CIG to collect nearly $700M in revenue

| 26/05/2016 | 36 Comments
Cayman News Service

Premier Alden McLaughlin wraps up debate on amendments to the Standards of Public Life Bill

(CNS): Government will have collected over $696 million in fees, taxes and other revenues when the current fiscal year ends next month, according to Premier Alden McLaughlin. Coupled with the revenue from statutory authorities and government companies and less the operating expenses of $563 million, the government will have a $145m surplus. 

Speaking at a political fundraising event for the PPM on Tuesday night, McLaughlin said that the next budget, which is due to be delivered on Monday and will cover 18 months, will collect over $1 billion in revenue, but there will be no new taxes and no new borrowing.

In front of an audience of the party faithful and donors, held exactly one year before the historic 2017 poll when Cayman switches to ‘one man, one vote’ in single member constituencies, the premier was keen to present his government’s fiscal credentials as he emphasised the lack of borrowing and the anticipated $400 million in surpluses at the end of this year generated by his government, compared to around $41 million collected by the previous UDP administration in its entire time in office.

The premier gave very little detail away about next week’s first ever multi-year budget, as he touted for campaign cash, but said he expected to receive the nod from the UK for the budget this week.

This will be the last year that the FCO officials will need to clear the budget before it can be presented because government has now balanced the books and met all of the demands of the Public Management and Finance Law and the fiscal requirements for a budget in terms of debt ratios and cash surpluses.

“The United Kingdom has said to us on several occasions, and again in recent weeks, how extremely impressed they are with the way we have turned around government finances,” he said.

He said operating and capital would be met from available resources and government would continue to operate from cash, as it had not used an overdraft since it was cancelled three budgets ago.

Justifying the move to multi-year budgets, he said there would still be legislative scrutiny by MLAs in between each new budget similar to Finance Committee, but the approach solved a number of problems.

“The current budget process takes up about nine months out of every year. This change will make the budget process more efficient – saving thousands of hours annually in budget preparation by civil servants and ministers,” he said.

“This change will also move the budget year-end to December. With May elections, this allows six months after an election for incoming governments to prepare new budgets with their priorities in mind,” he said, clearly hoping that budget would be drawn-up by a re-elected PPM administration. But he said it would avoid “the current mad scramble” to get a temporary budget just a few weeks following the election.

During the next 18 months government would finance capital improvements out of earnings, including ongoing work at the John Gray High School, the road network upgrades and expansions, some preliminary work on a new residential mental health facility, the airport project and the purchase of land for national environmental conservation.

He said there was also money in the budget for the cruise project, as the CIG presses ahead with the controversial project, a boardwalk and park in South Sound, as well as plans for the waste management system.

That project, which many believe is Cayman’s most pressing problem, is making particularly slow progress. The premier said the outline business case was still being worked on but a request for proposals for a private sector partner will be published in the last quarter of this year. But he said funding was being identified to meet government’s part in the project over the next 25 years.

Tags: , ,

Category: Government Finance, Politics

Comments (36)

Trackback URL | Comments RSS Feed

  1. Anonymous says:

    Here’s a huge way to decrease spending. Social services aka child and family services. If the deadbeat fathers were all forced to pay without the mothers having to take them back to court and the fathers paid sufficient maintenance which is half of the expenses of the child, then that department would not need to help anyone. That could be 2 million in extra funds there.

    How about campaigning that these men need to work? Any job, why are we importing bartenders and waiters? Because the lazy men in the community are too busy drinking at the bar rather than being interested in working at the bar.




    0



    0
  2. Anonymous says:

    Shout it from the roof tops. I do not care anymore. I am leaving on a jet plain and will never come back again.




    0



    0
  3. Anonymous says:

    If the PPM has really amassed the claimed 400m in cumulative surpluses, why has it only paid down around 70m in debt?

    Are we to understand the government has 330m in cash?

    Of course not. This is a typical sleight of hand. The surplus is an “operating surplus”, meaning what exactly?

