OAG: Budgets are opaque and complex

| 18/12/2020 | 46 Comments

(CNS): The government’s budget process is neither effective nor transparent and needs significant improvement to make it more simple and accountable, the auditor general has said in her latest report. Sue Winspear said that limited progress has been made in addressing the concerns her office has raised for more than seven years about how government manages and reports the way it spends public cash.

Winspear pointed out that government is failing to match its resources to the outcomes it wants to achieve and the budget document is inaccessible.

“I believe that ‘less is more’ and producing 2,700 pages of budget documents actually reduces transparency and understanding,” she said in Improving Financial Accountability and Transparency: Budgeting, the first of a trilogy of performance audit reports drilling down into the budget process.

The most recent budget document is 3,000 pages but fails to explain to the public how their cash is being used to achieve government goals.

“Providing more information does not necessarily improve transparency; too much information can make it difficult for readers to understand the Government’s spending programme,” she added.

The report sets out 17 recommendations to improve budgeting, and while they are aimed at the civil servants involved in preparing the budgets, Winspear had a message for the politicians too. Legislators have historically passed supplementary budget approvals running to millions of dollars after the budget year in question has ended, but they should be doing that in a more timely fashion to improve accountability to the people.

“This will be helped if the Parliament shifted to more frequent and regular meetings as it establishes itself as a new, independent entity,” she said.

The Office of the Auditor General has also published its annual review of the state of financial reporting and found some significant improvements in this area. All of the public sector entities that had completed their 2019 audits, which is 36 out of a total of 41, received a clean or unqualified opinion, and they are also producing reports with the accounts, which goes some way to addressing the transparency problems.

With government now on top of the financial reporting side of its public finance, Winspear said the focus must now shift to improvements in the budgeting process.

Responding to the OAG reports, officials welcomed her comments about improvements in the bookkeeping. Facing the more critical report on budgeting, officials said the finance ministry is committed to modernising the system for future budgets. They said a working group, which was established more than two years ago but has been inactive ever since, would now get to work, following the publication of this special audit by Winspear’s team and based on its recommendations.

Deputy Governor Franz Manderson, who has taken overall leadership responsibility for public financial management, said the government takes its responsibility as custodians of the public purse very seriously.

“Where we have been tasked with making improvements in recent years, we have strived to deliver those efficiently and strategically,” he said. “We pledge to continue to make improvements with regards to transparency and accountability in our use of public funds and, particularly, to make this information more accessible to the public.”

But back in 2013 the OAG had warned government that the links between the strategic policy statement and outcomes or policy aims of government and the outputs included in the budget statements were unclear and disjointed, and this is still the case.

“It is important that money and other resources are directed towards achieving the government’s strategic priorities and outcomes and that appropriate measures are put in place to demonstrate the progress towards achieving these,” Winspear wrote in the report.

She pointed out that while government sets out the broad strategic outcomes it wants, it does not outline how it will achieve them. Listing activities or projects are not outcomes, she noted. In other words, government is failing to show the public how the money it is spending is achieving the policy aims it has promised to voters.

By way of example, the auditor general noted that one of the specific goals in the 2019 budget, regarding education was headed “The Best Education Opportunities for All Our Children”, but the outcome listed was to focus on improving facilities, which does not by itself contribute to a better education, Winspear said.

“It would be better to set specific outcomes that relate to educational attainment such as increasing the overall level of educational achievement levels of school children, reducing the gap in educational attainment between the highest and lowest performers, and improving the Cayman
Islands’ standing when benchmarking internationally,” Winspear explained.

See both reports in the CNS Library.

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Category: Government Finance, Politics

Comments (46)

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  1. Big Johnny Stud says:

    Dearest Ropa why did you tell the Auditor General that several areas of spending was off limits to scrutiny especially the ones concerning your office and our dear premier special projects ??

    • Hubert says:

      Big Johnny Stud, Mother in London does her own regular auditing of the Governor’s office just like they do with all British High Commissioners and Ambassadors around the world.

