Auditor finds customs falling short

| 07/06/2019 | 22 Comments
Cayman News Service

Cayman Islands customs officer

(CNS): Although customs is responsible for collecting around $165 million per year in duties, fees and fines, amounting to over 20% of government revenue, the auditor general found a number of shortcomings at the unit, including a lack of any plans and a failure to manage duty waivers. In her latest report, based on an audit done before the Customs Department merged with border control, Sue Winspear said the department had no strategic plan to provide vision and clarity for the organisation’s objectives and priorities.

The audit office also found that government may not be collecting all of the revenue it should, as there are significant weaknesses in awarding and managing revenue concessions.

The report “Customs in the Cayman Islands”, which was published Thursday following an audit in 2018 on the Customs Department, reviewed how effective it was at collecting revenue and protecting the border.

“Customs makes a significant contribution to the Cayman Islands economy by collecting duties on imported and exported goods and also plays an important role in protecting our borders,” Winspear said.

“Despite this important role Customs did not have a clear strategic plan, setting out its vision and objectives; nor did it have a workforce plan or performance management framework to support effective management of the business. It is important that the new organisation, Customs and Border Control, develops these strategic documents as soon as possible to ensure its effectiveness,” she added.

Now that the new CBC agency has moved to a more risk-based and intelligence-led approach, she warned that even more work needs to be done to improve effectiveness.

“It is encouraging that Customs has started to change the way it protects the borders by using a more intelligence-led and risk-focused approach. However, more needs to be done to embed the new approach.”

The report also highlights that little progress has been made in implementing previous recommendations by the Office of the Auditor General to improve the policies and procedures for awarding concessions or waivers. She said the government still does not know how much revenue has been given up as a result.

“It is disappointing that there has been very little progress made to improve the process for revenue concessions,” Winspear said. “More than three years after making recommendations there is still no revenue concessions policy nor is there any systematic monitoring of the revenue concessions awarded and so it is not known how much money has been foregone or whether the things promised in return for the concession awarded have been being delivered.”

The auditor said that at the end of December 2018, the Customs Department had around 157 staff but did not have a workforce or corporate training plan to help manage staff effectively. It had started a project in January 2017 to modernise its IT systems but the first phase of the project was not well managed, resulting in delays and cost overruns.

Winspear pointed to a need to improve projections because the department generally collects much more than it predicts in the budget, with an average error rate of as much as 10% . “We found that the process for projecting revenues could be improved,” she added in the report.

The audit office made fifteen recommendations in the report which have largely been accepted by the relevant government management teams with the finance ministry, financial secretary or the agency director, who say the changes will be in place by the end of this year or next.

See the full report in the CNS Library

Related article: Audit was at ‘challenging time’ says Customs

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Category: Government Administration, Government Finance, Politics

Comments (22)

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  1. Anonymous says:

    another glorious day for the civil service….

  2. Patricia Bryan says:

    She’s wrong. There ARE new revenue concessions policies that has taken place within the last 3 years, aren’t there?! Cayman Airways has tacked on the concession for luggage carried on their flights so we are now either restricted to how much we can bring in or carry or we simply resign to pay the extra; Customs has raised tariffs for locals that want to go away for vacation or shop for the necessities that are not affordable or able to be obtained on the island; the cost of bringing in a vehicle that could fit the average class’ budget has risen… oh yes she’s wrong on that one. Evident everyday groceries are unaffordable to average class and lower class families. Yet we see concessions are cut for anyone who wants to invest in real estate or in businesses that apparently could be construed as contributing to the economy but in fact only contribution to the wealthy and upper classes pockets, and likely most politicians’ pockets who support certain endeavors. I am not specifically pointing at the present government, I am generalizing on the politicians overall regardless of which government is reigning.

  3. Anonymous says:

    ………same old, same old……… as long as it is the C.I. Government and its various arms wasting, fiddling, misusing, incorrectly managing, no audit trailing, misspending, payola-ing, misappropriating, looking after “friends and family”, abusing and shredding the people’s money……..then “HEY, that’s okay” ……and another Auditor’s General Report will be consigned to the filing cabinet to gather dust and never be heard of again, except when the next Auditor General’s Report make the exact same findings and makes reference to the previous (dusty) reports…..

    BUT GOD FORBID, if that was the private sector / international finance making “mistakes” or “omissions” or “having insufficient oversight” then they’d set CIMA on them and with Fines and Penalties…….. (and charge them back for the pleasure of the audit!)

    Incompetents in charge of our destiny. Sigh.

  4. Anonymous says:

    A part of the civil service making mistakes? Having no plan? Unable to implement change? Shurely shome mishtake?

  5. Anonymous says:

    Shocker, another government agency here that’s got their head up you know where and has no clue how to move towards the future.

    This is my shocked face…

  6. Anonymous says:

    knock knock….here to collect caesar’s”taxes!!!😇😆

  7. Anonymous says:

    This is what happens when you promote career customs employees who have no idea how to run a government department. Just because you have worked for customs for 20 years, it does not mean you are capable of managing the whole thing. The same applies to the existing MLA’s. Some of them literally do not know how to use a computer properly yet they are running our country.

    • Anonymous says:

      Computers are a fad that will eventually fade away so we’ll be fine with our MLAs who don’t how to use them.

    • Anonymous says:

      An old saw goes something like this: Boss to trainee, “go work with Jones, he has 30 years of experience.” Trainee to boss after a few weeks, “Jones has had one year of experience 30 times.”

    • Anonymous says:

      And you know this how?

      • Anonymous says:

        Results? Audits? Front page news? See the picture of the man with his head buried in the sand? That’s you. And them. Or maybe you looked but still did not comprehend.

    • Anonymous says:

      I don’t think that’s fair at all. They were thrust into uncharted waters with the new organisation, and now they are expected to have all their ducks in a row and quacking.

      They have never before been responsible for border control, even though it was sorta-kinda in their purview.

      I think we can whinge if a year from now things aren’t improved. Don’t forget that the reorganisation didn’t come with a roadmap to outline the interaction between the various agencies; they are literally having to create it on the run.

      Give them a break. They are us, just trying to do a difficult job in the midst of undefined criteria.

    • Anonymous says:

      You don’t need a high school diploma to run a country a wise man once said.

  8. Anonymous says:

    As is customary in our “world class” Civil Service.

  9. Jotnar says:

    “…the ministry of finance, financial secretary or the agency director, who say the changes will be in place by the end of this year or next”. Or next ….Or never… soon come. Given many of these recommendations are rehashing the previous recommendations made more than 3 years ago, what gives us any confidence that anything will be done? One thing will have changed in the meantime – Ms Winspears contract will have run out.

    • Ironside says:

      Not only will that one change happen, duty prices somewhere will increase. Just to keep Throwing more money at their shortcomings, as usual.

  10. Anonymous says:

    All is well, as usual, in the kingdom of the Corruptmen Islands.


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