The Cayman Islands ended its 2010/11 budget year on 30 June with a $25 million operating surplus, and now Premier McKeeva Bush wants to use it to give something back to government workers.
Mr. Bush said late Friday that he would recommend to the Cayman Islands Cabinet that a 3.2 per cent cost of living pay raise be awarded to civil servants effective by next month.
In July 2010, at the start of last year’s budget, civil servants received a 3.2 per cent pay reduction to help balance the books. Government has always said that pay cut was a temporary measure and Mr. Bush said it was his intention to return the pay once finances began to recover.
Mr. Bush said the performance in last year’s budget indicated improvements had been made.
The surplus, according to figures provided by the premier’s office ahead of a broadcast speech to the country on Thursday night, were final actual budget numbers for the fiscal year ending 30 June. The numbers had not yet been audited, but Mr. Bush said he expected “normal adjustments” but no major changes once that audit was completed.
Government’s projected revenues went from $510 million to an actual $535 million, according to the premier. Government operating expenses went from a projected $508 million to an actual $483 million.
Both represented improvements on projected figures of $25 million in each area.
Performance of government-owned companies and statutory authorities also improved from forecasts, reporting a surplus of about $3 million for the year.
In addition, government spent about $3 million less in financing costs for the year – that’s the amount of money Cayman must pay to meet its debts.
The premier said this was done by “stretching out the time before it became critical that we had to borrow the $155 million”. Cayman borrowed $155 million to help meet costs in the 2010/11 fiscal year.
“The entire public sector … was budgeted to have a deficit of $32 million whereas the year’s actual performance indicates an overall surplus of $25 million; a total turnaround of $57 million,” Mr. Bush said. “This is a tremendous testament to the prudent and responsible management of the country’s finances.”
Audit office slammed
In the speech, Mr. Bush also took aim at the Cayman Islands auditor general’s office, which recently released a report that was critical of how Mr. Bush’s government handled the acquisition of the $155 million loan facility.
Premier Bush said he understood the need to review how government bid processes worked, but termed what he saw happening currently in the country as “bureaucratic harassment”.
“How can we do anything at a quick pace, when we have these so-called good governance experts trying to make the government look like we are doing something nefarious?” Mr. Bush said. “We can only help by getting our projects moving quickly. Bureaucratic harassment is stopping us.
“We have worked hard as a government to stabilise government finances,” he said. “The result of our hard work proves that the efforts of the audit office and the opposition to show that I am not managing the finances of these Islands properly, is not true.”
A detailed summary of three recent Cayman Islands government bidding processes revealed rampant non-compliance with the country’s financial regulations, ‘extra’ spending for government services and, in one case, a complete failure to adhere to any legal bidding requirements at all.
Cayman Islands Auditor General Alastair Swarbrick’s review that was released Wednesday encompassed government’s bidding for arrangement of a US$185 million loan, bidding for the first phase of the public closed-circuit television system, and a contract awarded for the production of the 2009 Jazz Fest.
Mr. Swarbrick’s office opined that the premier overspent $450,000 by foregoing the established bidding process and choosing a New York-based financing firm to arrange a temporary loan for the government.
“I did my best to find a better solution for our country and if I [had] succeeded, I would have saved this country over $24 million,” he said. “And yes, I would do it again.”