Public finances remain solid despite COVID costs
(CNS): The unaudited financial report for the first two months of this year reveal that the Cayman Islands Government has remained in the black, despite the continued economic uncertainties, reduced earnings from tourism and increased spending due to the COVID pandemic. The CIG earned CI$2.7 million more than expected and spent CI$9 million less than forecast and the its overall assets exceeded CI$2 billion for the first time in history.
The public sector assets are largely made up of all the property, plant and equipment the government owns, which equals around CI$2 billion in estimated value. It also has CI$542.2 million in bank balances, with debt amounting to less than CI$228 million.
While the CIG is exceeding its budget forecast for 2022 at this early stage, this is the period when it collects most of its revenue from the financial sector. Nevertheless, several fee revenues have exceeded forecasts, including partnerships fees, mutual and private fund fees, and work permit fees also performed better than expected, all of which helped counter the shortfall of in exempt company fees and accommodation tax.
Government has kept a tight rein on spending due to savings in personnel costs and supplies, but transfer payments were more than CI$6.7 million over budget because of the stipends, support to business and other cash being given out to help people cope with the continued adverse economic and financial effects of the pandemic.
Finance Minister Chris Saunders said he was happy with the trend for the first two months of 2022 but he was keeping an eye on the amount of cash held by government at the end of February, which is lower than at the same time last year.
“While the year-to-date numbers for the first two months of the year are positive compared to the prior year, the government is nonetheless mindful of the cash balances at the end of February 2022 being CI$53.8 million less than the prior year and CI$179.4 million below the same period in 2019,” he said. “This clearly illustrates that we are still feeling the effects of the global COVID-19 pandemic.”
He said the CIG’s management of cash for the first two months of the year reflects a high level of prudence, as for the first time in three years it increased its cash position during the two-month period by CI$27.6 million versus previous combined decreases of CI$123.3 million over 2020 and 2021.
Saunders said the ministry will be monitoring the cash position while prioritising expenses and minimising borrowing. “Although government does have the authority to borrow at this point, we are only interested in borrowing as and when it is absolutely necessary in order that we keep interest expenses down,” he added.
Premier Wayne Panton thanked everyone involved in producing the solid results without compromising delivery of services to the public. He said the record milestone of CI$2 billion in net assets could not have been achieved without the contributions of many past administrations.
“The PACT Government remains committed to exercising prudence and good judgement in managing our finances and will continue to prioritise projects and initiatives that are in the best interest of our beloved Cayman Islands,” the premier stated.
“The government remains cognisant of the global challenges remaining from the pandemic, which are further compounded by the events in Ukraine. These factors have challenged ministers to prioritise expenditures without compromising initiatives that are important to the public.”
The government has still not produced the full details of the 2021 financial year, which last month the finance minister said was expected to show a lower deficit than first feared. He said the spending gap for 2021 would be around CI$5 million less than the CI$15 million revised budget forecast for last year, which had originally predicted a CI$90 million deficit due to COVID.
Meanwhile, government appears to be in a relatively solid position as it faces what could prove to be an exceptionally turbulent year globally, given the Russian invasion of Ukraine, the inflationary fall out from the pandemic and related supply chain issues.
See the preliminary figures for the first two months of 2022 in the CNS Library.
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Category: Government Finance, Politics
OK. Now would you please insist that all private businesses pay the workers pensions they have deducted.
A certain pension fund is shockingly behind in payment collections, with no recourse for workers even with recent court rulings against the businesses.
Really?
Let’s trim the fat.
The people want this!
Start with the big vanity projects like the duplicate Miss Cayman Pageants and the Dubai jaunts.
Why did Mac and entourage go to Spain..?
Sovereign Wealth Fund?
Should have invested in Bitcoin.
One question Chris, how is the entire public sector finances looking? The Government is not just the central government, it includes all the statutory authorities and government owned companies as well. I happen to know that you are misleading the country by reporting only one aspect of our affairs and hiding and staying quiet about the other elements which are struggling to make payroll. Be transparent give the country the full picture.
Source: trust me, bro
Chris , check your North side friends selling or taking fill that could generate income .
It’s really disappointing that the PACT regime didn’t add the necessary missing budgetary resources to SIPL or Auditor General departments to genuinely be seen to be wanting to address pervasive corruption in the Cayman Islands, highlighted by domestic and foreign watchdogs alike. Steady as she goes me maties.
Saunders is pathetic…..you should beg companies to please pay their fees.
and whats your plan to tackle rampant inflation????
borrow more????…….zzzzzzzz
tax, spend, borrow….its the pact way..they know they are only a one term government.
Chris, quit patting yourself on the back for better than expected financial results in two month. Cmon, you know the vast majority of permitting fees and trade licenses are collected Q1 of each year. And OMG, expenses were down you know that won’t happen again in 2022. Between the consultants Kenny is hiring the boat anchors of CAL and the turtle farm not to mention the restaurant boondoggle you’re building downtown you’re not even close to break even. I would suggest more creditable numbers should be looked at end of Q2 or Q3 to give a creditable picture of CIG’s financial health.
I’m curious Saunders said on the Resh Hour that government was considering giving stamp duty breaks to Caymanians. Is there any truth to this ?
Lol
Fix the dump. Nothing more urgent than that.
Yep – finances are looking so good that Saunders needs to borrow $400 million dollars and not pay back a penny for 30 years. The children of this country are F**ked while the PACT are living large – building more roads, paving all of North Side, adding 10% more employees to the Civil Service and pretty much giving the Brac everything they ever wanted. Every ministry hiring consulting strategists, after they hired Senior officer that apparently had these skill set.(LOL).I don’t think this is the change people wanted. 1 year later and zero result ….other than spending a pile of money.
Seniors still existing on 1,000 a month with no assistance from Government before or especially since COVID started. No ‘handouts’, ‘stipends’ or discounts for seniors!
And, 8:16, these poor seniors’ children are in many cases not giving a red cent to help their parents. “It’s governments responsibility to give them more”.
‘Government has kept a tight rein on spending due to savings in personnel costs and supplies‘
HAHAHAHAHAHAHAHAHHA CNS
They can say what they think we want to hear…
So will the criminal pension start this month?
I mean we are doing so well
Imagine how much of a better position we could be in if we didnt waste so much money.
The amount of money made in both 20 and 21 in Financial services and in 21 with property (stamp duty ect) was absolutely absurd.
$45 million a month payroll, don’t worry yourself about the revenue, there’s nothing left.