Cuts fund SPIT & CUC

| 23/03/2009

(CNS): Although every government department has made significant cuts to reduce spending in the face of the economic crisis, none of the savings have made their way to the treasury coffers. The need to pay almost $4.5 million for the Special Police Investigation and a further $6 million to CUC customers for the rebate, means that all the cuts in services have been absorbed by these and other unexpected government expenses. This has resulted in an addition to the operating budget rather than a reduction as was hoped when government asked for a 6% cut in spending across departments.

In a marathon finance committee sitting which started around 5:00 pm in the evening on Friday and continued until 1:00 am Saturday morning, legislators were faced with an appropriation document which was 199 pages long. The document was laid on the table of the house at around 11:00 am, which led Leader of the Opposition McKeeva Bush to raise his objection to the amount of time members were being given to study such an important document before they were expected to vote on the line items in committee.

Entering into what would be the first altercation of the day with government and Madame Speaker, Bush demanded more time. “We have been a reasonable opposition and we are only just seeing this document,” he said. “It is extremely important that as an opposition we get to examine this we demand more time to go through it.”

Despite his pleas and insistence, the deadline of the dissolution of parliament prevented more time being found as the House must conclude all its business before midnight on Monday evening. Consequently, after a long and heavy day ploughing through a number of important bills the members faced the task of examining the cuts and expenditures of government that had led to such a huge appropriation document coming before them at the eleventh hour.

Education, mosquito control, counselling and district health services, legal services, prisoner rehabilitation services and the police have all seen major budget reductions and cuts,while the introduction of the FOI law, the forthcoming general elections and referendum as well as the impact of hurricanes on the Sister Islands all required new money. However, most of the new requests were considerably less significant when compared to the $6,000,000 requested for the Residential Electricity Fuel Duty Rebate for CUC consumers, the $4,444,744 for the Special Police Investigation, and the $2,063,000 to meet the growing interest rate on public debt.

There were 104 requests for changes and 85 were reductions and only 19 increases but the result is that government’s operating costs have still increased by $4.3 million. Moreover, with revenue down some $21 million the coffers remain in deficit. Every single ministry and government entity has made significant cuts to reduce the overall budget, however, because of the major appropriations the government operating budget has still increased.

Introducing the document at the start of Finance Committee, Leader of Government Business Kurt Tibbetts said the world was in deep crisis and every country was being adversely affected but Cayman would weather the storm and things were not as bad as some would believe. “As a result of mis-information about the state of the economy people may be confused as to the true picture,” he said, adding that reports of Cayman receiving a terrible assessment from Moody’s were false and Cayman had retained its triple A credit rating. He said the purpose of this budget appropriation was to present an honest picture and he said the budget reductions were efficiencies and not cuts. He said the people would not bear the brunt and social services would not be cut.

Tibbetts explained that there was more than $20 million in unexpected spending, including the significant amount for SPIT, which he said he believed the tax payers should not have to pay but, as had been widely reported, his opinion had been over-ruled. He said that despite the problems the budget was compliant except in its ability to project on operating surplus.

Bush condemned the government’s mismanagement and said that the opposition had voted against the budget last year as it was obvious then that it was unrealistic.  “What we have before us is a fidget, not a budget,” Bush said, adding that government should have been more open back in June about what have now been revealed to be over projections about earnings. Again he cited the opposition’s fundamental objection to the hurry over the appropriation. “We are objecting to the rush to go through this 199 pages, just at a glance it’s easy to see revenue is off by around $21 million giving us a deficit of around $28 million."

"The country is in jeopardy,” he said. “If the budget drops further we won’t be compliant with the requirements of the PMFL and we are already off in one area.”

He also noted that as there have been few audited accounts tabled during the last four years the country cannot know the real state of the government finances and it was impossible to know how safe the country is. “The government is calling for the country to come together and I agree. We need to call on the country to remove an inept government,” he said.

Keep checking CNS this weekfor details of cuts and spending across all government ministries and departments. 

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  1. Anonymous says:

    Will the cost benefit of SPIT be evaluated along the standards used in the investigation of the BAE arms scandal?

    While claims of wrong doing were established with the BAE scandal, what noble elements drove the relevant powers to end that investigation?

