Senior Cayman Islands government managers ignored or actively opposed the majority of the recommendations made in a controversial 2015 audit that revealed opaqueness, “unlawful” acts and allegations of corruption in the management of public properties.
Auditor General Sue Winspear on Monday identified four audit reports where either partial progress or little progress had been made in response to her office’s findings and recommendations, which were reviewed by the Legislative Assembly’s Public Accounts Committee in 2016.
As a result, officials with the Ministry of Planning, as well as the Ministries of Community Affairs and Finance, will be called back to the committee this month to testify about the status of various improvements.
The land management audit, made public in July 2015, recommended that the Cayman Islands update its 1997 National Development Plan. It also recommended that shore lands below the high water mark should be included in those plans, which govern the rules for building in the islands.
No progress was reported on either recommendation.
On the possibility of updating the development plan – now 20 years out of date – government officials responded: “Due to lack of resources, this recommendation has not been taken forward but remains a priority.”
Another recommendation stated that the Central Planning Authority of Grand Cayman and the Development Control Board of Cayman Brac and Little Cayman should hold open public meetings and provide “a rationale” for their decisions. The audit also recommended changing up the membership of the planning authorities.
Shortly after the release of the 2015 audit, both boards were reappointed with exactly the same membership.
Officially, Ms. Winspear said in her report that it is “not clear” whether the transparency recommendations are being taken forward. Government officials said decisions about whether to hold open meetings are a matter for the board members themselves.
Recommendations to change the membership of the boards were “in progress,” according to the government.
The government did not agree with recommendations that enforcement of planning, building and electrical codes should be independent from the planning department. It will also not implement recommendations that technical experts with responsibility for health and safety should have “the final say” in regulatory enforcement of development projects.
Auditors said it was not clear whether government intended to implement recommendations that the public sector should follow the law and ensure there is a process for the Legislative Assembly to approve all government expenses.
This issue arose after auditors found that former Cayman Islands Minister of District Administration, Works, Lands and Agriculture Juliana O’Connor-Connolly “directed” in 2012 that government funds be used to buy a $125,000 property on Cayman Brac.
The purchase was made with “unspent funds” at the end of the government’s budget year, former Auditor General Alastair Swarbrick’s report on government land management revealed. The property was in an undeveloped subdivision on Cayman Brac.
“Although a Cabinet paper states the rationale for the purchase as development of affordable housing, the property has never been vested with Sister Islands Affordable Housing nor is there any evidence that the agency was consulted prior to the acquisition,” the audit report states. “[In the referenced case] there is a possible breach of trust as there was no evident government requirement [to purchase the land] whatsoever.”
Ms. O’Connor-Connolly denied any breach of trust had occurred at the time. The matter was referred to the Anti-Corruption Commission, but nothing further has been said publicly about it.
Revenues, social services
Government also flunked the follow-up audit in the areas of implementing revenue collection and social services changes.
Premier Alden McLaughlin, who is now the Minister of Community Affairs, said recently that a number of programs supported by government had “failed” to achieve their goals and that a review was under way to determine which programs should be kept and which should be cut or changed.
Auditors found in 2015 that while government spent more than $50 million on various social services programs, the review could not determine whether most of that spending represented value for money.
“The government response [to the follow-up audit on social services] reports much of the original management response to the … May 2015 report,” Ms. Winspear’s office found. “A number of responses state that the recommendation cannot be implemented without additional resources.”
The revenue collection audit recommended a survey should be completed to help track annual public sector earnings, something government has been unable to audit since it switched to its current accounting system in 2004.
“At the end of June 2007, no progress has been made,” auditors found.
Not all was bad news for government. The audit found that with four other reports reviewed by the Public Accounts Committee in 2016, the government had implemented most or all of the recommendations proposed.
Those areas included improving government’s IT security systems, managing public sector expenses for travel and hospitality, managing major capital projects and correcting issues identified under the former Nation Building Fund program.
“Government’s progress with implementing the recommendations in the eight reports is mixed,” Ms. Winspear said. “Encouragingly, almost all recommendations have been implemented for four reports, but the picture for the other four reports is less positive.”
Public Accounts Committee Chairman Ezzard Miller said he expected follow-up reviews of audit reports would become an essential part of the process, in order to ensure government is held accountable. Mr. Miller expressed disappointment with some of the follow up efforts revealed this week.
“Some of the original auditor general’s recommendations date as far back as May 2015 and limited progress has been made,” he said.