On March 3, 2022, Min­is­ter in the Of­fice of the Prime Min­is­ter, Stu­art Young, told the me­dia at a news con­fer­ence at the Diplo­mat­ic Cen­tre that Cab­i­net had de­cid­ed, on that day to set up a sub-com­mit­tee look in­to 51 per cent state-owned TSTT.

Fol­low­ing is an edit­ed ex­cerpt of Mr Young’s com­ments three years ago:

“As the pop­u­la­tion should be aware, we the peo­ple of Trinidad and To­ba­go ac­tu­al­ly have the ma­jor­i­ty own­er­ship in TSTT and there’s a mi­nor­i­ty own­er­ship of 49 per cent held by Ca­ble and Wire­less in TSTT.

“One of the dis­cus­sions that came up to­day in Cab­i­net was with re­spect to TSTT and a de­ci­sion was tak­en to ap­point a sub-com­mit­tee of Cab­i­net to take a look at TSTT’s cur­rent po­si­tion. What sta­tus are they in now?

“Sec­ond­ly, to take a look at are they fit for pur­pose in an ever-chang­ing world. That is a rev­o­lu­tion is tak­ing place in front of our eyes in the whole telecom­mu­ni­ca­tions in­dus­try.

“Third­ly, on be­half of the peo­ple of Trinidad and To­ba­go, for us to come back with rec­om­men­da­tions to the Cab­i­net as to what we be­lieve should be done with TSTT and part of that would, of course, in­clude a cur­rent val­u­a­tion of the com­pa­ny.

“This sub-com­mit­tee of Cab­i­net would be chaired by the Min­is­ter of Plan­ning and De­vel­op­ment, Camille Robin­son-Reg­is. It will in­clude the Min­is­ter of Pub­lic Util­i­ties, Mar­vin Gon­za­les, the Min­is­ter of Fi­nance, Colm Im­bert, the Min­is­ter of Dig­i­tal Trans­for­ma­tion, Has­sel Bac­chus and my­self out of the Of­fice of the Prime Min­is­ter.

“So that com­mit­tee, which com­pris­es the five of us, has been tasked by the Cab­i­net to take a look at TSTT and then make rec­om­men­da­tions to Cab­i­net that would in­clude a cur­rent mar­ket val­u­a­tion of TSTT.”

Asked whether the Gov­ern­ment was think­ing of pri­vatis­ing TSTT by sell­ing its 51 per cent stake in the com­pa­ny, Mr Young said, “That is a pre­ma­ture ques­tion. For us, I think we need to look at it. That would then form part of the rec­om­men­da­tions. We need to see what is the best way for­ward for it and re­al­ly think about what is best for tax­pay­ers. That is the man­date.”

Ques­tioned about the time­line for the sub-com­mit­tee to re­port to Cab­i­net, Young said, “I did not give a time­line be­cause we have not set a time­line as yet.”

And in re­sponse to a ques­tion about the par­tic­i­pa­tion of the rep­re­sen­ta­tive trade union at TSTT, the Com­mu­ni­ca­tions Work­ers Union, in the work of the sub-com­mit­tee, Young said, “We were just tasked with this task. The first thing is—cer­tain­ly, I am not very au courant with TSTT—let us start by get­ting in there and get­ting an un­der­stand­ing. I don’t get the im­pres­sion that we are go­ing to be do­ing a very deep dive. We are go­ing to be look­ing at it and get­ting an idea of what the sta­tus is, what needs to hap­pen and mak­ing rec­om­men­da­tions. There would be ab­solute­ly no move on our part to ex­clude the trade union.”

Ques­tions

1) Be­sides what was stat­ed by Mr Young, what was the re­al rea­son for Cab­i­net ap­point­ing a sub-com­mit­tee to look in­to TSTT on March 3, 2022?

2) Nor­mal­ly, Cab­i­net takes ac­tion based on a note pre­pared by the rel­e­vant min­is­ter. Was the de­ci­sion to es­tab­lish the sub-com­mit­tee based on a note from ei­ther the Min­is­ter of Fi­nance (Cor­po­ra­tion Sole) or the Min­is­ter of Pub­lic Util­i­ties?

3) Or was the de­ci­sion to es­tab­lish the sub-com­mit­tee based on a dis­cus­sion by the Cab­i­net on March 3, 2022, on what was go­ing on with TSTT at the time?

4) How many times did this com­mit­tee meet?

5) Who did this sub-com­mit­tee of Cab­i­net hold dis­cus­sions with and what ac­tu­al work did it do?

6) Did the sub-com­mit­tee ever re­port back to the Cab­i­net on the state of TSTT and whether it was fit for pur­pose in an ever-chang­ing telecom­mu­ni­ca­tions en­vi­ron­ment? And if the sub-com­mit­tee did not re­port back to Cab­i­net, why not?

7) What was the pur­pose of Cab­i­net re­quest­ing the sub-com­mit­tee to get a val­u­a­tion of TSTT, if the Gov­ern­ment’s in­ten­tion was not to sell its 51 per cent stake in the com­pa­ny or ac­quire the 49 per cent share­hold­ing owned by Lib­er­ty Glob­al, through Ca­ble & Wire­less Com­mu­ni­ca­tion?

