January 31, 2023

Cayman Islands Planning Ministry unveils plans to reduce Postal Service subsidy

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Screen Shot 2016-06-08 at 4.28.04 PMStrategic assessment paves way for Business Case Development to drive future change

Grand Cayman, Cayman Islands (8 June , 2016) Options to improve the commercial viability of the Cayman Islands Postal Service and reduce its future reliance on Government subsidies have been unveiled by the Ministry of Planning Lands, Agriculture, Housing & Infrastructure (PLAHI), as part of the Government’s Project Future Programme.

The review has resulted in the publication today of a Strategic Assessment, which analyses a wide range of options for change, to deliver on Project Future’s aims to achieve better outcomes and encourage public service innovation.

The key test for options is their ability to reduce the Government subsidy which has been increasing in recent years and is required to maintain postal services as its revenues fall. For the fiscal year 2015/16 the subsidy stands at $1.65M (even with revenue projections of $3.24M). The Assessment recognises that in order to reduce future subsidies the Service needs to combine productivity improvements, process efficiencies and cost reductions with measures that will reverse the fall in revenues.

In addition, the Assessment identifies two other objectives for the project, which are:
1. To enhance the customer experience
2. To establish a more commercial culture as the basis for driving future change

Two options for change are identified in the Strategic Assessment to go forward for more detailed testing through the development of an Outline Business Case. That Business Case will identify a preferred option for implementation.

The first option involves a significant upfront investment in technology to develop a modern infrastructure for the Postal Service and its capacity to explore and develop new markets. The initial analysis in the Assessment concludes this option has the potential to reverse the current trend of increasing Government subsidies.

The second option requires much less investment and potentially carries less risk, but is only likely to impact the timeframe over which the subsidy grows, rather than reduce it.

The potential for working with a commercial partner in the delivery of the changes required will also be explored during the development of the project.

Hon. Kurt Tibbetts, Minister Planning Lands, Agriculture, Housing & Infrastructure (PLAHI) welcomed the Strategic Assessment saying “This project is potentially very significant not just for the Government but for all the people and businesses on our Islands who rely on the Cayman Islands Postal Service.”

“I am delighted that the Ministry has been able to identify realistic options for maintaining and even enhancing the services offered by the Postal Service while tackling the problem of the increasing need to rely on Government subsidies”, he added.

The Strategic Assessment has been signed off by Cabinet and the short-listed options for change will now be tested in more detail through the creation of an Outline Business Case which will establish the preferred option for implementation. The Outline Business Case is due to be completed by August

The Ministry’s Chief Officer, Alan Jones, acknowledged the hard work of the staff who had worked on the Strategic Assessment, as well as the policy officers in his Ministry, who provided oversight and support. “Project Future has introduced a new way of working for many staff. It has indeed been challenging, but we are using the strategic assessment and business case process as a tool to challenge our thinking and to really evaluate the quality and efficiency of our work. This process has enabled my team to evaluate all of the options”, Mr. Jones explained.

The Strategic Assessment is available for public viewing on www.plahi.gov.ky.

1. The Cayman Islands Postal Service is the government department designated as the postal operator responsible for fulfilling the CIG’s obligations arising from adherence to the Universal Postal Union Convention in the Cayman Islands.
As the designated postal operator, the Postal Service is charged with ensuring
that postal services are accessible on a national level to all residents and visitors. Against this mandate, the Postal Service provides a domestic and international letter mail, parcel and courier services across all 3 islands, via 15 post offices.

2. Project Future is the 5 year programme of public sector reform launched by the
Premier and Deputy Governor in November 2015. An update on the Programme overall is available here: www.projectfuturecayman.com

3. The full Strategic Assessment for the project can be found here:
http://www.plahi.gov.ky and https://projectfuturecayman.com/

4. Project Future is utilising a best practice approach to managing what is a wide- ranging and complex programme of change. Strategic Assessments, the first stage in that process, establish the objectives for the project, identify the case for change and test a long list of options in order to create a short list to progress on to more detailed analysis in an Outline Business Case.

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