Business group supports government resize
While it supports the latest efforts to “rationalize” the Cayman Islands civil service, the Cayman Islands Chamber of Commerce noted last week that reams of advice about how to reduce the costs of the public sector have already been provided to local government.
Someone just needs to put in place the advice the public sector is being given, the advocacy group said.
“The Miller-Shaw report … was accepted by the Cayman Islands government in February 2010,” a letter sent on May 8 to Deputy Governor Franz Manderson from Chamber President Johann Moxam stated. “The Chamber Council supports the conclusions contained in the report and the majority of the recommendations identified.”
The recommendations from the report compiled by former U.S. President Ronald Reagan’s budget management director, Jim Miller, and Tory MP David Shaw included substantial privatization of public sector functions and the selling off of certain government assets; significant reductions in operating expenses; completing audits of all government entities, statutory authorities and government-owned companies and not imposing direct taxation.
In addition, the Chamber noted several recent reports from the Cayman Islands Auditor General’s Office that looked at management improvement strategies and better financial reporting.
“The [Chamber] Council believes that there is a need for a strong financial leader in the public sector who will be responsible for leading the public sector rationalization exercise,” Mr. Moxam’s letter stated.
The public sector reform should address six general areas, the Chamber letter to Mr. Manderson indicated.
*Rationalization: Certain examples such as regulatory authorities for utilities were given. The Chamber pointed out that the Information and Communications Technology Authority, the Water Authority Board and the Electricity Regulatory Authority Board all have separate operations and support staffs. Similarly, there are three separate boards to support Cayman Islands cultural organizations.
*Simplification: Cutting through the red tape to simplify processes, particularly in core government, could help reduce costs, the Chamber opined.
*Shared services: Functions like human resources, accounting and information technology can be run out of one central office, rather than having each ministry or department with their own HR or accounting managers.
*Strategy: The Chamber says government should look at not only what it wants to achieve, but whether those goals are actually being reached. A similar recommendation was made by the auditor general’s office last year.
*Affordability: Even if value for money has been achieved, the Chamber advises that certain projects are not affordable in the current economic climate.
*Values and ethics: The Chamber advocates addressing “competency” issues in the public service.
To help accomplish these goals, the local office of “big four” accounting firm Ernst & Young has been tapped by the Cayman Islands government. Ernst & Young was selected following a competitive bid process to assist government in several areas.
The contract, according to a statement from the government Portfolio of the Civil Service, was for CI$155,000 plus expenses.
Since 2001, the overall government service has grown from about 4,000 employees to close to 6,000, including individuals employed in statutory authorities and government-owned companies that have been separated from the daily operations of central government. In the last two years, those staff increases have leveled off, but no major reductions have occurred.
The Portfolio of the Civil Service, which manages government human resources, has reported that the Cayman Islands now has more than 80 core government entities and 25 separate authorities and government-owned companies. That doesn’t count various boards, commissions and committees appointed by government – which at last count a Cayman Compass review numbered at 115.
The accounting firm will “identify those functions that would better be carried out with private sector involvement,” according to the portfolio statement. This includes offering suggestions as to where public-private partnerships might work better than the public sector going it alone, and instances where simply selling off government assets might be preferred.
“Historically, the government of the Cayman Islands provided most public services as there was not a mature private sector,” the statement from the portfolio read. “The Cayman Islands economy has grown considerably and the government seeks to evaluate opportunities to engage the private sector where this would result in improved service delivery and greater efficiency.”