The cost of Government’s response to COVID-19 is at least $47 million

The report “Overview of the Government’s costs in relation to COVID-19” was issued today by the Office of the Auditor General (OAG).

The public interest report provides a factual summary of the Government’s response to the COVID-19 pandemic and a position statement of costs incurred to 19 June 2020 and the estimated costs of commitments made at the same date.

“COVID-19 has been a major world-wide pandemic which arrived in the Cayman Islands in early March. From mid-March the Government started to take a number of actions to suppress the spread of the disease.” says Ms. Winspear. “We estimate that the total cost of COVID-related activities will be at least $46.7 million.”

The report highlights that to 19 June the Government had spent $21.5 million on COVID-related activities. “By 19 June, when the Government announced that the country was moving to suppression leave 2, over $21.5 million had been spent on COVID-related activities.” The Auditor General adds “Not surprisingly, the largest area of spending at that time was on healthcare. Over $12.5 million had been spent on test kits, PPE and other medical supplies and equipment and the cost of carrying out tests.”

The report states that Government commitments made as at 19 June could cost more than $25 million. Ms. Winspear says “The Government has made a number of commitments in relation to COVID-19, particularly in relation to providing assistance to individuals suffering financial hardship and supporting businesses to help bolster the economy. These commitments could cost a further $25 million at least.”

The report summarises spending across seven categories of activity, including healthcare, quarantine and social distancing, social assistance to individuals, support for business, education, public sector personnel and other costs. The report states that $14.2 million is expected to be spent on healthcare and $15.7 million spent on supporting business.

“I along with the rest of the citizens of the Cayman Islands welcome the actions taken by the Government to suppress the spread of the disease. There is no doubt that the Government have succeeded in their number one priority of preserving life during the pandemic” Says the Auditor General, “However, these actions also have a financial cost. I will continue to monitor the expenditure and report further on this later in the year.”

More information about the report can be obtained by contacting Sue Winspear at (345) 244-3201 or Angela Cullen, Deputy Auditor General (Performance Audit) at (345) 244-3220.

1. Public Interest Reports address issues that have been identified during an audit or which a report has been requested during the year. They are used when there is a matter of public interest that should be reported to the Legislative Assembly but where a full audit is not necessarily required. Unlike performance or financial audit, public interest reports do not seek to provide an opinion or recommendations.
2. In May 2020, the PAC asked the Office of the Auditor General (OAG) to prepare a report on the costs of COVID-19. This Public Interest Report is in response to that request.
3. The figures in the Public Interest Report have not been audited, that is, they have not been verified whether they are valid COVID-19 expenditure or whether the monies have been disbursed in line with relevant policies and procedures or agreed criteria. The OAG obtained supporting evidence, such as invoices for some of the larger sums of expenditure, and Cabinet papers approving budgets for commitments.
4. The OAG used information provided by the Ministry of Finance and Economic Development, Health Services Authority and Cayman Islands Airport Authority. The OAG categorised the financial information received into the flowing seven categories of activity:
   1. Healthcare
   2. Quarantine and social distancing
   3. Social assistance to individuals
   4. Support for business
   5. Education
   6. Public sector personnel costs; and
   7. Other costs.
5. In June 2020 the OAG published its COVID-19 response plan “COVID-19: What it means for Public Audit in the Cayman Islands”. In this plan the OAG also set out its intention to prepare a summary of the Government’s spend, commitments and programmes relating to COVID-19, which will be incorporated into our upcoming report on Long-Term Financial Sustainability. The second report will validate expenditure as well as provide a summary of foregone revenues as a result of COVID-19.