      What is your source that the Governor said the dear Premiers special projects were off limits? Which projects were they?

      • Anonymous says:

        We pay for the Governor’s office, his house, security detail, chef, driver, cleaners, VIPs and special events.

        • Anonymous says:

          So what. All the costs associated with the governor are a drop in the bucket. Of all the people that guy is not part of the problem. Worry about the other 99.99% of the shenanigans going on here and get over it with the damn governor.

    • Anonymous says:

      Imagine dat shit. It has to be worse.

      Franz in charge of public finance.

  2. Anonymous says:

    Submitting a 3000 page accounting report to the OAG is, in itself, an act of corruption. Blowing 3000 pages of smoke is not in keeping with Generally Acceptable Accounting Practices and is the opposite of transparent and clear reporting. The Anti-Corruption Commission should be looking into the authors and sign-off principals of this telephone book. That should go without saying, but here, it seems it also needs to be said. Crooks.

  3. Anonymous says:

    Out of all of the ill-advised spending, what about the Government’s decision to subsidize the Cayman Islands Legal Practitioners Association (“CILPA”), which it then gave to Cayman Attorneys Regulation Authority (“CARA”) for over $1million dollars for 2020 and 2021.

    Both CILPA and CARA have been operating unlawfully, but with Government subsided money. Shame, shame, shame.

    Now Government has decided that CILPA and CARA are not right as an Anti-Money Laundering regulator for lawyers. What is going to be the outcome for CILPA and CARA paying back this money, especially since they have caused so much harm to the Cayman Island’s’ jurisdiction?

    This Government needs to be halted from the wake of damage that they have caused. It’s a good thing that next election is right around the corner, so that we can vote these knuckleheads out. Only housecleaning left after that is the Attorney General, who is a bigger failure than the Premier.

    Change is coming, but before that happens, it’s necessary to get that money back that Government gave to the lawyers, who did not need the money. Shame, shame, shame!!!’

  4. Anonymous says:

    Budget is opaque and complex!?! Almost as bad as getting ripped off on a car repair at GT! Brutal!

  5. Anonymous says:

    another glorious day for our ‘world class’ civil service…..zzzzzzzzz

  6. Anonymous says:

    Yes, 1 plus 1 can equal 1 in Cayman. The other 1 just magically disappears.
    No one has the balls to do an audit.
    Governor, where the bloody hell are you? Or is that a steel drum tune that you are just learning? Sir, you disappoint us.

    CNS: This article is literally about an audit.

  7. Anonymous says:

    Maybe the qualifications for office should include a basic math test at the sixth grade level along with just being a Caymanian. But I don’t think that will help.

  8. Anonymous says:

    What She(the OAG) wants CIG just does not have the ability to give. The best they have done in the past up to the present is failure after failure. They are just not qualified to do the job. Lack of education, training, and experience . You have only to look at the obvious leader of it all Mr. Bush. But this is the best Caymanians have. You will have to dumb it down just so they understand what you are talking about and settle for what they can do. Or do it for them.

  9. Anonymous says:

    Very few comments on articles requiring some intelligence and reading comprehension.

  10. Say it like it is says:

    Mr Manderson can I task you with dealing with the eternal problem of your employees never answering their telephone, please take personal responsibility for ending this fiasco.

    • Anonymous says:

      6:13 call the GAB and you we will be surprised by the efficient call handling. I have called the GAB every day this week and my call was answered within the 2nd ring.

      I am blown away to read…All of the public sector entities that had completed their 2019 audits, which is 36 out of a total of 41, received a clean or unqualified opinion, and they are also producing reports with the accounts, which goes some way to addressing the transparency problems.

      So much improvement must be applauded.

      • anon says:

        6.09am What is GAB?. When I tried calling the Deputy Governor’s Dept, I got a recorded message with a number of extensions, I tried 5 of them none of which answered, and gave up. Try calling the Planning Dept and see what happens (clue, nothing), and the list goes on.

