Cayman Islands Governor Duncan Taylor last week sought to downplay fears that the recent enactment of the Framework for Fiscal Responsibility into local law would somehow hold up the ForCayman Investment Alliance negotiations between government and the Dart group of companies.
However, Mr. Taylor noted that the United Kingdom’s economic adviser may wish to have a word with both parties involved in the agreement.
The negotiations include a proposal to relocate a section of West Bay Road along Seven Mile Beach and build a waste management facility in Bodden Town.
“It’s not a procurement process as such,” he said. “You’re not in a competitive tendering position because you’re looking at some swaps there between what government have and what Dart has.”
Mr. Taylor and UK officials indicated that the fiscal framework agreement might be with the Cayman Islands quite a bit longer than many expected.
There is no “sunset” or end date for the UK-drafted Framework for Fiscal Responsibility now contained within the Cayman Islands Public Management and Finance Law.
During his first visit to the Cayman Islands, British Overseas Territories Department Director Peter Hayes – who replaced former director Colin Roberts in October – fielded questions during a news conference about the fiscal framework document and other issues.
“[The Framework for Fiscal Responsibility] doesn’t sunset,” Mr. Hayes said. “But it’s not something that we would see as cast in stone forever.”
Right now, the framework agreement – signed by Cayman Islands Premier McKeeva Bush in November 2011 and passed into law by legislators last month – sets guidelines on certain areas like government spending and borrowing, bidding for public projects and rules for financial reporting.
The document prevents the Cayman Islands from entering into any further long-term borrowing to support public projects through June 30, 2016. The only exception to that rule is in the case of natural disasters affecting the territory.
“One would hope, as the financial management situation develops and as the guidelines come back within the debt limits … then obviously we want to make sure the Framework for Fiscal Responsibility is keeping pace with circumstances,” Mr. Hayes said.
Governor Taylor elaborated on the matter.
“There’s a timetable to get the government finances back into a position where they meet all the borrowing guidelines,” Mr. Taylor said. “At that stage, assuming we get there, then some of the ability of the minister in the UK to have a say in the setting of the [Cayman Islands] budget falls away.
However, the principles of sound management will stay in the finance law, and that could include new rules for things like public project procurement.
“We may well have a new procurement law,” Mr. Taylor said. “What you may find is those basic principles that are in the Framework for Fiscal Responsibility might be incorporated into some other bit of the Public Management and Finance Law at some stage.”
This might not be considered good news by Premier Bush, who has constantly railed against “good governance” interference getting in the way of public projects.
Statements made at the Future of Cayman forum by Premier Bush served to illustrate his general view on the subject.
“There are those who wine and dine and gulp down everything they are told today about good governance; good governance which seems to be nothing but pure unadulterated bureaucracy and how much, so they say, these Islands lack in box-ticking so-called good governance,” Mr. Bush said. “I can … promise to move these projects as quickly as we are allowed to, recognising their economic importance to the people of these Islands and that they will be done so as to achieve real value for money.”