States Assembly | R-19-2019

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STATES OF JERSEY

FINANCE LAW DELEGATION REPORT FOR THE 12 MONTH PERIOD TO

31ST DECEMBER 2018

Presented to the States on 1st March 2019 by the Minister for Treasury and Resources

STATES GREFFE

2019 R.19

REPORT

The administration of the public finances of Jersey

In accordance with the Public Finances (Jersey) Law 2005 ("the 2005 Law") (including Regulations approved under that Law and Financial Directions), certain matters relating to budgeting and to the financial control and administration of States' Trading Operations are required to be reported to the States twice-yearly by the Minister for Treasury and Resources ("the Minister").

This report summarises all decisions made during the 12 month period to 31st December 2018. Where decisions have not previously been published, this is due to one of 2 reasons –

The decisions were exempted under the Freedom of Information (Jersey) Law 2011; or
The decisions were taken by the Treasurer of the States under delegated authority from the Minister.

Reporting on decisions

The areas of administration which are to be reported on are as follows –

Borrowing and lending;
Budget transfers; and
Carry-forward of revenue balances.

Borrowing and lending

Jersey Student Loan Scheme

During the 12 month period to 31st December 2018, 24 new loans, with a collective value of £33,553.10, were guaranteed by the States under the Jersey Student Loan Scheme.

P.53/2007 – Student Loans for higher education – guarantees was debated by the States Assembly on 6th June 2007, and a maximum outstanding limit of £10 million for an unlimited time period was approved.

Infrastructure investments

During the 12 month period to 31st December 2018, the Parish of St. Martin infrastructure investment of the Housing Development Fund was approved. An initial amount of £1,167,700 was drawn down on 30th August, and an additional £25,000 in November.

Housing Development Fund

During the 12 month period to 31st December 2018, 3 new loans were approved by the Minister for Treasury and Resources –

to Andium Homes Ltd. – Loan 14, with a gross value of £52,277,607, was entered into on 30th March;
to Les Vaux Housing Association – Loan 15, with a gross value of £1,250,000, was entered into on 18th March; and

to Andium Homes Ltd. – Loan 16, with a gross value of £5,081,000, was entered into on 30th August.

The net value of loans outstanding from Andium increased from £102,900,000 at the end of 2017 to £139,709,856 at 31st December 2018.

Budget transfers

Articles 17 and 18 of the 2005 Law permit contingency expenditure and variations between heads of expenditure with the approval of the Minister.

Budget transfers under Articles 17 and 18 of the 2005 Law are reported on the following basis –

transfers from contingency expenditure to heads of expenditure
transfers between revenue heads of expenditure
transfers between capital heads of expenditure
transfers between revenue and capital heads of expenditure
transfers between revenue and capital heads of expenditure where the transfer is required in order to comply with accounting standards.

All transfers between departments vary the budgets of individual departments, but are net nil in total.

Transfers between contingency expenditure and heads of expenditure

Transfers between contingency expenditure and heads of expenditure during the 12 month period to 31st December 2018 are shown below –

Department		£	Purpose
From –	To –	£	Purpose
Central Contingency	T&R Revenue	188,680	Historic Abuse Redress Scheme ("HARS") costs
Central Contingency – Restructuring Provision	CMD Revenue	135,200	An Interim Resource Specialist for up to 6 months
Central Contingency	DfI various Capital DoE various Capital	6,756,000	Re-allocated funds as identified and presented to the States Assembly during the 2018 Budget debate (P.90/2017)
Central Contingency – Redundancy Provision	Various Departments	205,020	Costs associated with the 2017 Voluntary Release ("VR") and Redundancy Scheme
Central Contingency	Office of the Data Protection Commissioner Revenue	807,533	Increased running costs of the new Data Protection Authority
Central Contingency	Office of the Data Protection Commissioner Revenue	350,000	Implementation costs arising from the new General Data Protection Regulation ("GDPR")

