CIG spending grows by 3.7% in final budget
Marco Archer, Minister of Finance & Economic Development
(CNS): In his first 18-month budget and the last of this administration, Finance Minister Marco Archer revealed an anticipated surplus of just $46 million, considerably less than previous years, and a much bigger spending plan. He said Cayman was now in an enviable position, both economically and from a public finance perspective. He said the year and a half long spending plan put the government back in compliance with all of the requirements of the law. The longer budget is difficult to compare with previous years, but Archer announced expected revenue for government of $908.5 million, with spending of over $862.4 million.
Although civil service pay takes up almost half of the budget expenditure, Archer pointed to a list of extra spending to account for the more than 3.7% rise in spending, including $4.2m for public education services over and above the usual budget to meet the recommendations in the recent review of the local education system and the baseline inspection. This is is in addition to transfer payments for scholarships and the re-start of the construction of the new John Gray High School.
CIMA will also get an increase of some $3.2m for regulation services to keep pace with the new regulatory requirements and to meet the anticipated global assessments on the cards in 2017. Archer listed a further $2.1m for the Public Health Department to work on communicable diseases, another $2m to address unfair pay practice and wage stagnation across the civil service, and $1.4m for the 2017 general election.
The Needs Assessment Unit and family services will receive an extra $1.1m to address the needs of the most vulnerable people in the community and those at risk, as well as over $1m for legal aid, while a further half million will go towards funding rehabilitation services for the prison to help meet the requirements of the new Conditional Release Law.
Meanwhile, over a million dollars will be spent on Project Future and civil service reform, including the controversial creation of a supra-ombudsman’s office, merging the offices of the complaints commissioner and the information commissioner.
All of this will come from government revenue or surpluses, Archer said, as he emphasised that there would be no new borrowing or new taxes. Although there were no new tax cuts either, he noted the duty reductions in previous budgets, including that on fuel imported by CUC, the tradesman’s 2% import duty cut and the reductions on building materials.
Reviewing the figures for the year ending 2015/16, Archer revealed that government earned around $35m more than expected but spending was around $13.5m higher than forecast in the original budget.
Government spent an extra $8.4m on the uninsured, underinsured and indigent health care and also spent more than expected on illegal immigrants, Archer stated. It also spent an additional $1.4m on mosquito control measures, which, while not specified by the minister, is thought to be the investment the MRCU has made in the Oxitec bio-engineered insects that are expected to be released in West Bay this month.
Although the statutory authorities and government companies had a surplus that was half a million dollars less than predicted, government is still taking well over $120 million more than expected in revenue.
Given the cash sloshing around in government coffers, Archer announced that money would be paid against the future civil service pension liabilities and into the government’s cash reserve funds, as well as paying off a chunk of debt.
Check back for more stories on the budget later.
Category: Government Finance, Politics
This PPM Government has restored my faith in the honesty, integrity, and inherent intelligence of the Caymanian people. We might be silent for the most part, but make no mistake we are watching and thankfully we make up a majority of the voting population. No Government is perfect, but that’s OK as long as corruption is held at bay. Corrupt braggarts will be coming out of the woodwork over the next few months, looking to harvest the fruit from trees planted and nourished by others. You only have to look at Jamaica to see what happens when corruption is allowed to become “business as usual”. Beware of the know-it-alls with no substance, character, or accomplishments.
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CNS: Unison, writing with the caps lock on is known as shouting on the internet. It’s irritating to read and the CNS comment rules say that comments all in caps will be deleted.
NOTED
Gotta keep the supporters happy in the run up to May 2017.
Bigger government and more operating expenses less surplus under the ‘Progressives’. SMH
Less surplus because it is an 18 month budget and majority of revenue earned beginning of year. Surplus would be similar to prior years budget if it was only for a 12 month period. Politics are irrelevant to me, just stating facts from the budget address.
no borrowings, no new taxes, no tax cuts…………..nothing of any note achieved….
welcome to ppm land…..
my cat could have achieved the same results…..
meowww!
this ppm administration has been one big wasted opportunity……
their failure to tackle the cost of civil service will haunt cayman for decades…..
Just a few points on the 2016/2017 18month Budget:
PPM is Not Lawless: The budget meets the requirement under the Law! This is no easy feat and yes some sacrifices had to be made. The is an enviable financial position our country is now in while providing millions to those in need.
PPM helps those in Need: more spending is allocated to the needy than ever before. And it’s not just being doled out to supporters but based on a rigorous needs assessment.
PPM is finding some capital works from recurrent revenue without increasing taxes; how many Government can boast that?
PPM is working with the Leader of the Civil Service, The DG, to manage staff costs while acknowledging the anomalies that have existed for years. I challenge anyone to find a Government or indeed any high service oriented corporation where personnel costs is less than 50% of revenues. That is the nature of service oriented Governments and companies where staff retention is valued. In addition please advise the Government as to who will have to assist staff if the Government engages in a large scale staff cuts? Our country’s size and fragile economic pillars do not allow us to do business as usual! Think!
PPM is not afraid to tackle “politically risky issues… They acknowledge that current and posts healthcare costs for public servants is a heavy financial burden that will continue to grow and has a plan to deal with it.
More to come….