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Statement by Honourable Dr. Kenny D. Anthony to Commemorate the Twenty-First Anniversary of the National Insurance Corporation

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The growth and development of all societies are always contingent on ideas, vision and imagination without which, no society can earn the right of passage from one historical era to the next, said Prime Minister, Honourable Dr. Kenny D. Anthony in a statement to Commemorate the twenty-first Anniversary of the National Insurance Corporation


Dr. Anthony postulates that each era brings with it increased complexity, challenges and changes which can undermine the social stability and achievements of the previous period. Equally, he believes, a new era can offer solutions to problems which may have appeared difficult and impossible to resolve, because as society evolves, so too is its capacity to manage transition and change.




The attainment of political independence in 1979 represented the end of one historical era and the beginning of another. In this new beginning, there was a search for new directions underpinned by a philosophy of social inclusion and the need to create a more just, equitable and humane society. It became clear that society in partnership with the state had a responsibility to protect and care for the marginalized and vulnerable sectors of the population. Failure on the part of the society to do so would be tantamount to denying a significant portion of the population its most basic needs.


The state therefore had a pivotal role to play in changing the way that society viewed the disadvantaged and least fortunate in our midst. The prevailing view that the poor and the disadvantaged were principally responsible for, and were to be blamed for their own poverty resonated with large sections of the population. Such a view was counter-productive to the attainment of a holistic developmental approach, since it only served to deny the poor and the disadvantaged of their rights and entitlements to social provisioning, derived from their citizenship. It was through the evolution of social policy that the Government attempted to alter that perception and to dispel the notion that social welfare was the exclusive responsibility of individual charities rather than that of the society as a collective.


It became equally clear, that poverty reduction and social protection programmes could not be promoted as handouts which perpetuated social and economic dependence rather than fostering systems of self-reliance. Consequently, society had an inescapable moral and ethical responsibility for social provisioning and the implementation of social policies from which it cannot divest itself. It stands to reason that if poverty and social vulnerability are socially constructed, then they can be socially deconstructed, although once created poverty is extremely difficult to abolish. Undeniably, the establishment of the National Provident Fund in 1970 and its successor institution, the National Insurance Scheme in 1979 was influenced by these moral and ethical imperatives.


Hence, the conceptualization and establishment of these social protection systems must not, and cannot be regarded as a coincidence of history. Rather, it was the product of the deliberate and conscious efforts of those at the vanguard of development, those entrusted with shaping and redesigning a kinder and more equitable society. From the very outset, the introduction of the NPF and its successor institution, the NIS was an integral part of a developmental approach, which sought to integrate concerns about economic growth, social policy, social development and social capital, governance and political development, institutional and organizational restructuring and human resource development as interdependent elements of development. 


The NIS, now the NIC, therefore became a critical element in the overall government strategy to reevaluate and transform the role of the state and the society in the provision of safety nets to the poor and vulnerable. The NIS represented the first step in a process to meet the basic needs, rights, entitlements and citizenship in an emerging social welfare system. Essentially, the NIS became the mechanism through which the poor, vulnerable and marginalized were able to procure affordable safety nets and social security benefits.




As the NIC celebrates it Silver Jubilee Year, the question before us is whether the NIC has in any meaningful way lived up to its mandate and mission. Perhaps those who have existed at the margins and periphery of society are best placed to answer this question. For the marginalized and disadvantaged, the NIC has been a beacon of light and hope, which like a lighthouse perched on the hillside, has brought many a mariner ashore during their darkest hours.  One cannot however understand the true impact of the contribution of the NIC over the past twenty-five years without first understanding how it has contributed to the general welfare of Saint Lucians and the role it has played in fostering the general development of the nation.


The passage of time and the observance of significant milestones always call for reflection. Historical junctures demand that we pause to take stock and to consider the past and present and to contemplate the future. The significant contribution that the NIC has made to the development of Saint Lucia is a testimony of how well it has withstood the test of time. From the noble idea that gave rise to the creation of National Provident Fund (NPF), mainly as provider of pension benefits to retirees, the NIC is today an indispensable partner in the overall developmental framework of Saint Lucia. When the NIC was first established as the National Provident Fund in 1970, it began operations with a modest capital base of thirty thousand dollars, in the form of a loan from the Central Government. During its existence as the National Provident Fund, the social services provided were both limited in scope and in nature and consisted mainly of age, invalidity and survivor benefits.


Today, the NIC has not only increased its asset base but has also broadened the scope and the nature of the services that it provides. At this juncture it provides a number of benefits including sickness benefits, maternity benefits and grants, employment injury benefits, retirement benefits, funeral grants, survivorís benefits and invalidity benefits. At the same time its asset base has increased to over seven hundred and seventy five million dollars, of which ninety six percent is in the form of investment. As of December 30th, 2003, the NIC held two hundred and thirty-six million dollars in fixed deposits with the commercial banks. This amount represents more than fifteen percent of the money supply in Saint Lucia. This makes the National Insurance Corporation the largest single contributor to domestic saving.




According to a survey conducted by the International Monetary Fund, the percentage of national saving attributable to the NIC increased steadily from 2.6 percent of Gross Domestic Product in 1997/1998 to 3.2 percent in 2001/2002. By comparison, Central Government and public enterprises together averaged Ė0.6 percent. This reality has therefore permitted the NIC to play a lead role as a stabilizer of domestic savings. Hence, the NIC has emerged not only as a provider of a supplementary source of income for retirement and other social benefits but also as a pool of long term savings that can be utilized to finance socio-economic development. In order words, the NIC contributes significantly to the quantity of money in circulation within the domestic economy and functions as a major engine of growth and development.




