Accounting for nothing
In his latest report the auditor general has attempted to be kind to government over its continued failure to be accountable to the people for the money it has taken off them and spent. No doubt this is to encourage the tiny glimmer of possible improvement after the deputy governor committed to providing leadership on the problem plaguing government since 2004. But kindness is unlikely to help.
The fact that Alastair Swarbrick is only able to report the tiniest of improvements, which remains a far cry from any real accountability, after the government’s proverbial hands have been held in every possible way to get these accounts sorted speaks volumes.
Even after the creation of a task force, specialist teams, overseas intervention, amendments to the law, advice, help and recommendations by the bucket full from the public audit office, pressure from the Public Accounts Committee and even a fair dose of public outrage, nothing has really changed. The people have no more idea today than they did at the start of this administration where the money went.
Because the starting point was so bad, Swarbrick was encouraging in his report but the reality of the situation cannot be avoided.
While statutory authorities and government companies have for the mnost part made an effort to catch up and provide more timely and better quality information to the Office of the Auditor General, the portfolios and ministries, which spend and collect the bulk of taxpayers’ money, have failed to make any noticeable improvement. This means the consolidated accounts, or entire public sector financial report, cannot be produced. In turn — and this is the crux of the matter — the people cannot hold the government to account for what it has earned and spent.
One of the most fundamental issues for any electorate to understand is how the administration it voted for raises taxes and spends public money. The basis on which many people vote is on this very issue. But the Caymanian electorate has not been able to consider the tax and spend record of its governments for two elections and is about to head into a third.
While we know from the budget documents what government says it has collected and how it plans to spend money, the electorate has no idea how accurate those budget predictions really are or,more importantly, how closely each individual entity is following the appropriations. What we do know is that every year since 2008/09 the government has got its predictions wrong because each of those fiscal years has ended very differently from the forecasts made at the start.
For democracy to really work government must be accountable and transparent, otherwise the electorate, as is the case for the voters in Cayman for the last two elections, are engaged in nothingmore than a lottery. This is not democracy. There can be no choice when no one really knows how well ministers have presided over the tax and spend of their relevant departments.
There is no way for any voter to know when he or she goes to the polls next May if the candidates they select are being effective custodians of the public purse and spending money on successful policies or a they are a bunch of idiots that have no clue what they are doing or, worse, a gang of charlatans robbing the people blind.
On Tuesday in a report by CNS Ezzard Miller, the former PAC chair, repeated his call for the prosecution of, or at least some form of legal sanction against, the relevant senior civil servants who have failed to account for spending for the last eight years or failed to implement the systems that would allow them to account for public spending.
At this point there is no way to know who or what is really causing the problem. It could well be the political masters that are blocking the process because of fear of being exposed of being incompetent or worse. It may be senior civil servants who are afraid of their own inadequacies and failures coming to light. It could even be just one or two individuals who have key roles in the process that continue to undermine the attempts to sort out the situation.
But whatever the real cause, the result is untenable for the public. While Swarbrick may be pursuing a carrot approach in his latest report, the public needs a stick. Whether punishment will work or not remains to be seen as it has never been tried, but giving praise where it is certainly not due gives a distorted picture.
The improvements seen by Swarbrick and his office are academic when the man in the street remains ignorant over what the government is doing with his taxes. While praise should be given where it's due, praising someone for not doing their job properly but doing it ever so slightly better than they did several years ago after significant assistance is unlikely to produce the desired result.
Whether Miller is right about the threat of prosecution being able to help is something we are unlikely to find out since, other than the North Side MLA, there is no political will to pursue that route.
In the end, with the systemic failure of government on such a critically important matter, the only thing left is to give up on ever being able to hold the government to account and to stop kidding ourselves we live in a democracy.
In the interests of honesty, perhaps it’s time for Cayman to call it like it is and be the first country to rename its political system to ‘incompetocracy’. At least then, when we go to the polls next year we will all know where we stand.
