Editorial
Time to Live Well Within OurMeans
The government has declared its intentionto promote proper fiscal mangement and has spoken of the needfor an efficient, yet cost-effective delivery of service to thepublic.
It will not be an easy task, given that for too long, tight managementof the country's finances has not always been approached as diligentlyas it should be.
Nor is it to be expected that the governmnet will achieve itsgoal overnight.
The new administration inherits a budget shortfall of some $7.8million for the current fiscal year; there are capital projectsstill to be completed and the Leader of Government Business, whoalso has the portfolio for Planning , has promised that therewill be no curtailment of such projects.
It is easy to imagine that government will have to be creativeand thorough in its approach to achieving fiscal responsibility.Cost-saving measures will need to be accompanied by attitudinalchanges all around -- in paricular the Civil Service - and a commitmenton the part of everyone to this exercise.
The Civil Service may well look to a private sector approach -with the eye on the bottomline -- when they are in charge of deliveringthe products and services that are part of government's responsibilityto the public. This must start with the basics - from the prudentuse of telephones, energy, stationery, government vehicles andeverything else which will reduce the cost of operations.
By keeping a tight rein on its own spending, government, overtime, will find that it can reducethe frequency and level of raisingrevenue, or introducing new tax measures on consumers and thosewilling to continue using the Cayman Islands as user-friendlytax planning jurisdiction.
What this could also mean is that the government could very wellset the agenda for the entire community, including the privatesector decison makers, who themselves have had to face highercosts because of a less than efficient provision on some governmentservices, including the process of acquiring work permits.
A call for belt-tightening is never a popular move, nor is itusually well received. At a time like this, it comes with thesobering reminder that the public debt, which stood at over $80million at the end of 1999, will continue to grow, unless consciousand diligent efforts are made to reduce it and lower the rateat which it grows.
Achieving tighter fiscal control will not be solely about costcutting, though that may be necessary in some cases. It will alsoinvolve monitoring of expenditure to ensure that government andthe country gets the best value for money from suppliers of goodsand services. It must include close scrutiny of public works projectsto ascertain that those who are awarded contracts perform withthe budget and according to delivery times agreed and that overrunsare limited.
In its quest to achieve better fiscal management, government mustalso look to local providers of goods and services, who may beable to provide as good a deal as overseas suppliers, who, byvirtue of their home base can provide the kind of one on one servicethat may not otherwise be possible.
It is incumbent on this government, unlike previous administrations,to gain the confidence and cooperation of the private sector byleading the way for accountability and efficient use of the country'sfinancial resources.