    A surplus before… interest? Capital expenditure? Whatever it is there has been 330m of it in the last three years!

    In addition, what precisely has the government done to bring about this revenue?

    They can’t take credit for reducing taxes and for increasing revenues at the same time.




    0



    0
  4. Anonymous says:

    That is around 200,000 per Caymanian, how on earth can they spend that much money. Cayman governments have become addicted to spending.




    0



    0
  5. Kid Creme says:

    As the opposition spectators in the LA drive around in they trucks the PPM is rising and going from success to success. What happen to all those advisors and snitches running round cant get no Info!




    0



    0
  6. Certainly there is no reason at all for the politicians to be proud of such a huge revenue. Most of it has been confiscated from us taxpayers, and much of it frittered away on vanity projects. Rather, the MLAs should be ashamed of every dollar they have wasted. Are any of them? Doubtful.
    Gordon Barlow




    0



    0
  7. Anonymous says:

    So, the missing 1 billion that disappeared from govt. departments a few years ago has not surfaced, the health care bill is over 1 billion owed, the pension money is due to run out in 2024 and the bullet bond loan payment is due soon.

    Sounds like you got it covered.




    0



    0
  8. Anonymous says:

    I’m not as negative as some posters on here. I certainly appreciate the hard work done by Min Archer and others on the budget.

    But I have one question: do these surpluses take into account the pension shortfall and health care costs for civil servants?




    0



    0
  9. Anonymous says:

    More fantasy island stuff from PPM

    Must be election time soon




    0



    0
  10. Anonymous says:

    imagine if there was no dart?




    0



    0
  11. Anonymous says:

    ppm have maintained the economic surplus and policies brought in by the last government…..enforced by the uk…..
    it’s easy to maintain a surplus when you achieve nothing in 4 years but maintain the high cost of living and doing business bu hig indirect taxation




    0



    0
  12. Anonymous says:

    thank god for the budget controls brought in by the uk……..




    0



    0
  13. And still no money allocated to get rid of the dump. Getting rid of the dump should be a far higher priority than a new port. The dump is a time bomb waiting to explode and the time is now to get our Caymanian priorities correct.




    0



    0
    • Anonymous says:

      Another DART / Legge post.

      Yes, the dump needs attention but the obsession of DART and Legge on this subject is sickening.

      For DART and Legge even rain clouds are connected to the dump and another opportunity for their public relations goons and mindless robots to comment.

      The dump will be fixed when the government finds a way to recover the millions of dollars in subsidies Mr. McKeeva Bush and the UDP government gave to DART for generations to come.

      If DART was paying his way then there would be money to properly finance the management of the dump and on the site were it is now located.

      DART, you created the DUMP problem when you skillfully got the Mr. McKeeva Bush and the other UDP members (for reasons still to be revealed) to give you the over 100 million dollars in subsidies. If the Government was collecting the fees and other charges that they should be collecting, then Government would have the money to fix the DUMP problem.

      DART and Legge you know that this is the true fact.




      0



      0
  14. Anonymous says:

    A $145 million surplus which, assuming it actually ever gets collected, will instantly be wiped out by debts that pre-date this budget. These figures are simply an exercise in creative accounting.




    0



    0
    • Reality Check says:

      Marco Archer is no different than Alden McLaughlin and the other ppm comrades. He is spinning numbers calling it financial wizardry and sound fiscal management.

      Be thankful Cayman for UK budgetary oversight and the FFR.




      0



      0
  15. Anonymous says:

    It’s about time that money started being spent on the citizens of this country and not on comforting the UK that we will never cost them a single penny. By normal economic standards, a surplus that high compared to the revenue and operating expenses of the government, would be considered high treason against the taxpayer. Governments are not supposed to hold on to cash like Apple. Yes, we had to pay off our debts and get into compliance with the PMFL and FFR but once we have done so, the Government will be expected to think outside of this ‘fiscal constraint’ box it has had its head stuck in for years. This is one of the most affluent societies in the world yet social problems are increasing exponentially. Whether it is children turning to crime or the shocking divorce rate or the lack of wealth creation for Caymanians, we have more to be doing than patting ourselves on the back for fiscal prudence. When we get control of our budget again, we should be spending right up to the last cent that would require us to get UK approval again if we spent it. It’s long overdue.




