The Cayman Islands and the United Kingdom governments are negotiating over the territory’s 2012/13 budget, with Cayman Islands Premier McKeeva Bush hoping to present a spending plan to the Legislative Assembly by Friday.
If that occurs, lawmakers would have the weekend to review the document and could start debate on it Monday – six days before the end of the government’s current budget year.
Premier Bush cautioned, however, that he was not entirely in control of what would be presented since the UK Foreign and Commonwealth Office has to approve what Cayman proposes.
Mr. Bush confirmed he had received a letter from Overseas Territories Minister Henry Bellingham on Monday indicating the UK would get back to Cayman on its budget proposal.
The premier said that Mr. Bellingham “didn’t like the borrowing” proposed in the budget. Mr. Bush has said that some additional borrowing would be needed in 2012/13 to complete work on government schools construction, the construction of juvenile remand facilities required in the Constitution and some $15 million for the provision of solar panels for low-income homes.
“Maybe it will be around $40 million in total; not much,” Mr. Bush said.
According to government’s Public Management and Finance Law, Cayman’s government must approve a new spending plan by 30 June – the end of its budget year – in order to have the authority to spend money in the fiscal year that starts 1 July.
“If we don’t get [the budget] back in time for the 30th, then we would have to make arrangements to carry on spending,” Mr. Bush said Tuesday. “I hope it won’t come to that.
Premier Bush said he didn’t want to talk about the possibility of a temporary budget being approved. He said if there were a delay on the UK side, some temporary expenditure would have to go through. He admitted that government had presented its budget to the UK foreign office late.
“It’s a horrible mess, a horrible feeling for anybody who is a stout-hearted Democrat,” Mr. Bush said of the current situation with the government budget. “I am not blaming the UK, I am blaming [Opposition Leader] Alden McLaughlin.” Mr. Bush has frequently blamed Mr. McLaughlin and other previous members of the People’s Progressive Movement government for ending their last full year in office with an $81 million operating deficit and “saddling” government with two new high schools it couldn’t afford.
Mr. McLaughlin said Tuesday that Mr. Bush’s blaming the PPM might have worked for the United Democratic Party’s first budget in 2009/10, “but every budget since then has been late,” he said. “There can be no justification for it being late this year.”
The opposition leader said it was his view that it would have been simply impossible for government to come up with a modest surplus, as the premier has stated, after being faced with a $130 million gap between what it said the civil service should spend and initial proposals from government departments.
“What they are trying to do is create a situation on paper where there is a modest surplus,” Mr. McLaughlin said. “It’s incompetence. The system has been left to run itself.”
Mr. Bush said, when his government’s budget is presented to the house, it will be one he feels “everyone can live with”.
The premier said his government would not propose direct taxation in the 2012/13 spending plan.