        • Anonymous says:

          Too many of them still “working” remotely. Despite what the current trend is when a dept is Customer facing everyone should be in office.

      • nauticalone345 says:

        Some places do answer yes! But there are still too many that don’t! The Dental Clinic is certainly one that certainly needs improvement!

      • Anonymous says:

        Don’t know what world you are living in 6:09?

    • Anonymous says:

      This is what happens when the civil service recruits from the private sector.

  11. Anonymous says:

    Not only do the department heads need financial control reporting, but they must also take ownership to publish a quarterly and annual accountability report of what they actually do for the people of the Cayman Islands (who are paying)! There are entire departments of CIG that contribute little more to the community beyond comfortably remunerating their immediate staff. Websites dating from 2007! Why do these dead weights enjoy any job security?!? Fire them!

    • Anonymous says:

      How difficult can it be to have financial transparency and an effective budget with 3 dinky islands and a population of 65,000?

      Time for direct rule. This financial nonsense has to stop. Been going on for far too long.

    • Anonymous says:

      I overheard one former Permanent Secretary only a few months before the fiscal year end boasting how he still had $XMillion he needed to spend before the end of June, when the year end was 30th June and it was still single year budgets. We all thought this was madness, but it apparently still rampant. How he subsequently became the head of some statutory boards is mind boggling. Seems like efficiency and fiscal prudence is not rewarded.

  12. Anonymous says:

    This is not an accident! The budgets and accounting are opaque and full of holes for a reason people! Funds are constantly being siphoned off and misused by insiders. Why else would they be so resistant to change even after the OAG has been raising the issue for years and years and years. Remember that next time you’re paying duty that’s more than the cost of the item, or driving over potholes or stuck in traffic or despairing at your child’s education. Per capita Cayman is one of the wealthiest countries on earth.

    • Po Man says:

      “Per capita Cayman is one of the wealthiest countries on earth.”

      It may be one of the wealthiest countries on earth, but the high-ups have the lion’s share of the cash. The average wealth of the population is pitiful.

  13. Anonymous says:

    You’d think with all those people with MBAs in the government this would be a no brainer…oh wait, those are all matchbook degrees!

    • Big Bobo In West Bay says:

      Mickey Mouse degrees from Mickey Mouse universities.

      • Anonymous says:

        The education must be universal as people with MBA’s from ‘prestigious colleges’ are doing the same thing the world over.

        • Anonymous says:

          There’s always one who has for years pretended he has a Harvard MBA when in fact he just went to a two week Summer business course open to anyone.
          The charade works mainly on Americans who are seduced by his “when I was at Harvard “ line.

    • Anonymous says:

      More Bullshit Academia

    • Anonymous says:

      I was told at a good U.K. university that I should do an MSc, because an MBA = More Bad Advice!!

    • Anonymous says:

      The MBA has to be the most useless qualification. Consider a man was put on the moon with no MBA’s involved, Amazon, Microsoft, Apple will all tell you that attitude and experience are more useful than any university degree.

  14. Anonymous says:

    If the AG is receiving documents in comparison to having to fill out the new CBC “electronic system” of declaration of imported goods…i wish her luck. Now i know why cargo is backed up.

  15. ACaymanian says:

    That is exactly what I have been saying . Broad objectives without giving thought of how they will be achieved and equally as important prioritization of projects to ensure that there is achievement and resources placed on tithe most important items and down the line.

    This demands training of the zpoliticians who reall
    y have no experience in such matters and rely purely on the civil service over which they have no control in a blind leading the blind dance. Things have got to change . Thank you Madame Auditor for the service you provide. Now we need young and older educated and experienced politicians to be elected to run things properly. …

    • DonkeyFull Moon says:

      Exactly! Some of these politicians are in way over their heads – as far as the capacity to understand what they’re meant to do (other than photo ops!) the Health Minister is a perfect example of one completely clueless!
      Talking about donkeys and full moons and other nonsense!

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