Budget meeting cancelled at last minute

Updated 2.45pm: Premier McKeeva Bush released the following statement regarding government budget negotiations on Friday afternoon.

“The Cayman Islands government has postponed until 2:30pm Monday the Throne Speech and Budget Address scheduled for [Friday] afternoon. The government, working with the civil service, has produced a budget which we consider to be credible and sustainable both from the revenue and expenditure perspectives and which meets the targets established by the [UK] Foreign and Commonwealth Office for the next four years to return our finances to a sound footing.

“The FCO still has issues with a few technical areas and we have agreed to postpone the budget presentation until Monday while discussions continue to resolve these issues.

“We continue to do what is in the best interest of our beloved Cayman Islands.We wish all our residents a blessed and safe weekend.”

Earlier story: Acting Governor Franz Manderson confirmed early Friday afternoon that there would be no meeting of the Cayman Islands Legislative Assembly at Friday.

Several government sources contacted by the Caymanian Compass Thursday and Friday confirmed that the United Kingdom’s Foreign and Commonwealth Office had not yet approved the spending plan put forward by Premier McKeeva Bush’s government.

According to those close to the negotiations, UK officials and Caymanian lawmakers were in intense negotiations and were getting closer to an agreement on the proposed $580 million spending plan. However, the UK remained concerned about the level of Cayman’s government spending and whether it was sustainable.

On Thursday evening, the office of Premier McKeeva Bush’s press secretary issued a statement on a number of new revenue measures that had been proposed within the 2012/13 budget. It was unclear on Friday if the UK had signed off on those changes.

The statement read as follows:

“In addition to the revenue measures announced as alternatives to the Community Enhancement Fee, Government is proposing increases to other existing fees to further improve Government’s revenue for the 2012-13 Financial Year and beyond. Along with the increases, a proposed new licensing system for Fund and Corporate Directors will create a new revenue stream.

“The Government is proposing to increase the annual fees for Exempt Companies by $100. Issuing of certificates for a company, filing of a company document, company certification and express service for certificates, certification, filing and registration and re-registration are slated for a $25 increase.

“Annual Fees for directorships under the Companies Law are earmarked for the following increases: Securities and Investment Businesses increased by $500; Regulated Entities increased by $300; and all other directorships by $100. Company Managers and Trust Services are both listed for increases of $100. A variety of CIMA fees are also among the proposed fee increases, ranging from $100 to $800.

“Proposed amendments to the Companies Management Law will create and implement a new licensing system for Fund and Corporate Directors. At present these Directors are not licensed or regulated.

“Once the 2012-13 budget and the Amendments to the Companies Management Law are passed by the Legislative Assembly they will have to pay the fees detailed in this revenue measure. The proposed fees range from a low of $500 for one directorship per director to a high of $25.

“These measures are in addition to the revenue measures that replaced the Community Enhancement Fee, namely: increased bank and trusts license fees, work permit fees, tourist accommodation tax, departure tax, master fund registration fees, traffic regulatory fees; exempted limited partnerships; imposition of a stamp duty on certain property insurance policies; reverting to the 7.5% stamp duty on land transfers; and implementing fees for non-commercial boats.

“In all, these revenue measures and those measures that replaced the Community Enhancement Fee are expected to earn the Government some $90.46 million during the 2012-13 fiscal year.”

1 COMMENT

  1. Come on Mckeeva.The problem was spending get a chainsaw and trim some fat from the public services.We can afford US3/4 billion in spending anymore.I knew last week some public authorities hire more people and paying overtime like there is no tomorrow,come on stop this madness.

  2. The UK folks keep saying cut expenditures and all they do is raise fees to cover them. At this point they probably will not agree to anything less than serious cuts even if they have to come in and do it themselves. A lot of people have been asking for a UK take over like the Turks. Be careful what you ask for, you just might get it and it might not be the paradise you think it will be..

    If they were to come in, the first thing they would do is slash the Civil Service then there will be cuts in public assistance programs and nation building funding. And after it’s all done then you will what VAT means..

  3. In all, these revenue measures and those measures that replaced the Community Enhancement Fee
    are expected to earn the Government some 90.46 million during the 2012-13 fiscal year……

    I don’t know who writes the ‘scripts’ for these guys, but a certain Ken Dodd could do a far better job.

  4. NJ2Cay,

    Before you offer any more support for the nation-building/vote-buying based on projections of what the FCO might do, let me put it in perspective for you.

    The premier is proposing to spend 15 million dollars on solar panels for people who cannot afford to pay their electricity bill. That’s 10,000 dollars for 1,500 hand-picked individuals, or roughly 5% of the indigenous population. With an average of 3 people in each household that would represent 15% of the population.

    In America there are about 50 million people, or 15% of the population, living below the poverty line. If Obama decided to give each of those 10,000 dollars it would add 500 billion dollars to the budget.

    How do you feel about having your taxes increased so that everyone could be lifted out of poverty for one year?

  5. Still no cuts in spending? Yet you are going slam places like the Ritz with increased permit fees. They have nearly 600 permits because Caymanians won’t work in Hospitality, i.e. service. They are struggling now and you just threw a drowning guy an anchor. Personally I think they should get a volume discount. The boom is way over, cut headcount to pre-Ivan levels. Just watch, the FCO is going to kick your lame excuse of a budget right off the bluff and into the sea. Go fetch it.

  6. That Jinx sub does not seem to be sustainable, I wonder how many mouths that would feed.

    The Civil Servants employed by the government is an aberration brought on by preferential treatment for big business for too long. If their hire is an extension of social services, I would rather they work for their pay..

    If you must have another reason, they are our National guard, Marines, Air-force, and Army..

  7. Baffled,

    I was in no way offering any support for a National Building Fund, I was simply pointing out the types of things that would be cut as they probably should be. I personally think the CIG should be put on spending freeze until they get this all sorted out and balanced. As far as your point about my taxes being increased so that other could be lifted out of poverty in the US and Obama giving money to people below the poverty line. It’s already happened.

  8. caymanian-on-guard – There’s more to it than that. The aberration also comes government paying a pay scale higher than the private sector and also not holding its employees to the same rigors as the private sector. Human beings often take the path of least resistance and the civil service is that path in Cayman. The private sector hires expats because their main concern is profit and they need to get the work done. In addition, when they hire a bad or unreliable expat employee, they are easily dismissed. The civil service doesn’t work like that.
    I agree with you that its better for the government to give them jobs rather than to just put them on the dole. But for the country’s sake and the sake of a people, many of whom seem to have lost any semblance of personal pride, make them work to higher standards!