Ernst & Young report: A test of resolve for Cabinet, civil service

We haven’t seen it yet, but we can foretell that the Ernst & Young evaluation of the Cayman Islands public sector is setting up what we hope will be a civil debate regarding the future of the civil service.

The EY study, which considers central government, statutory authorities and government owned-companies as a whole, will pose recommendations to privatize, downsize, transfer or entirely eliminate government agencies and services. Within the next month or so, Cabinet will review the report and choose which recommendations to implement.

There’s no way for the Progressives government to sidestep the inevitability that following the consultants’ advice will bring sweeping change to the civil service — and in ways that may not be pleasing to its workforce.

The key question is this: “Does this elected government have the fortitude to challenge the 4,400 Caymanian public servants who comprise the country’s single-largest voting bloc; or will they, like their predecessors, ultimately crumble?”

No elected government in recent Cayman history has had the courage to confront the civil service, even on minor matters.

And this is a major matter.

(Case in point: The 2010 Miller-Shaw consultancy report, which in our opinion was one of the best-thought-out public documents ever requisitioned in these islands, turned out to be too politically unpalatable for our elected officials to act upon.)

As documented by Miller-Shaw, Cayman’s unsustainable, growing public sector spending is largely driven by the costs of human resources.

Put another way, there are too many people working for government, they’re making too much money (especially those in senior positions) and their benefits (such as healthcare, pensions and job security) are unrealistically generous.

But Cayman’s democratic realities are already in place, and civil servants will continue to exercise considerable control over elections (and politicians) until their numbers are significantly diminished. It’s a catch-22.

So the question remains, “Will Cabinet members put their country ahead of their political careers?”

In order for substantial reform efforts to succeed, Cabinet must align with Deputy Governor Franz Manderson who, in turn, will require unflinching support from Governor Helen Kilpatrick. This triumvirate must remain unified in both word and deed. Any dissent in public among them will be viewed as weakness and will be exploited by those seeking to perpetuate the unsustainable status quo.

So far, Cabinet’s approach, forcefully articulated by Premier Alden McLaughlin, and the deputy governor’s recent statements have been encouraging. We are especially pleased to hear Mr. Manderson emphasizing the “need for speed” in implementing the report’s recommendations.

We’ll also note that the EY study is likely to be far more than a series of bullet points on what to cut from government and what to keep. We expect it will serve as a “road map” for officials to follow when enacting the recommendations.

According to our understanding, the resources EY assembled to conduct this study — including flying in experts from its global network — far exceed the $155,000 that government has paid the firm for its services. Other comprehensive studies, such as on the cruise ship port, the airport or the landfill, routinely cost millions of dollars. Indeed, EY’s services can be thought of as a generous gift to the country.

What remains is to tear off the wrapping paper, read the instructions and put the gift to good use for the good of Cayman.

1 COMMENT

  1. This actually might be the spark that leads the country towards independence.

    We have to face the fact that the private sector does not have the capacity to absorb any significant amount of people that might be made redundant as a result of any significant downsizing or privatization, and the government, while keen to reduce expenditure, needs to also take into consideration the social (and financial) impact that any significant increase in unemployment will have on the government and the country as a whole.

    For the EY report to be worth anything it needs to speak to the wider economic impact of any downsizing as the funds paid out by the government each month in salaries essentially act as an indirect stimulus for the economy. Any significant reduction in the amount of spend available within the economy will most certainly have a negative impact on the wider economy. The EY report also needs to speak to the financial impact that downsizing will have on areas like social welfare, crime fighting, and other areas that are typically negatively impacted when the number of unemployed people goes up significantly.

    For better or worse, this actually might be the spark that leads the country towards independence.

    Note:
    —–
    If the government is going to downsize then it only makes sense that we will not need as many MLAs to run a significantly smaller government and the government needs to also speak to a reduction in MLAs as part of their long term strategy.

  2. Not Likely……..

    Until Cayman has a group of leaders that are willing and ready to do whatever is best for the country as a whole no matter how it tastes, these types of recommendation will be ignored. For the most part politicians are career minded people that are more concerned about furthering their career goals then they are about what best for Cayman. In a nutshell all they are really concerned about is getting reelected and keeping that big check coming..

    They are all masters of disguise and trained manipulators who will do whatever it takes, say whatever needs to be said and make unrealistic promises to get votes even if they know what they are promising is wrong or impossible to accomplish.

    Only a blind eye cannot see this.

  3. What really astonishing is the size of this country and amount of efforts taken, spent and time wasted to make it somewhat functional on the basic levels. How in the world just 30,000 people, including children and elders, managed to get itself into such a mess from which they can’t find way out?

  4. Wanted to look into 2014-2015 budget on CIG site, but not even 2013-2014 published on gov.ky site. It says though: These documents are published as PDF documents. For more information read the PDF guidelines. BUT NOTHING is published. Sigh….

  5. What is best for the Cayman People that is.. Cayman as an employment platform must function firstly for its people.

    Employment is the economic yardstick, and if the private sector is unable or unwilling to hire enough Cayman people, then the government would be neglectful in their duties if they fail to adjust and correct. Matter of fact against the national good if Caymanians are to be unemployed and over fifty percent of the population of our island is imported labor.

    Government employment is the governor which maintain some similance of stability where (some) private industry would care less if their workers were all from China and the indigenous people who welcomed them to their shores were endangered species.

    They say China subsidize their manufacturing unfairly, and businesses are unable to compete within their markets. China people are working!. Build it and sell it for less than you can make it, but people are working, Subsidy, distribution of the wealth, trickle down or food stamps, working..

    Why you say that someone would want to disband a not for profit socialist entity?.. To turn it into a profit driven platform of course.. If employment is the avenue used to provide goods and services to a population, having everyone employed would seem to be an ideal objective. This is government’s objective, not private industry. Government have to be careful not to be swayed too far in the interest of the profit makers, and forget their mission. All Caymanians must eat, thru continuation of the barta of good and services of employment.

    Child psychology, I bet they will not do it because they are afraid of their people, and they won’t let them play politics anymore.. Or that commenter is a troll.

  6. @Michael Davis: How did this all get started?

    It certainly did not get started by any elected government wanting to downsize the public sector, and it did not get started by Caymanians asking any elected government to downsize the public sector.

    This all got started because the government lost control of its ability to make certain critical decisions regarding government finances. As a results of this the government was forced (for better or worse) to take a closer look at their expenditure; and ultimately various reports from a number of external consultants recommended, among other things, that the government take a serious look at the downsizing of government and the privatization of some government services.

    There is still no appetite among politicians to do anything that could negatively impact their ability to get re-elected and they are essentially going to have to be carried kicking and screaming in order to get any significant reform enacted. The alternative to this is for the country to regain full control of all decisions related to government finances and there is only one way that that will happen.

    While I am personally in favor of a long term strategy that includes the downsizing of government the Caymanians that I have spoken with over the past few years (especially government workers) are mostly not in favor of any significant downsizing and are cautious about any privatization that might see the transfer of significant amounts of government assets into the hands of private individuals or companies.

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