There should be no “budget surprises” similar to what occurred following the Cayman Islands’ 2009 general election this time around, according to both elected members of government and top-ranking civil servants.
Deputy Premier Rolston Anglin said last week that government is now mandated to release a pre-election economic and financial update sometime between 10 April and 24 April, according to provisions in the country’s Public Management and Finance Law.
Mr. Anglin said he was hopeful the report could be released and discussed as early as this week.
“I have all confidence that we’re going to have a healthy operating surplus,” Mr. Anglin said Thursday.
The ruling United Democratic Party government’s budget, which was approved in August by lawmakers, forecast an $82 million operating surplus, meaning revenues should exceed government expenses by a significant amount.
Although he didn’t want to get into specific numbers, Deputy Governor Franz Manderson, who heads government’s Budget Delivery Committee, said Wednesday that revenues would likely not allow public sector finances to reach that surplus figure in the current 2012/13 financial year.
“Certainly, our revenue is not where we expected it to be and that is something that the premier is actively looking into at the moment as to what key decisions would need to be made to correct that,” Mr. Manderson said.
An operating surplus for the 2012/13 year is still possible, the deputy governor said, perhaps just not as great a surplus as was first forecast.
“In terms of our expenditure, we’re doing quite well,” he said. “We’re within budget, our numbers are where we expected them to be. [In terms of revenues] let me just say we are not on target at the moment.”
There were a number of new revenue measures enacted for the current budget by former Premier McKeeva Bush’s government; mainly levies on the local financial services industry. Mr. Bush said he expected an additional $90 million in revenues from those measures.
However, some of the new revenue proposals weren’t enacted by the legislature in enough time to be collected during the current year. It’s not clear how much effect that might have on government’s projected operating surplus, but it will have some.
The financial picture was positive enough that Mr. Anglin said he did not foresee Cayman needing to dip into its $40 million-plus environmental protection fund during the current year to make ends meet, although he said future governments should take a look at that fund and others the government maintains.
“We don’t think there should be one single fund that continues to grow and [government] doesn’t utilise those funds,” he said.
According to the Public Management and Finance Law, a number of details about government finances are to be released between 42 and 28 days prior to the general election date.
Economic forecasts for the current financial year and the next two financial years
Forecast financial statements for core government and the wider public sector, including the date on which those statements were prepared
An explanation of how government financial forecasts meet, or do not meet, principles of responsible financial management set out in the Public Management and Finance Law
The Cayman Islands government is running afoul of at least two of the six principles relating to debt and accumulated cash reserves.