MLA: Use reserves for budget

| 27/09/2009

(CNS): The failure of the government to bring the budget to the House last week has placed the UDP administration in a difficult position, says North Side representative, Ezzard Miller. He told CNS that, as the temporary appropriation brought after the election runs out this weekend, government will have no operating expenses to work with. The House’s only independent MLA said that the government should stop trying to persuade the UK to approve further borrowing and use the cash in the reserve account to bring a deficit budget to the LA with, if necessary, dramatic cuts as well as fee increases.

He said government would then have time to generate revenue and take stock over the next twelve months. "I believe the government must call a session of the Legislative Assembly regardless of the negotiations going on with the UK,” Miller stated in the wake of the government’s second cancellation of the expected LA budget meeting. “Government can bring a deficit budget with severe cuts and use the reserve funds in the interim.”

Miller explained that the government needs to bring the budget immediately, otherwise it cannot function. He said that hardly anyone in Cayman supports direct taxation and its introduction would, contrary to the UK’s insistence, entirely undermine future economic success and therefore it is best to raise existing fees.

“We need time to raise revenue by increasing the traditional consumption fees, as well as time to examine the cuts that can, and must, be made in government operating expenses,” he added. “In the interim, this year’s operating costs must be dramatically reduced. There are many non-essential things we can cut from the budget, especially in the department of tourism. We can use the funds in the reserve account to tide government through until January, when government will collect a significant part of its revenue and we can use this year to scrutinize government spending.”

Whatever happens, Miller said, the government has to bring a budget and it is quite clear that the UK will not allow anymore borrowing without taxation. Given the circumstances, Miller said Cayman should manage without that borrowing and use the reserves instead, which requires the approval of the Legislative Assembly andnot the UK.

Bush, however, told CNS this week that access to the reserves, which stands at $76.1 million, is not so easy and he did not want to finish the work of the PPM by truly bankrupting the country by using that cash. The financial secretary recently confirmed that the Cayman government does not need UK approval to access that money but he indicated it would require some legislative changes.

On Friday, in an article in the Guardian newspaper in the UK, Chris Bryant, the Overseas Territories Minister, once again spelt out the UK’s position as far as territories are concerned and made it clear that he would not approve more borrowing without the introduction of a sustainable tax base. He wrote that it was in the interests of all the overseas territories to have open, transparent fiscal arrangements and a sustainable revenue from a wide and diverse tax base. "Mere tax haven status will not pay the bills, nor will an over-reliance on indirect taxation.”

With an eye on what is expected to be revealed in Michael Foot’s forthcoming report, Bryant said that the overseas territories needed a strategy for reining in public expenditure and raising revenue to pay off debt. He said he expected that discussions with Cayman and other territories would continue and said he was determined that the territories’ public finances were resilient enough in the long term to handle economic shocks. He said fiscal policy may be down to the territories themselves but, he added, “The UK government is right to put restrictions on their ability to borrow unless and until they can come forward with a clear strategy for cutting that debt.”

During the course of this week rumour and speculation that Cayman would be introducing some form of direct taxation has caused enormous concern in the community, with the private sector entirely rejecting payroll, income, sales and property taxes. As the week drew to a close there was still no word on exactly what tax government would introduce as it remained in closed door negotiations with the UK, but it was perfectly apparent that the UK will not permit Bush to access the $372 million he has negotiated without the introduction of a direct tax.

Read Chris Bryant’s comment:

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  1. Anonymous says:

    Thank God!

    With an idea like this, I can only thank God that Ezzard is not Leader of Government Business.

    I sure hope the 200 people that it took to get this looney tune in office are paying attention.

    • Anonymous says:

       My friend who posted at Mon, 09/28/2009 – 13:13 – Using the reserve budget is not such a bad idea. When we borrow we have to repay plus interest – and having the reserve in the Bank generates substantially less interest than when we borrow.

       Ezzard’s point is that this is a temporary measure and that we should increase fees to fill the gap plus use the reserves as well until we can figure out where the losses are and seek to prevent them in the future. Nobody expects $76 million to run the Govt for a year.

      Of course some people seem to believe that weshould borrow $300 million plus and then kill the economy with new direct taxes and then in a year we will be much worse off and figure out the problem then. 

      I keep repeating: We cannot borrow our way out of debt!

    • Anonymous!!! says:

      You are an absolute nut, the 200 people that you keep  referring  to in north side is as proud of Ezzard as they  are of north side, we hope that you keep your sorry self out of our district and if you are a north sider which I highly beleive that you are, go get a life. You are just mad about your party not getting in, at least Ezzard has the cahoones  to say what he beleive and not tell you "I dont know what isgoing on" Dont cover up the truth.

    • Anonymous says:

      Ezzaed is just trying to make sure that he continue to recieve his fat paycheck.

      Thats all he cares about.

      Not a single MLA has offered to take a salary reduction and they all act as if they are really worth the salary they collect.

    • Anonymous says:

      And why is it that we, the people, have not yet laid eyes on what makes up this 81m deficit? Or is it that our so highly competent financial secretary is fudging them still?

