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STATES OF JERSEY
TRANSFERS BETWEEN HEADS OF EXPENDITURE UNDER THE PUBLIC FINANCES (JERSEY) LAW 2019: ARTICLE 18 – 8TH JANUARY 2021
Presented to the States on 17th February 2021 by the Minister for Treasury and Resources
STATES GREFFE
2021 R.22
REPORT
Decision(s): Under Article 18(4) of the Public Finances (Jersey) Law 2019 (the Law), the Minister for Treasury and Resources hereby notifies the States, and having consulted with any relevant Minister under Article 18(5) of the Law; that he/she has agreed to the following –
Transfers between Heads of Expenditure under Article 18 of the Law
MD-TR- Ref. | Department | £ | Funding of – | |
From – | To – | |||
2021- 0004 | CLS Head of Expenditure | General Reserve Fund | £814,000 | Offset of one-off deferral by Andium Homes of annual rent adjustment |
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After the expiry of 4 weeks following the presentation to the States of these transfers, the Minister hereby authorises the Treasurer of the States to action the transfers outlined in the table above. (More detail on the transfers is given below.)
Background
The States and Andium Homes entered into an Agreement on 22th July 2014 and an Addendum to the Agreement on 21st June 2019, such Addendum reflecting the introduction of a cap' and floor' to the percentage uplift of the Annual Return Amount payable by Andium.
In signing MD-H-2020-0017 (Appendix 1), the Minister for Children and Housing approved a one-off deferral of the annual rent adjustment required by the States Fair Market Rent policy which is applied to Andium tenancies. This adjustment was for the calendar year 2021. This decision was taken in consultation with the Minister for Treasury and Resources given the link (through the RPI uplift) of both the rental income to Andium and the Annual Return Amount due to the Guarantor under the Transfer Agreement.
The decision to make the one-off deferral will have an impact on the 2021 rental income of Andium and the company have agreed to absorb the net effect of that impact, which is estimated to be approximately £570,000. For Government, the impact of the decision is that there will be a reduction in the level of Income Support to be provided to Andium tenants of £814,000 in 2021 and a corresponding reduction in General Revenues income (for the reduced return from Andium) compared to that included in the approved Government Plan 2021-2024. The Minister, through this decision, is transferring £814,000 from the Customer and Local Services (CLS) head of expenditure to the General Reserve in 2021 to ensure that the consolidated fund is not adversely affected and the potential borrowing requirement in 2021 is not increased. This amount within the General Reserve will not be spent.
Further information on this decision may be viewed in due course at: https://www.gov.je/government/planningperformance/pages/ministerialdecisions.aspx
under Ministerial Decision reference MD-PH-2021-0004, which were signed on 8th January 2021.
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APPENDIX A
R.22/2021