Funded via the government’s For Cayman Investment Alliance agreement with the Dart Group, the $2.05 million “Save the Mortgage” programme and $690,000 “Home Repairs Assistance” programme could direct money to some 200 or more Caymanians and residents. Early on in the life of the mortgage loan programme, the Cayman Islands Auditor General expressed concerns about the design and legality of the initiative, particularly for the formation and direction of the governing committee by Bush, who is the minister responsible for Finance, Tourism and Development. Meanwhile, the chair of the committee responsible for the home repairs grant programme has said the Office of the Premier will have the final say on who receives how much money. 

On the flip side, the Attorney General’s Chambers issued a legal opinion indicating that the mortgage programme passes muster under the constitution and other laws; and, regarding the home repairs programme, Bush responded that the appointed committee will decide how the grant money is distributed. 

Save the Mortgage 

The last of the government’s cheques for the mortgage programme were dated 13 July, with interest-free loans given to 134 Caymanians. Of the 189 people who applied for the loans, 32 of them did not fall behind on their mortgage payments until after the premier’s announcement of the programme on 13 December, 2011. Of those late applicants, 14 were approved for loans totalling $190,000. 

For the entire programme, loan amounts ranged from $4,044 to $20,000, with repayment periods of five to 50 years and monthly payments between $11.44 to $177.58. 

According to records provided in response to a Freedom of Information request, the Auditor General’s Office raised questions about the programme in mid-February. In an e-mail sent 20 February to government officials, Audit Principal Martin Ruben said, “I noted that the Mortgage Assistance programme will be used as a case study for the upcoming governance audit and that we would like to have it as an opportunity to discuss good practices.” 

Ruben’s criticisms of the programme include “unclear policy direction from the political level”, “unclear objectives”, “seriously flawed” programme controls, and a lack of a formal reporting process to determine if the programme was successful. 

He warned, “there is currently an extreme risk that there would be abuse and mismanagement in its operations should it proceed in its current form.” 

Ruben’s February e-mail outlines a preliminary set of criteria that the Auditor General’s Office would use if it came back to conduct an audit once the programme was under way. 

In response to a records request submitted in late June, the ministry provided a “Save the Mortgage Programme” Governance and Control Framework, the stated purpose of which is to address the criteria stated by Ruben in February. 

One of Ruben’s primary concerns in his February e-mail was that Bush was directing the programme, and that Bush had “already met with the four member committee he appointed” in order to give them verbal directions on what his expectations are. 

Ruben said, “It is inappropriate in any acceptable governance framework for a politician to design and direct a government programme. This management framework gives the appearance that the programme may be open to abuse and mismanagement.” 

On 7 May, Ruben sent another e-mail to the ministry raising “some very significant concerns we have that the governance framework as outlined in the constitution, the [Public Management and Finance Law] and the [Public Service Management Law] has not been respected and that the real or perceived risk of mismanagement and abuse relating to the expenditure of public funds is still at a critical level from an audit perspective”. 

Ruben said, in the opinion of the Auditor General’s Office, that the laws require the chief officer (in this case Sonia McLaughlin, the ministry’s chief officer for Public Finance, who was on the committee) to direct the programme, rather than the premier. He said in their opinion the laws “clearly outline the requirement for ministers and politicians to not have any roles or responsibilities in the administrative activities of government”. 

Ruben advised the ministry to obtain a legal opinion from the attorney general before distributing the programme funds. 

In a legal opinion dated 31 May, the Attorney General’s Chambers gave its blessing to the programme: “Having reviewed the [Auditor General’s Office’s] comments and the materials and instructions presented to us by the ministry, we were unable to substantiate the [Office’s] concerns regarding any lack or potential lack of compliance with the governance/legal framework outlined in the constitution, PMFL and PSML that could lead to any real or perceived opportunities for abuse, mismanagement and conflict of interest with regard to the [Save the Mortgage Programme].” 

Home Repairs Assistance 

The premier also has an integral role in the $690,000 Home Repairs Assistance programme aimed at helping residents fix their homes. 

In July, committee chair Joanna Welcome-Martinez said, “The committee is carrying out an advisory role, and final decisions are made by the Office of the Premier whether to go ahead and follow the advice given by the committee in regard to the requests that were received.” 

Under the programme, Caymanians could apply for grants of up to $10,000 to conduct repair work on their homes, with emphasis on rectifying structural, health or safety issues, and on situations involving the elderly or children.  

Applicants who already received mortgage assistance loans are not eligible for home repair grants “unless there are extenuating circumstances”, according to the Office of the Premier. Applicants seeking home repair grants of more than $10,000 “should present evidence of the uniqueness or severity of their case”. 

Unlike the mortgage programme, the home repairs programme does not have an explicit requirement that applicants have Caymanian status. 

Following Welcome-Martinez’s comments, the premier stated publicly that the committee, not he or his office, will determine which grant applications are ultimately successful. 

“I am not on the committee. When the application is turned in, it’s turned in to a committee, and that committee will decide on the application. I don’t have anything to do with it as premier,” Bush said. 

Bush said he has confidence in the “very extensive terms of reference” by which the committee will consider applications, and he highlighted the backgrounds of committee members, who come from the civil service and the private sector. 

“That’s what we should have on our committees,” Bush said. 

Applicants must show the property requiring repair is at least five years old, is their sole residence and is owned by them. The programme’s application form asks for address details, ownership details, information about the repairs or renovations needed, and if the nature of the problem is related to health, safety or structural concerns.  

Committee members will conduct site inspections.  

Applicants also must include a contractor/builder estimate for the repair work required, and agree to sign a contract with builder/contractor for the work if approved for a grant.