Tuesday, July 23, 2024
spot_img
HomeLatest ArticlesCayman Islands Q2 2023 financial report gazetted

Cayman Islands Q2 2023 financial report gazetted

By Christina Trumbach

GEORGE TOWN, Cayman Islands – The Cayman Islands Government’s quarterly financial report for the six-month period ended 30 June 2023 was published in the Cayman Islands Gazette on Thursday, 10 August as required by law.

The unaudited financial results for the Second Quarter 2023 show a $165.9 million surplus for the Core Government and a $166.2 million surplus for the Entire Public Sector (EPS).

Net assets of the government were $2.2 billion, with overall bank account balances of $398.2 million in cash and deposits.

Surplus 

The overall EPS Surplus of $166.2 million was $22.7 million higher than the 2023 budget anticipated for the period, a positive variance of 15.8 percent.

This favourable position was due to actual revenues being higher than budgeted revenues by $27.4 million for the period.

Additionally, Statutory Authorities and Government Companies (SAGCs) contributed $0.3 million to the overall surplus for the EPS; exceeding their estimated results for the first half of 2023 by $9.8 million, when compared to an expected deficit of $9.5 million.

Comparing year-on-year numbers, the EPS Surplus was $20.5 million higher than that achieved for the same period in 2022 with SAGC second quarter results being $13.6 million higher than the prior year.

Revenues

Compared to the same period in the prior year, total revenues of Core government have increased by $19.5 million, largely due to increases in various categories of coercive revenues.

The first six months of 2023 generated coercive revenues of $621.2 million, which was $14.1 million more than budgeted expectations and $7.1 million higher than the 2022 year-to-date actual results.

The positive variance in 2023 coercive revenues compared to the budget was mainly due to:

  • Motor Vehicle Charges surpassed the expected budget by $5.3 million due to a higher-than-expected volume of vehicles being imported. When compared to the same period in the prior year these fees are on par.
  • Mutual Fund administrators’ fees and private fund fees performing better than anticipated by $3.2 million and $2.8 million respectively due to an increase in the volume of funds registered. Current year results for these fees are $0.3 million lower and $1.0 million higher, respectively, when compared to actual results for the prior year-to-date performance.
  • Tourism Accommodation charges came in at $12.4 million higher than budget expectations due to the increase in stay-over tourism following the reopening of the borders in 2022 amounting to 84% of pre-pandemic numbers. When compared to the 2022 results, the 2023 revenues from Tourism Accommodation charges are $19.6 million more.
  • Work Permit Fees collected amounting to $9.1 million more than anticipated due to continued increased demand for workers following the reopening of the borders and continued economic growth. Revenues in this area increased by $3.2 million over the same period in 2022.

Notwithstanding the overall favourable results in revenues collected, when compared to the 2023 budget, there were certain areas that fell short of projected expectations.

These included other import duty with a negative variance of $8.3 million and other company fees – exempt companies with a shortfall of $7.7 million. However, when compared to the 2022 year-to-date results, other import duties earned $6.6 million more in 2023; while other company fees–exempt companies earned $5.4 million less than in 2022.

Expenses

Expenses for the first six months of 2023 amounted to $490.2 million, which was $14.5 million higher than budgeted. Additionally, total expenses of Core government have risen by $12.6 million when compared to the same period in 2022.

Costs relating to personnel for the first six months of 2023 amounted to $216.0 million, which came in at $13.5 million lower than budgeted. This favourable variance is the result of vacant posts across several ministries, portfolios and offices. However, 2023 personnel costs are higher than the same period in 2022 by $17.4 million due to a cost-of-living adjustment awarded in September 2022 and a salary increment awarded in December 2022.

The savings against budget in staff costs were offset by higher-than-budgeted levels of expenditure in Outputs from SAGCs by $5.9 million, outputs from non-governmental suppliers by $20.7 million, and transfer payments by $5.4 million.

Payments to the SAGCs Cayman Islands National Insurance Company (CINICO) and the Health Services Authority (HSA) exceeded their year-to-date budgets by $2.5 million and $4.4 million, respectively. The variance with respect to CINICO is due to higher-than-expected actual costs for the Health Insurance for Civil Service Pensioners. The adverse variance with respect to the HSA is due to actual costs for the care of indigents exceeding the budget by $6.6 million.

When compared to the prior year-to-date actuals, these costs are $3.3 million higher – mostly related to increased funding paid to CINICO and the HSA in 2023 when compared to 2022.

The increase in payments to non-governmental suppliers is mainly due to expenditure on “NGS 55 Tertiary Care at Local and Overseas Institutions” being $21.3 million more than its year-to-date budget ($10.8 million). The costs for NGS 55 are currently $32.2 million and exceed prior year-to-date spending by $7.8 million. Thus far in the 2023 financial year, parliament has approved, via section 11(5) of the Public Management and Finance Act, an additional $9.0 million for NGS 55.

Transfer payments of $31.9 million were $5.4 million more than budgeted for the six-month period. This variance is mainly due to the overages in spending on scholarships and bursaries by $4.9 million and financial assistance by $2.4 million.

Cash position

Operating cash and deposits were $222.9 million and reserves and restricted deposits were $175.3 million, for a total cash and deposits balance of $398.2 million.

Forecast

In conclusion, the report noted the second quarter’s performance has positioned the government to be optimistic about its overall performance for 2023.

However, the report signalled increased costs as more personnel vacancies are filled and further capital projects come online over the remaining two quarters of 2023. The report advised that these costs would have to be diligently monitored to ensure unnecessary spending is not incurred.

The half-year report also highlighted that core government revenues must exceed the performance of $978.1 million set-out in the original 2023 budget in order to reach the revised target of $1.037 billion detailed in the Strategic Policy Statement tabled in parliament on 26 April, 2023.

The Cayman Islands Government’s Unaudited Quarterly Financial Report for the six-month period ended 30 June 2023 may be found here.

spot_img
RELATED ARTICLES

LEAVE A REPLY

Please enter your comment!
Please enter your name here

spot_img
spot_img
spot_img

Caribbean News

St Lucia announces new law for Piton Management Area

By Caribbean News Global contributor SOUFRIERE, St Lucia - The government of Saint Lucia has demonstrated its commitment to maintaining the Outstanding Universal Value of...

Global News

D-Link unveils the G530 5G NR AX3000 Wi-Fi 6 Router

TAIPEI, Taiwan - D-Link Corporation (TWSE Code: 2332), a global leader in networking solutions, proudly announces the launch of its cutting-edge G530 5G NR AX3000...