  2. Anonymous says:

    ezzard’s strategy cannot work unforunately because the reserves will not be anywhere near sufficient to run government and meet its obligations over even a 4 month period.

    These reserves have absolutely nothing to do with the country’s currency as cima already holds those reserves seperately and these are ring fenced by law.

  3. Anonymous says:


    Announce 12 month private sector transfer/apprenticehip program. Any Caymanian civil servant (save in particular circumstances where they are "Key")  can, in next 6 weeks, elect to transfer to private sector. Government will continue to pay their pension and health insurance, and (say) 30% of their salary. Private sector employer accepting them would only be liable for 70% of their salary. Overall remuneration would be unchanged but would be able to participate in overtime, bonuses etc. like any other private sector employee.

    At end of 12 months employer and civil servant could elect to continue relationship at which point private sector would become sole employer. If chose not to continue then would return to civil service.


    Immediate and significant reduction in government payroll liability.

    Subsidized manpower for private sector.

    More private sector opportunities for Caymanians.

    Vital private sector experience for participating Civil Servants.

    If neccessary and appropriate – Give preferential immigration treatment to participating businesses.


    Everyone wins.

    Implement this and I will employ a civil servant and in the process, benifit him or her, my business, the Island, and perhaps even save us from taxes. Come on guys – please think outside the box.








  4. Anonymous says:

    The Government motion which allows the current expenditure arrangements for the Country can be found on the Legislative Assembly’s website at,2280870&_dad=portal&_schema=PORTAL it is Government motion No. 1/09-10 and clearly states that the authorization will not expire until October 31st, 2009.

    One would have thought that the Chairman of the Public Accounts Committee would have at least read this motion … jeesh.

    • Anonymous says:

      This is just another example of the ability of our politicians to govern.

      The PPM was convinced that these funds were available to be blown.

      Ezzard now suggets that they should be blown.

      My question is: If the reserves are to protect our currency, would we not be devalueing our dollar by spending these  reserves????

      With us importing everything that would just be great.

      I saw other countries in the caribbean resort to this measure. Thats the last thing we would need to put the icing on the cake.

      I am now convinced more than ever that the Cayman Islands have become a rudderless ship.

      • Anonymous says:

        every Caymanian knows that ezzard Miller has been fighting for years to either get the UK to force us into independence, or for Cayman to go that route of independence. Why do you think that ezzard is so close with Mck bush? This stupid suggestion is another nudge in that direction, if it is done! As you said, he & Mck bush want us to go the same way as other countries in the Caribbean, & again that is why they have such a strong regional expat support. Ezzard Miller, Mck bush & the udp are very heavily influenced by our neighboring expats & as long as the money is right it is those same expat neighbors that is doing the talking!

  5. Anonymous says:

    How far can $76.1 million go in running a country for an entire year?

  6. Anonymous says:

    Good ideas Ezzard! I myself have been wondering: How are we going to borrow our way out of debt? 

    If direct taxation was the solution how come the UK and USA are in such an economic calamity? We need to cut spending and bring an end to the waste of public funds and we need to do it quickly!

    I believe that any increase in taxation will further destroy this country as well!

    We need to find out where we are losing and figure out how to stop those losses now and in the future – otherwise we are on a sinking ship that is headed for the reef.



    • Beth McField says:

      Excellent points! Thanks for looking at taxation that way and providing us with a common sense approach to the prospect of adopting taxation regulations.

  7. Sybill Survant says:

    Massive civil service job cuts.  Now.  How many jobs has Mac publicly said he will cut.  None.  What message is that sending to the UK?

    The UK knows we have too big and too overpaid a civil service.  The service we get from the civil service is awful. 

    Cut jobs.  Make the ones that stay know their jobs are not secure.  Cut 20% of the jobs, cut salaries by 20%.  They will moan, civil servants always do.  But it would be the first thing to help the public half of them will have done.


    • Anonymous says:

      “Massive Civil Service cuts now….”
      Maybe this is a dumb question but, where do families who are unable to support themselves go for help? Social Service? Another dumb question but, when people do not have jobs and thus have no money to spend, how do economies thrive? Here goes yet another question, does increased unemployment not also lead to increased crime? And my final question, are Civil Servants human?

      • Anonymous says:

        Private sector workers have already had the pay cuts and job losses shoved down their throats and have been made to work harder and more efficiently to get the work done. The civil service is bloated and does need to get with the program. Each contract should be approved before renewal, duplicate posts should be slashed.

        Civil service is supposed to provide a service to the island, it is not just a was to guarantee jobs for otherwise unemployable Caymanians.

        So yes salary cuts will mean those concerned needing to tighten their belts. Less restaurants and bars and going out in the week, less new blackberrys and 4×4 trucks, less bling.

        The private sector has already been there, they have had to do this. In an economic crisis that is worldwide everyone has been affected, except it appears, the Caymanian civil service.

