Public spending expected to reach over $1B by 2026
(CNS): Core government expenditure will exceed CI$1 billion by 2026, Premier Wayne Panton revealed in his Strategic Policy Statement delivered in the House of Parliament Wednesday. According to the document that sets out the government’s proposed spending plans for the rest of this administration and beyond, well over $3 billion in revenue is expected to be collected over the next three years.
While the Cayman Islands Government reached a record $1 billion in revenue collection last year, the CIG expects to spend that much running government by 2026 for the first time. But despite this expected record level of public sector expenditure, Panton said the government would collect enough revenue and could still expect a core government surplus of over CI$103 million that year.
Panton, in his new role as finance minister, painted a rosy fiscal picture for the rest of the PACT administration, with record low levels of unemployment, falling inflation and continued surpluses for the public purse. While growth in GDP is predicted to fall to just 1.6% next year, it is expected to grow by more than 2% for the rest of the SPS period, with no expectation of a recession here.
The government’s economists said in the SPS report, “Robust international demand for Cayman’s services is expected to support short-term growth in the Islands.” But they are warning that increasing geopolitical tensions, the current test of faith in the international banking system, and the continued fear around the world of a looming recession pose significant “unquantifiable downside risk to the forecast”.
Consumer demand remained strong in the Cayman Islands last year, and this resilience is expected to continue in the first part of 2023 and facilitate further growth. Despite the problems associated with it, consumption by the community remains one of the main drivers of revenue for the government in the coming years. Panton told the parliament that, alongside the financial services sector, import duty and stamp duty would be where the government collects most of its cash for the next three years.
With no new taxes, fees or borrowing planned, the public purse is expected to be filled by the offshore industry, continued acquisition of stuff (despite some slowdown in the pace of demand) and property sales. The demand for financial and insurance services will continue to be the main source of government revenue.
“The government’s priority to implement economic substance regulations for partnerships and other compliance-related regulations should add to the stable performance of the sector,” according to the SPS document. Although inflationary pressures and tighter monetary policy could partially limit the demand for loans, the finance and insurance services sector is projected to grow by around 1.6% over the medium term.
The premier said that the government remains committed to maintaining fiscal prudence, and the forthcoming budget, which will be delivered later this year, will be in full compliance with the Principles of Responsible Financial Management, as prescribed by the Public Management and Finance Act.
Alongside the usual economic management, the government would be focused on the human development side of society. Panton said there were plans to build new schools, improve gender inequality, increase affordable housing, improve public transport and lower the cost of living to reduce social inequality and raise living standards in the Cayman Islands.
As he presented the document to the House and before delivering his full address about the SPS, Panton stressed that the government was focused on responsibly improving the quality of life for all of the people of these islands.
See the SPS in the CNS Library.
Watch the morning’s parliamentary proceedings on CIGTV below:
- Fascinated
- Happy
- Sad
- Angry
- Bored
- Afraid
Category: Government Finance, Politics
Never mind of course that their pension scheme is unfunded. What could possibly go wrong?
With all that money to blow it’s time for our hard working MP’s (who think they are responsible for earning it)to award themselves another whopping salary increase.
to put into some context Birmingham unitary authority, the largest in Europe to provide services to in excess of 2 million people has a budget of 1.5 billion a year.
And with all this money what does the CIG achieve. put frankly absolutely #£@% all. They can’t even sort out a single major issue. It is such a poor return to the people. A bit of austerity might be the only way to improve this lack of performance and place a bit of control on the ever expanding sponsored government charity scheme ie the World Class civil service.
Govt spent 973.5 Million last year. Our premier thinks reach 1 B by 2026.
Did they include the inflation, money devaluation in their calculation.
Something missing???
Any possibility of fixing MRCU? Or do we have to keep suffering like it’s 1965.
Never in the history of public administration has so little been achieved with so much.
What of a Sovereign Fund or hard-times fund? Do we know if this or prior GOV have been putting aside anything into special fund in event things collapse or tough times hit? Given we have had many years of surplus, I can’t imagine a scenario whereby we are spending every cent of what we collect! Or are we?
“Do we know if this or prior GOV have been putting aside anything into special fund…”
Yes, I think we all know. The answer is ‘No’.
To 27/04/2023 at 9:37am: I will thank you to not ship all civil servants in the same catboat! Many of us have degrees that we busted our chops for; and a myriad transferable skills; and the commitment to serve. We come to work every day on time, and work our a**es off. I am TIRED of being misjudged for the ineffectiveness or entitled attitude of many others. It is not the fault of us, the hard-working, that POCS is unwilling to sack people who deserve it. Sick’ning!
11:38 am. most of them degrees was payed for from the tax payers/govt. so be thankful.
great news for the bloated, over-paid, under-worked incompetent civil service……a bigger trough for them to feed on….
scary…just more and more money to be thrown away with no real plans to tackle housing/traffic/environmental/cost of living issues.
and just remind me…how many recommendations of the miller shaw or e&y reports have been implemented????
Saunders and the rest of them, including many posting here, calling for free healthcare after age 60-whatever is totally missing the real issue.
