Archive for May, 2014
Tax breaks on duty, licenses
(CNS): The finance minister has managed to find a little bit of room in his 2014/15 spending plan to help everyone out with a cut on the fuel duty paid by CUC, which should cut electricity bills by 4.3%, and on duty for goods bought by licensed traders that he hopes will be passed on. In addition, Marco Archer revealed that there will be some significant cuts in the cost of trade and business licenses for small business in the districts and to provide for payment in installments across the year. He said he hoped the reductions would make a difference across the whole community with cheaper fuel bills and a cut in prices, as well as giving small businesses a break.
The tax breaks were revealed by the premier in his policy statement and detailed by Archer when he delivered his budget address.
Premier Alden McLaughlin said the fee cuts were aimed at helping small businesses because they are key to Cayman’s economy, with 60% of local businesses classified as small, employing under 11 people. Alongside the cut in fuel duty for CUC, which should see bills come down for commercial and residential customers starting on 1 January next year, the cuts include a reduction in duty for licensed retail traders only on most goods from 22% to 20% starting on 1 July. Trade and business license will also be cut starting in July and a payment scheme will be introduced for those fees.
McLaughlin said these were just the start and there would be additional cuts as government revenue strengthens. He also pointed to the possibility of Sunday trading, which he said would be subject to public discussion, and the introduction of daylight savings to help tourism and financial sectors coordinate with the North America.
Detailing the tax breaks, Archer said the 75 cent duty on fuel imported by CUC will be cut by 25c from 1 January. Although it cost the public purse more than $8 million, the anticipated beneficial knock-on effect in the economy would outweigh government’s revenue loss, the minister stated. Aside from the essential direct relief to customers, Archer is hoping it will also improve local spending power.
That too should be assisted by the cut in duty to retail licensed traders. Archer said that government plans to cut duty for merchants from 1 July, and although government will lose some $4 million in revenue, again the spending boost that government hopes will be triggered will help alleviate that loss. He said that government would also be watching prices closely to ensure the 2% reduction on goods is reflected on the store shelves.
Archer is also giving all small businesses a break with a cut in trade and business license fees. Business in George Town will see the fee come down by 25% while in North Side, East End, Bodden Town and Little Cayman license holders will get a 50% reduction. In Cayman Brac, licenses are being slashed to 75% and other breaks on that island include 100% duty free building materials, a duty cut for Cayman Brac and Little Cayman Power and Light Co. and a 75% stamp duty waiver on land developed within two years.
Archer said that the multiplier effect of this fee reductions should help boost the domestic economy and help address what he said was the worrying problem of a shrinking middle class.
For full budget documents and details of the 2014/15 spending plan see related story on CNS: Archer exceeds his targets.
Archer exceeds his targets
(CNS): The finance minister’s aim for his first budget was on target, the Legislative Assembly heard Monday, when Marco Archer said government expects to exceed the more than $100million forecast surplus for 2013/14 by more than $7million at 30 June. He also revealed that he would be looking for an even bigger surplus next year. Archer has forecast an operating surplus for 2014/15 of a whopping $128million for the entire public sector. With the minister having achieved this year’s goal on paper, he said, CIG was also on track to meet the three year plan and be in compliance with the fiscal framework for responsibility and all the requirements of the public management and finance law by 2016. (Photo Dennie Warren JR)
The finance minister said prudent financial management was still at the centre of his budget strategy for the 2014/15 financial year. He pointed to strict controls on spending as well as enhanced debt collection and proactive debt management as the key issues.
According to the budget documents, Archer’s unaudited figures appear to be adding up so far and the surplus is being used to pay down debt, cover capital expenditures and boost government’s cash reserves as require by law.
Archer revealed that the operating surplus at the end of next month is now expected to be $108.1million rather than the forecast $100.2million. The surplus was due to more revenue than anticipated and a little less public spending than expected. Government was hoping to earn just over $845million from core revenues and from its statutory authorities and government companies but it is expected to end up taking in over $850million. Meanwhile, overall government and SAGC spending was squeezed down from an expected $549.4million to just over $547million. Government’s debt stands at just over $548.8million.