The NIC through its use of the deposit facilities available at the commercial banks contributed significantly to the financial resources that commercial banks have at their disposal. As a result of the increased money supply within the banking sector, commercial banks have been able to expand their development activities into areas such as housing, education, tourism, the fishing industry, professional services and agriculture.  NIC has played a vital role in propelling the development of the capital market in the Organization of Eastern Caribbean States (OECS). It has invested in regional instruments such as bonds and notes both within the OECS sub-regional grouping, as well as outside the sub-regional grouping.




The NIC in addition to facilitating development through the institutional framework provided by the commercial banks, has itself played a direct role in the promotion of national development. Recognizing the existence of a shortage of affordable housing on the island, the NIC, through its subsidiary, Saint Lucia Mortgage Finance Company Limited has made an invaluable contribution towards the alleviation of this problem. The Saint Lucia Mortgage Finance Company has been the recipient of low cost funds from the NIC for the purposes of financing lower middle-income residential housing.  The net effect has been reduced rates on mortgages for lower middle-income families.


Other institutions have also been able to procure loans from NIC to undertake major projects of a developmental nature which have benefited the population both socially and economically. NIC has made loans available to the Saint Lucia Air and Sea Ports Authority for the infrastructural development of the nationís ports. The Saint Lucia Electricity Services with the assistance of loans from the NIC was able to embark upon its rural electrification programme, while the Housing Authority was able to make low cost housing available to low and middle income earners. Other institutions which have benefited from NIC funding include the Urban Development Corporation, National Research and Development Foundation, Financial Investment and Consultancy Services Ltd, to name a few. On the social security front, the NIC between the period of July 2002 to June 2003 paid over ten thousand short and long term benefit claims costing approximately EC$28.61 million.


Given the scale and scope of the activities that the NIC has been engaged in, it is fair to conclude that it has made a sterling contribution to national development. Clearly, there is no other institution that has impacted on the economic and social development of Saint Lucia during the independent era as has the NIC. Suffice it to say, the NIC has been a prime agent of change and modernization.  Certainly, the NIC has lived up to its Mission Statement, which is ď to ensure that every Saint Lucian enjoys social and financial protection and to assist in the development of our nation through the efficient collection of contributions, payment of relevant benefits, prudent management of assets, use of cutting edge technology, and a cadre of highly skilled staff.Ē  I am certain that today many of those who viewed the creation of the NIC with skepticism, ambivalence and indifference would agree that our society would be a lot poorer and more vulnerable if the NIC was never created.


For much of this journey down the path of independence, the NIC has nurtured the development of this nation. It has played a prominent part in fostering societyís acceptance of its role in providing safety nets for the vulnerable in our midst. On the observance of the NICís Silver Jubilee year, a grateful nation salutes its achievements and recognizes its contribution. The strides and achievements that it has made as an institution hold out hope that with the right institutional mix, indigenous development is not only possible but attainable. Although the Nation acknowledges and accepts that the NIC has come a long way, the nation also concedes that its work is far from over.




Although the NIC is taking into the future a legacy of achievement, there can be no room for complacency. Complacency is an enemy of success and the bedfellow of failure. Therefore, it is imperative that the NIC learn and build from the successes of the past twenty-five as it seeks to increase the scope and quality of services that it provide to a nation whose demand for social services is constantly on the rise. To satisfy the increase demand for social provisioning, the Government is envisaging an expanded role for the NIC in the evolving social protection system. Furthermore, the Government intends to retool the organization so as to increase the range of services provided and in the process make it more relevant to the challenges ahead.  To this end, the Government is in the process of consultation in order to determine the best approach to implementing a Universal Health Care Plan for Saint Lucia. The threat posed by HIV/AIDS and other communicable diseases are projected to place enormous stress on the nationís health care services. Furthermore, changes in the labour market as a consequence of economic transformation is likely to leave a large percentage of our population vulnerable and unable to afford health care. Being acutely aware that the development of a nation is contingent on having a healthy population, the Government will embark on the establishment of a Universal Health Care System which is affordable and within the reach of the most vulnerable elements of our population. The NIC will therefore be at the forefront of this initiative and will be charged with operating the nationís Universal Health Care system.


The Government is also exploring the possibility of establishing unemployment insurance to assist those, who have fallen victim to unemployment arising out of economic transformation, structural and seasonal changes in the labour market. This is critical in Governmentís strategy to combat poverty and to ensure that the unemployed within the society lead a dignified and meaningful existence. Chances are if unemployment insurance becomes a reality, the implementing agency will be the NIC.


On Monday, March 29, the NIC in an attempt to increase the range of services and benefits provided to our senior citizens launched a Gold Card. This Gold Card is an initiative specifically designed to provide a degree of relief to pensioners and to provide them with some preferential purchasing regime. Such an initiative on the part of the NIC is to be commended and applauded since it is in keeping with the philosophy of social provisioning.




For the past quarter of a century, the NIC has been part of the solution to many of the challenges that have confronted our society and the nation, and for the next quarter of a century and beyond, it will remain an integral part of the solutions to the problems that we will encounter.


So today as the NIC celebrates this historic and important milestone, a grateful nation rise in salute.  The NIC has certainly played its part and therefore should be immensely proud of its contributions. What the NIC has achieved, it has achieved against great odds and within a context of a skeptical nation that initially distrusted its motives. Its sterling contribution to national development has earned for it, the admiration of many a skeptic.


It would be remiss of me however, if I did not pay tribute to the architects of the NIC and to the cadre of committed, dedicated, devoted and hard working men and women who have worked tirelessly to make the NIC the success that it is today. Your hard work and dedication have given life to a philosophy and vision.  I extend to all who have been associated with the NIC a successful twenty-fifth anniversary celebration and I invite the nation to join the NIC in the celebration of this milestone.


Thank You.        


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