    While we need to address wrong in the RCIP, is there a point where the cost of SPIT/Cealt will overwhelm benefit as was a stated rational for discontinuing the BAE apprehensions in the UK?

    Why should our investigations cost so much? Do we need to sell Cayman Airways, shutter the HSA, divert revenue from the Port Authorirty and Water Authority to apprehend the wrongs at any price?

    Is the record so far, of tax payers money spent, been money well spent?

    Is the regard for  the integrity of investigative process, further enhanced by the recent happenings under SPIT? 

    We are a small country. Our budget is overwhelmed. Public safety allocations are being cut. That means less money to protect the community at a time when we need it most.

    Corruption must be addressed. However the price cannot be so high that less money will go to health care, education, public safety, while we owe almost a $1 billion at a time when our future is dark and cloudy.

    Are we being forced to have a heart and lung procedure when it is an apendectomy we need?  Is the diagnosis being performed by a less than competent or unqualified team of physicians? If this were you with an illness would you be going to the SPIT Clinic after reading that the doctors there charge more than you can you can afford, and their record of success up ontil now, has only yielded questions as to competence and mal practice?  Would you not seek a second opinion from others with a better record of success?

    Are we paying for a Boeing 777 when all we are getting is a hell of a helicopter?

  2. Anonymous says:

    Wow…we pay so some can SPIT in our faces. What self respect.  

  3. Anonymous says:

    To be fair, let’s look at the numbers:

    Revenue dropped $21.0 M (Cayman is not immune from what is going on in the rest of the world)

    Hurricane Paloma $5.5 M (is it the Government’s fault that this happened?)

    CUC Rebate $6.0 M (is this the time to cut this rebate and send everyone’s CUC bill back up?)

    Scholarships $2.2 M (should the Government stop paying for Caymanians to get higher education)

    Overseas medical care for indigents $4.0 M (should the Government allow the underpriviliged amongst us to simply die when they develop an ailment?)

    Special Investigation $4.4 M (I don’t really need to say anything about this one)

    Social benefits to the poor and seafarers $1.7 M ( should the Government just turn its back on these people to make a surplus?)

    Interest expense $2.0 M (again, is Cayman dictating the cost of borrowing funds on the international market? is the credit crisis and the associated scarcity in the availability of credit at this level the Cayman Island’s fault?)

    Judicial Tribunal $1.4 M (is it the Government’s fault that Justice Levers was removed and is now facing a tribunal?)

    Medical Services in Cayman Brac & Little Cayman $2.7 M (should the Government close Faith Hospital or simply refuse care to patients to make a surplus?)

    If nothing else happened,  just from the occurence of the above, the Government Finances would have had a $51 million negative change. That means, what was initially a $13.8 M surplus would have been a $37 M deficit.

    Give credit where credit is due, the fact that the Government was able to deal with these items, plus additional costs for prison, refugees, increasing transparency through FOI, maintaining roads etc. and managed to still have a projected cash balance of $126 M which is $7.5 M more than the original budget should be recognized.

    I will give them their hits as much as the next guy and I trample on them when they deserve it, but I think a few of you need to actually review the budget documents for yourself and draw your own conclusions rather than bandwagon based on hearsey.

    Finally, consider this, the Government should not tax its citizenry any more than what is required for them to deliver goods and services to same. It is suppose to be a non-profit entity. I for one do not wish to be taxed any more than what is necessary to look after me and my generation that is what intergenerational equity refers to. Perhaps that is why I am not hung up on a huge surplus, I do not want to know that it took $500 M to run the country, but the Government is taxing me $600 M …. just my 2 cent contribution

     

  4. Anonymous says:

    THEY KNOW NOTHING>>YOU ALL ARE NUTS!!! YOUR NUTS!!