The minister explained that the revised revenue forecast was down to a combination of positive economic growth and new revenue measures approved during the 2012/13 financial year. The most significant areas of better than expected performance was on import duty which is now forecast to be some $5.1 million above original budget projections and mutual fund administrator licences which are forecast to be $4.2 million above original budget projections.
Meanwhile, the revised forecast for operating expenses was down to a series of cost reduction measures including a $3.4million savings in personnel costs because of restrained recruitment and natural attrition. There was also a $0.8 million decrease in financing expenses, due to lower interest expenses resulting from renegotiated interest rates on a portion of the debt portfolio and because government stayed out of its overdraft facility, the minister said.
However, he warned the savings were partially offset by a bigger than expected bill for overseas medical care for those who have either exceeded their health insurance cover or who don’t have insurance, which is forecast to be $ $1.3 million more.
Turning to the forth coming year Archer is aiming higher for 2014/15 and expects core government and the public authorities to bring in a combined revenue of a record breaking $872.6million almost $20million more than this year. However, as much as government is trying to cut its operating costs Archer is still predicting $744.6million will be needed to pay for operating cost and financing expenses which is more than this year’s costs of $743.9million because of the increase in staff and as a result of the statutory authorities.
Government will also be plugging the Turtle Farm’s operating losses and debt to the tune of $9.5million as well as $4.8million to Cayman Airways to cover its losses. The National Housing development trust will also receive $2.8million for its debts and another $1.5million will go to the development banks debts.
Archer announced a new sinking fund which government plans to pay in to over the next four years and it will be starting this coming financial year with a contribution of $4.3million. He said government will also bring debt down by a further $25million and not only will there be no new borrowing the CIG doesn’t require an overdraft facility for the 2014/15 financial year. He noted however, just weeks away from the start of the hurricane season, that the UK had agreed to that facility should Cayman face any natural disasters this year.
Archer also revealed that the delay in the budget was not down to government waiting on the UK as he said his final spending plan was not sent to the FCO until last Monday and the minister gave the go ahead just two days later.
Describing his budget as once again fiscally prudent he said it was not just about complying with the Framework for Fiscal Responsibility but for future of the country. He said the budget provided a healthy surplus, to fund capital expenditures, the cash reserves and reduce debt.
See the full budget in detail in documents posted below.
Visitor charged with importing cannabis resin
(CNS): A French national visiting a family resident in the Cayman Islands who was arrested last week on suspicion of importing drugs has now been charged and was due to appear in Summary Court Monday. The man, who flew into Cayman from the United States, was arrested by customs officers at the airport for possession and importation of cannabis resin, also known as hashish, but officials did not reveal the quantity of the drug. The suspected drugs were found in his luggage during a search and on preliminary assessment he was arrested and placed on bail until the drug was analyzed. He was formally charged after the tests confirmed it was hashish.
Assistant Collector of Customs Trevor Williams said, “We will maintain our zero tolerance approach for possession and or importation of any illegal drugs; we will maintain our intense vigilance and wish to remind the public that offences of this nature will not be tolerated.”
Anyonewith Information relating to this type of crime to contact HM Customs tip-line on 1-800-534-8477 or email at tell.us@customs.gov.ky.
CS gets 2.5% one-off bonus
(CNS): Government is giving its core civil servants a one-off bonus payment to reward public sector workers for their part in meeting the targets of last year’s budget and their work towards presenting this one. The premier made the announcement during his policy statement ahead of Marco Archer’s budget address, with the details of the bonus set out in a letter sent to civil servants. Premier Alden McLaughlin said the 2.5% gratuity payment based on government workers' annual salaries will be in their pay packets next month. He said it applies only to central government workers, however, and not those working for government companies or statutory authorities, who are in charge of their own remuneration packages, or MLAs. (Photo Dennie Warren Jr)
The premier told the Legislative Assembly in his policy statement that, as with private business, government relies upon its human resources to succeed. “And like a private business would seek to do, it is important that the government’s leadership acknowledged and reward positive results.”