Department		£	Purpose
From –	To –	£	Purpose
Central Contingency (Pay Provision)	Education Revenue CCA Revenue	621,000 278,600	1% element of 2017 pay award out of scope of workforce modernisation
Central Contingency	CCA Revenue	66,379	Implementation costs associated with the Charities Commissioner
Central Contingency – Restructuring Provision	CMD Revenue	120,000	Four interim communications officers for up to 6 months
Central Contingency	CMD Revenue	Up to 683,000	The build and implementation of a Digital Identification Service, and running costs for first 2 years
Central Contingency	CCA Minor Capital	81,408	La Collette Emergency Siren upgrade
Central Contingency (EDGDP)	External Relations Revenue	1,073,000	Brexit – for the assignment of funding to various departments
Central Contingency (Pay Provision)	CMD Revenue External Relations Revenue CCA Revenue EDTSC Revenue Education Revenue DfI Revenue DoE Revenue H&SS Revenue SSD Revenue T&R Revenue Non-Ministerial Revenue States Assembly Revenue	3,046,115	Costs associated with 2017 pay award and impact of Workforce Modernisation for 2017
Central Contingency	Education Revenue	Up to 250,000	Minister for Education's decision to rescind means-tested nursery education from September 2018
Central Contingency	CCA Revenue	81,000	One post in CCA to support a co-ordinated cross-departmental approach to recommendations following publication of the Independent Jersey Care Inquiry ("IJCI") report
Central Contingency (EDGDP)	External Relations Revenue	Up to 397,460	Brexit – for the assignment of funding to various departments
Central Contingency	T&R Revenue (Taxes Office)	200,000	The Taxes Office – to increase the capacity and capability of the Tax Policy Unit
Central Contingency	CMD Revenue	465,000	The strengthening of Children's Services
Central Contingency	CMD Revenue	Up to 60,000	The Ofsted review of Children's Services

Department		£	Purpose
From –	To –	£	Purpose
Central Contingency	T&R Revenue	Up to 372,000	The review and re-organisation of the Public Finances Law and structure
Central Contingency	T&R Revenue	Up to 480,000	The first stage in finance transformation
Central Contingency	CMD Revenue	Up to 467,000	Increased Human Resources and Organisational Development capacity and capability to enable organisational change
Central Contingency	CMD Revenue	Up to 338,000	Leadership Development
Central Contingency	CMD Revenue	Up to 495,000	Cultural Change – Delivering Team Jersey
Central Contingency	CMD Revenue	Up to 490,000	Resourcing Partner for implanting the new organisational structure
Central Contingency	CMD Revenue	Up to 200,000	Reform of Policy and Governance Arrangements
Central Contingency	CMD Revenue	Up to 300,000	Transformation of Communications and Engagement
Central Contingency	States Assembly Revenue	Up to 43,000	Costs associated with States Assembly election observation
Confiscation Fund	LOD Revenue	250,000	Jersey becoming a donor nation for 3 years to the International Centre for Asset Recovery ("ICAR")
Central Contingency	DfI Liquid Waste Capital	3,000,000	Covering of the Primary Settlement Tanks at the new Sewage Treatment Works project at Bellozanne
Central Contingency – Restructuring Provision	T&R Revenue	3,000,000	The full cost of capital of TSSC (Taxes and Social Security Contributions) and TOMP (Taxes Office Modernisation Programme)
Central Contingency (Pay Provision)	Various Departments	234,541	Costs associated with the 2018 Voluntary Release ("VR") and Redundancy Scheme
Central Contingency (Pay Provision)	CMD Revenue External Relations Revenue CCA Revenue EDTSC Revenue Education Revenue DfI Revenue DoE Revenue H&SS Revenue SSD Revenue T&R Revenue Non-Ministerial Revenue	4,766,784	Costs associated with 2017 pay awards and impact of Workforce Modernisation in 2018 and 2019

