The housing trust has collected none of the CI$376,315 its old tenants owe, its chairman said.

Mark Scotland, chairman of the National Housing Development Trust (NHDT), told the Public Accounts Committee (PAC) on 5 November that "to the best of my knowledge none of that has been collected to date". He was answering Julie Hunter MP, who asked how much of the debt had been recovered or written off since 2023.

The figure comes from the Auditor General's report on affordable housing, published on 31 August 2026. It found that at 31 December 2023 the trust had 18 tenants in arrears in its old affordable housing homes, owing CI$376,315 between them, an average of CI$20,906 each. Hunter asked whether that meant people had lived in the homes all that time without paying rent. "Correct," Scotland said. "So we are actively going to address it."

Full breakdown ordered

Scotland said he had asked the trust's staff to bring the board "a complete breakdown and list of what is outstanding" so it could decide what was still collectible and what had to be written off. "Not much has been done about it up until this point," he said.

The Auditor General's report said the trust spent CI$1.2 million between 2019 and 2024 administering the old homes, many of which had deteriorated and been condemned. It said the level of arrears "raises questions about the effectiveness of the NHDT's management and debt-recovery processes".

The old Affordable Housing Initiative was launched in about 2002 for Caymanians earning less than CI$24,000 a year. The Auditor General first reported on it in 2004, citing poor build quality, cost overruns and delays. The programme later moved to lease-to-own and rental arrangements.

The 5 November hearing was the second day of PAC's examination of the report, titled The Government's approach to improving access to affordable housing. The committee is chaired by Roy McTaggart MP. Scotland, a former government minister, was appointed chairman of the trust in June 2025.

Twice the staff needed

Kenneth Bryan MP asked whether the trust had enough staff to deliver the government's 10-year housing plan. Scotland said an organisational review carried out by Deloitte for the previous board had recommended a complement of 22, "double" the current number.

"There's need for much more resources to carry out the required duties of the trust," he said. He told the committee the trust has an interim general manager and has recently taken on an interim project manager while it fills both posts permanently.

Hunter asked whether the Deloitte review was a public document. Scotland said it was not, as far as he was aware, but he had no objection to the committee receiving a copy.

Subsidy "not sustainable"

Bryan asked whether Scotland agreed with members who had said the day before that subsidising each home by about CI$130,000 was unsustainable.

"Totally agree," Scotland said. "All you have to do is divide the [CI]$8 million by 130,000. That tells you how many houses we can subsidise on an annual basis, which is not anything near to the thousand that's required."

He said the trust has "just over 1,200" people on its waiting list, while the government's housing policy puts the current shortage at 2,000 to 3,000 units, rising to 6,000 to 8,000 in future. "It isn't going to be done with an equity injection from government on an annual basis," he said. "We have to find some other, more sustainable way to fund that."

The Auditor General's report put the waiting list at 1,194 applicants at February 2026, with an average wait of 3.6 years and some waiting more than nine years. It said that between 2019 and 2024 the population grew by 27%, property prices rose by about 57% and average rents by 42%.

Asked by Tatum what a sustainable model might look like, Scotland pointed to Jamaica, where employers and employees pay contributions into a national housing trust and the money can be drawn down to buy or build a home. "It's a very successful model," he said.

What CI$68 million bought

Bryan said that "at a glance" the report showed about CI$68 million spent and 36 homes built, which "looks like you're building each house at [CI]$2 million". He said "we obviously know that's not factual" and invited Scotland to explain where the money went.

Scotland said that, by the numbers he had been given, the trust delivered 49 homes under the Affordable Housing Initiative and two under the Build On Your Own Property programme between 2018 and 2024, a total of 51.

Financial Secretary Kenneth Jefferson told the committee the CI$68 million was "not all construction cost". He said CI$26.5 million of it was stamp duty foregone, construction cost was about CI$37 million and administration about CI$4 million. Government equity injections from 2019 to 2024 totalled about CI$41 million, he said, almost all of it to the NHDT, with CI$1.5 million going to the Sister Islands Affordable Housing Development Corporation.

The Auditor General counted 36 affordable homes delivered by the trust between 2019 and 2024, with a further 50 under construction at the end of 2024, 45 of them in North Side and five in East End. The report also recorded two homes completed under the Build On Your Own Property programme, and none at all by the Sister Islands corporation, which started building four in 2025.

Bryan said any gap between the report and the trust's figures was "due to the lack of information provided" to the auditors at the time. "I do think there's a common place here, which is we're all accepting it's not sustainable at this point," he said.

Homes resold at market value

Roy Tatum MP asked whether the trust had first option to buy back a subsidised home when the owner sells, and at a discounted price. Scotland said the trust holds a first right of refusal, written into a covenant registered on each title, but at market value.

