The Cayman Islands government will announce its budget plans in the midst of hurricane season this year, changing to a two-year budget cycle approved by the previous administration.
According to public notices on Friday, the annual strategic policy statement from government is due to be presented to the Legislative Assembly on Aug. 21. The policy statement is government’s general outline for budget plans before the release of the spending proposal itself, which is to be made public on Oct. 13.
The government aims to have its budget approved and gazetted by Dec. 15, ahead of the start of the new fiscal year on Jan. 1, 2018.
Amendments to Cayman’s Public Management and Finance Law approved in 2015 changed the government’s July to June budget year to a calendar year period. To get to that point, the current government budget, which began on July 1, 2016, was extended for six months to Dec. 31, 2017. After that the two-year budgets will begin, with the first running through 2018 and 2019.
Former Finance Minister Marco Archer said that while the budget plan would be extended to two years, annual audits and reviews of government spending would still take place as prescribed by the current law.
Mr. Archer said the change was made to save government officials time in preparing documents and spending plans each year, a process that often began in October of one year and ended in June of the next.
George Town East MLA Roy McTaggart – who has been appointed Finance Minister in the new administration – led a committee that reviewed the Public Management and Finance Law and said the current switch to calendar year finances and two-year budget plans were just a few of some 40 amendments the group had proposed.
Mr. McTaggart said the two-year plan would have “flexibility built in” and if changes in the budget needed to be made, they would be brought to the Finance Committee at the appropriate time.
Mr. McTaggart argued that ministers and other elected members of the government have a responsibility to manage the budget process properly so that it does not overwhelm everything else government is trying to accomplish.
“[The annual budget process is] not where we wanted to spend time and resources,” he said.
Opposition Leader Ezzard Miller expressed opposition the switch to multiyear budgeting many times, as did current Speaker of the House McKeeva Bush when he was opposition leader.
Mr. Miller has said that while the government is now required to meet at least once a year in the Legislative Assembly’s Finance Committee to review an annual budget, moving to two-year budgets will mean that lawmakers will have only two chances during a government’s four-year term to review and question a spending plan.
“I think that severely reduces nongovernment [assembly] members’ ability to influence government expenses and finances,” Mr. Miller said. “If you think [public construction] projects are overrunning the budget now, wait until they don’t have to be scrutinized for two years.”
Mr. Bush has pointed out that government audits have often lagged years behind the actual expenditure, and that legislature members are not allowed to question those reports at the time they are made public anyway, due to Legislative Assembly rules.
“That is a long period of time when there is no scrutiny,” Mr. Bush said.