Department		£	Purpose
From –	To –	£	Purpose
	States Assembly Revenue
Central Contingency	CCA Revenue	147,715	Costs associated with the Charities Commissioner in 2018
Central Contingency	Education Revenue	89,524	Recommendations following publication of the Independent Jersey Care Inquiry ("IJCI") report
Central Contingency	CCA Revenue	29,850	Recommendations following publication of the Independent Jersey Care Inquiry ("IJCI") report
Central Contingency	CCA Revenue	9,000	Recommendations following publication of the Independent Jersey Care Inquiry ("IJCI") report
Central Contingency	CCA Revenue	50,993	Recommendations following publication of the Independent Jersey Care Inquiry ("IJCI") report
Central Contingency	Probation and After Care Service Revenue	10,000	Costs associated with the Youth Justice Review
Central Contingency	H&SS Revenue	70,000	Recommendations following publication of the Independent Jersey Care Inquiry ("IJCI") report
Central Contingency	CMD Revenue	111,910	Recommendations following publication of the Independent Jersey Care Inquiry ("IJCI") report
Central Contingency	CCA Revenue	70,000	Recommendations following publication of the Independent Jersey Care Inquiry ("IJCI") report
Central Contingency	Probation and After Care Service Revenue	15,000	Additional costs associated with the Youth Justice Review
Central Contingency	CMD Revenue	165,000	Funding for Telecoms Strategy Action Plan
Central Contingency	CMD Revenue	Up to 440,000	Re-allocation of funding for the e-Government Phase I Programme to meet ongoing revenue costs of the e-Government Programme
Central Contingency	States Assembly Revenue	Up to 90,000	For additional costs incurred during the election process
Central Contingency	Education Revenue	Up to 65,000	To fund franchising of delivery of a Social Work Degree on-Island
Central Contingency	CCA Revenue	Up to 70,500	Re-allocation of contingency funding for the pilot Parent/Infant Psychotherapy Service
Central Contingency	CCA Revenue	Up to 82,664	Upgrade to CAESAR freight management system

Department		£	Purpose
From –	To –	£	Purpose
Various departments	Central Contingency	3,730,519	Transfer of capital budgets unspent and no longer required for their original purpose
Central Contingency	T&R Revenue	301,600	Costs associated with the PECRS Pre-1987 Debt repayments
Central Contingency	Various departments	Up to 2,053,000	Additional funding requests for 2018 and 2019 – see MD-TR-2018-0131
Central Contingency	Education	Up to 100,000	JCG international programme pilot
Central Contingency	Various departments	Up to 3,236,600	To cover the provisional recurring cost associated with the 2018 Pay Award in respect of Nurses and Midwives, and Manual Workers and Energy Recovery Facility Workers
Central Contingency	Various departments	Up to 18,481,100	To cover the recurring and non-recurring costs associated with the 2018/19 Pay Award in respect of Civil Servants and Associated Groups, Teachers/Headteachers and Uniformed Services, and the pay groups who have accepted Workforce Modernisation Awards, and to fund increased employer's pension contributions
Central Contingency	Education	114,100	Provisional recurring cost associated with the additional 2018 Pay Award in respect of Teaching Assistants
Central Contingency	Office of the Lieutenant Governor	13,100	Additional accrual required for Manual Workers who were incorrectly identified as Civil Servants in previous calculations
Central Contingency	Various departments	Up to 1,880,000	Additional funding requests for 2018 and 2019 – see MD-TR-2018-0151
Central Contingency	Various departments	Up to 870,000	Additional funding requests for 2018 and 2019 – see MD-TR-2018-0152
Central Contingency	Various departments	Up to 300,541	To recognise the costs associated with the 2018 Voluntary Release ("VR") and Redundancy Scheme
Central Contingency	Education	150,700	For PEPS (Public Employees' Pension Scheme) costs
Central Contingency	Various departments	195,533	To recognise the costs associated with the 2018 Voluntary Release ("VR") and Redundancy Scheme

Transfers between revenue heads of expenditure

Revenue transfers during the 12 month period to 31st December 2018 are shown below –

Department		£	Purpose
From –	To –	£	Purpose
H&SS Revenue	CMD Revenue	18,716,778	The budget for the direct costs of Children's Services
Judicial Greffe Revenue LOD Revenue	OLG Revenue Bailiff 's Chamber Revenue CCA Revenue	242,533 46,004	Court and Case Costs in 2017
LOD Revenue	Data Protection Commission Revenue	25,400	2017 budget pressures
H&SS Revenue	Judicial Greffe Revenue	12,300	In respect of Family Mediation Services to consolidate all the grant funding in one department
T&R Revenue	CMD Revenue	600,000	To cover JCRA costs
CCA Revenue	H&SS Revenue	45,400	Transfer of funding for the UNICEF Healthy Living Programme
H&SS Revenue	CMD Revenue	702,277	Transfer of funding for the pay award for the Children's Service