Category: Viewpoint
The simple fact is the CIG has never taken accounting seriously. Most don't take their jobs seriously. One election to another, one party to another it has been a ongoing joke. Always someone else to blame, the previous government,etc. or some new accounting system no one can understand there is always an excuse to be found by manangement. Therefore no one under them cares either the results of all this have created a hierarchal system which nobody can unravel least of all an Auditor General. This leads one to look upon the CIG as not just incompetent but more so like an extended family. One in whom no one ever gets fired or reprimanded, no one is ever pushed to do their job, and most of all no one is ever held accountable. Because they're "family." As Mr. Duguay stated as long as management isn't held accountable why would they rock this very comfortable boat? flash The boat has hit a reef! Because no one was at the helm.
A centralized accounting and payments system would surely go a long way to forcing transparency and accountability. I presume Government does not have this? In a former life I used to run bankrupt companies for creditors and the first step and in regaining financial control of complex and interrelated companies was to centralise information and authority. Divorcing the front line from being able handle money and its accounts automatically creates a level of review and independence and from my experience resulted in dramatic reductions in wasteful expenditure. Of course, people will kick and scream at having their wings clipped but in an environment where they have clearly demonstrated they are unfit to hold the purse strings a strong central finance function is the only way forwards….it would take a year to implement at most provided of course that the political will is there. Which it isn’t…
Wendy
First of all, congratulations on this viewpoint. It is important to continue to shout from the rooftops on this issue until true accountability is obtained.
I won't criticize my successor as I think that he and my former Office continue to do a great job under almost impossible conditions. I have read his latest report in total and agree that some progress has been made. However, I think it is important to look at the larger picture here.
It is very clear to me that Departments and agencies are making a concerted effort to "get something in on time" However, given the results of the 2010-11 audit, it seems to me to be a matter of optics rather than a real attempt to be accountabile. There are still too many qualifications and adverse opinions. What I attribute this to is the old accounting saying of " BS in and BS out". What Departments in particular are trying to do is "game the system" Their attitude is get something in before the deadline so they say that they are complying with the law. But it doesn't work that way folks. If the AG is given crappy data and no supporting information, he is unable to give an unqualified opinion. That this is still happening after 8 years is unconciousable.
My succesor has tried to remain positive and work within the system. I applaud him for that. I am sure that he came in with the attitude that if only he could be conciliatory as opposed to the "miserable SOB previous AG", he could get better results. It was certainly worth a try but never had a chance to suceed for two simple reasons. First, civil servants, whether in Cayman or anywhere else in the world, try to be less than fully accountabile. We see it in Cayman both in terms of numbers and in FOI requests. This is not unusual.
The second is where I believe we need to focus. In most democracies, civil servants have their "feet held to the fire" by the politicians who ensure that things like proper financial statements get done or else. This is the real problem in Cayman. No politicians want to take the hard stand and ensure that financial statements get done or else. Certainly, we have not seen any political will from the present government. But I believe the problem lies with both parties. Certainly, in the first half of my tenure, the other political party was in power and did try to get civil servants to be more accountable. However, they were ignored and took no action.
So blame the civil servants if you wish but the bottom line is that they will continue to not be accountabile no matter what the AG says. Only the politicans can force them to be accountable and they show no signs of doing so.
Of course, an election in Cayman "soon comes" and I suspect that Mr. Miller will be joined by other politicians and want to be politicians in calling for more accountability. The same happened during the last elections. I pray for Cayman that the results are better this time.
When I was there, I had a simple solution for the lack of accountability which I shared with some politicians. Simply ask the financially impaired Departments how much they are paying for their accounting Departments, including the salary of the CFO, and deduct that amount from their next year's appropriation until they can do their primary job of preparing good financial accounts. No accounts, no money.
I believe in passing out carrots but also believe that sometimes you need a big 2 X $ to get their attention.
Mr. Duguay,
with the greatest of respect, I think the proof is in the pudding with regards to the merits of your track record using 2X4s and Mr. Swarbrick's using carrots.