With government forecasting to exceed its more than $100 million surplus and personnel costs for the 2013/14 fiscal year end or less than expected government’s cash position is stronger than expected creating some room for the bonus.
“This amount, which will be payable along with the civil servant salaries at the end of June, is in recognition of the fact that the consumer price index has steadily risen and that with the help of its staff, this year the Government has the means to provide compensation in the form of this one off payment,” McLaughlin said. Thanking public sector workers for not only “meeting but exceeding targets” he implored them to keep up the good work.
“The past year’s financial performance has only been possible through shared sacrifices as many departments have had to cope with fewer resources to meet the same or increased demand for services. However, this reward proves that when our staff succeed in the challenge ‘to do more with less’ not only does the organisation succeed but its staff can share in the fruits of that success.”
He said that government still wants to re-introduce the coat of living allowance and believes it should be more than 3.2% but he said government is still challenged by personnel costs in government and in the 2014/15 budget where government will be filling some essential positions the wage bill had reached its ceiling. McLaughlin recently said personal costs “blew the budget” and in his speech Monday he said salaries would continue to present struggle for government and he said leaving post vacant was just not sustainable.
“We have to contain personnel costs in a sustainable way he said as he pointed to phase five of the rationalization process where the public sector will see, mergers, consolidation and sell offs. But McLaughlin indicated it would be local small businesses that would benefit from government services contracted out to the private sector or provide civil servants now working for government to set up their own businesses to provide those services from the private sector instead.
“Through this exercise we hope to streamline government even more and devise a road map for implementation as well as to ensure Caymanians have an opportunity to become entrepreneurs,” he added.
McLaughlin said the EY report is due next month and the implementation of the recommendations will begin this budget year and some mergers would be taking place even before the report was completed.
Three men injured in violent weekend assaults
(CNS): Police are looking for witnesses after two separate and very violent incidents in George Town and along the West Bay Road in the early hours of Saturday morning. In the first fight on Shedden Road, believed to involved knives at least one man was stabbed and another injured in the face while in the second incident near the Dream nightclub a man received serious but non-life threatening head wounds from a machete. Detective Chief Inspector Kay of the George Town CID urged people to come forward. “This weekend, we have once again seen two very violent incidents involving young men using knives and machetes to inflict very serious injuries to their victims,” he said.
“These incidents of violence will be thoroughly investigated by the RCIPS and the offenders will be sought out and prosecuted to the fullest extent of the law. While we continuously strive to investigate these incidents, I would also like toencourage anyone who witnessed them or has any information about these horrific attacks to come forward in confidence and assist us with our inquiries,” the senior cop added.
The first incident occurred at around 2:31 Saturday morning around an after-hours session on Shedden Road in George Town. Police received a reported that a fight was in progress between a group of males at that location. One of the males received a laceration to his face while another male received a wound to the face along with a swollen eye. Both were treated for their injuries and released from the George Town Hospital.
The second incident happened on the West Bay Road close to Dream Night Club at about 3.07am when the 911 communications centre received a report that two men armed with machetes were chasing another man along the road.
Police said the victim received a number of very serious but none life threatening wounds to his head and neck. Armed police officers were dispatched to the scene, but upon their arrival all parties had departed the area. The injured man has since been treated for his injuries and released from the George Town Hospital.
Anyone with any information on either of these two incidents please contact Detective Sergeant Stewart George Town CID at 949-4222, or to remain anonymous or Crime stoppers 800-8477(TIPS).
