KINGSTON, Jamaica — Opposition spokesman on Labour and Social Security, Pearnel Charles, says that the government should abandon plans to invest National Insurance Fund (NIF) funds in a new privately-owned cement plant being planned for St Catherine.

The Opposition spokesman noted in his recent sectoral debate presentation that Minister of Labour and Social Security (MLSS), Derrick Kellier, had revealed that the failure of contributions to the National Insurance Scheme (NIS), which finances the NIF, to match benefits, was endangering the viability of the Fund.

Charles said that, if that is the case, he could not understand why the NIF is considering investing in a new cement plant.

“Investing in a new cement plant, when the one we already have has not been profitable don’t make sense to me, at all,” he said.

“The Carib Cement plant at Rockfort has excess capacity and has had to be seeking export markets. It made a tiny profit last year, for the first time in five years. It has accumulated losses of $7.5 billion. Having two cement plants is likely to lead to a price war, as they compete for the domestic market. That may be good for consumers, but highly risky for shareholders. The NIF should think twice about becoming one of those shareholders. I suggest that we abandon that idea,” he suggested.

He added that the government should use the money to support a programme to identify Jamaicans who can most effectively be transformed into the skilled workers that the country needs, and do so with full recovery to the fund so that it can provide the pensions that are due to its contributors.

The 2013/14 Annual Performance Report of the MLSS, which Kellier tabled in Parliament last Wednesday, stated that while NIS contributions for 2013/14 totalled $11.99 billion, benefits increased to approximately $14.72 billion, an increase of $2.40 billion over the same period, casting a shadow over the continued viability of the Fund, with a widening $2.73 billion gap between benefits and contributions.

However, the minister indicated that this would not hamper NIF investment projects, including plans to invest in a new south coast cement plant which could employ over 400 persons.

He said that the new plant, Cement Jamaica Limited (CJL), is a US$340 million project with a self-owned 39-megawatt power plant, situated on 182 acres on the island’s south coast and almost ready to take off.