Auditor general worried about lack of cruise berthing plans

The Cayman Islands auditor general’s office isn’t usually considered the “point man” on subjects like boosting the country’s 
tourism earnings.

However, even Scotland-born accountant Alastair Swarbrick has apparently become concerned over Cayman’s future competitiveness as a cruise ship destination; a concern he expressed to the Cayman Islands Port Authority’s Board of Directors as early as May of last year.

According to confidential minutes of a 19 May meeting with port board officials, Mr. Swarbrick suggested that delays in executing a new cruise berthing facility in George Town could “negatively impact on Cayman’s cruise business, especially as there are now so many berthing facilities elsewhere 
in the Caribbean”.

During the discussion with the board, details of which were made public under a Freedom of Information request, former port board chairman Stefan Baraud agreed with the concern, revealing that one of the major cruise ship companies operating in Cayman – Royal Caribbean Cruise Lines – eventually plans to leave Cayman off its list of destinations.

“The RCCL [Royal 
Caribbean Cruise Lines] business model calls for RCCL’s existing ship stopping in Cayman to be relocated to the Mediterranean,” Mr. Baraud is quoted as stating in the 19 May meeting. “RCCL values Cayman as a destination and had pledged to keep coming to Cayman for as long as possible, but it was noted that financial considerations may dictate otherwise.”

Mr. Baraud also noted the oft-stated concern that Cayman’s current cruise dock, which requires tender boats to pick passengers up from the cruise ship and drop them off at George Town harbour, won’t be able to accommodate the larger Genesis and Oasis-class cruise ships now traversing the seas.

“The Oasis-class ship has begun service in the western Caribbean and does not stop in Cayman … revenue is definitely being lost as a result of that,” Mr. Baraud said.

Attendees at the 19 May meeting, held about a month after talks with former port builder GLF construction collapsed, said the cruise market in the Caribbean was a whole different world from what existed 15 years ago.

Board members said in 1997, there were just two ports in the Caribbean capable of berthing cruise ships. Now there are 20 such ports.

Environmental issues

Another “significant issue” identified with constructing the George Town cruise ship berthing facility, according to the port board back in May, was that an environmental impact assessment would have to be done before the project was built.

Such a study had been commissioned by another former port project bidder, Dart Enterprises Construction Company often referred to as DECCO.

“But DECCO is unwilling to allow anyone to see their environmental impact assessment unless DECCO is compensated for it in the amount of approximately US$2 million,” according to the minutes of the 19 May meeting. “A commitment to make such a large payment could not be given unless and until the value of the materials to be acquired is ascertained.”

The Department of Environment has also not approved the study’s terms of reference, board members noted.

Auditors’ oversight

As of the 19 May meeting, Mr. Swarbrick requested the port board and auditor general’s office meet quarterly to discuss the progress of the port project.

“[Mr. Swarbrick] stated that his experience showed that political pressure is always brought to bear in these kinds of projects and he is concerned that good business decisions can be adversely affected by policy considerations which are not practical,” the minutes read. Mr. Swarbrick said his office intended to give “informal advice” on the project tendering and other matters along the way, but that the auditor’s office could not be part of management decisions.

Any formal advice would be given after the completion of his audit of the port berthing facility project, he said.

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1 COMMENT

  1. The Auditor general would serve us all well by defining the value for money aspects of the project..

    The UK did require a value for money report. Also it would be helpful if this government was given advice on how to avoid paying non performing contractors millions for doing nothing..

    As someone is often saying; Show us the flow of the dough and the sand.

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