The Finance Ministry is working out an arrangement with the National Housing Trust (NHT) to pay over billions of dollars in contributions.

In his 2005/2006 report, Auditor-General Adrian Strachan noted that Government owes the NHT $18.3 billion in employer contributions since 1994. That total includes interest of $9.9 billion.

But the NHT is yet to receive the money from the Government.

Senior Director of Finance, Hugh Reid, said the ministry and the NHT made some progress in their deliberations.

"We have agreed in principle to some of this debt being settled by way of transfer of lands from the Government to the National Housing Trust," says Reid.

He says six parcels of land owned by the National Land Agency have already been identified for transfer, but the procedure has not yetbeen undertaken.

The six parcels of land to be transferred will merely amount to $1 billion, Reid notes.

In the meantime, he says other options are being considered to reduce the amount that the Government owes the NHT.

"The Government is also examining what other parcels of land it can utilise for set-off against the debt," he said. "At this stage, we are not able to say how much of the debt will ultimately be satisfied via land transfers."

Contact was made with the Ministry of Finance to see what other steps the Government would be taking to cover the remainder of the outstanding debt, but no response was forthcoming from the ministry.

Swapping land

This is not the first time the Government has found itself swapping land to settle outstanding contributions to the NHT.

In April, the Financial Gleaner reported that Government had committed land to cover 10-15 per cent of a $6 billion debt from last year.

That arrangement was covered by a transfer of 3,000 acres of land mainly in Trelawny and Hanover.

The report indicated that the money could have been used to assist central Government, which was running a $30 billion deficit.

Under the National Housing Trust Act, employers, whether Government or private sector, are liable to pay contributions over to the agency.

It is treated as expenses incurred in acquiring income. However, there are no sanctions under the act for failing to turn over these contributions.