Legislators to tackle budget

| 07/10/2009

(CNS): Following Financial Secretary Kenneth Jefferson’s closing remarks on the budget debate this morning (Wednesday 6 October) in the Legislative Assembly, members of the House will be going into Finance Committee to scrutinize the budget and break down government spending plans for this financial year. The budget has already been described as overly optimistic by the opposition and the LA’s only independent member, and has also  raised concern from the wider community about its impact on small businesses.

Criticisms are already being made from a number of quarters that, while government has increased fees across the board to raise $126million over the next 12 months, digging deep into people’s pockets, it has not introduced measures to cut government spending by any significant amount. In contrast to the $94million extra the government says it will earn this year by those fee increases, it has only cut spending by $5 million.

In an attempt to address last year’s $81 million deficit in just one financial year, the government has introduced a range of new fees and increased a number of existing fees quite significantly. There has already been a considerable reaction from the business community that the increase in duty billed at 2% is extremely misleading as it is in fact a 10%-plus increase, as goods currently rated at 20% duty will be rated at 22% in future and likewise those at 25% will go to 27% which is likely to see an increase in prices.

Several small business owners have already told CNS that, with the duty increase on the goods they purchase, the business premises fee of 10% on rental rates for commercial tenants, as well as work permit fee increases, they have no choice but to increase prices to stay in business.

Despite small businesses taking a significant hit in the budget, the bulk ofthe $94 million that government plans to collect during the fiscal year to 30 June 2010 will come from fees impacting the financial services industry. CNS understand that a response from the industry body Cayman Finance (formerly the Cayman Islands Financial Services Association – CIFSA) will be forthcoming today.

The leader of government business has said, however, that the fee increases were done in close consultation with the industry in order to ensure that business would not be undermined. McKeeva Bush told the LA on Monday that the industry had helped government come to some tough decisions.

“There has been particular consultation with the financial services industry as we have resisted great pressure to introduce direct taxes. However, in the present situation, some new and enhanced revenue measures are unavoidable,” he said.

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  1. Czekd Him says:

    What about children born elsewhere because facilities were not good locally at the time (30-40 years ago) but whose parents were living here before, while and after they were born, but not "Caymanian" themselves, and then grew up only in Cayman?

    The only home they have known is also Cayman…  It is proof positive that there needs to be a true assessment of each situation.

    Truth be known, there are not many in this category, but they exist.

    My check-mate comment was aimed at the previous poster – using his arguements, it certainly was a slam-dunked, home-run of a check mate.


    • da wa ya get says:

      It would be ideal if there could be an assessment of each situation. Those people who have Caymanian parents and were born elsewhere because of inadequate facilities are considered Caymanian in every sense of the word by other Caymanians. Quite frankly, it’s disgraceful that the law doesn’t see them the same way.

  2. Anonymous says:

     On a beautiful Cayman Wednesday morning, Mr. McKeeva Bush stood in the Legislative Assembly and spent a fair amount of time criticizing the PPM.  How can a man who spends so much time looking to the past successfully lead the Cayman Islands into the future?  We all know what happened, Mr. Bush.  The question is, what are you going to do about it?  If your only answer is to, yet again, jabber on at length about the evil PPM – perhaps you need to step down, get your own radio show, let someone else lead the country and spend your time on the radio reminding everyone on a daily basis just how bad the PPM was before the UDP came along.

  3. Joe Average says:

    I’m trying to follow this.   a.  the government has increased fees across the board.  b.  this will affect businesses.  c.  they will have to increase their prices to pay for the increased fees.  d.  we will pay for more for goods.

    and then

    e. government will attempt to balance their budget…with increased revenue. but will do very little to decrease their costs.

    f.  businesses will attempt to balance their budgets…with increased prices. but will do very little to reduce their markup or profit.

    and then

    GEE.  our wages will… remain the same.  or possibly even be reduced.

    After everyone important as been consulted….could we be consulted?

    Or should we remain insulted?  


  4. Anonymous says:

    In response to ‘freethinker’ – what makes you say "because a lot of this tax …… will be coming from expats" – for your  information – Caymanians:

    own businesses and will have to pay increased work permit fees; import items and will have to pay increased import duties; transfer money overseas & will have to pay fees; are tenants & will have to pay the business premises fees; smoke cigarettes and will have to pay the duty; receive and send packages and will have to pay the package tax; own companies and therefore will have to pay the increased annual company fees; bring in used vehicles and will have to pay the EI fee.

    As to the Regulatory and Statutory increases, those companies that have for a good number of years made an extremely handsome profit (they wouldn’t be operating here if they hadn’t), will now have to realise a smaller profit – note I did not say "small" as they will still be making fairly good profits.

    As a Caymanian I’m not happy with these increases either but we have to do what must be done. We’ve had a very good life for a long time and, like the rest of the world, we have realised that it’s time to pay the piper.

    I ask of "freethinker" that next time he/she thinks before they make such an assumption.


