Archive for March, 2012
Cash shuffle reduces deficit
(CNS): A combination of reshuffling money, a donation from Dart and an increase in expected revenue means that, despite increasing government spending by some $50 million, the government has reduced the anticipated deficit to about $7 million. The premier told Finance Committee on Tuesday that while there were new expenditures which came to light during the course of the year, some of the supplementary appropriations had been in the original budget, which he had wanted to present last June which the UK had refused. McKeeva Bush, in his role as chair of the committee, said government would be in a near “break even position” by the year end and the deficit was down to the statutory authorities.
Given the circumstances, Bush said, this was not bad, despite the fact that the original budget had forecast a small surplus, but he warned that government would need to keep a close eye on the public purse.
“These financial results will need constant and careful monitoring,” he said, adding that there would be close intervention between now and 30 June to ensure the position doesn’t get any worse. “We have reduced the figures to the lowest possible degree,” Bush told the committee. “The original request was much more but I couldn’t tolerate much at this time.”
Government has an overdraft facility of up to $25 million which it could use, he explained, as there would, of course, be no more borrowing. The government has now paid back some $26 million on its existing debt, Bush revealed, as he pointed to the fact that this was the first financial year for a long time where government had not taken on any new debt.
Explaining how government was managing to cover the increase in expenditures, he said that some $8 million was coming from the roads fund in anticipation of changes to the National Roads Authority as a result of an internal public sector review.
The move was queried by Opposition Leader Alden McLaughlin, who said it was “acurious exercise” as it appeared to be an off-balance sheet sum. The premier denied this, stating that the cash was from duties and fees earmarked for the road fund but now it was being transferred back as the NRA was going to be changed into a regulatory authority and would not in the future be funding road projects and no longer need so much in the fund.
A significant part of the cash was for increases in spending on fighting crime, funds to complete the Clifton Hunter High School and money for overseas medical care for the indigent and uninsured. The premier also revealed that some of the costs which government was incurring during this financial year were ones which came as no surprise: from an increase in scholarships to the poor relief payments, the civil servants had said the money would be needed when the UK forced the budget cuts.
“The budget which I had wanted to announce the UK said we couldn’t have,” he said. “The UK came back and said 'no' three times.” He recalled how he was forced to deliver the budget address so late because of the UK having to approve his government’s spending and it wasn’t until more cuts were made that the foreign office officials gave the go-ahead.
“But the staff had said these are the needs and they are going to arise during the year and they would be needed,” the premier added, as he explained that although they were revised to meet the UK’s demands, the needs hadn’t gone away.
The opposition leader then asked the premier if he meant that the budget he had presented in June last year was “not realistic”, a comment Bush dismissed as he pressed on with the business of the committee.
Schools’ bill rises to $197M
(CNS): The minister for education told Finance Committee on Tuesday that the final bill to finish both of the high schools would eventually total around $197 milllion. Appearing before his legislative colleagues to ask for an increase in cash for his ministry for thisfinancial year, Rolston Anglin revealed that the final cost to the public purse for Clifton Hunter would be over $99.5 million, while the total for John Grey, which will not be finished until next year, would be $97.4 million. Most of this expenditure has occurred during his tenure and means the schools are now double the cost of the original contract signed by the previous minister. The PPM had signed a contract with Tom Jones International (TJI) to do both schools for just over $114 million.
Answering questions regarding the need to increase his ministry's budget by some $16 million, he said that when he took up the post of minister in May 2009, only $50 million had been spent in total across both school project sites. Currently the costs for Clifton Hunter alone have surpassed $87 million and the bill so far for John Grey, where the work has been considerably reduced in order to phase its development, stands at around $54 million.
TJI, the original general contractor, walked off the job in November 2009 as a result of a dispute with government over payments and the projects were then stalled for almost a year before a new general contractor was employed.
The minister acknowledged that the school costs have now ballooned from the original contract costs of around $58 million for John Grey and some $56 million for Clifton Hunter as he said that the original contract with TJI was only for construction costs and not for architect and consultancy fees or fixtures and fittings, all of which still had to be paid for.
Anglin claimed that he found no plans in place for raising revenue to pay for the schools. “The projects were always going to be completed through massive borrowings,” the minister told the committee.
Opposition Leader Alden McLaughlin, who was education minister when TJI was contracted to build the schools, said that when the audits were finally done, the country would come to see what had really happened to result in the “significantly inflated final costs” when compared to the original contract, and he asked what had caused the inflation.
Anglin admitted that the current growing bill included design changes that had been incurred since TJI walked off the project and under the new contractor and as a result of his policies. However, he said, a lot of the additional costs were accounted for as a result of shoddy work by that original contractor.