    Listen,

    As much as you think things are bad it is really a blessing hidden under the cover of passing clouds.  External forces are the reason for this rainy day which no man/ woman on this blog has control over.  You all have rested your faith on the dollar which was borrowed by Americans and British and they now find themselves in a position where they can’t repay it.  This is the source of the worlds problems and since us here in Cayman have enviously expected that Americans (Our role models) to keep spending forever and ever amen we have positioned ourselves in a rather tight spot.  But relax, guess what? what you feel like prosperity was false like the americans ability to pay back their loans.  We stand at a great point in history! If the British and Americans shut us down then guess who stands to pick  up the tab..You guessed it, the British and The Canadians; the British via our inability to finance our debts and the Canadians via their Banks who have extended loans to me and you.  I doubt if our Government will stand idle once the British turn the sword on us and we have no future.  My advice to any Caymanian who still has the ability (has a job) is to borrow as much as you can.  Only then can you be true patriots as you will put more chips on the table.  The CI Government of the Past 4 years understands this I think or they just got really lucky but in this world only money talks.  As far as status grant are concerned if you don’t like them don’t vote for them.  Meanwhile, If you look at the benefit of the Ritz_Carlton I would beg to say that little revenue for Caymanians is dervied from them..I don’t see them employing or training vast amounts of Caymanians.  So we could have had $20 million from that to help us borrow some more right now.  So ask yourself this question Cayman…If we are to defend ourself in this NEW WORLD ORDER…It will be with our debt not with our coffer. …SO your idol (AMERICA) has a great deal to teach you…the larger your debt the more pain for everyone else….MAKEUK,AMERICa, CANADA, BERMUDA Everyone feel our pain if they want us destroyed.  PPM you are on the right path keep spending and I will keep borrowing and when times get hard shove it down these bankers jaws and let them chew on something hard to swallow.  Caymanians…be a little worldly and stop being stupid and for the sake of all that is good and great inspire youself so that the world can be inspired…They have showed us now let us teach them how we learn.. CI Government rack up the debt while you can get it and feed our young minds in new building and let us show the world what we know about it.  After when can’t pay it back we will legislate that they can not take it back…Oh yeah.. don’t borrow from Cayman National unless you intend to pay it back smarty..  This is how to play like a big boy and not like a baby so if you want to get spanked vote for some babies.. I’ll be too far gone to worry about things like crying babies if you make the wrong choices..

    • Anonymous says:

      PPM Hopeless!

      PPM made the people of the Cayman Islands pay CUC approximately $13M for CUC’s decision to not insure their property.

      PPM decided to spend $700M – but not produce a single ‘new’ revenue stream for the Cayman Islands.

      PPM now decides at the 11th hour to reduce stamp duty.

      Please God! send May 20th quick! so we can get UDP in.

      • Anonymous says:

        "PPM made the people of the Cayman Islands pay CUC approximately $13M for CUC’s decision to not insure their property".

        This is UDP propaganda. First, consumers did not pay $13m. The original agreed amount was $11.4m. CUC collected $9.2m and, as part of Govt’s negotiations with them, agreed to write off the balance of $2.2 million.

        Second, this was not simply because of a decision by CUC not to insure its property. CUC was entitled to permanent rate increase under its licence of 9.5%. Instead, Govt. negotiated a temporary surcharge of 4.7% resulting in a massive saving for the consumer.

        B/T/W/ Florida Power & Light and many other utilities were also allowed to charge billions of dollars in a surcharge to consumers for hurricane related losses.

        Get your facts straight.

        • Anonymous says:

          PPM & CUC

          Ok, so the PPM made Caymanians pay 9.2 Millions of Dollars to CUC – I hope you feel better because most Caymanians sure don’t!

          PPM can’t be trusted.

          • Anonymous says:

            "Ok, so the PPM made Caymanians pay 9.2 Millions of Dollars to CUC".

            Suppose you try reading the whole of the post and reflecting a little before posting.

  5. Anonymous says:

    I as a young Caymanian will have to agree with most people who say UDP is the way to go.  I think UDP has a very strong group this election with Elio Solomon, Jonathan and Mr. Adams.  All very respectable to the people who know them.Big Mac will always have my vote. 

    We can sit and say he did this and he did that but at the end of the day he did alot more for this country than PPM has done in the last 4 years.  Amazing in the last 3.5 years you didn’t hear that much from PPM but in the last 2 months they have been going strong. 

    All these years kids slipping through the crack if they had a learning problem, but it just now they realize that they have a problem.  I have known people graduate from high school and can’t read or write.  While we sit here and bash the criminals, that is why we have so many, Gov let them slip through with going to special ed classes and cutting and pasting.  I know cause I have family who went through it.  These kids can’t go out and get a job so the resort to crime and drugs.  Building new schools can’t help if you don’t have the proper teachers and education program to to teach the kids. 