In my opinion, during your tenure, more focus should have been placed on engaging with the Agencies of Government in a mutual partnership towards a common objective than sitting in your Office writing press releases … a situation which in my opinion led to your professional demise here.
Media houses and the public are going to continue to hold the Civil Service and Civil Servants accountable until they get it perfect and they should, but the truth of the matter is, more progress has been made in the short time Mr. Swarbrick has been at the helm than in your entire career here.
With your 2X4, you never had a single set of annual accounts produced on time for you to Audit since the PMFL came into existence 8 years ago, since the carrot was introduced, annual accounts of an improved quality has been produced for the past two years.
We will get there Sir, and we will get there without your Monday morning quarter backing, it will take time, we will endure the black eyes along the way but we will get there.
You make it sound like climbing Everest or putting a man on the moon!! "We will get there" – for Pete's sake, if you want to do it, you can, and within a single accounting cycle.
Producing a set of accounts is not rocket science – every private sector business of any size manages to do it 4 times a year. This should not be an aspirational goal only to be achieved after years of hard labour. Its accounting, for heavens sake, not building the pyramids. If your accountants cannot handle the bookeeping, fire them and get ones who can. If the people that expend the money cannot keep a record of what they spent it on, same solution. And guess what, if you have Chief Officers willing to preside over this disaster, and not make the tough choices set out above, same solution.
The real problem with Mr Duguay's 2 x4 solution is, as you implicitly accept, not the fact that a threat would not work, but that he was completely powerless to wield it – leaving people like you to dismiss him as a "Monday morning quarterback" – a man who could pass opinions after the event but completely powerless to influence how the game is played. I have news for you. First, Monday morning quarterbacks are not necessarially wrong in their views. Second, if you were a Chief Officer (perhaps you are!) and I told you that I would fire you if your department did not present an auditable set of accounts within 12 months, irrespective of the reasons, and you knew I had the power and the will to do that, I would be remarkably surprised if a set of accounts was not forthcoming.
This state of affairs would be sad if it was a small little corner shop business, but understandable. But we are talking of a government in one of the worlds leading financial centres. You seem to think its acceptable that the CS can spend over $2 billion of the public's money over 4 years and simply shrug their shoulders and say they cannot account for what happened to it. SMH.
Mr anonymouse of 1957
Clearly you have no clue as to what you are talking about and moreover you are very disrespectful to a highly qualified person who has achieved more than you ever will. The very fact that you are anonymouse confirms my opinion of you. For the more intellectual readers of this news blog it is clear that nothing has improved since Mr Duguay’s uncalled for and untimely political departure. So why was a change of AG made in the first place? No one really knows but it does raise a red flag if you understand what I mean. His replacement whilst maintaining a lower profile is frustrated with the same uncompromising idiots maintaining the accounting of Government’s records. In the commercial arena such persons would have been fired long ago. It is ironic that whilst Government tolerates this crap CIMA on the other hand will jump down your throat if something is amiss in you bank or other regulated entity.
Just in case you do not get it : it is ok to you for Government to be remiss in it’s accounts and reporting procedures but not the commercial sector. This is called duel standards, something which you obviously support but probably fail to comprehend.
You will find sir as days pass that the thumbs down to your asinine response will increase daily. Such is life.
dan for premier!!!
i don't expect anything better from cig and the civil service…..
the only thing we know is that caymanians do not have the competence to run their own affairs….
It's a good thing that this is the Cayman Islands.
I think the material I uncovered about Dan Duguay's 2009 audit into Operations Tempura and Cealt should serve as a warning to everyone about just how little respect some senior civil servants in the Cayman Islands have for the Office of the Auditor General (OAG).
The criticism (or more accurately bitching) about that audit coupled with the level of misinformation fed into the process was, to someone with first hand experience of civil service audits in the UK, completely beyond belief and raised serious questions about whether many public servants actually regard themselves as being in any way accountable to the people who pay their wages.
If a public servant spends public money then the public have an absolute right to know where that money went. If the people spending that money (your money) don't produce the proper accounts to show what they did with it then it's not unreasonable to assume they haven't spent it wisely and that's the big problem here.
