Offshore sector fuels early extra surplus for CIG
(CNS): The Cayman Islands Government started the year with a surplus of over CI$260 million, much more than the $214.1 million it was expecting due to higher than forecasted revenue and lower than predicted personnel costs during the first quarter of 2024. According to the unaudited financial results for the period, core government collected $27.4 million more than expected in those three months and spent $11.5 million less on civil service pay and benefits.
The report shows that the CIG earned $39 million more this year than last but spent an additional $22.2 million compared to the first quarter of 2023.
Published in the government’s Gazette earlier this month, this most recent document reflecting the state of the public finances shows just how critical the financial services sector is to government coffers. The additional $27.4 million in revenue came almost entirely from Exempt Company, Partnership and Private Fund Fees.
“Due to the cyclical nature of revenues, the first quarter’s Coercive revenue results of $489.5 million are expected to be the highest revenues earned in any single quarter for 2024,” the government officials stated in the report.
The annual regulatory licence fees are due at the start of each year, which always boosts the government’s first quarter and the total revenue collected in the first three months represents almost half of what government is expecting to bring in during the whole of 2024.
But not all fees did as well as those collected from the offshore sector, with some falling below expectations. The $11.5 million saving on personnel is also unlikely to be repeated as vacancies could be filled. There are several signs, too, of higher than budgeted spending over the period by some statutory authorities and government companies as well as the usual soaring healthcare costs for government.
Government payouts to the Health Services Authority (HSA) exceeded the budget by $5.6 million due to actual costs for the Care of Indigents of $8.4 million. Government also paid out an additional $8.1 million more than its year-to-date budget for the notorious appropriation NGS55 — overseas medical expenses for those who are not covered.
Government also spent $4.9 million extra in the first three months on Scholarships and Bursaries and an additional $2 million on the budget for Financial Assistance.
Overall the SAGCs recorded a combined net operating surplus of $8.4 million for the first three months of 2024, some $8.8 million more favourable than the budgeted deficit of $400,000, mainly attributed to better than expected earnings by the Cayman Islands Monetary Authority, CINICO, Port Authority and Water Authority Cayman. But these better results were partially offset by the unfavourable performance of thr Cayman Islands Airports Authority.
Officials from the finance ministry said that adherence to fiscal policy continued to yield significant overall cash and deposit balances held by government. Operating Cash and Deposits were $529.1 million and Reserves and Restricted Deposits were $173.5 million, for a total Cash and Deposits balance of $702.6 million, which is $36 million more than anticipated in the 2024 – 2025 Plan & Estimates.
“The overall fiscal performance reported for the period shows a Net Surplus of $260.2 million for the EPS, which is 22% higher than budgeted,” the government accountants wrote in the report. “The first quarter’s performance has positioned the government to be optimistic about its performance for 2024. Over the remaining three quarters of 2024 costs will have to be diligently monitored to ensure spending is not incurred unnecessarily.”
The CIG predicted it will have a total surplus at the end of 2024 of $42 million in this year’s whopping $1.4 billion budget.
Download the full report here.
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Category: Business, Financial Services, Government Finance, Politics
The problem is that some people in the VI believe all the wealth only belongs to them
https://www.virginislandsnewsonline.com/en/news/some-in-vi-believe-all-the-wealth-only-belongs-to-them-hon-smith
Sad, really sad
https://www.virginislandsnewsonline.com/en/news/it-is-the-hardest-task-getting-businesses-to-interview-locals-for-jobs-hon-wheatley
“Lower than predicted personnel costs”
Yeah, because they have like 25 jobs available across both central Government and SAGCs.
Payroll went up $6mln year over year.
I think the most important words in this article are ” …unaudited financial results ….”
A word of advice for Cayman ministers: Save, don’t spend, the surplus. Don’t go down the sinkhole of debt that’s swallowing up the U.S. and many other countries.
I guess you dont live here then.
Actually, I do. When I gave the advice to “save, don’t spend”, I didn’t say that Cayman ministers would necessarily have the good sense to follow that advice, however.
Cayman politicians will spend money WE don’t have to ensure their re-election.’
Fat pension and benefits will keep them fed irrespective of government’s financial woes.
The financial industry is our mainstay, but Tourism (Jamaican taxi drivers ) is where the votes are for Mac Kenneth Seymour and Saunders who will ruin Cayman to keep their unemployable snouts in the trough.
It’s debt, not a contribution surplus. We have >$400mln in carried serviced debt that need to be paid back with interest.
Andre is the only minister who can read and write and understands this.
The rest of our current government quite frankly are only there to travel, attend photo ops , and collect excessive salary and benefits.
What do you mean, we’re already in one and getting deeper every year. Pension and healthcare liabilies mean anything to you or have just crawled out of another hole? I guess what you don’t know can’t hurt you.
too late
You sure the surplus didn’t come from the Walmart crowd coming off the cruise ships which the PPM loves so much?
Tourism contributes a comparatively small return in exchange for thousands of imported economic refugees who damage our social fabric.
Beach ruined by Jamaican higglers , town smeared with placard wavers, tour bus and taxi drivers rushing to seduce their next fares.
This is not the image that Cayman needs to present to the world.
But it’s the reality you have nurtured and cultivated. The Cayman electorate can change things if/when they want; but we all know the will/knowledge/education/ethics is not there. For all Cayman wants to be and project to the world, it has become a very corrupt society unable to manage being a first world territory. This is why it has become overwhelmed by outside money – Cayman has no backbone anymore.