He said that only $4 million had been given as a bond on each school, which wasn't enough for government to be able to claim compensation for the work that was being re-done. As “the company doesn't appear to have money, there is no point in government trying to sue for costs,” Anglin said about the poor work. He stated that the repairs had been done but everything that was wrong had been documented and the ministry had a full record of the poor standard of work.
He said that some of the change orders which formed part of the dispute between government and TJI, to the tune of $17 million, had been paid but others remained in dispute.
Anglin said there had been “many problems” regarding the original general contractor and the dispute but TJI and government would be taking part in an arbitration hearing some time this summer in an effort to deal with the main issue, which was still the original claim by Tom Jones that the Cayman government had not paid cleared invoices, a position the minister said was disputed. He explained that the core of the law suit had always been over the certified payments and the reasons why the contractor walked off the job. TJI has never claimed any damages regarding loss of earnings or profit after losing the contract, Anglin told the committee.
Following the discussions among committee members, the committee approved, among other appropriations, $14.5 million in transfer payments to the ministry, most of which, Anglin said, would be spent on the schools this financialyear. Despite the financial difficulties of government, the minister said he was pressing ahead to ensure that the Clifton Hunter campus was completed by this summer and that the students would be in the school for the start of the next academic year. He also stated that the hurricane shelter at the site would be in use for this season.
The minister further revealed that the renovations and enhancements to several of the country's primary schools and an additional building at Cayman Brac's high School had cost just over $11 million.
Red meat is blamed for one in 10 early deaths
(The Telegraph): The Department of Health was last night urged to review its guidance on red meat after a study found that eating almost half the daily recommended amount can significantly increase the risk of dying early from cancer and heart disease. Small quantities of processed meat such as bacon, sausages or salami can increase the likelihood of dying early by a fifth, researchers from Harvard School of Medicine found. Eating steak increases the risk of early death by 12%. The study found that cutting the amount of red meat in peoples’ diets to 1.5 ounces (42 grams) a day, equivalent to one large steak a week, could prevent almost one in 10 early deaths in men and one in 13 in women.
The scientists said that the government’s current advice that people should eat no more than 2.5 ounces (70 grams) a day, around the level the average Briton already consumes, was “generous”.
Lower valley residents ready for ‘quarry’ battle
(CNS): The Planning Appeals Tribunal is expected to hear an appeal by Whiterock Investments Tuesday morning in connection with an on-going disputed development in the Lower Valley area of Bodden Town. As a result of procedural objections the appeal which was scheduled for 13 February was cancelled at the last minute. The appeal has been rescheduled and residents who are objecting to what they see as an application to quarry on the doorstep of their homes are preparing once again to present their objections. The tribunal will hear the appeal against a decision made by the CPA one year ago not to allow the excavation of 295,000 cubic yards of fill.
The residents of the Lower Valley Forest community, which is also home to a number of indigenous and native endangered species, have been battling with Whiterock for some 15 years over blasting and excavation in the heart of their quiet, countryside community.
Although the residents had hoped, once again, last year that their long running misery may have ended when the CPA denied the application, the appeal has raised significant concerns, not just for the homeowners but the local environment, which is home to the critically endangered white shouldered bat.
The application in February last year was denied, as was the case in October 2008, on the basis that it wasillegal to pursue activities that would "cause noise and create a nuisance and annoyance to the residents of the area" and "negatively affect the quality of life of the residents in the surrounding area". The developer has filed an appeal stating that the CPA was “erroneous in law, unreasonable and in breach of the rules of natural justice.”
However, allowing the application would certainly be a threat to the natural environment as the developer wishes to level land in the heart of a habitat of particular significance.
As well as being home to the white shouldered bat, which was once thought to be extinct in the Cayman Islands but was rediscovered in the area in 2001, the Department of Environment hopes the forest will become one of the country’s first critical habitats protected in law should the long awaited national conservation law ever be passed.
With no conservation law in place at present, as with every planning issue the CPA or tribunal hears, during this appeal there will be no compulsion for it to consider the environmental implications nor, should the appeal be allowed, would the landowners be under any obligation to carry out an environmental impact assessment.
Both the endangered bat and the residents will be depending on the planning law, which prohibits excavation on such a scale in a residential area. Whiterock has denied allegations by the residents that the original application was a quarry but claims the goal is to level the land for development. The developer also claims that because the blasting will be done during the day the impact of the excavation on residents will be kept to a minimum.
In last year’s application Whiterock also stated that the environmental impact would be minimal as it would move some of the native trees at the site and as a result believed that any species at risk would move to the surrounding area.
