CIG still running big surplus despite spending worries
(CNS): Even though former premier Wayne Panton recently urged the civil service to help cut public spending, the government is still running a healthy surplus so far this year. According to the third quarter unaudited financial report on public finances, published last week, the surplus for the Entire Public Sector stands at $116.6 million, some $69.6 million more than predicted. This is due to CIG collecting $49.5 million in revenue more than expected.
Government collected $26.7 million more than budgeted expectations in coercive revenue from multiple streams, including a whopping $7.8 million more in vehicle charges, as residents continued to import a higher volume of cars than expected, even though government stopped the importation of older vehicles. Mutual fund administrators fees were up by $3.5 million, as the number of registered funds increased.
Accommodation fees generated CI$15 million more than expected as visitors return, which has also fuelled an increase in expatriate workers, leading to a spike in work permit fees, generating some $14.5 million more than predicted for the last nine months.
Meanwhile, the real estate sector continues to generate significant revenue for government, as it collected $3.6 million more than it had been forecast in stamp duty due to the relentless demand in the market. Land transfers generated $6.3 million more than expected as a result of higher value transactions.
Overall, comparing the year-on-year numbers, the Entire Public Sector surplus was $34.8 million higher than the same period last year, with statutory authorities and government companies bringing in $20.6 million more than they did over the same nine months in 2022.
However, spending is still a challenge, even as government battles to stay within budget. Expenses for the first nine months of 2023 amounted to $734.9 million, some $22.1 million more than the year-to-date budget. Personnel costs for the first nine months of 2023 were $323.6 million, $20.7 million less than the budget, mainly due to delayed recruitment, officials said. This still amounts to nearly $23 million more than the same period in 2022 because of the cost of living adjustments awarded to civil servants at the end of last year.
Supplies and consumables costs were $102 million for the period, $2.6 million less than the year-to-date budget. But as more projects come online during the remaining quarter of 2023, government officials believe costs will align closer to the amounts anticipated in the full-year budget.
The savings against budget in staff costs were offset by higher-than-budgeted levels of expenditure in outputs from SAGCs by $12.6 million, outputs from non-governmental suppliers by $21.7 million, and transfer payments by $10.3 million.
As always, much of the additional spending was due to soaring healthcare costs for government, as the broken system continues to put demands on the public purse.
Payments to the Cayman Islands National Insurance Company (CINICO) and the Health Services Authority (HSA) exceeded their original year-to-date budgets by $3.8 million and $8.6 million, respectively. The $3.8 million adverse variance with respect to CINICO is due to the fact that actual costs for the health insurance for civil service pensioners exceeded the budget for this category.
The majority of the $8.6 million adverse variance with respect to the HSA is due to actual costs for the care of indigents exceeding the budget for this category by $8.8 million. Outputs from non-governmental suppliers of $60 million were $21.7 million more than the year-to-date original budget, mainly due to the infamous “NGS 55 Tertiary Care at Local and Overseas Institutions” being $24.5 million more than the year-to-date budget of $16.2 million.
So far in the 2023 financial year, the parliament has approved, via section 11(5) and section 12 of the Public Management and Finance Act, an additional $30.8 million for NGS 55. This is due to the significant number of people who are inadequately insured or not insured at all as they cannot afford the premiums.
Transfer payments of $50 million were $10.3 million more than budgeted between January and the end of September, mainly due to spending on scholarships and bursaries as well as financial assistance. But compared to 2022, government still spent $23.4 million less so far this year than last year.
While the third quarter’s performance has positioned the government to be optimistic about its financial performance for 2023, during the final quarter of the year there will be a push to meet planned 2023 objectives, and Premier Juliana O’Connor-Connolly, the new finance minister, will need to diligently monitor spending over the last couple of months of the year.
The nine-month report also highlighted that core government revenues must exceed the performance of $978.1 million set out in the original 2023 budget in order to reach the revised target of $1.037 billion detailed in the Strategic Policy Statement tabled in parliament on 26 April, 2023.
See the full report on the government website here: Extraordinary Gazette Supplements | Cayman Gazette (gov.ky).
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Category: Government Finance, Politics
FIX THE DUMP!
New government now, please finish the ReGen contract!
For those not paying attention, or who missed Mac’s rant in Parliament before flipped again back to the government last week, all of the PACT was pissed because Wayne was trying to rein in the wild spending. He’s no idiot and could see that real estate (aka the cash cow) was slowing and he could not present a budget of wild spending by each district. Not one of the PACT are capable of compromise when it comes to what’s best for the ‘country’ versus what is best for each of them to get re-elected. Possibly the worst one was Julie. She had Wayne by the short and curlies. The tipping point was when Julie and Mac demanded 2 new high schools schools, totaling $120 Million. Wayne knew the country couldn’t afford it and his efforts to stop it resulted in his demise.
I hope peo0ple remember Julie’s announcement last year to raise all of the teachers compensation by 30% – with no money in the budget and no approval she took it upon herself to announce it to the public, forcing the CIG to go good on it.
#LetTheWildSpendingBegin
How can we measure success on surpluses when we have people who cannot even pay their mortgage and light bill? Are we that stupid? When I hear about all these surpluses, there is nothing else to do but be ashamed of who we have put in charge.
I think Kenny should get on board with the beach replenishment project. Install some groins and bring the West Bay Beach all the way around to Kenny Beach across from Kirk Market. That way, he can brag that the 7-mile beach was only 5-mile when he became Minister, but now it’s Kenny’s 8-Mile Beach!
Surplus with JOCC at the helm? That’ll be gone right quick with unwarranted JOCC school in the Brac. She, of all people, just can’t help herself from wasting other people’s money. She has serious issues requiring more frequent and higher amounts of retail therapy.