Some 20+ years ago Parliament passed a law forcing everyone in Cayman to be covered by health insurance. In passing those laws they allowed the insurance companies to cherry pick their customers and not cover those who needed it most.
What has been the result of Government passing the Health Insurance Law?
1. Insurance companies have averaged millions of dollars in profits over the last 20 years.
2. Government has paid the medical bills for those who the insurance companies refused to cover and/or set their rates so high that health insurance was not feasible.
3. MP’s made provisions that they would get free healthcare for life.
So once again Saunders is proposing that government, which is all of us, pay the healthcare cost of the young and aged. The insurance companies must be lining up to fund his re-election campaign.
Free health care, or government subsidized health care, should start at age 65 (Retirement age), Not 70.
We are planning to move permanently from Cayman after 35 years of residence, partly as a result of the health care cost.
Caymans problem is the health care system is based on the U.S. health care provision system, with grossly over-inflated insurance coverage costs /coverage.
Being told that CIG will have $1 Billion in expected public spending , while having no set plan for a retiree health care policy , reflects just where this & past administrations park their priorities for its population.
They are only interested in themselves.
Don’t let the plane door hit you on the way out, insurance doesn’t cover it.
Enjoy your stay.
Bingo. $1B spent and what do we have to show for it? that works out at like 10k per person on this island per year at a rough estimate of 70k people.
We don’t have healthcare, we don’t have public transport, pensions are shit, there is no social safety net, the list goes on.
This is madness. That billion goes to keep the elites at CIG and the associates quangos in their lavish lifestyles. If you’re senior enough at CIG or hanging on the coat tails of one. You’re set.
Meanwhile the rest of us….
Don’t blame the US, your system is nothing
Iike ours.
Yeah, it’s worse
And that’s just the parliament catering costs.
CIG doesn’t and never has had a revenue problem. What is has, and always has had is a spending problem. Electing ignorant pandering politicians has only exasperated the problem.
When this deck of cards collapses, and it will, average Caymanians will be left holding the bag. But the bag will be empty.
The problem is definitely exasperated.
Can we please aid the senior citizens in this country with some of these $’s. Can’t even get free vaccinations or eye tests (not covered by their insurance). They are struggling, even $100 a month extra would help to cover their bills & you are talking billions!! Let’s give all Caymanians over 70 free health coverage.
We seniors really need some help with our medical. My pension ran out last year, now paying CI$501 per month on CInico which comes from my savings. Cinico does not cover eye care and sometimes the medical and dental coverage runs out by end of 1st quarter. HSA rates are as high as private hospital/clinic.. should all of line up at NAU for some asssitance? Just asking for all struggling seniors.
Let’s just cut teachers police officers firemen prison officers social workers CBC officers and those civil servants who process all the work permits. We should able to reduce the budget quite easily.
I’m not sure the point of this post. Either way, it’s badly made.
Need to set aside a damages fund for the multiple violations of human rights and fundamental freedoms, which is gradually draining the public purse. Do your job, AG. We keep paying for your litigation mistakes.
Don’t ever expect the AG to do his job properly. That would require him to resign with immediate effect.
Last week’s headlines read approx ‘Government expects revenues over 1 billion for the first time’. Where’s the surplus…a few mill?
Absolutely ridiculous for an island this small!
“significant “unquantifiable downside risk to the forecast”. Is absolutely right. So rather than put the surplus away for the rainy days to come, rather than trim the wasted expenditures, they just keep spending like a drunken sailor in port. Because accountability is always short term. Going to end really badly, folks.
Spend it all and the cry babies want to limit development and work permits, the two biggest cash cows for Cayman. We need to allow Dart to dredge out the north sound, use the fill wherever his team feels it is necessary and get our port into that area along with mega yachts. This will bring in so much revenue so we can keep the miracle alive and growing!
Thats about the silliest thing I’ve seen on here in a long time. Sounds like a burn out straight to a crash. The north sound should be left just as is it before greedy pats like yourself destroy it along with this most special Caribbean island. Lets not forget most of these people here see us as an inconvenience to their dreams and aspirations. Running from the crime ridden, polluted countries where they cant even go for a morning or evening walk without fear of violence. Soon we will have leaders thats going to replicate what Penlin did in Bahamas! that will be a great awakening. There should be 6 of us for every foreigner
You are one of the cry babies who love what the high dollar investors bring to the table but then whine over some little things like fish and mangroves. Get over it as it will be all right and enjoy the rewards of all the influx of big money and great jobs! But at the end of the day progress will win because the government/CPA knows how to treat progress and developers.
You should sign your name at the bottom when making such bold claims!
Aight bobo soon reach with the fill to bury your house.
Finance and tourism are the two biggest cash cows, always have been.
Finance and construction/development/real estate are the two pillars. Tourism a distant third. IMO
A distant third and dropping fast. Main reason being that we have priced ourselves out of the Caribbean tourist market. Just too damn expensive.
For Pete’s sake, bring in manufacturing!
Establish a Cannabis Licensing Authority to issue licenses to 100% Caymanian owned and controlled businesses.