However, the public sector is still expected to end the year on 30 June with an operating deficit, due to the overall performance of statutory authorities and government companies.
“We will end up with about a $7 million deficit because the government companies are having it hard,” Mr. Bush told a crowd of more than 150 people in Bodden Town Thursday night. “It is still better than the 81 million dollars that they left.”
Mr. Bush’s last comment is a reference to the former People’s Progressive Movement administration, which ended its last year in government with an $81 million operating deficit. An operating deficit means government expenses were greater than its revenues for the year.
The current United Democratic Party government has some work left to do if it intends to break even for the 2011/12 financial year.
The Legislative Assembly’s Finance Committee is expected to have a meeting soon to approve supplementary funding requests for the current year. The precise figures regarding how much the government will need have not been revealed, but two sources within the government that spoke on condition of anonymity said the public sector would have to make up tens of millions of dollars. Most of the problem is due to additional spending.
Some of the cash is being sought for spending items that were unplanned when the year started; others are required to deal with increases in government spending for some already budgeted areas, the Caymanian Compass has learned.
One example of a budget increase that government will have to support via supplemental funding is the $4.6 million boost given to the Royal Cayman Islands Police Service earlier in the year. That extra spending was approved amid a major public outcry over a string of gang shootings that occurred in September 2011.
Supplemental budgets are fairly common during government budget years and are used when adjustments are needed to make ends meet.
Premier McKeeva Bush has previously warned of a government financial fall off during the current 2011/12 year. Government ended the 2010/11 year with an unaudited budget surplus of about $25 million.