CIG surplus surges to $200M

| 12/08/2019 | 57 Comments
Cayman News Service

(CNS): Domestic levies on goods and services, such as bank licences and accommodation tax, has led to a much larger surplus than government had anticipated at the halfway point for 2019. The latest audited accounts from government show that the public purse took in 65% more than previously budgeted, resulting in another boost to the public finances of almost $80 million more than expected.

The Unaudited Quarterly Financial Report for the six-month period ended 30 June, gazetted Friday, shows the surplus for the entire public sector (EPS), which is core government and all the public authorities, stood at $201 million, against the budgeted figure of $122 million.

The surplus was generated primarily through higher revenue from levies, duties, fees and government charges that were recorded at $499 million, which is $51 million more than expected, officials said in a release about the government coffers.

Minister for Finance and Economic Development Roy McTaggart said, not surprisingly, that he was pleased to see the continuing positive performance of the public finances.

“We will maintain prudent fiscal management and stewardship throughout the year to ensure that we generate a substantial surplus in government’s finances at year-end, so that we can continue to pay off our debts and invest in government’s priorities,” he said.

Among the highest recorded increases in earnings came from bank and trust licences and tourist accommodation charges, at $20 million, which were fuelled by the continued record high in stay-over visitor arrivals. Import duties reached $18 million, and levies on property, primarily stamp duties on land transfers, stood at $13 million.

Given the higher than forecast earnings, operating cash and deposits were $522 million at the end of the second quarter, while reserves and restricted deposits were $168 million, resulting in a total cash and deposits balance of $690 million. The net surplus for the EPS is set to match last year’s performance.

Meanwhile, core government’s debt is also falling. The overall debt principal repayments were $13 million, bringing the debt down to $407.1million.

While much of the boost to the public purse came from government’s core revenue streams, two dozen of the government’s public authorities were also bringing in money, generating $11 million through the second quarter.

See the full statement in the CNS library


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Category: Government Finance, Politics

Comments (57)

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  1. Anonymous says:

    Now raise the salaries for the people of Cayman.

  2. Rick says:

    This is the kind of perspective that gives a spendthrift government the signal to spend on things for which they had not even budgeted, like a second helicopter for example. When you live in the country with the highest cost-of-living (as opposed to the highest-standard-of-living), there is not budget surplus, just over-taxation. Instead of looking for excuses to buy new toys and waste our money, the government should be looking at reducing the cost of living!!!

  3. Anonymous says:

    Fix the damn dump Roy!

  4. Anonymous says:

    If this Government was good one, they would cut the import duties for fuel to 25 C per gal for C U C, so they could lower their power bill, after all the Brac co. gets everything duty free, so why not give Grand a break now, also cut the Gas duties to 25 c per gal. The Brac on pays 12.5 c per gal.for gas.

  5. Anonymous says:

    This is good to hear but the average Caymanian is suffering because of the high cost of living. Why not use this opportunity to help drive down some of these costs. For example, how about cutting the import duty cost on all foodstuff in half for six months or dropping the stamp duty for all Caymanians by half for a year. These are just two things that I have thought of but I am sure there are a lot of other creative ways that could be implemented by the economists that be..

    Many of us are living paycheck to paycheck, many times wondering whether to pay which of the Devils the bank for the mortgage or CUC just to keep the lights on..

    Cayman is now a rich country with poor people..Something needs to be done..

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    • Anonymous says:

      Yes, and we will be the same fools to vote them back in next time..

      These are purely optics to make them look good..Somebody telling me they have $200M in their pocket while they see me picking food out of a trash can has no empathy for me..

    • Anonymous says:

      Because this is an operating surplus not surplus money. Learn the difference. You have far bigger debts and unfunded liabilities to pay for.

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  6. Anonymous says:

    When the head tax on the cruise tourists goes for the dock, the surplus will disappear.

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  7. Anonymous says:

    A surplus of lies.

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  8. Anonymous says:

    now imagine if they tackled the waste in the civil service…

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  9. Anonymous says:

    This is the peoples money.
    Mismanagement of revenues and expenditures led to this surplus.

    NOW GIVE IT BACK !!

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  10. Anonymous says:

    I had thought our FCO-permitted loan capacity was pegged at $400mln, how did we lever over the limit, or did nobody at the FCO notice? Maybe that’s why it had to be paid down in advance of bond refinancing in Q4? Has anyone asked how many months of CIG payroll reserve are we riding on?

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    • Anonymous says:

      There is no requirement for a $400mln limit on debt so no requirement to advice FCO. There is a net debt requirement of 80% of Revenues but $400mln is far from 80%. Regarding payroll…..read the report….there are HUGE cash balances….payroll is definitely covered for a long while at this point.

  11. Anonymous says:

    Lower the import duties back down to 20% … and then off of food.

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    • Anonymous says:

      Better yet, reduce it to 10%..and tell the grocery stores if the prices don’t come down they will be charged with price gouging..

    • Anonymous says:

      3:09 pm, the import duties are 20% and have been for long time for the merchants, but still 22% if one imports the same items. In the Brac cutting down the imports duties does N O T help the consumers for it is NEVER passed on, its only a bigger profits for the business people.

