Shadow Public Accounts Committee - terms of reference

STATES OF JERSEY

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SHADOW PUBLIC ACCOUNTS COMMITTEE – TERMS OF REFERENCE

Lodged au Greffe on 16th December 2003 by the Finance and Economics Committee

STATES GREFFE

PROPOSITION

THE STATES are asked to decide whether they are of opinion

(a ) to agree that the Shadow Public Accounts Committee should be established from 1st February

2004, or as soon as possible thereafter, and that the Committee should operate in accordance with the terms of reference set out in the Appendix to the report of the Finance and Economics Committee dated 10th December 2003;

( b ) to agree that the States Audit Commission should cease to exist upon the establishment of a

Shadow Public Accounts Committee with its membership being assumed within the Shadow Public Accounts Committee.

FINANCE AND ECONOMICS COMMITTEE

REPORT

1. T h e States Audit Commissionwas established by the StatesinMarch1994. Its main objective, set outin its terms of reference, being to –

" in i ti ate a programme of value for money reviews across all areas of public administration, and to report thereon to the States, through the Finance and Economics Committee."

2. T h e States Audit Commission comprises 6 independent members appointed by the Finance and Economics Committee: 2 oftheseposts are currently vacant.There is also anindependentChairman, whose appointment is approved by the Stateson the recommendation of the Finance and Economics Committee. One member of the Finance and Economics Committee also sits on the States Audit Commission.
3. O n 10th June 2003 the States considered and adopted P.59/2003 leading to the re-appointment of Mr. TimothyDunninghamasChairmanofthe States Audit Commission for a further periodof 3 years The reportof the Finance and Economics Committeerecognised that Mr. Dunningham's termof office could be less than 3 years if the appointmentof a Comptroller and AuditorGeneral and the establishmen of a Public Accounts Committee are madewithinthe3-year period.
4. A t its meeting on 24th July 2003 the States adopted P.79/2003, MachineryofGovernment:Establishment of Scrutiny Panels and PublicAccountsCommittee', and approved a trial period of Shadow Scrutiny' in advance of the introductionofthenew system ofgovernment. The Privileges andProceduresCommittee has agreed that this Shadow Scrutiny' should extend to establishing a Shadow Public Accounts Committee.
5. T h e purposes ofShadow Scrutiny, asdescribedin P79/2003 are –

( i) t o create opportunities for training both members and officers – in particular developing new

skills;

(i i) to include a wide range of members in the Shadow Scrutiny process; (i ii ) t o provide a learning experience for officers supporting the Panels.

6. A tt achedasanAppendix to this report is a setofsuggestedterms of reference for the ShadowPublic Accounts Committee.Thesetermsofreferencewereapprovedby the Finance and EconomicsCommittee at its meeting on 10th December2003.
7. T h e terms of reference propose the following membershipof the ShadowPublicAccountsCommittee – M r . T im o th y Dunningham – Chairman;

a S t a te s M e m ber who will be the Shadow Chairman, appointed by the States;

th e C hairmen of the 2 Shadow Scrutiny Panels, appointed by the States;

4 in d e p e n d e nt members, appointed by the Finance and Economics Committee, after discussion

with the Privileges and Procedures Committee;

a S t a te s M e m ber, nominated by the Shadow Chairman and appointed by the States.

8. A  ll the independent members,including the Chairman, will stand downupon the formation of the Public Accounts Committee and theappointmentof a Comptrollerand Auditor General.
9. T h e Privileges andProceduresCommitteehas recently written to all StatesMembers to ask them to state

whether they are interested in becoming a member of one of the Shadow Scrutiny Panels or the Shadow Chairman

of the Shadow Public Accounts Committee.

10. If the States approve the terms of reference, it is intended that the Shadow Public Accounts Committee will be established from 1st February 2004. This will be subject to the States agreeingby that date the Chairmen of the 2  Shadow Scrutiny PanelsandtheShadow Chairman of the ShadowPublicAccounts Committee.
11. U p on the establishmentof the ShadowPublicAccountsCommittee,the current States AuditCommission will cease to operate. Its current membership will be assumed within the Shadow Public Accounts Committee.
12. T h ere are no additional financial ormanpower implications for the States arising outof this proposition. 10th December 2003

APPENDIX

SHADOW PUBLIC ACCOUNTS COMMITTEE SUGGESTED TERMS OF REFERENCE

With effect from 1st February 2004

1. T h e Shadow Public AccountsCommittee(ShadowPAC) will operate until the establishmentof the Public Accounts Committee upon the bringing into force of Ministerial government.

