Among the reams of financial statements, projections, revenues and expenditures, the most important number in the Cayman Islands government budget is this: $10.29 million.
That’s the amount of this year’s taxpayer subsidy to the Cayman Turtle Farm. Until that number is effaced from the government’s books, our political leaders cannot lay serious claim to the mantle of fiscal responsibility.
Let’s put the $10.29 million in context.
It’s more than Cabinet expects to spend this year on the University College of the Cayman Islands, the International College of the Cayman Islands, the CAYS Foundation, the Drug Council, the Elite Athletes Programme, the National Cultural Foundation, the National Gallery and the National Museum – COMBINED!
• The $10.29 million subsidy to the Turtle Farm translates roughly to $11,000 for each of 931 turtles harvested for meat in 2012.
• With the $10.29 million subsidy, the actual cost of harvested turtle is in the region of $140 per pound. (The Turtle Farm recently reduced its selling prices to $19 per pound for turtle steak and $9 per pound for turtle stew meat.)
• Including the $10.29 million subsidy for the 2013/14 budget year, the government will have spent nearly $57 million on Turtle Farm life support over the last six years. That number is in addition to the approximately $60 million it cost to build and expand the facility from 2001 to 2005.
• If part of the rationale to keep the Turtle Farm operating is to provide jobs for 80 to 100 employees (most of them Caymanians), it is worth pointing out that it would have been far less expensive simply to give each of them $1 million – and skip this whole exorbitant exercise.
Here’s what former Auditor General Dan Duguay had to say in a scathing 2007 report on the government’s securing a US$44.6 million loan to build the facility. It was, he said in a word, “appalling.”
That “wanton disregard to the use of their funds” has set the bar for Turtle Farm spending ever since.
And the problems extend far beyond the ledger sheets. The international outcry over the Turtle Farm’s very existence from animal rights activists is getting louder and more widespread (even drawing the condemnation of former Beatle Paul McCartney).
The Turtle Farm clearly doesn’t make sense economically, and it most likely doesn’t make sense ecologically. No rational private sector investor is ever likely to acquire such a debt-ridden, money-losing entity — at least not on any terms government appears willing to entertain.
In business, the Turtle Farm’s losses are called “sunk costs.” They’re never coming back, and if the government does nothing, they will continue to contribute to Cayman’s inability to fund properly our universities and pave our roads.
The remedy is to shut down the Turtle Farm and sell off the property to repay a portion of the $31 million that remains on the original construction loan.
If the government is not prepared to deal with the Turtle Farm, its rhetoric regarding privatization, austerity and commitment to cost cutting have no credibility whatsoever.