Plan to scrap ‘disastrous’ scholarship fund

Government could face legal action if it fails to honor scholarship agreements handed out under the controversial Young Nation Builders Scholarship Fund, former Premier McKeeva Bush claimed Monday in response to allegations that he gave excessive grants to political favorites.

The fund has been scrapped by the People’s Progressive Movement, and scholarships will now be capped at $25,000 and administered by “education experts” in an effort to reform a system beset by allegations of mismanagement and political abuse.

The changes, which go into effect in the 2014/2015 academic year, will cut funding to some students, some of whom received in excess of $70,000 annually. Students were sent letters recommending they make alternative arrangements, including student loans, to cover the shortfall for the rest of their programs.

Premier Alden McLaughlin has claimed that thousands of dollars of scholarship money was doled out through the fund for colleges that do not exist.

He said the system was run “out of the back pocket” of Mr. Bush, who he alleged handed out large scholarships to the children of political allies, while other qualified students received nothing.

Mr. Bush accused the premier of a “low blow” and suggested recipients of grants under his program could take legal action if government cut funding before the end of their four-year scholarship agreements.

Mr. McLaughlin, speaking in the Legislative Assembly on Thursday, described the fund as a “complete and utter shambles.”

He claimed that some students are receiving Young Nation Builders grants of more than three times the maximum of $20,000 ordinarily handed out through the Education Council; that some students are receiving separate scholarship grants from three different government departments; in one instance the daughter of Mr. Bush’s political adviser was given $70,000 for a high school scholarship; and that Mr. Bush was the ultimate decision maker, deciding who got scholarships and who did not.

Mr. Bush has denied that he favored political allies, saying he simply had final sign off, following recommendations from a panel of civil servants. He accepted some students had received more than others but said some universities and programs cost more than others, claiming the aim of the fund was to give “extra capable” students the chance to progress.

“They could never do that with the education council grant of $20,000,” he said. “Surely you would not expect that a student going to the UCCI would receive the same amount as a student going to Miami Dade community college or other community college?”

Mr. McLaughlin told legislators that the payments made through the fund were the subject of an auditor general’s report and the facts would come out.

“It would be difficult to conceive of a more disastrous program or set of circumstances than we were presented with when we took office,” he said. “There is little in terms of systems, there was one person deciding who gets scholarships and that was the premier himself …”

He added, “The former premier operated this program out of his back pocket and decided who was going to get a scholarship and exactly how much they were going to get.”

All students receiving more than the Education Council maximum of $20,000 for undergraduate studies and $25,000 for post-graduate studies received letters last month informing them that their funding would be cut.

Mary Rodrigues, chief officer with responsibility for education, wrote: “Cabinet has indicated that it is minded to adjust the terms and conditions for the level of funding provided for scholarship awards previously made under the Young Nation Building Scholarship Fund to be consistent with awards made under the education council scholarship program.”

The letter indicates that students will now be eligible for a maximum of one government scholarship and that the changes come into place for the start of the 2014 academic year.

Mr. McLaughlin, during his speech in the Assembly, acknowledged that the upper limit for scholarships may need to be increased. But, he said, it needed to be done in a transparent and accountable way, rather than at the whim of whoever happens to be premier.

Government hands out around $13 million in scholarship funding every year for young Caymanians to study both locally and overseas.

Allegations of incompetence and abuse of the scholarship system are nothing new. The previous Progressives administration, in which Mr. McLaughlin was education minister, faced accusations of neglect and mismanagement over its running of the system.

Rolston Anglin, who was the United Democratic Party’s education minister under Mr. Bush, gave a damming critique of the PPM’s handling of grant money in the Legislative Assembly in 2009, pointing out that some scholarship recipients had GPAs of 1.0 or less – far lower than the minimum criteria. The program was also criticized for a lack of organization and consistency, with just one full-time staff member overseeing scholarships and no clarity on requirements and assessment procedures.

The controversy continued under the UDP. Government’s internal audit unit investigated a sample of 30 scholarship awards between July 2009 and June 2010 and expressed concern that families earning between $95,000 and $186,000 were getting scholarships.

Mr. McLaughlin’s most serious allegations about the Nation Building scholarships extend beyond incompetence.

He said, “We have recorded instances of students attending or being sent to institutions which quite frankly did not exist. We have instances, one of which is being pursued now by the Cayman Islands government, of the person ostensibly in charge seemingly taking the money, the young people not attending any school, living in YMCAs …

“We have instances here … of young people, ostensibly under this program, being sent off to high schools at the cost, in one instance, of US$71,810 a year, in the case of another $69,590 a year. All awarded under the hand of the now leader of opposition who was then the premier.”

Mr. Bush said he “seriously doubts” that any student received a scholarship and didn’t attend school. He said government’s plan to terminate four-year scholarship agreements could land them in court.

“Those students signed a four-year legal document and if either student or government is not fulfilling their agreement, each has legal recourse because it is all legal obligations,” he added.

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2 COMMENTS

  1. Looks like another legal food fight developing here.

    I particularly like the way the former Premier has spun the legal implications because to me this seems very simple –

    1. If a student or their parents obtained the money under false pretences that is fraud and RCIPS must deal with that.

    2. If the awards themselves were made for a genuine educational program but the amounts involved were, as is being suggested here, excessive then it needs to be determined if the original agreements were reasonable and if not, why not.

    In the UK handing out money for political advantage (which I am not suggesting happened here) is called gerrymandering with serious financial implications for anyone involved.

    Google Shirley Porter Westminster City Council for more info on this.

    Does the Cayman Islands have any similar legal provisions? Again the question must me – If not, why not?

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  2. Got to correct that comment because I’ve just been slapped down by a colleague for misinterpreting and confusing the nature of gerrymandering.

    What actually happened in Westminster was that Council owned properties were sold off in an apparent attempt to boost Tory votes and a fairly large itinerant (mostly non-voters and definitely non-Tory voters) population was re-located thus shifting the voting balance. That was use or misuse of public funds but in a different context.

    Is this the same? I am not in a position to judge.

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