  12. Anonymous says:

    It saddens me to see Grand Cayman overloaded with expats, etc., I prefer to see
    The authentic caymanians prosper, there are too few left…. Like Hawaii, the natives
    Are pushed to more undesirable areas…… Breaks my heart……

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  13. Anonymous says:

    Now stop bragging about the revenue that government has made, and do something about the high cost of living in the Cayman Islands.

    There are people suffering that this Unity Government don’t want to acknowledge.

    Hope they are all voted out next election.

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    • Anonymous says:

      A short-term Budget Surplus is not new found “spending money”, though even the Cabinet doesn’t seem to understand this, or how to retire debt, or even honestly account for looming Bln+ liabilities.

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  14. Anonymous says:

    The public is easily fooled by this propaganda. It simply means more money came in than expected, it is not disposable cash like they want you to believe.

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    • Anonymous says:

      Yes it is

      • Anonymous says:

        Of course it is. The budget set already takes into account what is needed to service debt. If we do better than that, then we have money we didn’t expect to have. Yes, we could put all of it towards liabilities, but that’s not required. We could spend some of the money and we should.

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  15. Anonymous says:

    Good. Santa, we need a few new ambulances and actually a 4th one in service at all times to meet the increase in demand for service. And the emergency room at Georgetown hospital needs to at least double in size. Thank you

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    • Anonymous says:

      Well what about the outside ceiling at the ER ,? Or you did not know that dropped down at 2:am one nite last week ? Thank God no one was out there ,bet ye na hear that ..

  16. Anonymous says:

    Pigs can fly too!! Hope if is is so they don’t spend it all on PR for the port. They need to absorb some towards my CI500 per month Cinico coverage!

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    • Anonymous says:

      Just be grateful this lot don’t go on world travels with their hangers on, private jet junkets to casinos , with personal drivers and bodyguards spending your money.
      Be careful what you wish for when you wote.

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      • Anonymous says:

        Actually they do and they take Big Mac along with them. They are all the same. The PPM have become the old UDP.

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  17. Anonymous says:

    well…if they tax and dont pay workers according to cost of living…of course it gonna surge…caymanians…vote them in during the 2021 elections so the can have us eating out of dumpsters as soon as they get elected..😢

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  18. Anonymous says:

    On March 21, Moody’s Investors Service affirmed the UK-backstopped “Aa3” LT- foreign currency credit rating of Cayman Islands with, for now, a “stable” pre-Brexit outlook.

    We have USD$312,000,000 coming due on November 24, 2019 (http://cbonds.com/emissions/issue/11677) and, instead of retiring that and rebuilding reserve, will have to roll forward much of that debt forward via a new 10 or 20 year issue and service that debt at a new interest rate to avoid default.

    That issue will count against our total permitted loan capacity with the post-Brexit Foreign Commonwealth Office.

    There is no EXCESS money for spending, folks, and there are still Billion+ dollar underfunding liabilities with CIG healthcare and pension that aren’t reflected on the territorial balance sheet.

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    • Anonymous says:

      10:58 Outstanding comment – thank you!

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    • Anonymous says:

      Credit downgrade is a very real possibility for the UK and its territories, with the no-deal Brexit that looks now to be on course to become a certainty. This will potentially raise our ongoing debt servicing expenses on whatever principal balance is refinanced later this year.

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    • Anonymous says:

      Hear! Hear! All we have are a bunch of pigs at the trough, licking their chops at the opportunities to extend their time at the trough.

  19. George Towner says:

    People may criticize Alden and his PPM team all they want, but I can tell you, they sure do know how to boost the public 🙂

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  20. Anonymous says:

    If they have 200 mill booting around in the bank, why don’t they drop that exte 25c fuel duty that mckeeva tacked on when he ‘balanced’ the books a few years ago.
    Scary thought that lame brain used to be minister of finance

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  21. Anonymous says:

    Here, sitting back, waiting for the onslaught of negativity.

    And NO, these are not audited figures as the fiscal year ends December 31, 2019.

    And NO, Franz did not do his job and got the historic figures up-to-date and audited.

    Fire away!

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  22. Bean Counter says:

    Is the Minister of Finance including the unfunded pension liabilities and healthcare costs that no one wants to acknowledge?

    Are the figures presented audited consolidated financials?

    If not what is the true position?

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    • Anonymous says:

      10:39am

      Tell me one country that has a pension liability reserve fund.

      Then tell me one country that has a fund that is fully funded.

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      • Anonymous says:

        Norway?

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      • Anonymous says:

        Those are just called “pensions”, and they get a lot less headlines when people are paid the money they are due, on time, and without negotiating partial payments or reneging payments altogether.

        Being a responsible government should be the goal, not emulating the fiscal imprudence of others, or volunteering to be a participant in the Gov’t Pension Storms ahead. The Cayman Islands, by raising the retirement age, is already operating from the wrong handbook.

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  23. Anonymous says:

    yep..paid for the people on the island who have to live in a place with the highest cost of living in the world…
    and what have the do-nothing ppm done to tackle the cost of living??….yep nothing.

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  24. Anonymous says:

    Gather ye rosebuds while ye may. Good news guys, but time to establish a sovereign wealth fund? This cannot go on forever.

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    • Anonymous says:

      Firstly we’re still massively in debt despite this surplus. Secondly, who do you imagine would invest this money? LOL

  25. Anonymous says:

    Build the port! We na paying for it.

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