Accounting system may change

Some say it costs Government too much

Cayman Islands civil servants have suggested that moving away from the government’s accrual accounting system and back to the old way of doing things could help balance the country’s budget.

Leader of Government Business McKeeva Bush indicated last week that the government would consider the suggestion.

‘I know there are civil servants who say…the whole new (accounting) system is not working,” Mr. Bush said. ‘One thing we do know is that it has created tremendous costs.’

The Cayman Islands Civil Service Association has proposed the government change its current accounting system, which was implemented through what is known as the financial management initiative earlier this decade. The initiative involved a complex system of inter-departmental charging for services.

According to the system, when one government agency produces services for another agency, the second agency is billed for those services. In order to receive payment from government ministries, the agencies must account for the services they have rendered during any budget year.

If a particular department hasn’t performed, they can have payment withheld by the ministry that oversees their operation.

The civil servants group urged government officials last week to drop this part of the financial management initiative.

‘This aspect…should be repealed, or handled differently,’ stated a draft report written by the Civil Service Association.

The association suggested that quarterly meetings be held between chief financial officers of government departments to satisfy accounting principles.

‘It must be seen that it really does not matter how expensive it is for departments to purchase services from each other, since we are simply transferring money from part of government to another,’ the report stated.

Mr. Bush said he was aware that government accounting officers have met and discussed the possibility of whether the accounting aspects of the financial management initiative can be changed.

‘I know there’s concern…as to the amount of money this system takes to run in the current form it is,’ he said.

Civil servants claim the decentralisation of government hiring has also ended up costing Cayman more money.

Until the end of 2006, the Cayman Islands Civil Service Commission was responsible for all final hiring and firing decisions made by government. Critics of the process said it was simply delaying departments who needed to fill crucial positions.

Starting in 2007, managers of portfolios and ministries were put in charge of human resources. This resulted in many departments hiring HR staff to perform functions they were simply unfamiliar with.

Education Minister Rolston Anglin has previously complained that no cost-benefit analysis was done to determine whether decentralisation would achieve the efficiencies it intended.

The Civil Service Association is of the opinion that it did not.

‘Decentralisation has contributed to the current state of affairs,’ the association’s draft report read. ‘Government can never operate as a private entity because of the whole of country and social mandates included in government providing service.’

The association also suggested that decentralisation has contributed to duplicate hirings being made in jobs such as human resources and public relations.

‘It is obvious that there are certain areas that will benefit from centralisation,’ the Civil Service Association report stated. ‘All job groups, especially those created through recent reforms, should be analysed to see how jobs providing duplicate and overlap services can be consolidated.’

Mr. Anglin, for instance, pointed out recently that his Education Ministry had two HR employees, while the Education Department had two more HR personnel.

‘Consolidation will mean that some employees will not be needed,’ the association’s draft report read. ‘However, it must also be seen that there are areas within the civil service that are overloaded and others that need more bodies in order to operate properly.’

The association advised that government chief officers establish a list of those who are not needed in their current jobs, and look at other areas of the civil service where they might find employment.