The amount of money the Cayman Islands government pays to subsidise statutory authorities and government-owned companies, as well as various other non-governmental organisations, has risen by 49 per cent during the past five years.
According to figures from the government’s Economics and Statistics Office, government spent $88.1 million in subsidies to those entities during calendar year 2007. By 2011, that figure had jumped to $131.6 million, rising every year in between.
For the recently-approved 2012/2013 budget, government seeks to spend more than $127 million on what the economics office would refer to as subsidies. However, it should be pointed out that figure is for the budget year, which runs between July 2012 and June 2013, while the economics office figures run calendar year – not a precise “apples to apples” comparison.
Statutory authorities are entities like the Health Services Authority, Water Authority-Cayman or the Cayman Islands Monetary Authority; quasi-government entities that provide a specific set of services and generally keep all the revenue they generate within their own budgets. They are generally governed by an appointed board of directors which acts as an overseer for the agency.
Government-owned companies include entities such as the Cayman Turtle Farm and Cayman Airways, which are also governed by appointed boards and operate semi-independently of government.
In some cases, central government seeks particular services from such a company or authority or is required to pay a certain amount to make up a budget shortfall within the agency. In others, government subsumes a portion of the profits from those authorities to assist with its own operations, depending on the circumstances.
One of the largest subsidised areas of expenditure within the government’s 2012/13 budget deals with health care coverage costs.
For example, the Cayman Islands government has budgeted $9.1 million for medical care to seamen and veterans; $12.6 million in medical care for indigents and $18.1 million in health insurance for civil service pensioners. All of those figures represent substantial increases from what government spent in the previous budget.
A figure of $9.4 million was set aside for medical care at overseas providers. However, previous unaudited budget figures show the territory actually spent $18.6 million on that during the last budget – more than double what was set aside in the 2012/13 year.
Other government subsidies to authorities, companies and non-governmental organisations include:
$15.2 million in air service to strategic markets [Cayman Airways Limited] and $2.95 million in inter-islands air service by Cayman Airways Express.
$11.3 million for regulation of the financial services industry.
$1.6 million for management of Pedro St. James and the Queen Elizabeth II Botanic Park.
$3.4 million for medical services to Cayman Brac and Little Cayman
$1.7 million for legal aid services
$1.5 million to rental accommodation for persons in need.
In total, significantly less is budgeted to go to non-governmental suppliers in the 2012/13 budget. They will receive a budgeted $18.95 million in the current budget, compared with last year’s $29.5 million.
However, subsidies to the statutory authorities and government-owned companies will go up slightly from year-to-year; roughly a$7 million increase for 2012/13.
Related Videos
Yet more evidence that Government spending is totally out of control. Noone seems to ask where on earth is the revenue coming from to meet this expenditure. With a Minister of Finance who was once on his own admission shown to be incapable to be a director of a small bank, what else can one expect?
What about the the joke of a craft market selling hardly anything made in Cayman, the worst tourist trap ever, ‘Hell’ and Pirates Week? Don’t they get money from a subsidy like Botanic Park and Pedro castle? Well atleats Pirates week and Botanic Park are good….2 out of 5!