$20 M BUDGET GIVEAWAY COMING

THE Government is planning to give away a total of $20 million to people who say they have a business idea.

Applications will be invited for gifts of $200,000 each.

The applicants would not be required to repay the funds.

A total of $12 million will be set aside for youths between the ages of 18 and 35.

The giveaway of taxpayer dollars would be handled by General Secretary of the ruling PNM Foster Cummings in his capacity as Minister of Youth Development and National Service.

The handouts are meant to assist emerging business operators, but the Government already has the National Entrepreneurial Development Company (NEDCO) for that purpose.

NEDCO currently offers loans of up to $250,000 for first-time borrowers, $500,000 for repeat clients, and has plans to send up the limit to $1 million.

The State enterprise currently has $1.6 billion in bad debts from 161 delinquent clients.

Some debtors have not serviced their loans in years and cannot be found by the lending agency.

NEDCO’s Chairman Clarry Benn said there was poor decision-making about whether the defaulting clients “really qualified to access the loan commitments” and had the appropriate collateral.

Benn said the bad decisions also relate to whether there was “an appropriate alignment between the quantum offered as loans and the entity’s ability to repay.”

NEDCO falls under Cummings’ Ministry.

The agency has recorded bad debts in every recent year.

In 2016-2017, the first year of the Rowley Government, there was $66 million in unpaid loans.

Those loans were later written off after being classified as “irretrievable.”

In the nine years leading to 2014, bad loans totalled $160 million.

NEDCO has announced a plan to “name-and-shame” non-paying clients.

Agricultural Development Bank (ADB), another State-owned lending agency, was found in an audit to have wasted tens of millions of dollars between 2004 and 2010.

There were $120 million in losses, with $41 million in bad loans.

The bank was a “slush fund” for certain people, it was revealed.

There were scandals in the rental of an office, in employment, with credit cards, purchase of furniture, and other matters.

Hastily-formed companies were given loans, the audit found.

In one case, a Government-owned warehouse was used as security for a loan for the setting up of a juice factory.

A total of $50 million was paid to a legal firm.

The 2023-2024 budget is expected to be presented within the next few weeks.