Civil service costs a concern

A group of local business owners
and educators at the Fidelity Cayman Business Outlook forum last week applauded
Premier McKeeva Bush for several high-profile steps aimed at growing and
diversifying the local economy.

But, as it turned out, there was a
multimillion-dollar elephant in the room in the view of some of the panel
members.

“One thing that wasn’t said in
there is anything about cutting services or becoming more efficient,” said
financial consultant Tom McCallum, one of six panel members. “There has to be a
balance here.”

Panel moderator Austin Harris had
posed the question this way: “If we run over [personal expenses], we either
have to head to the bank for an overdraft, or reduce expenses, or get another
job and work longer hours. Why doesn’t the government apply the same logic to
balance their books?”

The question was posed to Mr.
McCallum first.

“Well, where’s that bullet-proof
vest I had?” he joked.

“With all the excitement [regarding
the Premier’s economic development plans]…we can’t expect a few mega-developers
to bail us out of the systemic issues that we have,” Mr. McCallum continued.

He said that no matter what
economic growth incentives or revenue-generation measures government tries,
some cost cutting is still needed.

“I’ll say what we all know: The
biggest voting block on the Island is the public service.”

“How much [political capital] are
we willing to spend on really maximising our services?” Mr. McCallum asked.
“And how much are Caymanians willing to accept any more fees for services?”

Local architect Burns Conolly –
another a panel member – took a different approach to the same view, talking
about the huge debt the country is amassing, partly to pay for ongoing
government costs.

“We are now closing in on $1
billion worth of public debt for 15,000 voters…that’s a lot of debt,” he said.
“We will get to a point where the revenue coming in is not going to pay for the
costs.”

Direct taxation to support
government would not work, in Mr. Conolly’s view, largely because a great deal
of Cayman’s capital in the financial services industry isn’t fixed.

“Most of that capital will move,”
he said.

The panellists were asked what
government services should be cut. None made any specific suggestions, though
Mr. McCallum suggested resuming garbage fees.

 

Cost cutting

According to the latest economic
reports, the government has made some headway in cutting back expenses.

The third quarter report for 2010,
produced by the government’s Economic and Statistics Office, indicated that
central government’s personnel expenses had dropped by about 5 per cent when
compared to the same quarter of 2009.

Also, the government had eliminated
the vast majority of its ‘extraordinary expenses’ – payment for things like
disaster recovery from Hurricane Paloma or for the special police investigation
known as Operation Tempura.

The report stated that other
expenses went up, including interest payments, government subsidies and
payments for supplies and consumables. Overall, expenses dropped by about 2.8
per cent for the period.

The civil service is still engaged
in its review of various government departments. A report issued last year
recommended that four departments cut some $17 million, of which the elected
government accepted $15.5 million.

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3 COMMENTS

  1. The Cayman Islands civil service is a bloated, inefficient monster. There is massive over-manning, out-of-control costs, and a pervasive cant do attitude.

    A succession of weak political leaders has used the civil service as an ersatz welfare system, giving overpaid non-jobs to those Caymanians who will not or cannot hold down a job in the private sector.

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  2. It would be interesting to know what percentage of the Caymanian population is employed by the public sector. I bet its one of the highest in the world.

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  3. Speaking about the cost..For two years I have been watching construction of a new Government building. If you had only known how many times the ground around the building was compacted, then disturbed again because they forgot to do something. Or quite often, when I drive Elgin ave, I see one or two person working and 5 standing around looking at them I bet contractor bills government for these type of services. I am also waiting for the next real rainto see what is going to happen where Elgin Ave meets Cricket Square entry- was this upgrade designed and engineered by a third grader?

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