Members of Cayman’s opposition political party said last week that a bevy of new fees and charges that were approved as part of the country’s 2009/10 budget didn’t earn anything close to what the ruling administration once had hoped.

In fact, when comparing government revenues for the fiscal year that ended on 30 June to the previous year, opposition members noted that the grand total revenue increase was a little more than $4 million.

According to unaudited figures, the Cayman Islands ended the 2008/09 year with $487.4 million in revenues; it ended 2009/10 with a forecast $491.6 million in revenues.

“In the result, the $94 million of projected revenue didn’t happen,” said George Town MLA Alden McLaughlin.

For an entire year, the government said its package of new and increased revenue measures during the 2009/10 budget would have earned about $126 million. Because of delays in the budget process caused by the May 2009 elections, government expected the new fees to raise somewhere around $94 million for the remainder of the 2009/10 year.

However, since most of those charges didn’t take effect until January, that amount was not taken in. Also, there were some fees initially proposed by government – such as the 10 per cent business premises fee – that were never implemented.

Mr. McLaughlin’s comments came during a political meeting of the opposition People’s Progressive Movement party last week in George Town, during which he fully admitted that government’s major financial problems started on his party’s watch. 

“The first major deficit occurred in the last year of our administration,” Mr. McLaughlin said.

That spending gap – basically the difference between what government earned and what it paid for various services – was at $81 million in June 2009. By last month, the government operating deficit had been reduced to some $45 million, according to budget documents.

That gap shrank mainly due to a reduction in government spending.

Considering the relatively small increase in government revenues, Mr. McLaughlin said he found it surprising the government would choose to increase more fees in the current budget, including planning and development charges and fuel import duties.

“Having had the benefit – if you can call it that – of that particular experience - that increasing fees significantly in relation to one sector of the economy has had the opposite effect intended - they’ve gone and done it again,” Mr. McLaughlin said.

“It is absolutely the wrong approach to increase the cost on those who do business here in the middle of the worst recession the world has seen since the Great Depression of the ’30s.”

During the Legislative Assembly debate on the new government budget and on the 25 cent increase on fuel imports, Premier Bush repeatedly pointed out that opposition members would make similar statements and not propose alternative revenue generation measures.

Mr. Bush has publicly lambasted four opposition lawmakers for voting against his government’s budget for the 2010/11 fiscal year.

“Leadership requires prudence,” Mr. Bush said during his introduction of the amendment to fuel import duties. “We must be prepared to make the tough decisions that are in the country’s interest.”

Mr. Bush said his government had examined many other options and had determined that the fuel import increase was the lesser of many evils.

For instance, Mr. Bush said the projected 5 per cent increase in electricity bills expected to result from the import duty hike would mean roughly $10 extra a month on a $200 Caribbean Utilities Company bill.  That would add up to $120 per year in additional electric fees.

An increase in vehicle registration charges from $160 to $400 annually – as North Side MLA Ezzard Miller had proposed - would cost drivers an extra $240 a year, Mr. Bush said. 

Income taxes of 2 per cent on a $30,000 a year salary would come to $600 a year; while property taxes of 2 per cent on a $200,000 home would lead to yearly payments of $4,000, Mr.