    To give usa cut on stamp duty and building materials when half of Caymanians are losing their jobs is a joke.  Maybe a year ago alot more Caymanians would have been sitting in their own homes instead of paying someone else rent for something they will never own.  I just pray that Caymanians are being left in their positions and not being the ones booted.  Again the ones with money can buy up the land and sell it back to us young Caymanians when things pick back up at an 150% increase.

    It is a shame that the Government has let our beautiful 7mile road just look like another bundled up road.  You can’t even enjoy looking out the sea as you sit in traffic with all those 7 story buildings.  I think Government should really think about not letting any more 7 story building on the west bay road.  Spread it out accross Cayman.  Cayman is so small that we should never have allowed for those types of building here.  Hopefully we don’t become another underwater attraction one day.  GOD BLESS US ALL AS WE NEED.

     

    • Anonymous says:

      "I as a young Caymanian will have to agree with most people who say UDP is the way to go.  I think UDP has a very strong group this election with Elio Solomon, Jonathan and Mr. Adams.  All very respectable to the people who know them.Big Mac will always have my vote. …It is a shame that the Government has let our beautiful 7mile road just look like another bundled up road.  You can’t even enjoy looking out the sea as you sit in traffic with all those 7 story buildings.  I think Government should really think about not letting any more 7 story building on the west bay road". 

      Young fella, who exactly do you think was responsible for the 7 storey buildings on WB road and in GT? The self-same UDP Govt. and Mr. Bush in particular. Unbridled development suited Mr. Bush because of his real estate company and other interests. When asked who are we developing for he said we were developing "for us all". This has directly led to speculation in land by expats and has put the price of homes beyond the reach of many ordinary Caymanians. Please research the issue and know something about the history of the matter before you start posting.    

      • Anonymous says:

        Young fella, who exactly do you think was responsible for the 7 storey buildings on WB road and in GT? The self-same UDP Govt. and Mr. Bush in particular. Unbridled development suited Mr. Bush because of his real estate company and other interests. When asked who are we developing for he said we were developing "for us all". This has directly led to speculation in land by expats and has put the price of homes beyond the reach of many ordinary Caymanians. Please research the issue and know something about the history of the matter before you start posting.   

        I never said that Mac didn’t make choices that the rest of us didn’t like.  Like all others he has had his share of wrongs and rights.   Every politian in there looks to find a way in order to increase his or her revenue while collecting a salary for being MLA, can we say if we were in there we wouldn’t do the same??     Just becuase he approved those dosen’t mean that every application that is submitted for a 7 story building should be approved.  

        As for posting; any post you put up whether you are right or wrong there will always be someone with a different opinion.   

         

        • Anonymous says:

          "I never said that Mac didn’t make choices that the rest of us didn’t like".

          The point is that you are blaming "the Government" for something the UDP Govt. did while all the time recommending the UDP Govt.  This was not my point, but yours.

        • Anonymous says:

          Cayman can’t afford 4 more years of PPM!

          The reality is that Cayman can’t afford PPM to be in charge for 4 more years. if the PPM thought the 7 story buildings were wrong they would have changed the law. they didn’t. You all need to stop eating Kurt’s turtle stew – the proof is in the pudding, and cayman is in the hole because of PPM.

          • Anonymous says:

            "..if the PPM thought the 7 story buildings were wrong they would have changed the law. they didn’t".

            You are missing the point. The original poster was mistakenly criticising "the Govt." for the effects of this change in the law.  

            Typical UDP supporter – can’t reason or think straight.     

  6. Anonymous says:

    INDEPENDENTS ARE THE WAY TO GO….

    It is clear with these issues, that the Parties are more concern with POWER and CONTROL than in serving the people…CAYMAN WAKE UP!…we need to put MLAs in the house that can think for themselves and not be a pawn for someone’s power grab.

    It is clear that the PPM is out of control. I hope we do not see too much more damage prior to them being sent home.

    Cayman select people that have the ability first and the backbone to stand up in the LA and say their mind.

