CIG sees $180M surplus due to record revenues
(CNS): The outlook for the public finances “remains sunny”, Finance Minister Chris Saunders said Friday as he released the Cayman Islands Government’s unaudited financial results for the first five months of the year. Saunders revealed record-breaking revenues for the public purse and a surplus that is more than $30 million above what had been forecast, mostly from stamp duty fuelled by surging real estate prices and the financial services sector. The extra money will be used to help people cope with soaring electricity costs, the minister said.
Total revenues had surpassed the half-billion mark by the end of April 2022, which is an unprecedented achievement. Total Operating Revenues of Core Government for the four-month period ended 30 April 2022 totalled $509.5 million, marking the first time that revenues have exceeded half a billion dollars in the first four months of any financial year.
While inflation is helping fill government coffers, it is clearing the bank accounts of ordinary people, but Premier Wayne Panton said the surplus would help Cayman navigate through the choppy global economic waters ahead.
With an operating surplus for the Entire Public Sector of more than $179.5 million, government is well ahead of the budget forecast, which called for a surplus less than $150 million. However, the CIG has already collected most of the money from the financial services for this year, which means that government is on track to maintain the cash cushion. The minister said this would enable the government to easily finance the Energy Assistance Programme announced in Parliament earlier this month.
“With oil, and therefore energy prices, showing no sign of meaningful abatement in the local market and indeed worldwide, we will use a portion of the surplus to assist our people with the challenges this increase in the cost of living has caused,” Saunders said. “We are fortunate to be able to take this and other initiatives as announced by the premier and look forward to offering this additional support during such a challenging time to provide much-needed financial relief to our people.”
He said the numbers for May are following this year’s trend for higher than budgeted revenue. “I maintain a cautious optimism as most of the government revenue collected in any given year comes in the first half of the year due to various financial services fee structures. However, the May year-to-date numbers shore up our positive position heading into the historically leaner second half of the year.”
Inflation might at some point also affect expenses, which are so far running largely in line with the budget expected expenditure of $381.6 million. Actual expenses were $381.7 million, a figure that exceeds last year by $31.3 million.
But there have been much better than expected performance in several areas, including the financial services, where fees are to date more than CI$11.5 million better than forecast, as well as land share and stamp duty fees. With the tourism sector starting to recruit again, an additional CI$5.5 milllion over the budgeted forecast has also been collected in work permit fees.
The government’s cash position on 31 May 2022 was $469.4 million. This amount is represented as Operating Cash of $304.5 million, $284.2 million of which is held in the form of fixed deposits, and Reserves and Restricted Cash of $164.9 million.
Government’s operating revenue is much better than last year, which Saunders said reflected the confidence in Cayman’s financial services sector, a high volume of property sales and steady growth in permit fees as the tourism begins a slow recovery.
“The tourism sector is obviously not recovering as rapidly as we had hoped, particularly due to the late start following the emergence of the Omicron variant earlier this year,” Saunders said. “However, I anticipate that tourism numbers will begin rising once further travel restrictions are lifted and we roll into high season toward the end of the year. Despite some shortfalls in individual revenue line items, the overall outlook for government finances remains sunny. We are keeping a close eye on the numbers and tracking both upward and downward movements monthly in order that we can be as nimble as possible and respond quickly to any unexpected issues.”
Panton said the PACT Government’s commitment to fiscal discipline, a strong and resilient economy and continued investor confidence has led to the surplus, also helped by the civil service keeping expenses under control.
“This better than budget surplus will help us navigate through the choppy global economic waters that are ahead yet allow us to responsibly help those in our society that need support,” the premier said. “We intend to continue to be fiscally disciplined as we dynamically build on our existing strengths to fulfil Cayman’s potential as a leader in sustainability in the world and one of the best places on the planet to live, work, visit and invest.”