        And yes, higher unemployment does lead to higher crime, but sustaining the civil service at it’s present size and cost is not feasible. Even if the Uk approves those loans, the government is going to try and borrow itself out of a whole, but with decreasing tourist revenue and the financial services leavign for safer jurisdictions they can never afford to pay off those loans and the island will be so much worse off in the long run.

        A lean, efficient civil service is a must. The harsh reality is that it is overstaffed and overpaid and like private business andother civil services worldwide, they need to cutback.


        • Cushy Jobs must go... says:


          The government employees are as human as those in the private sector.  They have families like the private sector, and they should be subject to the same competitive forces of the private sector.

          That means facing the harsh realities of life – noone is indispensible and that desperate times call for desperate measures.

          Truth be known, if many of those in government jobs didn’t act and work like their job was a protected right, we probably wouldn’t be in this much of a mess.  Problem is, everyone knows that a significant majority of government employees don’t work as efficiently as they should, and as a result, it takes more of them and more time to complete tasks.  And 99.9% of the time, they get away with it.

          Waste and abuse are rampant.  And it reflects poorly on those that really are working hard and producing.

          If all government employees really cared about their jobs, the slackers would be putting their asses to the road and busting themselves to work harder, more efficiently and making themselves as important and efficient as possible.  

          At the end of the day, cuts are coming – and those that heed this advice will be much more likely to be around in a year or two.

          Note to Mr. Bush – andI am not a UDP supporter – Yes, you did stand up in the weeks before the election and say no government job cuts.  And I am sure that line is the one that you don’t want to violate.  But the truth is, you said this thinking the country was in a much better state than it is.  I honestly believe that had you known then what you know now, you would have stood up and noted that you would try as hard as you could to maintain as many positions in government as possible, but the harsh reality is, some would have to be cut.

          I am sure there will be those that throw back at you "but you promised…" and all you can say is that you did so without knowing the facts, and if you stick to your word, everyone is screwed, so sadly, you have to make some very tough decisions.

          Friends will be affected, family will be affected, but I am sure that with a little assistance from the work permit board, jobs can be opened up elsewhere and in the long term, everyone will be better off.

          It is time for a balanced, rational, well thought out approach, and I am confident you will make the tough decisions you have to, even if you do have to go back on your words a bit.

      • Thankful says:

        Thank you for asking these dumb questions because I wanted to ask them. Actually, I was going to chew into their suggestions.

        Don’t need to add anything further.

      • Anonymous says:

        "Maybe this is a dumb question but, where do families who are unable to support themselves go for help?"  They can find a job.  There are plenty of them if you are Caymanian and want a job.  If our civil servants are not good enough to find a job in the private sector it speaks volumes for the quality of our civil servants.

        "Another dumb question but, when people do not havejobs and thus have no money to spend, how do economies thrive?"  Cutting government expenditure is the priority right now.  The private sector will contribute more in wages if the burden of supporting an over-fat civil service is reduced.

        "Does increased unemployment not also lead to increased crime?"  Yes it does.  But generally the correlation is to unemployment amongst the unskilled workforce.  Unless of course you are saying that our civil servants are unskilled.  If the job cuts fall in the expat sector (which they invariably will for political reasons), this is unlikely to be a factor.


  8. Albert Jackson says:

    Ezzard is showing his true independence and speaking truth to power man. Mr. Travers has put Mac in an unatainable position with his letter of insult to the British Crown directly interfering into internal government affairs.

    Mac has no authority to get pre- approved loans of $375 million. The governor can’t even do it. This is strange for Mac that did not even want constitutional review to get more power and he still don’t have much.

    It seems to me that Ezzard is the only one that has a balanced mind and says what is right.

    The money Hawks (bankers) think because they have both parties leaders in their hip pocket they can dictate to the British Crown. Watch the back hand the Crown slaps back with.

                                                            Albert Jackson


  9. The16YearOld says:

    Wow, Cayman Politics is just uneducated politically and socially. There really should be a law deeming that people can only run in politics if they have the valid credentials and degrees which you suit the occupation of a Politician.

    Cayman has too many inadequate politics, we really need a better governing system.

    • Anonymous says:

      I’ll drink to that..



    • Anonymous says:

      If a person had to have valid credentials to represent government that would mean McKeeva Bush would not be able to run for office and that would mean…………..wait, hold on a small minute there, McKeeva Bush not able to run? Hey, that would be a good thing, a great thing, a fantastic thing for Cayman. Cayman would still be for Caymanians, would not have been sold out to rich foreigners who lined a certain politicans’ pockets, Cayman would still be like we once knew it in the good old days! But alas, it’s too late! Wake up man, dreams don’t feed nobody, those days are gone forever & he is filthy rich

  10. SIR TURTLE says:



    There is really no distinction between TAXATION and STEALING. One is against the Law, and the other one is made Legal by the UK and the United States…

    Mind you now… History:  from the beginning, the United States was one time funding its own military by DONATIONS. That is how George Washington initially fought the war against England, which wanted to tax the people of the states heavily…

    Now, my sweet home, Cayman Islands, is being put to the test!  Are we going to legally "steal" from hardworking Caymanians???