Guest column: The red tape fiasco

Gilbert Connolly

The PPM government recently had a photo op with the Hon. Acting Governor, Mr. Franz Manderson, a Minister of Cabinet and several senior civil servants to announce that government was implementing measures to cut red tape in government. With all the bad publicity the government has been getting about excessive red tape, they must have felt that they had to do something, even if it was only symbolic. Do they believe that the public would be fooled with such shenanigans? However you spin the occassion, it is sad to see politicians and senior civil servants being used to stage a “reality show” fiasco that was so poorly conceived and written.

All societies and organizations require some form of regulations or rules to function effectively. In the Cayman experience, successive governments have taken the country from a jurisdiction of little regulations to one of overregulation. Governor Anwar Choudhury was on the island less than three months when he realized that the government and the country were suffering from overregulation. Simply stated, Cayman has too much red tape. Here again in 2018, we had to wait until someone came from overseas to tell us the government has too much red tape!

You do not have to be a governor or a rocket scientist to figure out that the islands are awash in red tape. Just go to the Government Administration Building, or any other government office, to conduct a simple, routine transaction and it becomes a nightmare wrapped in red tape. The governor had made this a number one priority to address, in order to bring some normalcy or common sense back to the governance of the Cayman Islands. Unfortunately, he did not have the opportunity to clean up the bureaucratic mess that the government finds itself in today.

The PPM government is responsible for escalating and exacerbating the problem of too much red tape. The PPM’s mission to maximize government’s red tape seems to be based on its apparent confusion that good governance means overregulation, so they continue to pass hundreds of laws that affect all areas of our lives. Herbert Grubell, in his writings on the Canadian government, said “Governments should pass regulations only if benefits exceed costs.” A very simple but powerful principle that the PPM government should adopt if they are going to stop this destructive mission of overregulation, which if it continues, will only bring more misery to citizens.

The term red tape had an honorable beginning but today has lost its good reputation. So, what is red tape? It can be defined as laws, regulations or rules that are poorly drafted or designed, costly to businesses and individuals, repetitious and counterproductive, thus, causing delays and frustration to customers. Simply stated, it is a request by government for additional information or documentation that serves no useful purpose, just to satisfy a redundant rule or policy.

In the Cayman context, overregulation has two important consequences for Caymanians. Firstly, in most cases, the laws and regulations that are passed eliminate Caymanians and Caymanian small businesses from competing in the marketplace and ultimately put more Caymanians out of work. Perhaps one of the best examples of this phenomenon is the revised Planning Law. Based on the onerous requirements added to the law, individual Caymanians and small Caymanian businesses in the construction industry have effectually been phased out. In addition, professional Caymanians, e.g., lawyers, are suffering under the heavy burden of unreasonable regulatory requirements. Secondly, the more complex the laws that are passed, the more foreign experts will be needed to interpret them, at least based on the approach that we have seen this and other governments take.

The PPM government should be credited for owning the problem of too much red tape, but that is hardly a plus, when they themselves have contributed to creating the issue in the first place. Acknowledging the problem is one thing; doing something meaningful about it is quite another, and the recent photo op to announce measures to reduce red tape just does not cut it. What we learned from the photo op is that government needs to develop a proper and comprehensive plan to reduce red tape and put us back to a position of normalcy.

First, they need to put a moratorium on passing any new regulation that will increase red tape. Secondly, the government should appoint a committee of five Caymanians (including a lawyer) from various industries, including the construction industry, to advise on the laws that need to have excessive red tape removed. The committee’s remit should be to: a) advise on how the burden of red tape on business can be reduced b) recommend how Caymanian businesses can be grandfathered into new laws to avoid red tape, and c) make it easier for businesses to do business with regulatory departments. We do not need someone from overseas to tell us how to fix this problem.

Gilbert Connolly is a retired Cayman Islands senior civil servant. He is a graduate of Pace University, New York with a bachelor’s degree in Business Administration, holds a post graduate Diploma in Insurance Management from Nottingham University and City University London, and an EMBA from UCCI and the University of Toronto.

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