeopardised. He also fretted that it could severely impact retirees who were being battered by ravaging inflation and devaluation of the Jamaican currency, but who had not benefited from the distribution.
Stewart listened with unmasked paternal pride as the Jamaican tourism minister, Dr Wykeham McNeill, trotted out statistics in Parliament recently that reconfirmed his rightness in establishing the ATL Group pension scheme.
"The data unveiled by the minister made it abundantly clear that we had done the right thing for our employees. It's really one of the best decisions we have made and our focus is completely in the right place," the ATL/Sandals chairman said.
Of nearly 80,000 employees in the tourism sector, only 6,100 currently contribute to pension schemes that are registered with and monitored by the watchdog Financial Services Commission, McNeill told Parliament.
Sandals accounts for the bulk of that number, noted Stewart, pointing to further statistics from McNeill that a massive 84 per cent of workers in the accommodation sector would retire with no pension arrangement in place.
The ATL Group Pension Fund, a model scheme, is described as a "Defined Contribution" scheme, providing retirement benefits based on the funds credited to members' accounts. A key component is that it matches the employees' compulsory contribution of five per cent of salaries.
That contribution, including the portion made by the company on the employees' behalf, is paid over by the respective company to the ATL Group Pension Trustees Nominee Limited every month and then invested with the aim of maximising the returns on that investment over the long term.
Stewart also supported McNeill's call for the creation of a contributory pension plan for tourism workers not yet covered by one to ensure that at the end of their working life in a sector that is Jamaica's single largest foreign exchange earner, they would have something to show for it.
"We will continue to do everything we can to ensure that the ATL Pension Scheme continues to provide increasing benefits to our valued retirees," Stewart said. "That is my unwavering commitment."