Surprise fuel cut in budget
(CNS): The premier has announced a reduction of 25 cents per gallon on diesel duty imported by CUC from 1 January next year, which will cut the cost of bills for both residential and business customers. In his presentation ahead of the finance minister's budget Monday in the Legisaltive Assembly, he revealed the fuel duty cut as well as reduction in general duty of 2% on all goods for licensed retail traders, which he also said would help merchants cut their prices and encourage people to buy local. As he began delivering the full budget, Marco Archer also announced that government was expecting to end this financial year with a $108 million surplus, $7 milllion more than expected.
Check back for more reports from budget throughout the day.
Wild turtle killed by boat propeller in NS
(CNS): Officials from the Department of Environment (DoE) are urging boaters to be more vigilant regarding turtles following the death of a 300lb adult male last week after it appeared to have been hit by a boat. The green turtle was found dead in a mangrove area of North Sound on Wednesday by a group of kayakers, who spotted the turtle in a remote area and notified the DoE. Research staff recovered the turtle and found a deep fracture in its upper shell, characteristic of a propeller wound. With the turtle breeding season having started, the wild marine creatures are now even more vulnerable.
“Turtles spend time at the surface breathing, basking in the sun and mating. Adult male and female turtles are particularly vulnerable to boat strikes,” said DoE Research Officer Janice Blumenthal. “The turtle breeding and nesting season has now begun and will continue throughout the summer. DoE urges members of the public to exercise caution when boating: Use slow speeds when possible, and watch out for turtles at the surface. We hope this unfortunate incident increases the boating public's awareness, helping us better protect and conserve Cayman's turtles.”
DoE staff have collected samples from the turtle and transported it to the St. Matthew’s University School of Veterinary Medicine, where veterinarians, assisted by students, will perform a full internal examination (necropsy) and report the results to DoE.
“This partnership with DoE is an excellent educational opportunity for our students as well as providing information which benefits turtle conservation,” said Veterinary School Associate Professor of Clinical Sciences Samantha Shields.
Members of the public finding dead or injured turtles are asked to call the Department of Environment's Sea Turtle Hotline at 938-NEST (938-6378).
NHDT owners to lose homes
(CNS): The majority of homeowners at the original affordable housing site, Apple Blossom in West Bay, will lose their homes because they are either behind on their mortgages or they will not be able to get new larger loans from the bank. Owners and tenants learned very little about their future at a meeting on the site last week, called by the National Housing and Development Trust Board to tell them that the home plots will be re-parcelled, their houses pulled down and new ones constructed. The board chair said there is no new housing policy in place and he did not know what would happen to owners who were not able to pay arrears or get a new loan. However, he said that government would come up with an alternative place for them to live.
Feelings ran high at the meeting, as those facing the loss of their homes were given little comfort by NHDT chair Tony Powell, who was not able to tell the tenants very much other than government would be selling the new homes, once they were built, for between $97,000 and $120,000, even though they would be worth considerably more. Powell said he was letting tenants know so they could begin to make arrangements over the next four or five months before construction starts and suggested they asked family members to help with the money to pay their arrears.
He said owners who were up to date with their NHDT mortgages would be able to transfer that equity to a new mortgage with the bank. The NHDT was negotiating for lower interest rates and fees as the Trust was no longer going to offer home loans. However, speaking to the owners on the site, most of whom are elderly, sick or indigent, he said they needed to come up with as much as $12,000 for a deposit and then the administrative costs and fees — all way beyond the reach of virtually all the families living on the site at present.
He said the Department of Children and Family Services would be assessing the circumstances of all of the 25 or so families still resident to see what their needs were, but in the absence of both the housing minister and the education minister, Powell, the only government representative in West Bay, was unable to say what the future holds for most of the tenants and where they would be living once the Trust begins pulling down the houses.
“You will not be displaced we will do what we can,” Powell said, as he insisted nobody would be put out on the road. “We won’t start the re-construction until everyone has somewhere to go.”
