In response to a parliamentary
question in Legislative Assembly last week, Premier McKeeva Bush said
government was not considering further pay cuts for its workers.
Civil servants’ salaries were cut
by 3.2 per cent starting in July as part of government efforts to reduce
spending in the current 2010/11 budget year.
Opposition MLA Alden McLaughlin
posed the question, to which Mr. Bush responded: “The government is not
considering reducing the salaries and/or benefits of public servants.”
Rumours about a 5 per cent to 7 per
cent pay reduction for government workers have been swirling around the civil
service for several weeks, but government officials contacted by the Caymanian
Compass about the matter denied that was happening.
Cayman Islands Civil Service
Association President James Watler said last month that he was not aware of any
government plan to further cut civil servants’ salaries.
“However, it is expected that there
will be further reviews of the public service along the lines of those carried
out earlier this year as per the agreement between the FCO and CIG for further
borrowings,” Mr. Watler said in a statement to association members Friday. “We
have communicated that there are a number of issues regarding the staffing and
management of the Civil Service which we hope will be addressed, regardless of
the outcomes of these reviews, but especially before the possibility of any
further Civil Service cuts are entertained.”
Although the premier has said
government was not considering reducing salaries or benefits, the three-year
budget plan approved between Cayman and the UK earlier this year calls for
further reductions to personnel costs in the next two budget years.
According to the three-year budget
forecast completed on 24 May, “Total personnel costs are reduced further by
seven per cent in the 2011/12 fiscal year and by three per cent in the 2012/13
“These targets will be achieved
through a combination of divestment or restructuring of departments as well as
through discussions between the governor, deputy governor and the civil
service,” the budget forecast document stated.
Costs not directly related to
personnel were planned to be reduced by 10 per cent over the 2011/12 and
2012/13 budget years, largely by reducing government’s rent expenses and
through other public sector reforms.
Reducing personnel costs doesn’t
necessarily mean cutting salaries. However, Chief Officer of the Portfolio of
Internal and External Affairs Franz Manderson noted in May that government’s
budget cutting exercise did not end with the new budget year in July.
“Further reductions in operating
expenses will be expected over the next three years,” Mr. Manderson wrote in a
7 May memo. “Sustainable means of reducing costs must continuously be pursued.”