There is always a tendency (I've seen it in local government and central government) for public servants to ignore the normal economic realities because it's 'not their money'. Doesn't matter if it's paying £10 for basics like toilet rolls or pens when ones costing £2 would do the job or, as happened at my last public sector employer, accepting quotes for building repairs that were three times what those signing the contracts would have accepted if it was their property involved, the safety net is always the auditors. So when staff demonstrate a lack of willingness to cooperate with what is nothing more than a normal part of the job they are being paid to do you can pretty much bet that they are trying to hide something.
Can those asinine retentives who gave this article the thumbs down please advise CNS as to which department of Government they are employed.
I gave it thumbs down for the crass generalisation that underpinned it and the general lack of objectivity in the poster's responses on CNS generally.
So Jumbles, what department do you work in?
I could tell you, but then I would probably have to kill you.
so you work for the financial section?
Nice bit of well-written public sector gobbledygook there.
Bottom line is I bet, whoever and whatever you are, I have spent a lot more time dealing with difficult people in the public sector than you ever will so it's not generalisation or lack of objectivity – it's the voice of experience.
If you think I'm an interfering old XXXXX why not just say it?
Coming from people like you I will always take it as a compliment.
Very true. The role of the government is to take the nation's resources and apply them in the best interests of the country, by providing welfare, healthcare, law enforcement etc.
In the absence of reliable information we have to go on what we see and hear.
And what we see and hear is that the Premier and Deputy are travelling the world first class with their friends and that their ministries are among the worst offenders, the the Premier himself is under 3 police investigations, was caught XXXX taking money from a Las Vegas ATM in the middle of the night, that there have been many duty waivers given out in a non-transparent way, that the public procurement rules are flouted by ministers and lucrative contracts given to private businesses based on mysterious decisions, that there are bank accounts under the unilateral control of the premier where millions in public funds are banked for him to spend without oversight, that the civil service is an inefficient mess, that publicly funded schemes like the Gasboy cards, the Turtle Farm and CINICO are being ripped off on a grand scale, that government departments like housing and the NRA have been caught red-handed acting illegally and in a corrupt way. The list goes on and on and on.
So what conclusions are we meant to draw about how they are managing the country's resources? The only conclusion I can draw is that they are taking them from us to fill their own stomachs and pockets and arrogantly shouting down anyone who dares question them.
Good points well made!
When I see the list of governmental misdeeds listed like that (and many not mentioned) I find myself wondering why the people of Cayman allow it.
I remember asking a co worker why, as a West Bayer, she voted in a man who had, as Director of First Cayman Bank, been closely involved in losing her and many other Caymanians their savings. She was quite clear, he didnt have anything to do with that, he didnt understand stuff like that so he couldnt be responsible. This at a time when the afit Davit of the FCB liquidator to the then Attorney General listed such extraordinary failures was widely circulated in the Island. The conclusion I came to was that her memory extended only to the fridge, or whatever inducement she had received to make her think that this was a good man!
The conclusion I have come to is that the people that work for Government are so short sighted (and numerous) that their thoughts extend only as far as the short term benefits of having access to illicit perks, or for that matter a job at all. So why would they upset the apple cart.
The voters too, carry on voting in this way and thus get the government they deserve! Sad that they cannot, or will not see that this short term thinking is allowing their leaders to get away with this kind of greed.
I really do not understand why we would expect anything else from this UDP Government. Please remember how they fudged the numbers just after they took office in 2009 and came out with their CI$81,000 000 deficit being left by PPM. They lied then and will have to continue lying – unless of course they might want to tell the truth and clear it all up. IF YOU START OUT WITH A LIE- YOU WILL END UP WITH A LIE, ONLY THE TRUTH WILL CHANGE IT!!
You got the Viewpoint titles mixed up.
This one should have been called "Cayman and the 2012 Apocalypse" and Guy Harrison's waste of words should have been called "Accounting for nothing".