Bishop Nicholas Sykes, one of the Mahogany Estate residents who have been leading the fight against the excavation for more than a decade, said that although the CPA had ruled against Whiterock three times, the residents once again would be forced to fight for their homes, their right to peace in their community and the environment.
The appeal will be heard in theconference room at the Government Administration Building at 9:00am.
Filmmakers wanted for regional video challenge
(CNS): Young Caymanian filmmakers have the chance to take part in a regional video challenge organised by the Barbados-based Caribbean Development Bank (CDB), through its youth outreach programme known as Vybzing. The theme is “Citizen Security” and young people living in Cayman aged between 16-25, who want to take part in the contest must produce a three minute video giving this unique interpretation on the issue. The short films will be rated by a panel of local judges and the first placed winner will receive US$1500. There will also be a second prize of US$1000, a third prize of US$650, and a People’s Choice Award of US$250.
Young people wishing to participate in the Challenge may visit the Bank’s website: www.caribank.org or www.cdbvybzing.org/facebook for further information. Deadline for the submission of videos is midnight on April 29, 2012.
During the period May 1-7, 2012, the public is invited to visit the facebook page and vote for their favourite video in the People’s Choice Award. The issue of “Citizen Security” has been singled out by CDB President, Dr. Warren Smith, as one of the hurdles challenging development in the Region, and CDB has been paying particular attention to this subject.
$50M increase to public purse
(CNS): The premier will be presenting a spending increase of around $50 milllion to the Finance Committee of the Legislative Assembly Tuesday morning when he chairs a special session in his role as minister of finance. The committee will meet at 8:30am tomorrow but there will be no sitting of the Legislative Assembly or any change to this financial year’s appropriation law. Although Cabinet can, under the Public Management and Finance Law, approve a 10% increase in government spending without requiring a change to the legislation, government may have surpassed that threshold.
The government will be bringing a 200 page supplementary appropriations document to the committee hearing not only to move sums around from one ministry, portfolio or department to another but it will also be increasing public spending by more than $50 million, which is more than 10% of the core government budget for the 2012 to 2013 financial year.
The independent member for North Side, Ezzard Miller, said he believes that the government should bring an amendment to this year’s appropriation bill and actually change the law after a debate in the Legislative Assembly as he believes the spending increase is too great to be dealt with purely by Finance Committee.
“In reality I think government needs to change the law," Miller said. “Nevertheless, I shall be using the opportunity of Finance Committee to ask questions to find out how it is that the government needs to increase spending so much.”
With government now expecting a significant deficit bythe year end on 30 June, in contrast to the original budgeted forecast of a small surplus, it is not clear how government intends to fund the deficit given that it is not allowed to enter into further borrowing under the terms of the Public Management and Finance Law.
The government spending increases also appear to be in contrast with the framework for financial responsibility that the premier signed in London with the UK's FCO minister last month. That document requires the Cayman Islands Government, among other things, to control government spending and reduce costs.
Electronic tag gets in way of work for accused man
(CNS): Although the electronic tagging of defendants on bail awaiting trials has proved a positive resource for law enforcement officials as well as those accused of a crime one young accused man could lose his job because the tags are not waterproof the court heard Friday. Defence attorney John Furness pointed out the difficulties one of his clients faced as a result of working for a local watersports operator when he said the tags don’t allow the wearers to go below six feet in the water. The lawyer also pointed out that the tag was becoming an issue as his employer was concerned about the reaction tourists may have.
Furness said hewould be making an application to vary the bail conditions imposed on Frederick Booth in order to try and save his job.
The idea of tagging defendants who are on bail awaiting trial is to enable law enforcement to keep an eye on suspects while at the same time cutting down on costs to the public purse and also helping those accused but not found guilty of any crime to keep in work and finance themselves. In most cases the bail conditions of suspects who are tagged usually ensure that curfews are lifted during the hours of work to allow defendants to keep their jobs.
Booth along with a second man has been charged with possession of an unlicensed firearm following the discovery of a hand gun and ammunition in the vicinity of Lawrence Boulevard in George Town on 26 March.
Police call a stop to missing man search
(CNS): Updated -Officers leadingthe search for missing teaching assistant, Nathan Clarke, confirmed Monday that the official search has now been called off some 16 days since Nathan was last seen walking towards the water’s edge on Seven Mile Beach near Calico Jack’s. Despite hundreds of civilian volunteers working with RCIPS officers and the deploment of major resources including specialist dogs from Miami there has been no sign of Nathan. Only the 31 year old man's cell phone has been recovered during the search. “We have completely exhausted the search areas at land and at sea, but unfortunately we have not been able to find Nathan,"Chief Inspector Richard Barrow, who has been overseeing the search operation.