Stop civil servants getting treatment off island. There are enough specialists & consultants & hospitals to do virtually everything here now. Unless it’s a heart transplant, for example, deny overseas scans/surgery.
I believe CINICO also pays for a family member/friend to travel free, to support, even for a routine checkup. This has to stop!
Come back with that uneducated comment when you have a real medical problem or one of your kids or spouse does.
It’s rarely better here, it’s an Island in the Caribbean at the end of the day.
Then why have any hospital here? Stop all hospital services except emergency, if they cannot provide the service and everyone ‘needs’ to go off with their friend to get a scan that could be done here
That’s what WebMD is for.
No one should worry at all because with our new government, this money will soon be spent plus more. Love you Unity team! Give all Caymanians $20,000.00 for Christmas.
I am one of the $950 pensioner. Motion was passed unanimously in Parliament for an upliftment to $1500 effective from the 1/1/24. I have contacted the Pension Board on numerous occasions only to be told they have been advised. What is going on? We pensioners are hurting. We made an indelible mark with CIG and deserve empathy. I listened to the Premier intently yesterday on The Record and she has elucidated that she has her Caymanian People best interest at heart, so Madam follow through.
Sovereign wealth fund?
8:33, this should have been started in the 80s when the money started pouring in with the condo building boom. Imagine how much that fund would have had now. But the Unity Team would not countenance such a proactive prudent measure. They preferred to spend like drunken sailors.
Never ever ever would I give my money voluntarily to anything remotely controlled by CIG. Bad enough I am forced to pay into a useless pension scheme that only benefits the local service providers.
put $30k per mini bus
times 20 busses
have the busses as an option for people to commute to work
and increase the tax on having cars, double or triple it
this will encourage the mini bus use
there are too many cars in cayman, am I the only person who sees/feels it?
You lost me at mini bus.
The government better allocate some of this surplus to the civil servants now and next year if they wish to be reelected come 2025.
the mafia
Only 5000 wotes…not enough
But how well will it be under the control of Juliana
Let’s not forget about the $2.5 billion unfunded health care liability.
or pension liabilities (Miller Shaw).
I could apply accelerated …….. nevermind. What’s the point. Foolish to explain what we all know.
All lip service that does us all absolutely no good. We are mostly on our own treading water (we hope it’s only water) in an adverse economy. Good luck everybody.
Don’t give up, and don’t let us all be pulled apart. I will help everyone who I can.
Bear in mind that the financials are “unaudited” and the public will not know if Government’s figures are accurate until late next year if lucky.
The 2022 results for the PAHI ministry was not mentioned in the Auditor General’s Report as the audits have not been completed so how do trust 2023 3rd quarter results????
Never in the history of public administration has so little been achieved with so much.
“Government collected $26.7 million more than budgeted expectations in coercive revenue from multiple streams including a whopping $7.8 million more in vehicle charges as residents continued to import a higher volume of cars than expected despite government putting a stop to the importation of older vehicles.”
The importation of cars will not stop as the population keeps growing and there is no realistic alternative to driving as the public transport system is a joke.
A small budget surplus against colossal unfactored medium-term liabilities is still a fail, per Auditor General’s reports. We still don’t have passing grade accounting to put trust in these predictable quarterly self-congratulatory proclamations.
Insurance (both medical and household) is becoming a big problem for the people of Cayman.
Our medical insurance premiums increased 40% last year, 32% this year. Thats an 84% increase in 2 years. Next year my husband reaches 60 and his medical insurance premium will more than double at his next renewal.
Our house insurance has gone from $382 two yrs ago to $628 this year, and now next year is $848 per month from January. How on earth are we supposed to continue to pay these premium increases.
I expect that next year we will have to stop both the house and medical insurances because we cannot afford the premiums. We are already on the most affordable plans. Its totally out of control now. We are one big bill, one storm, one illness away from bankruptcy.
We all should get 20-30% increase in pay. Private and government should start now.
Thumps down by Bussiness owners.
Yes tell all employers to raise our pay Honorable Premier or put them out of business.
What about us retired folk? No increase in pension can keep up with these expenses
Guess you shouldn’t have voted in all these clowns over the years. Now you are getting what you voted in 😉
I don’t live in WB/Northside/EE/Brac/Bodden Town so unfortunately I have no control over voting in those idiots. One man one vote doesn’t work
Stop the house insurance and self insure (needs self discipline). The insurance folk will find a way not to pay you properly anyway if we have another Ivan. They were utterly disgusting and rapacious last time.
So true, but if you have a mortgage the banks require you to have insurance. Also no choice if you live in a condo. You can’t opt out
so what was wayne on about then ?
Wayne’s point was that current spending was not sustainable and that the growth in public sector spending was not benefiting the people. All it takes is a recession in the USA and a drop in revenues to see what he is talking about.
#waynewasright
#leggewasntwrong
Jackass!
Government collects most revenue in the first 6 months and collects very little in the last 6 months. The spending continues at full speed for 12 months and spikes in the last 3 months.
There will be a spending spree this Christmas like no other!
So if the numbers are good why a change in government/direction to people who the AG says want to spend our money without any accountability and to hand reigns over to those who put us in serious debt the last time??? makes absolutely no sense? Mackeewa and JuJu keep threatening to leave politics we just wish they would carryout their threat.
What part of incompetent Wayne don’t you get ? The man waffled his way through for half a term with nothing to show for it besides increasing Company fees!
Kenny Beach, Kenny World and JuJuville soon take care of that.
Add $100Million plus millions in consultants fees for our woke resort prison .
Wasteful expenditure when $10Million would easily deal with upgrades at Northward.
Juju stop the bleed now, and don’t be swayed by smooth talking “Consultant” who has millions to gain.
Yeah, it might look good compared to budget. how does it look compared to actual 2023 expenditure?