Previously flagged by the Board of Directors and the Office of the Auditor General for excessive costs, the entity established to regulate Cayman’s utilities says it had managed to reduce those costs and was on the right path to “efficient spending”.
In a press release sent out by OfReg’s CEO Malike Cummings (who has held this position since late last year), it said that OfReg faced significant challenges when it first began operations three years ago because of a lack of a change management plan, the effects of which still impacted OfReg today.
OfReg (the Utility Regulation and Competition Office) is an independent regulatory authority which began operations on 16 January 2017, an amalgamation of the former Information and Communications Technology Authority (ICTA), the Electricity Regulatory Authority (ERA) and the Petroleum Inspectorate (previously a Government department).
Even though OfReg has been operating for three years, Mr Cummings said that it was still young and needed time to “build and mature to fully satisfy its regulatory remit and inculcate core values and established positive culture”.
Despite past challenges, Mr Cummings said OfReg had been able to curb excess costs, especially in areas such as the use of consultants - an area flagged for excessive spending by the Board of Directors and the Office of the Auditor General. As a result, its spending on consultants in 2019 was 600 per cent lower than these costs in 2017. Overseas travel, training and development costs in 2019 were 500 percent lower than that of 2017, the release said.
Mr Cummings confirmed: “My focus as CEO from the inception was to address the concerns regarding value-for-money spending and accountability, and I am comfortable that the necessary measures are now in place, with the dedicated support of the Board and commitment of the team.”
Recently adopted policies that have helped cut costs include strict adherence to the procurement policy in the use of consultants, overseas travel, training and development, employment and recruitment, use of mobile phones, Government’s anti-fraud regime, and to ensure value-for-money, the release stated.
The Board was also considering a new HR manual to guide and govern behaviour and ensure accountability. It also commissioned the Risk and Audit Committee in late 2019, which will act as an internal auditor and will oversee the establishment of a risk management framework for the Office. Mr Cummings said they had also employed a Financial Controller who had “significantly improved OfReg’s financial accounting and reporting”.
Mr Cummings explained that OfReg had an obligation to protect the short and long-term interests of consumers in relation to utility services and had developed or implemented several regulations to ensure the regulatory framework remained relevant. One important advancement in this area was the creation of Consumer Protection Regulations for all sectors, which the Office took very seriously, he said. Work on protecting critical national infrastructure continued, as well as cyber security, working towards supporting the requirements of the National Energy Policy and renewable energy targets, finalising the regulatory framework for the water sector, Fuel Market definition and Assessment and improved public and stakeholder engagement, to name a few aspects of the work that OfReg was undertaking.
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