"If you bought the house at [CI]$170,000 and 10 years later you try to sell it for [CI]$300 or [CI]$400,000, and the trust has a first right of refusal, then if we decide to buy it back, the next person comes along, we sell it back to them at 170,000 again," Scotland said.

He said the issue had "only come to my attention within the last week" because the trust has a live case, and that he had asked staff "to look at that covenant, look at the policy and see what we can do to fix that".

Tatum said "there's something wrong with that" if a buyer could sell a CI$180,000 home for CI$400,000 within 10 to 15 years. "I'm also stopping somebody else from the same opportunity," he said. Scotland agreed, and said the trust may need to look instead at whether owners should be allowed to sell at all. He said the government-assisted homes of years ago could not be rented or sold.

Tatum asked for copies of the covenants to be sent to the committee's clerk. Scotland agreed.

Trust not consulted on 2022 working group

Tatum put to Scotland paragraph 74 of the report, which records that the trust told auditors it was "neither consulted nor involved" in the technical working group that Cabinet set up in March 2022 to develop a housing strategy. The report said the omission "may have significantly limited the understanding of housing needs" and that the group's report went to Cabinet in October 2023. He asked what part the trust later played in the 2025 policy and plan.

"I'm not aware of what specifically the involvement was of the trust in the preparation of the plan," Scotland said. He said the trust now sits on the steering and implementation committee for the plan, which has met at least four times and is working through the policy's 98 recommendations. He said the ministry is looking at streamlining planning processes.

Asked whether planning requirements were a hurdle to delivery, Scotland said "yes", and that the trust would offer the ministry suggestions for amendments.

No buyers selected since June

Bryan asked Scotland to answer people who say applicants have "jumped the line" to get a house. Scotland said he could not speak to the selection process before June 2025, and that since then the trust had not selected anyone because the 14 homes now being built in West Bay were replacement houses already assigned.

He said a new credit review committee policy, covering selection criteria and means testing, has been drafted and will go to the board with a finance policy. The committee's first task will be a full review of the selection policy, moving to "a real scoring matrix". A delegation of authority document is to be approved by the end of the year.

The trust is also building a website portal where applicants can apply, see their score and get updates on their place in the queue. Scotland said he hoped it would open early in the new year, and gave the first quarter of 2027 as the timeline for the policy review. "There's not much information coming back out to you at all," he said of the current system. "The trust would acknowledge that's not been a strong point over the years."

Hunter urged him to look at the selection criteria used by the Sister Islands corporation, which she said the committee had heard the day before and was "very well detailed". Scotland said the trust would liaise with the Brac.

On board interference, Scotland said the trust is a company rather than a statutory authority, so its governing document is its charter. He said a board charter and governance policy, drafted under the previous board and approved on 24 September, define the roles of the board and management.

Four contractors on 14 West Bay homes

Asked how the trust chooses contractors, Scotland said the latest round began with an approved business case for 60 homes at Birch Tree Heights in West Bay. The trust tendered 14 of them, with packages offering each contractor a minimum of two homes and a maximum of four, so that large firms would find them unattractive and small and medium contractors would get the work. Four contractors were selected on a scored evaluation, he said, and "there's no subjectivity in that".

He said a new contract document sets six to eight construction stages at which a contractor can apply for payment, replacing an inconsistent system. There is no district-specific contracting, he said.

Old mortgage scheme nearly closed out

Hunter, a former banker, asked about the 325 mortgages the trust still administers under the 2012 Government-Guaranteed Home-Assisted Mortgage programme. Scotland said only one still carried an obligation, because another loan was tied to the same house, and there had been no defaults.

Jefferson said the government's total payout on the 325 guaranteed loans was "in the region of" CI$900,000, and its remaining exposure on the one outstanding loan was about CI$14,500. Scotland said the government is developing a replacement, the HOME programme, through the ministry and the banks, and the trust would administer it.

Scotland said the Build On Your Own Property programme had been paused while the trust tightened its agreements, including placing a lien on the land, because owners sometimes could not get a loan until after the house was finished. Five houses have been handed over and two are awaiting completion, he said, and the programme will restart early next year. The last lease-to-own homes were completed in Windsor Park in about 2014.

Development bank's bad loans

Bryan asked whether the Cayman Islands Development Bank should be used ahead of commercial banks, given past reluctance to enforce government loans. Scotland, who said he chaired the bank until earlier this year, said it is regulated by the Cayman Islands Monetary Authority and must enforce repayment. When he left, he said, bad loans had fallen "from somewhere around 35% to around 10%".

McTaggart closed the session by thanking Scotland for "the candid way in which you responded", and said it was for him "one of the most useful" sessions the committee had held.

The committee has asked for the Deloitte organisational review and the title covenants. Scotland said the credit review, finance and delegation of authority policies would be in place by the end of 2026.