    0



    0
    • Jotnar says:

      “Yes, we had to pay off our debts …” You do understand that the surplus is a current surplus – one year taken in isolation, and there is no provision for the $260m bullet payment on debt coming due in 2019 beyond the $17m million CIG has so far set aside, let alone the underfunded health and pension obligations, well in excess of $1 billion? Pay off our debts – not yet, and nowhere near. But you want to borrow and spend more. Ah well. How about cutting the chronic waste out first, and redirecting that towards social care, rather than digging the debt hole even deeper?




      0



      0
      • Anonymous says:

        No, I don’t want to borrow and spend more. I just want to spend more. If this budget brings us into compliance with the UK requirements then the surplus in the next budget should be much less than $150m. We won’t be chasing a target anymore so I expect all funds to be diverted to the urgent needs of the country. How long do YOU expect us to put ‘the man’ first before our own well being?




        0



        0
      • Anonymous says:

        Countries all over the world have been spending what it takes to bring vibrancy back to their economies. The money comes out of the economy so the Government has an obligation to put it back in in some form. Otherwise, our efforts to work hard, build businesses and look after each other are for nothing, as they will never lead to an increase in living standards if the Government takes so much in fees and gives so little back. I don’t know any country where the Government runs a surplus of more than 25% of its operating expenses. This is a TEMPORARY situation – I don’t care how many debts we have falling due in how many years. Check our credit rating – it’s got a long way to fall and no history of doing so, even before we improved things to where they are now.




        0



        0
    • Anonymous says:

      Money is being spent by creating jobs working for government and getting rid of expats. Sounds good to me. I am naturalized and love cayman but I see in my Caymanian born children a sense of entitlement and full knowledge that they will get a job for life working for CIG once they return from overseas studies.




      0



      0
  16. The Professor says:

    Yep. That would get the $1.8 billion down to $1.4 billion. Then if we paid $10 million payments per year we could have it paid off in only 140 years.




    0



    0
  17. Anonymous says:

    Go Through PPM! opposition totally lost and don”t have a clue or ingling of what’s going down in Cayman.




    0



    0
  18. Anonymous says:

    Hope he gives some of the surplus to the unemployed he has sacrificed for the sake of permit fees.




    0



    0
  19. The Parliamentarian says:

    My Dear Honourable Premier McLaughlin:
    Please put action on the horrible dump and rampant crime FIRST on your “to do” list. We don’t need what you define as a “cruise project” to ruin our dive industry. Lets get the airport project finished and boost our stay-over guest numbers.




    0



    0
    • Caymanlover says:

      I endorse these points completely. The stay over visitor will generate far more income in the long run and our pristine waters and diving will not be compromised. We should be ashamed of the dump and actually take some of the advice qualified consultants have given over the years.




      0



      0
  20. Anonymous says:

    It is convenient to omit talk of the existing debt burden or pension liabilities in all this “look at our huge surplus” re-election campaigning. Both parties enjoy fanning the dreams of supporters with prestigious projects, and shiny new toys where no actual balance sheet surplus exists. Worse, they start them anyway and never finish, or hire consultants to stall it out, while neglecting less glamorous priorities. It’s disappointing that not even the opposition are willing to challenge this style of BS they wrote the book on. We need to confront this BS and call it out going into 2017.




    0



    0
  21. Anonymous says:

    That should go a long way to paying back the $1.8 billion CIG owes on medical care so…




    0



    0

Please include your email address in the form below if you are using your real name. You can use a pseudonym, with or without leaving an email address, or just leave the form blank to be "Anonymous". All comments will be moderated before they are published. Please read the CNS Comment Policy at the top of this page.