$576M budget rejected

An
initially proposed CI$576 million government spending plan for 1 July was
rejected by Cayman Islands lawmakers as too expensive, a spokesman for Premier
McKeeva Bush confirmed Monday.

Negotiations
between the government and elected officials on ways to reduce costs have since
resulted in a significant reduction to that figure, according to the premier.

Mr.
Bush said he was not seeking to bash civil servants because the spending plan
they proposed reflected the policies of both the ruling United Democratic Party
government and former People’s Progressive Movement government.

The
$576 million figure would represent a nearly 15 per cent increase from the
position expenditures are expected to end up in during the current budget year
– around $502 million. Cayman’s fiscal year ends 30 June.

Lawmakers
are facing a tight time-line to approve the upcoming budget, which will be
presented to the Legislative Assembly on 15 June. Politicians will have just 13
days total – nine working days – from 18 June to 30 June to debate the spending
plan.

Mr.
Bush has not yet revealed specific figures for the upcoming spending plan,
partly because the United Kingdom has not signed off on Cayman’s borrowing requests.
The premier said the local government would be seeking a significant level of
borrowing from the UK’s Foreign and Commonwealth Office.

That
figure is likely to exceed $200 million over the next three years.

According
to the premier, no form of direct taxation has been proposed by his government
in the upcoming spending plan. Mr. Bush also noted that there would be no
significant revenue measures for the financial services industry or other
sectors in the proposal.

Civil
servants will be getting a 3.2 per cent pay cut starting 1 July.

Mr.
Bush also noted that government’s revenue estimates would be considerably less
than the $562 million originally included in the 2009/10 budget. Those revenue
projections, at last check, had fallen to $490 million in the current year.

The
Cayman Islands is expected to end its budget on 30 June with about a $50
million operating deficit, despite reducing expenditures by nearly $30 million
since the start of the year.

1 COMMENT

  1. Assuming there are 60 thousand people now living in Cayman, we are talking CI$10,000.00 per person of the population! This is clearly crazy! Why doesn,t Mr Jefferson get some advice from people who have lived here longer than he is old? It is a simple solution, and unless asked I will not give an answer. Cayman Politicians need to wake up and start understanding the ramifications of poor governance and poor decisions that are not made in the public interest, the but rather assume and copy that what is done in USA/UK is the answer! It does not mean that it will work for the benefit of all Caymanians.

    Editor’s note: Again, we must stress that this initial budget proposal has been changed and that budget talks with the UK are on-going.

  2. Has the government brought in the necessary legislation to cut government contract holders’ salaries by 3.2%? If you have a contract signed by the government that does not end until,say,September 2011, with your agreed salary clearly delineated, how is it legal to just cut that salary without the agreement of both individual parties? Just a matter of interest…

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