The Ernst & Young report on reducing the size and cost of the Cayman Islands civil service, it seems, was just a fantasy. Project Future – the government’s ongoing reinterpretation of the EY Report – is shaping up to be something else entirely.
Toward the close of the year, the government published a “Project Future Update Report November 2016,” following a similar update report from May. After perusing the document, we can only assume the reason the government didn’t call it a “progress report” is because there is so little progress to report.
Here’s the tale of the tape: Over the past year, the government has managed to complete three “projects,” while 41 are in some stage of review or implementation, and eight have been put on hold.
The three finished projects (they are really more “decisions” than “projects”) include moving the government’s London Office under the supervision of the Cabinet Secretary, raising the civil service retirement age from 60 to 65, and providing additional support to Cayman Finance and the financial services industry.
By most measures, those items are, in a word, “modest” – as are other projects that are nearing completion, such as the proposed mergers of watchdog entities and regulatory authorities into an ombudsman’s office and a public utilities commission.
From a cost standpoint, for example, any immediate savings from those initiatives would be wiped out by two recent announcements from government: First, salary increases for some 1,500 civil servants suffering from “stagnated pay,” and second, an increase in government’s contributions to civil servants on “defined benefit” pension plans (from 12 percent of their salaries to 17 percent).
Don’t mistake our message. We do not have any issue, per se, with any of the individual actions we have mentioned above. Moving the London Office under the aegis of the Cabinet Secretary might make sense on the organizational chart level. The civil service retirement age should in theory align with that of the private sector. We believe the government should support Cayman’s financial services industry in every possible way.
In regard to the increases in civil servants’ salaries and pension contributions, we understand that our government workers should be paid in line with market rates and on par with their colleagues, and we recognize that government must adequately fund the public sector retirement schemes to fulfill obligations to its employees.
Rather, our larger point is that the sprawling, paperwork exercise that is Project Future is a far cry from the laser-focused, results-oriented EY Report. Presented with a document that could have served as a road map to rightsizing Cayman’s bloated public sector, the Progressives government has transformed it into an amorphous, bureaucratic blob – a disjointed hodgepodge of activity, all lumped under the banner of “Project Future.”
Government’s squandering of its opportunity is lamentable but not unexpected, given the possible political ramifications of threatening the job security of perhaps thousands of civil servants, the single-largest voting bloc in Cayman.
That being said, as in any free capitalistic country, it is going to be the private sector that drives the future of Cayman, just as the private sector has created the bountiful Cayman we celebrate today. A public sector with an instinct toward heavy-handed regulation and an expansionary appetite for self-growth is antithetical to the success of a company, or a country.
In other words, Cayman should not conflate its future with Project Future.