Risks remain on major CIG projects, warns OAG

| 30/10/2017 | 18 Comments
Cayman News Service

Sue Winspear, Cayman Islands Auditor General

(CNS): As government gears up to spend hundreds of millions of dollars on capital projects over the next five years, the Office of the Auditor General is warning that there are still risks regarding the use of public cash on these big government developments. Auditor General Sue Winspear said that much work needs to be done to develop a capital investment strategy and improve budget and financial frameworks to ensure value for money.

In a review of the damning audit reports conducted by the office in 2012 and 2015 that found significant weakness in the way government managed major projects, she said that things had “significantly improved” since then. However, she warned that with government expected to spend half a billion dollars over the next five years on infrastructure projects, it is important that all of these projects are well managed.

Winspear is calling for a long-term capital investment plan, with clear links to an updated National Development Plan and other long-term strategies and policies, to provide an overarching strategy for public sector investment.

“A long-term capital investment plan is needed that enables capital investment decisions to be made with full information on all major capital projects, including their affordability and the capacity of government and industry to deliver them,” she said in a release about the latest report, “Major Capital Projects – Follow Up”.

The report found that limited progress has been made in improving the budgeting process for capital projects and in reporting progress on major capital projects to the Legislative Assembly.

“We concluded that the budgetary framework and approval process for capital projects are not aligned. This presents risks to the use of funds and project timescales,” Winspear said.

She also pointed to the risks presented by government’s first public-private partnership contracts. Government is entering into another PPP with Dart for the wast-management facility, in addition to the existing deal over the NRA agreement. It is also planning a public-private-partnership on the cruise facility.

“These will result in payments to private sector providers of between $280 million and $310 million for 20 to 25 years after the …projects are completed. It is important that these long-term financial commitments are built into future budgets,” she warned.

She welcomed the creation of the Major Projects Office as a positive step but she warned that the way it has been funded and staffed could present risks, and she urged the government to review this office to ensure it can continue to provide leadership.

The OAG report said government was making “little headway” in the way decisions are made to support these massive spending projects. As well as its failure to improve the budgeting and strategic planning, she pointed out that reporting arrangements has not been properly addressed and that the public sector investment committee has still not been established.

Winspear’s overall concern is that, given the amount of money the government plans to invest in infrastructure, it has not yet sufficiently addressed the numerous risks that come with these huge capital projects to ensure transparency, accountability and value for money.

See the report in the CNS Library 

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Comments (18)

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  1. Anonymous says:

    I am shocked that more Caymanians are not absolutely outraged that Government is putting hundreds of millions of dollars of our money into brick and mortar schools, rather than putting that money into ACTUALLY EDUCATING CAYMANIAN CHILDREN! How many quality teachers could be employed with that money? How many Caymanians could have used that money in the form of university grants and scholarships? Caymanians should demand that these projects be scrapped and that money directed towards actually educating our children and preparing them for the future. Why pour millions into brick and mortar, and millions more over the years to maintain it, when our kids will still come out of their new fancy schools without the necessary skills to enter the work force or move on to higher education? Has the big new air conditioned school up in Frank Sound produced better students??

    • Anonymous says:

      Govt. schools are saddled with all kinds of teachers who apply for jobs and it is impossible to select only “quality teachers” . Added to that …pupils whose parents are not interested in their children’s schooling .
      The socio economic/parental background of the students is as much to blame for lack of success , as accusations of inadequate teaching staff.

  2. Anonymous says:

    mo projectz means mo money to ma 3rd cousins twice removed bizness. We do sh%^& jobs but nobody cares as long as the money keeps coming. na competition, na sir.

  3. Anonymous says:

    Finally some good news from the OAG. It’s obvious so many positive things are happening in the civil service.

  4. Ambassador of Absurdistan says:

    Just Another Day in Absurdistan

  5. Anonymous says:

    If there is a way to mess it up they will. Part of the learning process. The difference in developed countries is they give the jobs to those who have already learned.

  6. Anonymous says:

    You know what makes me laugh, this problem was created by the same idiot that wants to build this cruise ship peer….

    • Veritas says:

      3.28pm, presumably your peers are also unable to spell pier, but I wholeheartedly agree with your criticism.

  7. Anonymous says:

    New Auditor General highlighting the same issues as her predecessors.

    Now that’s progressive!

  8. Anonymous says:

    Everything CIG touches turns to shit. At this rate Cayman will become the Greece of the Caribbean

  9. Revelations 3:45 says:

    After reading this report I can only imagine what the expensive mega disaster that will be the cruise port in GT harbor will end of like. At this rate it will make CHHS & JGHS look like well managed projects and value for money. Given the track record of leadership.

    Dear God please help the people of the Cayman Islands because its leaders seem determined to take the country into 4th world status due to poor decisions, poor management and no idea as to the meaning of accountability.

  10. Anonymous says:

    “Standards in Public Life” needs to be passed ASAP. Given the volumes of high-level abuses we’ve encountered and have been documented in the Cayman Islands over the last 30 years, some of it shockingly egregious, some of it gathering international headlines, we should ask ourselves why fixing a deadline for it’s passage hasn’t been the highest priority for this government. Is there really anything more important than putting a simple code of conduct on those we’ve put our faith in?!?

  11. Anonymous says:

    Well managed, in Cayman! hahahahaha…oh that’s a good one. Is it April 1st?

  12. Anonymous says:

    Does CIG consult with the auditor general for guidance on good governance, before it actually does anything?? Would save a lot of time,hassle and wasted money…unless of course there are things to hide.

  13. Anonymous says:

    This is by far the best AG report I have read. Gone are the days when the AG recommendations were ignored. This AG approach is a breath of fresh air.

    Kudos to the civil service for making these great improvements.

    Remember auditors will always find something wrong.

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