    • ex-freethinker says:

      My bad and I apologize. Expates will not pay as much as Caymanians. And its not hard at all to see that in the end Caymanians have more at stake here.  Much , Much more.  Thank you for setting me straight.  I should have asked instead if this money will actually make it to the Islands infrastructure and also to the betterment of all the Caymanians.  I promise to try and be more open minded and not just a freethinker. 

  5. Anonymous says:

    No schools will likely be built for children of expats. But I can tell you that the children of expats don’t go to schools under grape trees or breadfruit trees. You should see for yourself the children in the schools before you make ridicoulus comments about the schools and the conditions.

    • ex-freethinker says:

      You are of course correct that it was a ridicoulus comment and not at all a good way to get my point across. please see my reply to the person above.  My apologies and thank you for setting me straight.

  6. Anonymous says:

    You may not realize but the presence of expats requires govt. to spend significantly more on infrastructure. You currently do not pay enough taxes to cover for that.

    It is of course absurd to ask for expat-only schools. However, note that under the new Constitution the right to education requires all resident children to receive free education. This will require additional schools to be built and is one of the reasons the Bill of Rights has a delayed inplementation.    



    • Major Sir Gerry says:

      Need to get that tongue out of the cheek of that poor guy.  Not sure anyone will understand how hard his recovery will be…

  7. Makam says:

    Sorry I missed the "close consultation with the industry" that took place with the financial sector after all I am only a small business man whose rent will be increased by 10%.

    As for the calls for the PPM to have a plan where was the UDP plan when they were in opposition, why do we have this Ad hoc scramble by the dictatorial LOGB who has so far only managed to damage Caymans standing in the global finance sectors opinion and now proceeds to kill the economy completely.

    I hear that there were "visits" by overseas "interested parties" to some of the government assets if not before the election but so soon after that they must have been arranged before the election.

    It is obvious to me that the UDP (or more likely the LOGB) was doing deals to sell off government assets long before he announced the possibility.

  8. freethinker says:

    Because a lot of this Tax (but called fees) will be comeing from Expats and overseas money how many expat only schools will be built?

    • Reality Sucks says:

      Since there is no such thing as a NATIVE Caymanian (‘cept them Blues and ‘gators) – everyone came from somewhere else – all government schools are for expats!!! 

      Reality really bites…

      Unless of course by expat you mean discriminated-against non-belonger  (to coin a Bermudian phrase – and boy, that island eminates social harmony – sadly coming soon to an island near you…)


      • Anonymous says:

        There is of course such a thing as a "native Caymanian". I am one. Perhaps you should look up the meaning of the word before spewing garbage. You might then not look so silly while trying to appear clever.

        According to the Oxford English Dictionary:

        native n. 1. a person born in a specified place or associated with a place by birth.

        • Logic says:

          So by your logic all green iguanas are native to the Cayman Islands too.

          • Anonymous says:

            I think you are confusing the words "native" and "indigenous" which are not precisely the same. Get an education.

            • Czeck May-T says:

              Thanks, but they just off-loaded the entire ammo magazine of an AK-47 into their own foot!!!

              In trying to prove me wrong, they just gave rights to my kids (born here) and several thousand others.  Irony is – they gave these rights to the kids of expats born here during their parents tenure of indebted servitude…  So now they can all come back at any time, show their birth certs and, by Mr/Mrs/Ms Logic’s arguement, should now be granted all the rights of the "true Caymanians"…

              I trust they won’t discriminate against them based on looks and language as the fact that the face of Cayman has just changed dramatically according to their logic…

              In the swipe of ignorance, they have single-handedly proven every point – either we accept all, as none of us are really native/indigenous (generationality is no longer an issue…), or we are living in a balloon of hypocrisy where the goal pasts shift to suit our self effaciating needs…

              I suspect the latter has just been proven…

              Check Mate??!!!

              • da wa ya get says:

                Sorry, although I believe that children who were born here, grew up here, and know Cayman as their only home should be granted Caymanian Status at the age of 18, that is not the law. These children must not only be born here, but their mother must be also be Caymanian. So, no checkmate.

            • Anonymous says:

              Well the green iguanas are certainly not indigenous, and by the definition given by the other poster technically fit the criteria for native. I would suggest you might want to rethink your education comment…

              • Desperation... says:

                If we are not careful, and Cayman experiences serious backlash from the current global economic turmoil and local problems, we will be wishing we had given more rights to people who wanted to stay when the times were good. 

                Humans generally prefer the devil they know, so if things go bad, many would weather it if they felt welcome and wanted.

                You make them feel alien and unwanted, and when the sh!t hits, they have every reason to run away laughin at the country’s demise…

              • Anonymous says:

                You have completely missed the point.  

                It would be correct to state that there are no indigenous Caymanians (or that green iguanas are not indigenous). It is not correct to state that there are no native Caymanians.  Indigenous does not equal native.

  9. average worker says:

    So lets get this straight.  The average worker (Caymanian and otherwise) will now have to pay not only to live here now but also on top of that they will have to pay for the past years bill which they have all ready payed for. Is that what your telling us?  And NO meaningfull cuts in Goverment spending means we can do it again and agian every year until……….