Nevertheless, Powell could not be specific about what that meant, raising concerns from the residents on the scheme. The people at the meeting were clearly troubled and dissatisfied with the situation they were presented with as there seemed to be little option, given the circumstances of most of the owners who are delinquent on mortgage payments and therefore will lose their homes.
Most expressed their disappointment that the ministers were not there to explain where they would go and what would happen to the money many of them had paid on their mortgage in years past before they fell behind due to a change in their circumstances.
Powell was unable to state why they had not come to the meeting but said he believed that Kurt Tibbetts, the housing minister, was called to another appointment. Meanwhile, CNS has since learned that Tara Rivers, the education and employment minister, was unable to attend as she was at a conference in the Bahamas. The only legislator present was Bernie Bush, a bankbench member ofthe opposition and the fourth elected member for the district.
Homeowners revealed a catalogue of issues impacting them, indicating that it may be almost impossible for any of them to get one of the new houses. Some had faced the death of a spouse or breadwinners, others the loss of jobs, some were faced with serious illness with no insurance cover, and in some cases the owners are simply too old for banks to give them new mortgages.
The homes at the site are now in a bad way and Powell said the government had no choice but to tear the properties down and rebuild as the houses had reached such a poor state of repair that even a strong wind could blow them down. Powell said the DCFS would be undertaking an assessment as he was aware most owners were now behind with mortgages and they needed to see what the problems were.
However, one owner at site clearly stated the main issue: “The problem is we are poor,” he said.
Several people explained their circumstances at the meeting, making it perfectly clear that they were not in any position to get a mortgage from the bank, and with no options on the table, they were resigning themselves to be homeless.
Shawn Ebanks, who is leading the new local activist group Justice for Cayman, urged the NHDT to have some form of phased transition, as had happened in George Town, and pressed the board to understand the circumstances people were in.
As the meeting broke up, one owner who fell behind on payments when she became sick and her husband lost his job at the same time told CNS that they she would rather see the house razed to the ground with her in it than be put out in the street. “I think this is really unfair,” she said.
After the meeting the chair issued a press statement about the Trust's plans, stating that no tenants are being displaced.
"However, the houses they currently occupy have been condemned. In fairness to the tenants, this issue needs to be resolved ASAP, " Powell said. "I wish to stress that the government will ensure that no one is left homeless through this process."
He said the Trust had been mandated to provide an assessment of the site and each family’s position.
"The Needs Assessment Unit of the Department of Children and Family Services will conduct personal assessments in coming weeks, following which a clearer outline of each family’s position will be outlined in the social reports. Following this, the Trust will determine the financial status of each tenant. Once these steps are taken, we will then determine what levels of assistance are required," the chair added.
Over the next few months the residents of Apple Blossom will be required to participate in the assessments by the Needs Assessment Unit of the Department of Children & Family at scheduled appointments and complete the necessary paperwork and forms.
McTaggart’s U-turn revealed
(CNS): A report from a parliamentary committee to be laid in the Legislative Assembly during this week’s meeting reveals that government back-bencher Roy McTaggart proposed a committee motion which he ultimately voted against when legislators last met. The U-turn by the George Town C4C member, who serves as a councillor in the ministries of finance and financial services, is shown in the minutes of meetings of the Oversight Committee for the Office of the Complaints Commissioner (OCC), chaired by Ezzard Miller. The document shows McTaggart had proposed and agreed that the committee chair table a report by the OCC on whistleblowing and move a motion in the LA that it be accepted as government policy.
According to the minutes from 1 April, seen by CNS, which are contained in the committee’s annual report, the members had discussed a report by Complaints Commissioner Nicola Williams on whistleblowing. During the meeting McTaggart moved a committee motion, which was seconded by opposition member Bernie Bush. The motion directed the chair to table William’s report and draft a motion for debate in the LA, as the committee members all agreed the report should be debated ahead of government adopting the recommendations in the report as policy.
