(CNS): Auditor General Sue Winspear has commended government for improvements to public finance reporting but she is not giving the leaders a free pass, as there are still many areas that need improvement, especially when it comes to the collection of revenue and what government gives away. Winspear said she is expecting to soon see a framework implemented that will set out the general parameters or criteria surrounding government concessions. Accepting that officials need room to negotiate and rules cannot be set in stone, she said there still needed to be some broad transparent guidelines.
Concessions packages to large developers continue to be a major point of controversy as in some cases it is hard for people to see the benefits deals given to often overseas investors when local businesses are paying all their fees in full. From full duty waivers to the elimination of work permit fees, concessions are often seen by government as an incentive to attract inward investment or shape a new area of business but whether they actually work remains an unanswered question.
Winspear told CNS that the management and justification for concessions given to anyone which will reduce the money coming into the public coffers needs to be more transparent. She explained that a lack of transparency in many areas of government finance remains a major problem across the board. But she said government management must understand that being open and honest, regardless of mistakes or criticisms, always works out better than trying to cover up something that is bound to be revealed in the end.
When it comes to concessions, Winspear said the public needs to see the reasons why they have been given and what government hopes to achieve as a result. She also called for concessions to be monitored and said government should be examining whether or not it got what it wanted after the concessions were granted.
Given the problems regarding how government reports back to the people about how it has spent public cash, it is currently not reporting whether the concessions are working or not, whether they are fulfilling expectations of creating jobs or boosting the economy.
Public Accounts Committee Chair and Opposition Leader Ezzard Miller has also been sounding the alarm about government’s lack of management when it comes to the concession deals it makes with developers.
He told CNS that he will be pressing this issue again in 2018 and agrees that without transparency, politicians and civil servants are negotiating behind closed doors, resulting in public suspicion of potential corruption. Miller is calling for a strict set of criteria that is based on the amount of investment and the goals of a project. He said that this way developers know what is available and the public can see what is being given away and why.
He said government needs to pay far more attention to monitoring what developers are claiming because it is not unheard of for some to abuse the system by importing materials unrelated to the specified project alongside those that are, making it easy to get everything through either duty-free or at the favorable rate.
Over the years numerous developers have been given concessions, in some cases exceptionally generous ones, but it is hard to gauge what the benefits have been to the community at large. In some case it has emerged after the fact that the government and the public purse lost out significantly and any benefit to the wider Caymanian community has been hard to identify.
Government has, as far as we can confirm, never undertaken any kind of evidence-based assessment of the concessions it has given through the years or ascertained what the short- or long-term benefits were and whether or not it is the most productive way of getting jobs or generating trade for local businesses.