8 Did the sub-com­mit­tee ever get a val­u­a­tion of TSTT, as was re­quest­ed by the Cab­i­net? And if not, why not?

9) Three years af­ter its ap­point­ment, does the sub-com­mit­tee in­tend to ful­fill the man­date giv­en to it by Cab­i­net or does the sub-com­mit­tee be­lieve that the ur­gency of a re­port on TSTT, and a val­u­a­tion of the com­pa­ny, has passed?

TSTT’s con­text on March 3, 2022

Three years ago, TSTT was en­gaged in a re­struc­tur­ing of the com­pa­ny, which was led by its then CEO, Lisa Agard, who had been ap­point­ed to the job ef­fec­tive May 24, 2021.

At the time of the ap­point­ment of the sub-com­mit­tee, the then sec­re­tary gen­er­al of the Com­mu­ni­ca­tion Work­ers Union, Com­rade Clyde El­der, was rais­ing an alarm about the num­ber of em­ploy­ees who would be af­fect­ed by TSTT’s re­struc­tur­ing ex­er­cise.

About 468 TSTT work­ers and man­agers were re­trenched in Ju­ly 2022.

An­oth­er im­por­tant as­pect of what was hap­pen­ing with TSTT at the time, was that the com­pa­ny’s au­di­tors placed a ‘ma­te­r­i­al un­cer­tain­ty re­lat­ing to go­ing con­cern’ note in the com­pa­ny’s au­dit­ed fi­nan­cials for the years end­ed March 31, 2020, March 31, 2021, and March 31, 2022. That means TSTT’s au­di­tors, EY, were con­cerned that the com­pa­ny could go bank­rupt for three years.

In fact, in the five years be­tween 2018 and 2022, TSTT lost a to­tal of US$261 mil­lion, which was $1.76 bil­lion, ac­cord­ing to in­for­ma­tion pre­sent­ed to the in­ter­na­tion­al in­vestors in TSTT’s bonds on Ju­ly 28, 2023. The go­ing-con­cern warn­ing from EY was re­moved for the year end­ed March 31, 2023, as TSTT was able to demon­strate to its au­di­tors that the cur­rent and fu­ture po­si­tion of the com­pa­ny had sig­nif­i­cant­ly im­proved from a prof­itabil­i­ty and cash flow per­spec­tive.

TSTT de­clared US$14 mil­lion prof­it in its 2023 fi­nan­cial year.

In an in­ter­view with the Busi­ness Guardian on Ju­ly 29, 2023, Agard said the 2022 em­ploy­ee sep­a­ra­tion ex­er­cise re­sult­ed in $180 mil­lion in op­er­at­ing ex­pen­di­ture sav­ings.

Asked whether TSTT would have sur­vived with­out the 2022 re­struc­tur­ing ex­er­cise, Agard said: “It would not have, based on the sig­nals from our ex­ter­nal au­di­tors.”

She agreed that the de­ci­sions tak­en by the board and man­age­ment of TSTT to re­struc­ture the com­pa­ny’s em­ploy­ment saved it from fail­ure and col­lapse.

“That’s cor­rect. That would be a very ac­cu­rate de­scrip­tion.”

But she said TSTT’s cost man­age­ment was not on­ly a func­tion of the re­struc­tur­ing of its staff com­ple­ment in 2022.

“I want to em­pha­sise that we had very strin­gent cost con­tain­ment in oth­er ar­eas of the com­pa­ny, which on an an­nu­al ba­sis, re­sult­ed in op­er­at­ing ex­pen­di­ture sav­ings of $160 mil­lion a year, which we in­cor­po­rat­ed in­to the an­nu­al op­er­at­ing plan this year. We ex­pect to yield more op­er­at­ing ex­pen­di­ture sav­ings as we im­prove the ef­fi­cien­cy of our op­er­a­tions,” Agard said.

What to do with TSTT?

TSTT de­clared an af­ter-tax prof­it of US$19 mil­lion for the year end­ed March 31, 2024, mark­ing a 36 per cent in­crease com­pared to its US$14 mil­lion prof­it for 2023. The com­pa­ny’s prof­itabil­i­ty in 2024 was es­tab­lished by Agard and the com­pa­ny’s for­mer chief fi­nan­cial of­fi­cer, Shi­va Ram­nar­ine, who were ter­mi­nat­ed sev­en-and-a-half months in­to the 2024 fi­nan­cial year for the cy­ber­se­cu­ri­ty in­cur­sion.

If TSTT main­tains its cur­rent tra­jec­to­ry, it should con­tin­ue to be prof­itable and its prof­its will whit­tle away its ac­cu­mu­lat­ed loss­es which were es­ti­mat­ed at $2.3 bil­lion in Ju­ly 2023. Those loss­es mean that the com­pa­ny does not pay cor­po­rate tax­es, but that it al­so can­not pay any div­i­dends.

In my view, the TSTT sub-com­mit­tee should com­plete its ex­er­cise, up­date the val­u­a­tion of the com­pa­ny and pre­pare it for pri­vati­sa­tion as there is no strate­gic rea­son for the Gov­ern­ment, through pub­licly list­ed Na­tion­al En­ter­pris­es Ltd, to own 51 per cent of a telecom­mu­ni­ca­tions com­pa­ny, op­er­at­ing in a com­pet­i­tive mar­ket.

I am sure sell­ing 51 per cent of TSTT would be best for tax­pay­ers.