Government Plan: assessments of planned efficiency savings (P.88/2019 as amended) – comments [P.88/2019 Com.]

STATES OF JERSEY

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GOVERNMENT PLAN: ASSESSMENTS OF PLANNED EFFICIENCY SAVINGS (P.88/2019 AS AMENDED) – COMMENTS

Presented to the States on 18th October 2019 by the Chief Minister

STATES GREFFE

2019  P.88 Com.

COMMENTS

Should all of the amendments to P.88/2019 – Government Plan: assessments of planned efficiency savings be adopted by the Assembly, the proposition will read –

THE STATES are asked to decide whether they are of opinion

1. to request the Scrutiny Liaison Committee, throughout the life of the Government Plan, to undertake, commission or oversee detailed  6-monthly  assessments  of  the  planned  efficiency savings,  specifying  the  expected  impact  on  the  ongoing delivery of public services, by Minister, Department and CSP priority, accompanied by a comparable comprehensive review of the real impact of the previous 6 months' efficiencies; and
2. to agree that the Council of Ministers is requested to bring forward  detailed  proposals  each  year,  to  be  included  as  a separate paragraph within the Government Plan proposition, seeking the Assembly's specific endorsement of each of the efficiencies contained in the Government Plan.

The Government Plan is intended to be a strategic document that deals with spending plans at a high level, and as Chief Minister I recognise the legitimate interest of States Members in how efficiencies are likely to affect services and Islanders.

So,  while  it  was  not  possible  to  include  2020  efficiencies  within  the  lodged 2020 Government Plan, this year we have planned to present a detailed efficiency plan over  4 weeks  before  the  debate,  which  also  matches   Deputy  K.F. Morel  of St. Lawrence 's recently approved proposition on this subject (P.90/2019). Beyond this, as  per  our  amendment,  the  efficiency  plan  for  2021  will  be  included  within  the 2021 Government Plan, intended to be lodged in July 2020.  This means that the departments' proposed heads of expenditure in the Government Plan will be after efficiencies are deducted.

However, as with all plans for continuous improvements, changes in how we deliver efficiencies may arise in the period after the lodging of the plan, and over the course of the financial year. For example, the Accountable Officer of a department may identify an  additional course  of action that improves financial efficiency, usually through members of staff proposing innovations and changes in process and systems.

It would seem detrimental to good public services and delivering value for money for the  taxpayer  if  the  Accountable  Officer  could  not  pursue  efficiencies  across  the department's budget, managing expenditure within the maximum limit approved as the head of expenditure (and they could not effectively discharge their own legal obligations to support efficiency if they could not do this).

For that reason, in supporting part (b), it seems helpful to outline how it would be enacted by this government in future Government plans: The intention would be that from the Government Plan 2021–2024 onwards, we will include, as a separate paragraph within the Government Plan proposition, a request to endorse a table containing each proposed  efficiency  required  by  the  plan  to  support  each  departmental  head  of

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expenditure.  It  is  important  to  remember  that  when  the  States  Assembly  gives permission for departments to spend, it is giving them permission to spend up to a maximum. The longstanding requirement on Accountable Officers to use resources economically, efficiently and effectively is intended to promote departments finding ways to go under budget.

If supported, efficiencies will be delivered as proposed in this table endorsed by the Assembly, including any amendments approved by the Assembly. However, in doing so,  Accountable  Officers  would  be  able  during  the  year  to  deliver  additional  or alternative  efficiency  savings.  This  would  be  with  appropriate  governance  and oversight, including ensuring that Ministers are properly informed and have opportunity to provide policy direction which is incorporated into any plans. Any changes and progress  against  plans  will  also  be  reported  6-monthly  to  the  Scrutiny  Liaison Committee, regardless of whether part (a) of the proposition is adopted, delivering high levels  of  transparency  and  accountability.  This  level  of  financial  flexibility  and intelligence is required in any organisation.

This  position  has  been  adopted  following  constructive  engagement  with   Deputy G.P. Southern of St. Helier .

It is also worth noting that the efficiencies contained in the Government Plan 2021– 2024 will already have been reflected in the heads of expenditure put forward for approval  in  another  part  of  the  proposition  as  part  of  a  balanced  budget.  Any amendments put forward to the table of proposed efficiencies, therefore, will need a corresponding amendment to the respective  head of expenditure, another head  of expenditure and/or income.

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