Breakdown of revenues collected for the first five months of the year in several categories with a comparison to prior years:
| 2019 | 2020 | 2021 | 2022 | |
| Import Duty Revenues | $76,739,000 | $67,488,000 | $76,597,000 | $90,044,000 |
| General Registry Fees | $140,223,000 | $136,467,000 | $148,508,000 | $159,088,000 |
| Fees collected by CIMA for Govt | $89,369,000 | $81,728,000 | $133,358,000 | $143,554,000 |
| Work Permit Revenues | $35,611,000 | $21,906,000 | $31,770,000 | $44,255,000 |
| Property-related Revenues | $30,775,000 | $28,339,000 | $50,734,000 | $44,616,000 |
| Tourism-related Revenues | $26,419,000 | $9,768,000 | $539,000 | $7,412,000 |
| Other Coercive Revenues | $32,177,000 | $27,367,000 | $38,666,000 | $42,453,000 |
Comparison of the May 2022 YTD financial performance compared to the previous 3 years:
| 2019 | 2020 | 2021 | 2022 | |
| Revenues | $481,095,000 | $408,618,000 | $517,946,000 | $568,857,000 |
| Operating Expenses, Financing Costs and Non-Operating Costs | $274,461,000 | $308,614,000 | $350,341,000 | $381,685,000 |
| Operating Surplus of Central Government | $206,634,000 | $100,004,000 | $167,605,000 | $187,172,000 |
| Surplus/(Deficit) made by Statutory Authorities and Government Companies | $4,174,000 | ($190,000) | ($12,893,000) | ($7,715,00) |
| Surplus of the Entire Public Sector | $210,808,000 | $99,814,000 | $154,712,000 | $179,457,000 |
| Total Bank Account balances | $711,387,000 | $603,209,000 | $549,803,000 | $469,445,000 |
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Category: Government Finance, Politics
Better get ready for the tourism workers kickback.
The busiest summer ever is here. Yet locals not being employed.
Not even as Ritzy or Kimpton doormen. Pure yardies n Africans.
And I know good local kids who applied!
Just wait.
Me too. Great local kid here from university. Work permit holder employed over them for no lawful reason. Immigration need to start doing their jobs (and it is not to tick boxes!).
Was WORC aware that they applied?
I guess their new system isn’t working.
Or perhaps no one cares until teens start to use drugs in idleness, or turn to crime.
But lots of funds available for new prisons and police stations tho!!
A rass tragedy
I know of 3 caymanians who applied at hotels (front of house) and did not get hired.
We really need WORK to have a hotline and accountability!!!
Why aren’t the hotels hiring our HS graduates for the summer and training them? I would LOVE to see our young locals in the tourism sector.
Again, no Govt program to facilitate this? It would have taken less than a week to organize!
Kenneth Bryan only switch to the rich.
Big boys club now.
You will wait on it. Summer is when the expats bring their own kids to take the jobs like baggers in supermarkets.
Local kids don’t have a chance.
Time to cancel all cruise ships. It’s not worth it for the small amount they contribute and only hurts the stay over numbers.
Sovereign wealth fund? We are going to need one!
More like a Savrin slush fund.
Manage another year like that, take the surplus, and buy another island.
Hmmm. Revenue since 2019 has gone up every year, now $86 million higher. Yet cash has gone down every year, now $242 million lower than 2019 despite the record revenues. You can manipulate the accounting all you like, but the cash doesn’t lie. So wheres the money gone, Chris? Sure as hell isn’t in reducing the unfunded liabilities. But Chris , the massive financial genius that he is, thinks that higher revenue is an invitation to spend even more money – oh, and then borrow a few hunde=red million more as well!
Tourism revenue figures are deminimis – yet CIG give bulk of their support, time and effort to the Bobos involved……
CIG & General Registry revenue emanates from the international financial services (FS) industry, as does a large part of the Work Permit fees revenue, add to that the property fees for the WP holders (places to live, work and enjoy), plus “tourism” fees associated with the FS industry, being hotels, restaurants, taxis for the visiting FS clients etc,….
Yet we treat the tourism industry as if it was the be all and end all…Compare the local air time of Kenny B v Andre E……
Keep your eye on the prize that is the FS industry….the envy of the Caribbean & LatAm….
