A report that detailed several serious problems in Cayman’s Public Service Pensions fund apparently took more than eight years to be compiled and released to the public.
It includes financial statements related to the fund for the year ended 31 December, 1999. The report was tabled in the Legislative Assembly Wednesday.
Both Auditor General Dan Duguay and Standing Public Accounts Committee Chairman Osbourne Bodden agreed that information contained in the report which was crucially important to government employees at the time is not so today since most of the problems that existed have already been identified.
‘Reports have to be timely to be of any relevance,’ Mr. Bodden said.
Mr. Duguay said the eight year delay also reaffirmed the importance of allowing the auditor’s office to release its reports to the public without first having to send them to the Public Accounts Committee for review and approval.
In this case, the auditor’s office presented its final report to the committee in April 2003. It apparently sat there until July 2007 when minutes of a meeting show it was first considered.
Mr. Bodden, who took over the Public Accounts Committee in 2005, said when he became chairman the report was already six years old.
‘No priority was placed on it as we had our hands full with (reports on) debris removal, housing, government accounts, Cayman General Insurance reports, etc,’ he said.
Mr. Duguay said the Auditor General’s report on the Public Service Pensions fund was delayed for a number of reasons including a lack of financial statements from the pension board. Mr. Bodden said the Public Accounts Committee found that the understaffed pension administration was simply overwhelmed by the complexity of the Pensions Law.
There was also a delay in actuarial valuations of the pension system at that time because of a number of uncertain factors involved in calculating benefits.
For instance, there was a group of 86 civil servants older than 60 who had begun receiving retirement benefits while they were still working for the government. Mr. Duguay said those employees were making contributions to the pension system while also taking payments out of it. The arrangement took some time to calculate in terms of its effects on the pension system.
Also, there were dozens of civil servants who had to be placed in what are known as a ‘defined benefit’ plan after they had received Caymanian status. Normally, those expatriate employees would have been able to ‘cash out’ their pension savings upon leaving the island. However, Mr. Duguay said after joining the defined benefit plan, they were owed a pension.
It was largely due to this report that government later eliminated its defined benefit pension plan for all employees hired after 1999. All government employees hired after 1999 contribute to a ‘defined contribution’ plan, which acts as a retirement savings account, rather than a pension following retirement.
Mr. Duguay said government has made great strides in providing information to the public in recent years by allowing auditors to release their reports directly after completion.
‘The value of information depreciates over time,’ he said.
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