After years of repeated calls for a formal policy on government concessions, it appears an official framework to regulate how waivers are granted and who gets them may be making its way to Cabinet for consideration.

Acting Financial Secretary Matthew Tibbetts has confirmed that at the end of February a draft policy will be presented to local leaders for approval.

While Auditor General Sue Winspear welcomed movement on the policy, which was initially expected to be finalised in 2020, she said she remains “disappointed” that it has taken this long to move forward.

Auditor General Sue Winspear

She pointed out that before her arrival in 2015 an audit on collecting government revenues in September of that year was done and a recommendation was made about a formal concessions policy.

However, three reports and five years later, no policy is yet in place.

“Bear in mind the concessions policy can have some discretion in there. It’s just to get that degree of accountability,” she told the Cayman Compass in a recent interview.

The auditor general’s office, back then, she said, was told a draft policy was going to the caucus and then Cabinet in 2016, but that did not happen.

“We were then told it was going in July 2017. We followed up on that and nothing’s happened. And then last year we did another report on collecting government [revenues] on the customs side and picked up on collecting revenues again,” she said.

Following that report, she said, recommendations about a concessions policy were again made.

“We were told at that time it was going to caucus and Cabinet … and here we are in 2020 and to the best of my knowledge, we still don’t have a policy,” she told the Compass in December.

Finance Minister Roy McTaggart acknowledged there has been a delay in completing the policy.

However, he told the Compass that getting a policy finalised was not an easy task.

“The Ministry of Finance has been working on this concessions policy for some time. It is not as simple as one might think. I’ve had some discussions with them from time to time about it. I’m looking forward now to sometime in February, when they have indicated that we should have a draft policy,” McTaggart said.

Finance Minister Roy McTaggart

He said he is keen to discuss the policy with his ministry first and then with his colleagues, “with the hope that we can have this finalised and implemented before we demit office, once the [Parliament] is dissolved in March.”

While Winspear acknowledged that the process is not an easy one, she said the people have a right to understand that if the government forgoes revenue of several million dollars, it’s the same as making an expenditure of several million dollars, and that level of accountability needs to be comparable to spending that amount of money.

“I would very much advocate that government put the concessions policy in place. As I’ve said many a time, it doesn’t have to be absolutely thoroughly prescriptive. As much as you’d like that clarity and a set of criteria around it, which you’d expect to see, there’s always the option for discretion,” she said, adding her wish has always been to start simple.

“Start high level and improve it as time goes by. It’s better to have something simple in place than nothing at all, because that starts the accountability process. But, regardless of the policy, the more important thing is there’s some accountability back to the people about whether the concessions granted have actually achieved the benefits to the country that were expected,” she said.

To date, she said, there is no dollar figure available on how many concessions have been given and what benefit has been derived from those that have been issued. A formal recording mechanism, she said, will address this gap.

“If you offer a concession, a tax concession of a million [dollars] and you expect to have 20 Caymanian jobs for the next five years, it’s for the population… the electorate to determine whether that’s good value for money or not… not me. But the important thing is you’ve captured the amount you’ve given as concession and you’ve also checked the accountability point – that what they said they’re going to give in return is actually done,” she said.

For her part, Winspear said, she would like to see the policy drafted like it would be for expenditure.

“All you want to see is clarity about what the concession is, how much is the value, what you expect in return for that concession, and then, most importantly of all, for accountability purposes, you follow up and there’s a sort of reporting mechanism,” she added.

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