Chris says FS failing in the next 5-10 years so we have to increase tourism. Where does he get his facts?!?
His basis is to appease those calling for end to PPM and now PACT’s policy of FS permits for anyone who can pay.
…”alternative facts”..from the mouth of someone who knows nothing about everything…..
If he truly believes the FS industry is gone in 5 – 10 years, best for EVERYONE to cash in now, sell your property and do not be left at the bottom of the pyramid (scheme)…
This is absolute rubbish..We cannot do without the Tourism numbers. If You were running a business that depended on two pillars and one was performing well until a pandemic happened, would you try to bring that pillar back or would you just let it die even though you know there is great potential and demand for it?
Is Kenneth the best one to get the job done? I’m not so sure anymore. Like those before him, the glitz, glamour and money are charming him. His strong arming tactics particularly of women and people that professionally know a heck of a lot more than him leaves a bad taste in my mouth..His choice of John John with his history of the PPM tactics and behavior, to be his second in command is, well, I’ll leave that for others to draw conclusions..
We can & should do without the hordes of tourists. Homes in Air BB back on the market for locals, less traffics c on the roads. Stop building hotels. Stop building luxury condos no one here can afford.
Enough is enough. Condos & hotels on SMB sufficient for the ultra rich tourist we need & want. Not the cheap cruises, not the cheap self catering air b&b crowd.
Correct. How much the government earns from tourism is not the nly value. Many people earn their living in tourism.
…. a hell of a lot less than earn their living in the FS industry….
Well as FS clearly pays for the entire civil service you can include them too!
Doing well before Covid? it was generating a massive 55 of government revenue pre Covid. If we only have 2 pillars, that one is pretty short!
Tourism revenue to government is small, but that does not mean the tourist industry is small or that no private persons make a living in it.
Spending 5 million to assist with high cost of electricity just does make any sense…what do make sense, is to negotiate with CUC to somehow lower and give fair readings on their bills so that everyone can benefit. This is 5 million more in CUC purse and everyone has to now pay for this, in one way or the other.
You do know your reading is based on what you use? The best way to decrease that is to make changes to how you use electricity, upgrade your insulation and AC equipment, and change out appliances and lights when you can with energy efficient versions.
Like that moves the meter, not.
Minister, how about giving us figures for total Civil Service salaries including COLA adjustments, pensions, and their gold plated medical scheme?.
Why, 10:22? Are you jealous of civil servants who, even when they are excellent workers, are constantly pissed on by posters like you? Is the private sector full of high performing employees with no employment benefits?
9.40am Do you ever read the comments on CNS about the performance of the Civil Service?, you are criticised for very good reasons.You get annual cost of living adjustments to your salaries and your pensions and God only knows how much your army of employees and dependents spend on medical treatment when it costs you absolutely nothing. Try comparing the Cinico SHIC contract which costs the public $800 a month or more with co-payments of 20%, with the Civil Service plan which pays 100% on almost everything with zero premiums.You get $6,000 a month for home care, compare this to the $35,000 lifetime maximum for mental health care under the SHIC plan. The private sector does not provide free gold plated medical care, it does not provide automatic annual cost of living adjustments to salaries and pensions, and above all it does require accountability from all employees, something that is unheard of in the Civil Service.
9:40; guaranteed the private sector is not:
full of employees who do not perform yet collect higher salaries than world leaders;
Let us know what happens in the answering the private sector when you don’t answer the phone, or are arrested or the list goes on….
Sh*t that flies with Govt does not fly in the private sector.
In Govt when you f**k up you get moved to another dept to carry on; in the private sector you get fired.
Truth hurts, we know, fix it.
Yeah, I wonder why? They have fleeced me for $650 over the past month for planning application fees and now refuse to admit that I’ve applied. If this happens to 1000 people a month, their coffers are obviously going to be full.
Saunders was on the Resh hour stating that there would be stamp duty exemptions for Caymanians, when is this going to happen right before the next election ? Get it done….