Responsibilities

2. T h e terms of reference for the ShadowPAC will be –

( i) to commission and receive reports investigating the value for money achieved by States

departments and other public bodies and to report significant issues to the States Assembly;

( ii ) to assess whether public money is being applied for the purposes intended by the States, that

extravagance and waste are eradicated, and that sound financial practices are applied throughout the States administration;

(i ii ) t o receive reports from the States Auditor on the results of the audit of –

• t h e a nnual accounts of the States and its associated organisations and companies; and

• t h e annual accounts of the Social Security Fund, Social Security (Reserve) Fund and Health Insurance Fund;

(i v ) t o report to the States Assembly any significant issues arising from these audits. Membership

3. T h e membership will be –

M  r. Timothy Dunningham, the independent Chairman, re-appointed by the States at its meeting on 10th

June 2003, for a further period of 3  years.*

4 i n d ependent members, appointed by the Finance and Economics Committee, after discussion with the

Privileges and Procedures Committee.*

A S ta tes member who will be the Shadow Chairman, appointed by the States.

T h e C  hairmen of the 2 Shadow Scrutiny Panels.

A S ta tes Member nominated by the Shadow Chairman and appointed by the States.

* A l l independent members, including the Chairman, will stand down upon formation of the Public Accounts Committee and the appointment of a Comptroller and Auditor General.

4. T h e Chief Internal Auditor oftheStatesTreasury (or his/her representative) will be requiredto attend all meetings of the ShadowPAC.
5. T h e Treasurer of the States (or his/her representative) willberequiredto attend meetings of the Shadow PAC if invited todoso.

6. I n theeventofanindependentmemberresigningduring their termof office, a replacement shall be appointed by the Finance and Economics Committee, following discussions with the Privileges and Procedures Committee, for the remainderof the term.If the Chairman resigns, the membersshall appoint a Chairman from amongst the remaining independentmembers,and the nameof the new chairmanshall be reported to the States. If the Shadow Chairman resigns, his/her replacement will beconsideredby the Privileges andProcedures Committee and agreedby the States.
7. M  e mbership shallbeonan honorary basis. TheapprovaloftheFinanceand Economics Committeeis required to anyschemefor the reimbursementofmembers' expenses.

Resources

8. T h e ShadowPAC will be provided with theannualbudgetof£30,000whichwaspreviously provided to the States Audit Commission bytheFinanceandEconomicsCommittee.TheShadowPAC will have access to the adviceand assistance of the Chief Internal Auditor. TheShadowPACmayalso request additional funds from the Privileges and Procedures Committee's consultancy budget for Shadow Scrutiny. Suchrequests will be prioritised against the bids of the Shadow Scrutiny Panels.
9. O ff icers from theShadow Scrutiny Teamwill provide administrative support to the ShadowPAC.In particular they will arrange all meetings and public hearingsoftheShadowPACand ensure that an accurate record ofthesemeetingsand hearings isproduced.

Meetings and reporting

10. T h e ShadowPACshall meet as frequently asrequired to carry out its functions. The programme of meetings will be agreed by the ShadowPAC once it is fully constituted. A total of fourmembers,at least 2 ofwhom should be States Members, must attend a meetingforittobequorate.
11. In the absence of the Chairman, theShadow Chairman will actas Chairman for the meeting.
12. A l l the meetingsof the ShadowPACshallbe recorded, andtheminutes shall be signedby the Chairman.
13. T h e ShadowPACmay report to the Statesonsuch matters and at such timesasit thinks fit. TheShadow PAC will produceanannualreport for the year ended31stDecember 2004, and for every year thereafter until thecreation of the Public AccountsCommittee.Thisannualreportshallbe submitted tothe States.
14. A l l membersshall maintain the confidentiality of matters underdiscussion, and shall not publicly release any information nor make any public comment without the express approval of the Chairman. The ShadowPACmay from time to time authorise the Chairman tomake public commenton its behalf.
15. T h e independentmembers will berequiredto complete a register of interests which will be held by the Greffier of the States. All members have a duty to declare to the Chairmanany potential conflicts of interest whichmay arise on any item underdiscussion.

Supporting authority

16. In orderto perform its responsibilities as set out inparagraph 2, the ShadowPAC will hold hearings in public orincamera as appropriate, send forpersons, request papersand records andreport to the States Assembly asand when required.

10th December 2003