More than 80 percent of the Cayman Islands government’s core budget will be spent in five general areas over the next two years, according to a breakdown of planned public sector spending in 2018 and 2019.
The central government’s operating expenses for the two-year cycle are anticipated to be just more than $1.3 billion. Added to the operational spending is nearly $193 million for capital projects during the period, for a total of $1.5 billion.
Comprising 22 percent of the territory’s budget will be security-related expenses (police, immigration, customs, etc.), based on figures provided to the Cayman Compass by the financial secretary’s office.
The other four top-dollar areas, on average, in the two-year budget include general government services (18 percent), education (17 percent), health (15.5 percent) and social security/welfare (9 percent).
Additional areas of government spending include economic affairs (8.5 percent), financial services (4 percent), tourism (4 percent), culture (1 percent) and environmental protection (1 percent).
The only difference between the 2018 and 2019 budget breakdown is that economic affairs receives slightly more funding in 2018 and health services receives more during 2019.
The figures do not include expenditures made by the government’s separately operating statutory authorities and government-owned companies, some of which are self-funded as independently operating entities based on fees their customers or users pay. However, the government is expected to pay a total of $11.4 million to cover the overall losses of those authorities and companies during the two years. Those figures are included in the operating expenses of the budget.
Additionally, the government plans to spend $192.9 million during 2018-19 on construction or infrastructure development projects.
That spending includes more than $20 million on the continued construction of the new John Gray High School and another nearly $20 million on the development of local roads.
More than $14 million is budgeted to plan the new waste management facility in George Town. Some $13 million is allocated for the development of a new mental healthcare facility.
Other major spends during the two years include digital/IT infrastructure development and security ($16.2 million), equipment for the fire department ($7.7 million), development of new police stations in George Town and West Bay ($4.4 million) and development of the George Town cruise berthing facility ($3 million).
The other big ticket item in the government budget not included in its operational expenditures is the repayment of principal amounts due on long-term debts.
In 2018, government plans to spend $30.3 million to repay principal debt amounts (not including interest). In 2019, that figure jumps to $309.4 million – about half of which (an estimated $153 million) will have to be borrowed in order to make the payment. The remainder will be paid out of existing cash reserves.
The government is required to make a $262 million one-time repayment of a “bullet loan” in November 2019 that was taken out in 2009 to pay for government’s operating expenses, as well as some capital projects.