Transfers between capital heads of expenditure

Transfers between existing capital heads of expenditure during the 12 month period to 31st December 2018 are shown below –

Department		£	Purpose
From –	To –	£	Purpose
DfI Infrastructure Rolling Vote Capital	DfI Liquid Waste Strategy Capital	7,000,000	Liquid Waste Strategy
DfI Commercial Recycling Capital	DfI La Collette Waste Site Development Capital	1,400,000	Capital spend at La Collette under one head of expenditure
DfI EFW Plant La Collette Capital	DfI Replacement Assets Capital	127,505	The Quick Brain Asset System

Transfers between revenue and capital heads of expenditure

Transfers between revenue and capital during the 12 month period to 31st December 2018 are shown below –

Department		£	Purpose
From –	To –	£	Purpose
DfI Haut de la Garenne Capital	CCA Revenue	50,000	Consultation works regarding the future of the Haut de la Garenne site
Education minor capital	Education Revenue	150.000	Safeguarding and security improvements at St. Luke's primary school, and at Haute Vallée and Le Rocquier secondary schools

Department		£	Purpose
From –	To –	£	Purpose
CCA Revenue	DfI Prison capital	220,000	Prison key vending system
Probation and Aftercare Service Revenue	Daisy Software Upgrade project within the Non- Ministerial Departments Minor Capital head of expenditure	20,000	To fund the project using income from Guernsey

Transfers between revenue and capital heads of expenditure where the transfer is required in order to comply with accounting standards

The States of Jersey adopted International Financial Reporting Standards ("IFRS") as interpreted by the Jersey Financial Reporting Manual ("JFReM") from 2012 as its framework. Under IFRS, expenditure that meets the definition of capital expenditure must be capitalised. The following transfers show the movement between capital and revenue required to align the budgeting treatment of expenditure with the accounting treatment, in order to comply with IFRS.

IFRS transfers between revenue and capital during the 12 month period to 31st December 2018 are shown below –

Department		£	Purpose
From –	To –	£	Purpose
CMD Revenue	CMD Enterprise Systems Development HRPAYSYS Capital	342,426	The procurement and implementation of a States- wide workforce planning and management system
CMD e-Government Capital	CMD Revenue	1,819,503	Expenditure associated with e-Government
DoE Revenue	DoE Equipment, Maintenance and Minor Capital	Up to 125,000	To fund the Digitally Integrated Planning Process
CCA Minor Capital	DfI Revenue	Up to 370,000	Healthcare Refurbishment at the Jersey Prison Service
DfI Revenue	DfI Road Safety Improvements Capital DfI Eastern Cycle Network Capital	Up to 305,097 Up to 66,284	To fulfil the requirement of various Planning Obligation Agreements

Transfers over multiple years between various heads of expenditure

Multi-year transfers between the various heads of expenditure during the 12 month period to 31st December 2018 are shown below –