"I would like to thank all of the volunteers who came out day after day and tirelessly assisted our officers during the searches. I know that Nathan’s parents, his brother and sister, his fiancée Lisa and her parents are also very grateful to all those who have helped and shown support during this difficult time,” he added.
Although the land and sea searches have been called off officers stressed that the investigation into what happened to Nathan is still active and hey continue to appeal for people on the Island to remain vigilant and to report immediately any information that may assist police with the enquiry.
"The families will continue to be kept fully informed of progress," a police spokesperson noted.
Nathan was last seen by his grilfriend at around 8:30 close to the water’s edge on Saturday 26 February outside Calico Jack’s bar
Anyone with information can call the RCIPS on 949-3999 and they can send images of the night he disappeared to nathanclarkeinfo@yahoo.com for other details visit the Find Nathan Facebook page.
Ryan loses control ofRitz
(CNS): Following the recent revelations regarding legal action against the developer of the Ritz-Carlton, Grand Cayman and his various companies, RC Cayman Holdings LLC, the secured lender to the companies involved in the development of the resort announced the appointment of receivers Monday. Kris Beighton and Keith Blake of KPMG, Grand Cayman have been made joint receivers of Cesar Hotelco (Cayman) Ltd, CondoCo Grand Cayman Resort Ltd, Cesar Properties Ltd and CondoCo Properties Ltd, which were involved in the development of The Ritz-Carlton, Grand Cayman and are all owned by Micheal Ryan (left), who has now lost control of the property. In a statement regarding the appointment, KPMG said it was a legal step taken by RC Cayman under its security arrangements.
“The appointment of the Joint Receivers will have no noticeable impact upon the day-to-day operations of the resort, which have been and will continue to be managed and operated by Ritz-Carlton,” a spokesperson for the joint receivers said, adding that they intend to work closely with Ritz-Carlton to ensure that guests, visitors, owners and tenants continue to enjoy the five star experience and service for which the resort is known.
A spokesperson stated that it was very early days for the receivers but the management team from the Ritz Carlton, which is part of the Marriot Group, would continue to operate the resort as normal.
This comes on the heels of legal action filed in the Grand Court last month by RC Cayman Holdings, the current owner of a $250 million loan used to build The Ritz-Carlton. The company, which acquired the loan in May last year, filed a civil suit seeking an injunction against a number of defendants, including Ryan, to prevent them from "interfering with" its attempts to take control of the development.
The loan used to build the Seven Mile Beach property was originally extended by The Royal Bank of Scotland in 2001. Six years later RBS sold the loan, which at the time had outstanding principal and interest of $161 million, for an undisclosed amount to New York-based Credit Suisse subsidiary Column Financial, Inc., which immediately increased the size of the loan to $250 million and solid it to RC Cayman, but it is not clear how much of that original amount remains outstanding.
Following the writ, Michael Ryan had said in a statement to OffshoreAlert that there was an issue as to whether the lender was entitled to take control. "It is hoped and expected that an agreement between the parties to resolve this matter will be concluded in the near future," Ryan told the Miami based watchdog.
The developer of the Ritz Carlton also owes the Cayman Islands government over $6 million in deferred payments on customs duties on material used to build the resort. With the hotel now in the hands of the privately appointed receivers, it is not clear where the Cayman government stands in relation to its ability to recover that outstanding debt to the public purse.
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Police look for owners of stolen goods
(CNS): Police are looking for the owners of two pieces of stolen property recovered last week. A toolkit and a laptop, both suspected of being stolen, were recovered by police last week during the course of an investigation. Officers from George Town police station have circulated the photographs of the items in the hope of reuniting the stolen goods with their owners. Detective Sergeant Ian McDonald is asking anyone who recognises either the Toshiba laptop or the Performance tool kit to contact him as soon as possible as he reminded owners to take a record of their valuables.
“All too often when people report their property stolen, particularly electrical items such as laptops, they are unable to provide us with details of the make, model or serial numbers,” he said. “That’s why when we do recover items which we believe to be stolen it’s difficult to reunite the owners with their property. People should take a note of these important details and also consider marking their property with UV pens.”
DS McDonald is also warning people who buy property like laptops privately to be cautious. "If you are offered a deal that’s too good to be true, or the seller is unable to provide genuine paperwork/ receipts for the equipment, you run the risk of being prosecuted for handling stolen property.“
DS McDonald can be contacted at George Town police station 949-4222. Anyone who wishes crime prevention advice should contact their local police station.