Sovereign wealth fund?
Not quite. We still have hundreds of million in debt we are servicing, so there will be no sovereign wealth fund!
Plus let’s not forget the >KYD$2Billion in unreported liabilities that stand to violate the Framework for Fiscal Responsibility and forfeit our piggy-backing on UK’s AA rating, downgrading us to C or C minus overnight. But, let’s ignore that and build a $100mln sports facility on the bluff in the middle of nowhere.
We suggested that to Jim Bodden…he humiliated us and accused us of communism and the usual crap that they went on with at that time. Can you imagine how much would be in it if he hadn’t been such a profligate dickhead?
The problem with Jim he got his pwn money mixed up with his client monies at prospect.
That was only one of the problems with Jim, Chris.
Sure, we’ll take out another bullet loan to kickstart it.
Sovereign Queen of Spot Bay.
It’s already spent on an unnecessary high school on the Brac and the housing for the workers who will build it.
Then Kenny plans to build an unnecessary private aircraft terminal and unnecessary runway extension.
Surplus???
Don’t forget Kenny’s Scranton park development where his NAU supporters can hang out in the shade.
income has never been the problem.
Keep asking….
How many recommendations of the miller-shaw or ernst & young reports have been implemented?
You’re spot on. Reckless spending is the problem and all they know and understand.
I’m not the sharpest knife in the drawer, but even I know that having a Million dollar windfall is useless , if I owe a Hundred million .
now imagine if we did not blow a $1bn every year on a bloated inefficient civil service that gives us little or nothing in return.
you would have a bloated NAU list.
That’s probably true, but if they actually gave the civil service jobs to truly qualified people who deserved them (Caymanians as well as expats) then at least the CIG would run more efficiently/less expensively.
so you are confirming that cig civil service is a social welfare program for locals?…thank you.
4500 employees in CIG cost >KYD$500mln/year in payroll. We can probably safely trim those numbers, and maybe increase productivity and value for money from the headcount exercise.
We can replace 50% of them with Chat GPT, and should start to do so now.
But what will all those Caymanians who stand and watch other Caymanians stand and watch Caymanians do… nothing – for a living. They have NO SKILLS!
Not until Chat GPT gets status.
Year-over-year, a slight improvement in quarterly revenue of $35mln over ’23, less additional $6mln in payroll, less $19mln in investment losses, less, less, less…Ken has moved the Butterfield loan liability into the Revenue column and thinks that’s going to fly on an island of accountants.
This calls for a new JuJu Land theme park to be constructed on the bluff!
Bet somebody is drawing up plans for more buildings in Cayman Brac.
Someone needs to protect the Golden Goose from greedy politicians who are intent on raising fees and creating new fees.
…..and CIMA from killing off industry with their idiotic approach to regulation, lack of any commercial understanding, and taking a fundamentalist approach – “proportional/risk based” my foot…….
SHHHHHHHHH!! Nobody tell Juju about this! She’ll find a way to spend it.
Already is!
Hell her and the other clowns in their already spent it and more!
Isn’t it fantastic the we also have the massive surpluses generated by the tourism sector to add to the CIG pot?
Yes, as you say, it is tourism and taxis that generate all this “free” cash for CIG to blow from the magical money tree.
All this Financial Services blah blah that says CONSTRUCTION is driven by the FS industry (offices, rentals and homes) and stay over TOURISM is driven by International FS clients and service providers (visiting the island for meetings, restaurants and boat trips etc.) never mind the Fees genertated by the FS Insdustry itself – CIMA/ROC fees etc), work permit fees, yada, yada….. WELL….. you only have to look at Lock-Down to see that TOURISM kept the WHOLE SHOW on the road……., ah..wait a minute…
Nothing to do with FS at all.
Only Wayne and Andre can spell “Financial Services”. The rest in government belive the world is 6,000 years old, a rising moon lifts all urges and the Auditor General is the perfect mud guard.
where’s the LOL button!?
Particularly enjoyed the “mud guard”
9/10 – missing something about Jesus and donkeys
So says Kenneth Bryan…to “his people”.
Juju carrying the surplus to Cayman Brac.
This fleeting surplus has already been eaten up on vote buying projects such as the new Brac school and construction worker’s hotel & country clubhouse. The East West Aorta will bleed the rest of this surplus and any further revenues from the remainder of the year. Judging by Ju Ju’s current squander spree, this time next year we’ll be in the red with a rebranded set of the same cabinet clowns. All this grandstanding is all fiction of course until audited, it’s also hilarious that these surplus reports are quick to be publicized but SAGCs still continually find difficulty in meeting their annual audit deadline.
USD$150mln of the balance sheet was sitting somewhat inert in tbills from 2023 BNTB loan, which Juju plans to spend entirely in her term via her Brac school and other “Nation Building” infrastructure procurements pitched in December. This isn’t a collected surplus. It’s part of over $400mln in debt we need to pay back with interest. Ken Jefferson needs to be removed and banned from preparing financial reporting to the public.
Ken Ken just does what he is told, hence why he has survived so long in the post.
Replace with George Jefferson.
Don’t worry. The pigs in the Parliament building (the few times a year they bother to do anything) will soon take care of that stupid surplus.
Maybe some status in Heroes square for Mac and JuJu?
Forgot to mention the pension and healthcare liabilities. There is no surplus.
100%.