Try to appear you are helping but really all they are doing is securing their votes for the next election. Apparently it’s only government employees that pay CUC.
Obviously they are charging too much for the service they offer reduce some of the government fees and allow the citizens to have a better life.
So does this mean we can listen to music on a Sunday now?
World class. How do we blame for this.
Great. We have lots of money why don’t we give it to the rich developers in the form of duty concession instead of spending it on improving the lives of the non rich Caymanians. That is the logical thing to do if they own you, elected officials.
PACT – we’ll help the masses with soaring inflation.. but only after we’ve gouged them all of $180 million…
P – Panton
A – And
C – Co
T – Totally Useless !!
I have said this before and will say it again. The government is making huge windfall profits due to the price of oil. Reduce the amount of duty on gas and help reduce the cost of electricity and petrol to the consumer. It can always be raised once the price of oil comes down.
If this can be achieved supermarkets and other retailers can pass savings onto the consumer. It will also benefit the tourist industry which has gone through hard times in the last couple of years.
Chris, you keep saying it but it’s like you never bother to look up that those duties are volumetric, not value-based.
Government is making no additional revenue for fuel as a result of higher prices.
I think Chris is referring to the windfall duties on all other imports due to inflation pushing up prices and therefore the amount of duties. That gives room to adjust other duties including energy.
Fair point, and apologies to Chris I hadn’t considered he may have meant secondary impacts on pricing for goods that have value-based duty assessment.
Not sure though that the difference is going to be that much, maybe a percentage point or so?
Not well thought out! Go back to elementary school…
Firstly, thank you PPM foe leaving behind a strong economy.
However, while Saunders boasts about surplus budgets, he failed to mention that most of the money collected comes in during the first 3 months of the year (Annual company Registrations etc) after that, nothing is paid for an entire year, so yes the first quarter always looks great on paper.
Another thing the PACT Government is not talking about is the continued reliance on work permits in all sectors. Yes there are more jobs than Caymanians but in the specialist trained and professional fields there must be an effort to educate and train Caymanians to take those jobs! This is where the surplus needs to be spent. The Premier said the surplus will be used to get us through the hard times, that wonderful but how about some long term spending on education and training with guaranteed returns, rather than the handout programs that are simply bandaids!
Agree to an extent but before there is even a discussion about how to get more Caymanians into highly skilled jobs, the disgraceful education system here needs to addressed. When so low a proportion of young people are even achieving the minimum standard it’s fairly obvious that the public educational establishments are consistently failing local children. It’s not like the government don’t have money to invest for the benefit of future generations; it’s that the current strategic leaders are rewarded for failure, are massively under qualified to lead this type of change and will put more effort into blaming someone else for shortcomings, rather than actually accepting responsibility.
Disgraceful or non existent parenting is just as much of a problem as the education system and has been for at least 40 years. Far too many very young kids are entering primary schools with poor or zero communication and social skills, as if they have been neglected from toddler days. They start life with deficits and these deficits just get worse and frustration leads to anti social behavior and often eventually crime.
Cut fuel duty for CUC most obvious and simple way to put money back into people’s pockets.
Fix the damn dump.
How many times have you posted this? 50? I laugh every time.
Pathetic they are.
Lools like record work permits…PACT comtinues with the supported abuse of the immigration laws for the benefit of themselves. Maybe we can mow their lawns or clean these big men’s houses.
Sounds like you need a sick day
How can you have a surplus when you are spending borrowed money?????
1:48, All our Govt means is they can pay upcoming bills.
There is never a surplus but the vast majority of voters don’t get that.
How can you have a surplus when your pension plan is unfunded?
Off the backs of our people who continue to suffer.
Never been a better time to build our cruise berthing facility
and still measures to tackle inflation or the oncoming global recession?
you need to do more than just tax/spend/borrow
Cut duty in half on everything so we all get some help instead of just a few select people.
But we all don’t wote.
More proof that we are not reliant on tourism.
Perhaps the country isn’t, but many individuals are.
Yeah, well they should have figured out something else to do about 2 years ago now.
