Last week in the Cabinet press briefing, Leader of Government Business Kurt Tibbetts said there was no way anyone could have foreseen the $14 million in extraordinary expenses that helped lead to the government’s now-projected $29 million budget deficit for the 2008/09 financial year.
Even if it were true that the $14 million of extraordinary expenses were unforeseeable, that amount is still less than half of the projected $29 million deficit. We’re not sure if Mr. Tibbetts’ remarks were meant to suggest that had the extraordinary expenses not occurred, a $15 million budget deficit would have been acceptable to the people of the country. We think not.
Another point we’d like to argue is whether the extraordinary expenses were really unforeseeable.
We live in an area where hurricanes are prevalent. In fact, according to the hurricanecity.com website, Grand Cayman is the tropical cyclone capital of the Caribbean. In addition, the Caribbean basin is in the midst of a multi-decadal period of increased tropical cyclone activity, a fact on which many meteorologists, including those at the National Hurricane Center in Miami, have commented.
It might be accurate to say there is no way anyone could have predicted Hurricane Paloma was going to ravage Cayman Brac and Little Cayman last 8 November, but in would be unrealistically optimistic to think no hurricane would affect one of the Cayman Islands during the 2008 hurricane season. It should have been seen as a distinct possibility and planned for accordingly.
Another expense the government says it had no way to foresee was the cost of the UK metropolitan police investigation. It is true that when the government drafted the 2008/09 Strategic Policy Statement in late 2007, it had no idea of the investigation. However, by the time the Budget Session started in Legislative Assembly last May, the government was well aware the Met team was here in force and that it would be paid from the government’s coffers.
The government might not have been able to predict the extent of investigation – or all of the problems that have arisen with it – but surely the government should have known it would face considerable expense from the Met investigation during the 2008/09 financial year.
Despite these factors and what it already knew about growing global economic crisis, the government still presented a budget so full of spending that even with severe subsequent cutbacks, it will leave a huge deficit for the next government to deal with.
The opposition warned the government early on in this administration that they were promoting ‘good times’ budgets that that didn’t allow for negative contingencies. Well, the chickens of misfortune have come home to roost.
While no government can foresee the precise timing and nature of economic adversity, the smart one makes contingency plans just in case. In the PPM Government’s zeal to provide everything it promised and more, it forgot to account for ‘just in case’.