(CNS): The Cayman Islands Government has agreed to look at increasing the ex gratia pension paid to retired civil servants, though Social Development Minister André Ebanks warned that this might be very difficult, given the budget constraints caused by the recent increase in long-term financial assistance payments. These stipends were recently increased from CI$950 to CI$1,250, but the opposition has called for them to be increased further because of the cost of living crisis.

Speaking in parliament last month, Ebanks explained that many of those on long-term help receive additional benefits on top of the regular monthly payment. The Needs Assessment Unit currently has 1,162 clients as well as 898 seafarers and 43 veterans who all receive long-term benefits — 2,103 in total at the last count.

Responding to a private member’s motion brought by Sir Alden McLaughlin (RED), Ebanks said that if the increase was implemented as requested for these people, it would add CI$6.3 million to the existing budget on top of the recent increase in the payments. However, he also noted that people who are still struggling can get additional benefits.

The minister said that these were the “realities that we have to grapple with” at the Department of Children and Family Services and at the NAU, as he described some of the difficult judgment calls that had to be made.

In some cases, the need is not just a result of inflation but of very complex social situations, Ebanks said. Some elderly people are not being treated well by their relatives, who are manipulating them and getting access to their funding and using it for vacations, he explained. In some cases, very elderly seafarers have much younger spouses who were not working and living off their partner’s benefits even though they are more than able to work, and some people receiving the payments have significant savings, he noted.

Around one-third of those getting financial help are not disabled, elderly or veterans but are unemployed or outside the workforce. Ebanks said the government is working to reduce the size of this group and get them into work. If they help those who are able to work get over common barriers, such as child care or transportation problems, the money that would be paid to them can be redirected to the elderly and disabled, he explained.

Ebanks said a pilot programme with six single mothers had been a great success; with the support provided, at least four of them had found, and were still in, well-paid work. He said his ministry was trying to budget more programmes like that to get people into work and find private sector partners willing to give people placement and training while the government pays them.

Ebanks added that he wanted the government to be the last resort for people in need. It was better to use public money to get people into work, so that would need to be budgeted for in the government’s spending plan for 2024/25, as well as the actual payments.

Another issue was the requirement for transitional housing for those who have nothing and who are homeless. Ebanks noted that this was a growing problem, and helping those people would also “need some budget behind it”.

“I am not advocating… that we should not try to find the uplift for civil servants… and not saying we shouldn’t consider $1,500” for other indigents, he said, but if it can’t get that high, money will still be in the budget to get more people in need into work.

Once the financial assistance legislation is in place, he said, the ministry needed to motivate people to do something of value for the community in exchange for the money they reveive from the government and transition into the formal economy.

He said raising long-term financial assistance outside the context of the plans for social development might not be the best use of resources because there were factors at play beyond the cost of living, he said.

Premier Wayne Panton said that, that given the situation over the last two years, it was not surprising that MPs want to assist, but the priority was to give to those who were elderly and vulnerable. However, he confirmed that the government planned to give former public servants the increase by the start of next year.

McLaughlin noted that since 2021, the cost of living had increased by more than 25%. He welcomed the government’s broad support to help those in need but said the heart of the issue was the amount the elderly and vulnerable were getting. The former premier, who has previously held the social affairs ministry, also warned about the CIG’s growing future obligations regarding those in need.

“The issue, pure and simple when you boil it down, is this: can anyone in this country be expected to live decently on $1,250 a month? That’s the question,” he said. “We have massive challenges I have talked about for years… There is a whole new generation of people for whom, even if they are working now and making pension contributions, the pension they are going to get at the end is going to be inadequate to look after them.”

He said those retirees would also be faced with health insurance premiums that they cannot afford. “Those two areas, pensions and health cover, have got to be grappled with,” he added and warned that the number of people in need now was small compared to what was going to happen in another ten years.

“For the younger members of this House who have the ambition of remaining here in the longer term, they will have massive, massive problems to grapple with. So we might as well, when we have a billion dollar budget… start thinking about priorities.”

He asked what MPs are doing everything else for if the average person cannot even feed themselves, and said they had to do everything they could to help those who need help. “This we have to do,” he added.

During the course of the debate, Tourism Minister Kenneth Bryan (GTC) pointed to the increasing population, which is growing because of immigration and the constant creation of new Caymanians. He said the system wasn’t working, which was why he had put up the billboards calling for immigration reform, and all the MPs were well aware that the people want the growth to slow down.

Bryan noted that Cayman’s economy and government revenue was largely based on consumption. If Cayman stops developing, duties and fees would decrease and there would be no money for helping the elderly in the future, Bryan said, as he described the well-known conundrum and the vicious circle of a consumption-based economy fuelling unsustainable growth that the local population doesn’t want.

See the session of parliament on CIGTV below:

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