However, some nine days later when Miller tabled the report and moved that agreed motion, not only did the government benches shy from debating the motion but McTaggart also voted ‘no’ to the adoption of the report’s recommendation, despite his position just a week earlier.
The motion and McTaggart’s U-turn caused a political stir, as the government appeared to be taken by surprise by the motion tabled by Miller. But the chair stated at the time that the motion proposed by McTaggart had been accepted by the committee members at the 1 April meeting, with the exception of PPM back-bench committee member Al Suckoo, who was not present.
The minutes for the following committee meeting on 15 April reveal that the committee was concerned that despite their agreement McTaggart had voted ‘no’ and that only the deputy governor and the premier had said anything on Miller’s motion. The commissioner was also very disappointed that the government had chosen not to debate the motion about her recommendations, given the significant public interest. She said such a debate and show of support would have “given comfort to whistleblowers".
Williams also revealed that despite her work she had not been consulted about the proposed legislation or discussion document which the Law Reform Commission recently published for public input. However, but her office had offered to assist and that offered remained.
Coach remanded on sex offence conviction
(CNS): A local man was remanded in custody on Thursday afternoon as he awaits a Grand Court decision on the length it time he will serve in connection with a sex crime against a teenage girl whom he was coaching at a local sports club. The 33-year-old man is charged with defilement after having sex with her when she was just 13 and he was 31, and possessing an indecent image of a child as he had videoed the two of them having sex. The crime came to light when the teen had a row with her parents and she told them about what she believed was a consensual, loving, relationship with her coach, who is 18 years her senior. Following the teen’s revelations, the man was arrested and he admitted his guilt.
Appearing before Justice Charles Quin on Thursday afternoon, the man, who cannot be named due to a court order restricting the publishing of any information that could identify the teenager, was told that a custodial sentence was inevitable. He was remanded in custody after being on bail for many months, having been arrested in March 2013.
The court heard that the young teen, who is now 15, and her family have all suffered a very difficult time since the crime came to light. The teenager has since been sent overseas to school as a result of the harassment she and her family have suffered after exposing the coach, who appears to be well-liked by other parents and players at the sports club.
As a result of the sensitivity of the case, the crown revealed little about it in open court, though the judge was supplied with all of the evidence and relevant documentation. The court heard that the teenage girl did not believe herself to be a victim and was anticipating that she and the coach would be revealing their relationship as soon as she was 16.
However, the crown said that the video image found on the coach’s phone when he was arrested had been made without her consent.
Outlining the aggravating circumstances of the case, the crown said the case was a very clear breach of trust, as the man was the teen’s coach, and there was also the disparity in their ages to consider.
In mitigation, the man’s attorney said her client accepted full responsibility and did not wish to diminish what had happened, but she pointed out that this was a consensual situation and he too had considered it to be a real relationship. The lawyer said her client had pleaded guilty at the outset and had cooperated fully with the police. He was of previous good character, held a job for some 14 years and was held in high regard in the community.
A social enquiry report revealed a harrowing background for the coach, who had been subjected to sexual and physical abuse when he was young, and that this was “a classic case of the abused becoming an abuser”.
Despite his own appalling upbringing, the coach had, however, taken a positive path in life and this was the first time he had done anything wrong. The lawyer explained that the coach had genuinely started out wanting to help the teenager, who was going through a difficult time. But he acknowledged it went too far and that it was a “monumental error of judgment that will cost him everything”.
The lawyer pointed out that there had been no intervention to save him from his abuser and no therapeutic help available to him as he was growing up. To compound matters, a programme that was recommended by the probation service for the coach to undertake is not available in the Cayman Islands.
The court also heard that the coach is a father of two, and although separated from his children’s mother, the pair have an amicable relationship and he is very active in his children’s lives, providing for them financially as well. The lawyer noted that sending her client to jail, which she acknowledged was inevitable, would add to the number of people who will be hurt by the offence.
Justice Quin remanded the coach into custody and said he would deliver his verdict on the sentence on Tuesday 27 May.