$100M surpluses forecast for next 3 years
Roy McTaggart delivers SPS financials
(CNS): Over the next three years core government is forecast to have operating surpluses of near or over $100 million, as Finance Minister Roy McTaggart predicts that Cayman’s economy will continue to grow by at least 2% per year from now until 2022. As he delivered the facts and figures to support the government’s strategic policy statement in the Legislative Assembly Friday, McTaggart said government would not be increasing taxes or borrowing money but would use revenue to finance its operations, capital projects and pay down the public debt.
“Our main goal is to manage our expenses in a sustainable manner that allows us to efficiently deliver our services to the high standard expected,” the minister told his colleagues. He said government was committed “to keeping our operating expenditures well below operating revenues” and it would limit expenditure by pursuing operational efficiencies.
McTaggart predicted that government would have operating surpluses of $94.9 million in 2020, $109.2 million in 2021 and $90.1 million in 2022. He said that real gross domestic product, or GDP, was expected to grow by 2.2% in 2020, 2.1% in 2021, and 2.0% in 2022.
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The forecast is for core government to collect around $829.1 million in 2020, $851 million in 2021 and $836.9million in 2022, while expenditure is expected to be $734.2 million in 2020, $741.7 million in 2021, and $746.8 million in 2022.
The minister said government will be paying off more debt over the coming years and the current debt, which stands at just under $420 million, will be more than halved by 2022, which it is expected to be down to $181.5 million.
“This government remains committed to ensuring that our economy continues to grow in a stable and sustainable way that ensures maximum opportunities for Caymanians,” he said.
“Over the next three financial years the Economics and Statistics Office has forecast that our economy will grow at steady and healthy rates, in line with forecasts for the world’s major economies, the source markets for our major economic pillars.
“Over the next three years, economic growth will create additional jobs and is expected to keep the unemployment rate below 4%. Unemployment rates are forecast to be 3.5% in 2020, 3.6% in 2021, and 3.8% in 2022,” he said.
However, among the good news about the state of government finances, the expectations that the economy will continue to grow and push down unemployment to a new low of well under 4%, the issue of inflation will be a challenge.
Last year Cayman saw inflation reach 3.3%. In 2019 the cost of living is expected to increase by some 2.7% and continue growing by well over 2% for the following three years.
McTaggart said that to help manage the impact of inflation government was leaving in place the import duty reductions implemented in the last administration.
He said the reduced import duty of 25 cents per gallon, down from 75 cents per gallon, on fuel used by Caribbean Utilities Company for electricity would continue, as would the duty cut of 2% for licensed traders on consumer goods for retail sale.
Despite predictions that construction would continue to boom over the next three, he said that the 15% cut on building materials would also remain in place.
“By keeping in place these import duty reductions, the government is doing its part to keep retail prices as low as possible, thereby keeping the cost of living for households and the cost of doing business as low as possible,” the minister said, as he laid out the public sector numbers for members of the Legislative Assembly.
See the SPS financials in the CNS Library
Watch the minister deliver the statement on CIGTV
Category: Government Finance, Politics
That was just hallucinations from all the smoke you inhaled that the LA has been blowing out lately.
All of these projections are assuming the US economy doesn’t go into a recession in the next 2 years which is highly likely
Unemployment will jump up to between 6-10% depending on the severity
Tourism will instantly dip as will financial services
Don’t be surprised when this projected surplus goes up in smoke
Wonder how many people here will be praising Trump then
unnah don’t think all this surplus isn’t going to be from the chinese firm bidding for the port? open up your eyes…
And I saw pigs flying over the LA this morning.
Roy this is the freakin Cayman Government. Delivering services in an efficient manner – HUH. You can’t even pickup the garbage for gods sake.
Wait for the audited financial statements.
No mention of the ballooning debt in Government heath care and pension costs.This will inevitably eradicate any revenue surplus within the next decade or two.
FIX THE DUMP!
The DAMN dump!
No concept of long time irreparable cost of record breaking permit and PR fees. I get Aldart as he can’t make it out there and really needs the cushy job with his true benefactor..but McTaggart seems committed to ensuring no young Caymanian has the same opportunities he was given.
I truly hope these financial surpluses will be put back into our island – improving health care, education, after-school and vocational programs, providing scholarships, maintaining and fixing infrastructure. What a dream that would be!
Unfortunately… It’ll go to lining the pockets of our MLAs and a cruise ship port we don’t need.
This —> “If the Conservation Law had been around at the time the Creator was turning his hand to founding our three islands, we would still be waiting on an environmental impact assessment.”
We still have a regime that thinks making educated, reasonable decisions, based on carefully researched impact assessments, are a complete waste of time – either because they can’t read, or don’t care, regardless of what smarter accredited industry professionals have to suggest. Note they also freely compare themselves to God. That’s all you really need to know about our runaway LA at this point in history.
And we still don’t know how store grains when fruits in season! Gravy not the same if not on rice.
Cam.
Never been a better time to spend…
One fifth pay down debt?
One fifth to unfunded liabilities?
One fifth sovereign wealth fund?
One fifth reduced taxes on residents to lower cost of living?
One fifth infrastructure development and maintenance (education, roads, public transport)?
Hahaha!! Wishful thinking! It’s going to be 100% thrown into the sea on a bogus cruise port that we don’t want or need!
But we do need The Dump removed / fixed ASAP. Why don’t we get our priorities right?
So, you are saying the dump is in the wrong place? Why? Too close to Camana Bay? See where that argument gets you?
Ultimately DART’s problem, not mine and not that of my government.
How about we build the outline of the new dock out of reinforced concrete, pump all the sea water out, and then truck the whole dump to be landfill for the dock. Once done, we can cap it with concrete, and invite Carnival passengers to walk around on it buying products from Carnival owned shops. We can build luxury condos where the dump used to be, and then start our new dump (we will still need one) in your back yard.
Does that resolve your concerns?
Need an extra fifth to grease the palms.
True. I wish governor would fulfil his role and impose some good governance when we repeatedly demonstrate an inability to achieve it ourselves.
You saw what happened to the last one who attempted to help us. Mafia cleaned house!
Don’t reduce the taxes. Cayman is a high cost of living place. Nothing anyone can do about that. CIG is already proudly keeping the tax cuts in place just to keep 2% growth going. While doing some ‘rob Peter pay Paul’ economics within CIG. I’m not saying they’re wrong, just that further tax/income cuts will hurt more than help the Country in the long term. (Unless we like having our garbage picked up once a week, maybe.)
They dont need to cut taxes to help reduce cost of living. They could simply better regulate and reign in the ridiculous profits being made by service providers….banks, water, electricity, health insurance, internet etc who are charging us extortionate rates for crappy services!
The cost of basic food items and utilities can be reduced. The cost of living is destroying the prospects of too many Caymanians. I am not talking about luxuries – but necessities.
Maybe, but not by reducing taxes further.
Some import duties on select items could (and should) be reduced. Others (such as sugar-filled sodas) should be raised.
This is exactly what they should be doing but NO, they are going to piss away millions on BS like the dock and some unecessary buildings over in CB.
I hope all the idiots out there who make comments on CNS saying we have no debts are reading this. CI 420,000,000 just in case the number of zeros makes it clearer.
With all this money, youd think they could buy back some public beach for the Caymanian people too…public as in not for vendors and cruise ship passengers!!