Public finance review in works

Premier McKeeva Bush has set a May
deadline for the review of the law that directs the fiscal operation and
management of the Cayman Islands government.

The Public Management and Finance Law
(2005 Revision) first came into effect in July 2004 and was designed to improve
public financial management in Cayman, as well as increasing accountability in
government’s budget decisions.

According to North Side MLA Ezzard
Miller, the law has done neither.

“This law has in some instances
increased the numbers of civil servants and the cost these intended
improvements,” Mr. Miller told Legislative Assembly members, as he attempted to
pass a motion that would lead to the review of the law by a select committee of
the LA.

Mr. Miller argued that the
decentralisation of hiring and management processes as prescribed by the Public
Management and Finance Law may have actually ended up causing a reduction in
government’s control and ability to monitor finances.

While not necessarily disagreeing
with Mr. Miller’s assessment, Premier Bush said government had to answer some
key questions before commencing with a complete overhaul of the system.

Those included whether the Public
Management and Finance Law had been implemented correctly, and whether it was
the law itself that had contributed to the growth of the civil service in
recent years.

“While we may have strong
suspicions that decentralisation of certain controls may have contributed to
rising expenditures or that the (law) has contributed to the increase in the
number of civil servants, it is best to pose the questions for those carrying
out the review objectively to prevent prejudicing the approach,” Mr. Bush said.

“I feel that a more prudent
approach would be for this proposed review to be carried out by a professional
team external to the Legislative Assembly.”

Mr. Bush did not state how much
would be spent in the compiling of such a report.

The Premier said he did have a
“strong view” that certain procedures operating within the civil service were
not geared toward serving the needs of Cayman’s economy.

“If well-intended systems and
procedures result in failure to address inward investment needs, or the need
for government to execute its policies, then it does beg the question as to
what is the point of having these systems and procedures in the first place.”

Prior to 2007, all hiring decisions
in the Cayman Islands government were made by
the Public Service Commission. Separate departments and chief officers
interviewed job candidates but the final stamp of approval had to be given by
that central commission before anyone was hired.

The commission was disbanded at the
end of 2006. At the time, the general complaint was that government’s hiring
process was simply too slow and was leading to inefficiencies in providing
public services. The Public Management and Finance Law sought to give
individual department heads more control over the hiring and firing of

However, under the current budget
situation, most government departments have required that any new hires be
approved by the chief officers for each ministry or portfolio anyway. The Cayman Islands government has been operating under a
“soft” hiring freeze since late 2008.


Mr. Bush
Photo: File