Not arguing with that, only against the those that predicted doom and gloom without tourists.
Are you even reading people’s comments? There is a lot of gloom among those not on the government gravy train.
Meanwhile first-time Caymanian buyers are still required to pay stamp duty on properties above 400k despite there being no properties available below this threshold and no moratorium on foreign investors purchasing everything available in this category.
I recall this man ran on the promise of an expansion of the stamp duty waiver protocol yet nothing has been fulfilled – and has the gall to brag about a surplus — yes there is a surplus of gov income because you have taken it directly away from the people.
If you can afford to purchase property over 400K you really have nothing to complain about.
If you can find a property UNDER 400k, please link to it
3:55 pm in the Brac is plenty land under 50,000(fifty thousand)
You remind me of people who complain they can’t purchase a decent bottle of wine in Cayman for less than $100.
The point is, if you can access and payback a $400K bank loan, you are not suffering financially.
It’s not of whether someone is or isn’t suffering, it’s about a systematic failure by the gov to create/adjust policies so that those who have not yet had a chance to enter the property market (for sake of needing to save every single penny for the down-payment, bank fees, legal fees, registration fees) are actually able to do so ie young caymanians.
The goal post keeps shifting and it is becoming harder and harder for young caymanians to “get their piece of the pie”. It begs to question – if we can’t afford to live in our own country then who are the policies being designed to benefit? Because it surely is not young caymanians. Instead we read articles like this about a gov surplus meanwhile we’re forced to remain at home with our parents (who themselves are forced to work beyond retirement age) or pay rent to some landlord that may not even live on the island (the very same foreign investor that managed to snap up two or three 2bed units at 300k as part of the necessary investment required to obtain citizenship).
If that’s not a rigged system then please enlighten me to the contrary. At this point it’s knocking on the door of economic genocide aimed squarely at the sons and daughters of the common man.
Believe me, I know your pain. In 1990 I had to beg and plead, and still only one bank in Cayman was willing to take the chance and give me a mortgage at 14% interest, which I was delighted to take since my monthly payments went towards a house that I now own instead of to a wealthy individual who owned many apartments.
However, I’m just saying don’t cry about not be able to afford new shoes when there are people who have no feet. You seem to be an intelligent person so I suggest you run for office or support someone with similar thoughts to your own.
Unfortunately, the vast majority of those in power, and those who hold aspirations, will appeal to the lowest common denominator if they wish to be elected and/or re-elected, so $25 handouts will always get better returns than good long-term policies.
While I would gladly engage your pointless suggestion to not “cry about not being able to afford new shoes…” I rather leave you with a useful insight as to what young caymanians are starting to realize about the prospects of having a future here:
“It is far too expensive to get started, and even more expensive to stay afloat than any other country out there”.
If you cannot see the merit in that opinion then you are clearly operating with blinders on as to the impact these very policies will have on generations to come. But according to you we shouldn’t “cry” because the government will save us all once we are at the point that a $25 handout satisfies us? I certainly do not want that for my, nor my children’s future.
Perhaps the real problem is that we haven’t cried enough.
I had a lovely modern 3 bed, 2 bath house available for under 400k in Northward, fully furnished, in a nice quiet cul de sac. Had it on the market for a month and only one family came to look at it. So I rented it instead and there were dozens of people who wanted it. Would still consider selling if I got a $400k offer.
Properties wouldn’t be so expensive if government would put a moratorium on expat buying houses. The houses are used as AirBnB’s which leave less houses for the locals to rent as well.
As for 400,000 property…don’t think you can find any for less anymore.
Great for the government but families are suffering. Return tax dollars back to the populace. Do not forget that those tax dollars are the publics money. Not the governments or the civil services.
Give us a break on import duties
So why is he borrowing the $300 million+ again?
To hand out to Mac Kenny and Saunders supporters, NAU etc. for wote dem.
I haven’t seen the announcement promised last week – who is getting help with their CUC bills this summer? I hope all seniors!
Just about to get June bills – isn’t this summer?! When are the details of help going to be released?!
All Lodge.