Department		£	Funding of	Year(s) of transfer
From –	To –	£	Funding of	Year(s) of transfer
Central Contingency	Office of the Data Protection Commissioner Revenue	1,146,000	Increased running costs of the new Data Protection Authority	2019
Central Contingency	CMD Revenue	Up to 177,000	The build and implementation of a Digital Identification Service and running costs for first 2 years	2019
Central Contingency (EDGDP)	External Relations Revenue	1,073,000	Brexit – for the assignment of funding to various departments	2019
Central Contingency	Education Revenue	Up to 467,000	Minister for Education's decision to rescind means-tested nursery education from September 2018	2019
Central Contingency (EDGDP)	External Relations Revenue	Up to 714,420	Brexit – for the assignment of funding to various departments	2019
Central Contingency	T&R Revenue (Taxes Office)	Up to 201,000	The Taxes Office – to increase the capacity and capability of the Tax Policy Unit	2019
DfI Victoria College Extension Capital	EDU Revenue	450,000 117,000	The Victoria College School Five Year Strategic Plan 2018–2022	2019 2020
Central Contingency	CMD Revenue	Up to 95,000	Funding for Telecoms Strategy Action Plan	2019
Central Contingency	Education Revenue	Up to 156,500	To fund franchising of delivery of a Social work degree on-Island	2019
Central Contingency	CCA Revenue	Up to 35,000 Up to 70,500	Re-allocation of contingency funding for the pilot Parent/Infant Psychotherapy Service	2017 2019
CCA Revenue	H&SS Revenue	91,000	Transfer of funding for the UNICEF Healthy Living Programme	2019
H&SS Revenue	CMD Revenue	702,277	Transfer of funding for the pay award for the Children's Service	2019
Central Contingency	CCA Revenue	Up to 163,519	Upgrade to CAESAR freight management system	2019
Central Contingency	Various departments	Up to 3,313,000	Additional funding requests for 2018 and 2019 – see MD-TR-2018-0131	2019
Central Contingency	Various departments	Up to 18,481,100	To cover the recurring and non- recurring costs associated with the 2018/19 Pay Award in respect of Civil Servants and Associated Groups, Teachers/Headteachers and Uniformed Services, and the pay groups who have accepted Workforce Modernisation	2019

Department		£	Funding of	Year(s) of transfer
From –	To –	£	Funding of	Year(s) of transfer
			Awards, and to fund increased employer's pension contributions
Central Contingency	Various departments	Up to 2,205,000	Additional funding requests for 2018 and 2019 – see MD-TR-2018-0151	2019
Central Contingency	Various departments	Up to 3,795,000	Additional funding requests for 2018 and 2019 – see MD-TR-2018-0152	2019

Carry-forwards

Departments' carry-forwards were dealt with in Ministerial Decision reference MD-TR-2018-0048 –

Appendix 1	Recommended to Carry Forward	Ringfenced in Contingency	Returned to Contingency	Total
Chief Minister's Department	1,864,596	-	(212,030)
- Overseas Aid	39,972	-	-
External Relations	233,954	-	183,705
Community and Constitutional Affairs	192,709	-	300,413
Economic Development, Tourism, Sport and Culture	181,000	-	355,824
Education	1,278,085	-	339,669
Department of the Environment	673,727	100,000	595,785
Health and Social Services	5,819,215	1,255,110	(3,090,790)
Department for Infrastructure	372,000	1,769,000	(377,212)
Social Security	300,000	-	10,670,388
Treasury and Resources	829,457	-	506,324
Non Ministerial States Funded	420,301	489,748	1,166,598

Bailiff 's Chamber	-	95,000	42
Law Officers'	97,546	-	539,577
Judicial Greffe	90,000	-	460,123
Data Protection	-	-	24
Viscount's	52,000	85,000	292,637
Official Analyst	18,237	-	92,023
Lieutenant Governor	42,520	-	-
Probation	-	-	45,263
C&AG	-	-	46,870
Dean of Jersey	-	-	16,446
	-	-	-
States Assembly	119,998	-	(16,659)
TOTALS	12,205,016	3,613,858	10,438,674	26,257,548

Acronyms and Abbreviations

CCA Community and Constitutional Affairs

COCF Criminal Offences Confiscation Fund

CMD Chief Minister's Department

DfI Department for Infrastructure

DoE Department of the Environment

EDU Education Department

EDTSC Economic Development, Tourism, Sport and Culture EFW Energy from Waste

EPGDP Economic and Productivity Growth Drawdown Provision FTE Full-Time Equivalent

HARS Historic Abuse Redress Scheme

H&SS Health and Social Services Department

IJCI Independent Jersey Care Inquiry

JCG Jersey College for Girls

JCP Jersey College Preparatory

JG Judicial Greffe

JPH Jersey Property Holdings

LOD Law Officers' Department

LTC Long-Term Care

OLG Office of the Lieutenant Governor

PSR Public Sector Reform

SoJ States of Jersey

SSD Social Security Department

VC Victoria College

VCP Victoria College Preparatory

Finance Law Delegation Report for the 12 month period to 31st December 2018