     

  7. Anonymous says:

    To be fair i do think that some of these guys have integrity. and I voted for 3 PPM in boddehn town last election. But i wont be sticking with the party vote just for the sake of it this time around. I may give Mr Eden a vote again, but i wont be voting for the ossie or chuckie because they have not done anything for my country.

    Not when they handle financial issues like this. No way.

  8. Anonymous says:

    hear hear……all the people are asking for is a little management of the public sector money. if they cannot ensure that spending equals revenues on a year to year basis, how can we be confident that they know anything about running the country?

  9. Anonymous says:

    Totally mismanagement of the people’s money. one or two of these guys should know better. I don’t get how the government has managed to wreck both the country and the people’s pocket so badly.

    i dont have figures myself but i have been told by someone who works in the treasury department that this has never been this bad in Cayman’s history.

  10. Anonymous says:

     

    very sad to see that kurt tibbets and alden are destroying this country’s finances. also shameful that tibbets mentions the the poor, scholarships and cuc payments asthe reason for the very large deficit they are expecting. why does he not tell the truth? the true reason for the deifict is not that the government had to do those things (which he had to do anyway) but because they over spent in other areas.

    they were hell bent on spending like crazy when everyohne was saying they needed to reduce spending and better prioritise the spening on huige projects to at least fit with these economic times.

    the PPM has made the country broke. Tjhis is a first in cayman’s history. and its time for at least some of them (at least the ones responsible which in my opinion is Alden Mclaughlin and Kurt Tibbets) to be out of office.

  11. Anonymous says:

    clear evidence again that the ppm has messed up government fnances. what i find ironic is that mckeeva bush has warned about many of these things more than 18 months ago. It is actually a fact that he recommnded cutting duties and customs etc MORE THAN A YEAR AGO and he was told by thre PPm leader that it was not a good idea. say what you want about Mckeeva but he is truly an economic leader. and that is what we need right now. mckeeva asked government to reduce spending early last year and they ignored him. Now we are all paying fopr the PPm’s financial mismanagement.

  12. G says:

    As a young Caymanian who was not interested in politics and voting….I now see the need to have a say. I will be there May 20 and I will be voting UDP. This is crazy! What happened to PPM values? People PROGRESSIVE movement? Where is the progress? It seems like they were truly Poor People Mistake, who only form because they were People Provoking McKeeva! We all fuss about the status grants that McKeeva gave, and I agree that it was wrong, but goss he’s been good! Yeah, he probably pocket something whilst in power, but hey which damn politicians you see who ain’t a crook? NONE! They all the same. However, McKeeva has his people at heart. He is there when you need him.

    I’m also glad to see that McKeeva has decided to replenish his team with a new young educated batch of canidates. People, get over the status grants. yes he was wrong. Write him a letter and express yourself, but do not make that get in your way to making the right choice on May 20! Let’s put the petty stuff aside, UDP is the better choice.

    WB – UDP all the Way

    GT- UDP all the way

    BT – UPD + Sandra Catron

    EE – Arden

    NS – Ezsard

    SI – UDP!

  13. Anonymous says:

    I have a foggy memory but i remember Mac saying something after he lost power, to the effect of…the projects you are doing are great, we all need them. but remember to put something away for a rainy day, because we never know when another Ivan is coming, or what is facing us down the road…We can’t overextend our selves financially because we don’t know what maybe ahead.

    The rainy day is here, the more we borrow, the more vulnerable we are to external forces, including the UK….Just common sense, why can’t we use it?

  14. Anonymous says:

    As expected for months, the sitting govt., literaly sitting, on their backsides, are banking on the premise that all of us are stupid… If they are so so successful. brag on the achievements…PLEASE. We need to know that you are in control…Don’t try to bamboozle us…We ARE you, remember the people you meet on the way up are the same you meet on the way down. Be honest with us, show us the books, if you screwed up, say it. Quit playing games .Be  true Caymanians for a change, that would be nice, but I guess that would have worked a year or two ago.  Is there money in the coffers or not?…If not, how bad isit? Why have you kept us in a fog about finances?Do you think we are too stupid to understand, or do you have something to hide?

    If and when you decide to speak to the people do you still have credibility? Will we still believe what you tell us?

    If so, why now? Why should we have faith in you all of a sudden?