The good news about the Public Authorities Bill is that it aims to make Cayman Islands statutory authorities and government-owned companies operate more like central government.
The less good news about the bill is it only aims to make government’s authorities and companies operate more like central government.
Make no mistake, we support the intent of the bill — to rein in the explosion in the size and cost of the public sector and to introduce greater accountability to Cabinet. What we don’t like is that it stops far short of actually reducing the size and cost of Cayman’s government.
As we reported in a front page story in Tuesday’s Compass, and have observed many times over the past decade, the story of government growth in Cayman has had two distinct narrative arcs: a slow decline in central government, and a sharp rise among the country’s 26 distinct authorities and companies.
The number of core civil servants peaked at about 3,800 employees in 2008, and has since dropped to 3,591 as of December 2015. That’s a decrease of about 5 percent.
In contrast, the number of employees at government authorities and companies stood at 2,194 in 2010 and grew to 2,751 in December 2015. That’s an increase of more than 25 percent.
In addition to the sheer size of the authorities and companies, the relative cost of those entities has been out of Cabinet’s control. An illustration of this is the lucrative salaries of executive directories of the (typically loss-making) authorities and companies. For example, in 2014, the head of the port authority made between $180,000 and $204,000; the head of Cayman Airways made between $150,000 and $180,000; and the head of the airports authority made between $152,000 and $160,000 — each of which is more than the salary of Cayman’s premier.
The proposed Public Authorities Bill would bring workers and managers at the authorities and companies under the “public service umbrella,” in terms of accountability and expectations. The bill gives Cabinet greater control over the financial management of the entities and the remuneration of executive directors. The bill does not, thankfully, expand access to the woefully extravagant public pensions and public health insurance schemes.
The bill, however, does contain a “grandfather clause” exempting individuals whose current employment terms are more generous than the ones allowed by central government. (The term “grandfather” is appropriate — in that the existence of such clauses means many of our readers, and their children, will be grandparents before any savings are realized under this section.)
Taken by itself, the bill is fine. But we shouldn’t labor under the illusion that the legislation constitutes meaningful reform of Cayman’s public sector, which now employs more than 6,300 people — more than 15 percent of the country’s total labor force.
As demonstrated in “Project Future” (aka the “EY report”), the two hallmarks of real reform to the public sector are a reduction in the number of public servants, and a reduction in the cost of the public service.
Measures that are lacking in those areas, such as this bill, are the equivalent of moving checkers around a game board without allowing any of the pieces to be captured and removed.