Civil service pay cut nixed

Bush to address country on Thursday

Civil servant workers earning more than $3,000 per month will not have their salaries reduced by two-per cent after all.

Speaking in a telephone interview from London, Leader of Government Business McKeeva Bush dismissed the idea.

‘The elected government has decided it’s not going to do a two-per cent pay cut on civil servants,’ he said, adding that it was not the elected government that suggested the idea in the first place.

‘They made the offer,’ he said. ‘It was the civil service hierarchy that made it.’

The suggestion for the pay cut was circulated to civil servants via email on Friday 11 September. Chief Secretary Donovan Ebanks said the government was considering the temporary measure in effort to cut costs. It would have gone into effect in October 2009 and concluded at the end of the financial year, on 30 June 2010. It would not have applied to the government’s classroom teachers.

As compensation the government workers affected would have received four extra days off.

Mr. Bush said he didn’t believe the measure, which would have only saved the government some $2.5 million between now and the end of the financial year, was worth the problems it caused for civil servants.

‘I have to consider the situation with civil servants,’ he said. ‘We’re not going to exacerbate the economic conditions for anyone in the country.’

Mr. Bush was in London meeting with a UK team that included Foreign and Commonwealth Office Director Colin Roberts and UK economist Damien Reeves.

The discussions centred on a 27 August letter from Parliamentary Under Secretary of State Chris Bryant, which indicated the UK was not prepared to allow the Cayman Islands to borrow any more money unless it was convinced there was a sustainable plan to turn around the state of the territory’s public finances.

Mr. Bryant, who did not attend last week’s meetings, suggested in his letter that the Cayman Islands had no choice but to consider imposing new taxes such as payroll and property taxes.

Mr. Bush said he and his small team, which included Financial Secretary Kenneth Jefferson and consultant Paul Byles, fought against the idea of imposing income or property taxes.

‘The meetings have been very professional and very businesslike, but also very intense,’ he said. ‘I’m fighting against any kind of tax that would change our whole business environment.’

Mr. Bush said he will hold a public meeting in front of the Court House on Thursday evening to provide more details about the proposals made to the UK last week.

‘I will address the country on the state of affairs,’ he said.

The meetings in London did not end with a finalised agreement, Mr. Bush said, adding that he intends to consult with various stakeholders back here in Cayman first.

In the meantime, Cayman’s financial crisis continues to deepen. A complete shut down of one of the government’s major infrastructure projects, the John Gray High School, is possible this Friday unless the government can pay the contractor, Tom Jones International amounts now in arrears.

However, Mr. Bush said Cayman’s civil servants will be paid their September salaries this week.

‘You can tell them McKeeva Bush says we’re going to make it,’ he said. ‘The Cayman Islands will continue to honour every cent owed to anyone.’

Mr. Bush also said that the 2009/10 budget session, which was scheduled to begin on Wednesday was now expected to begin on Friday instead.