Public Accounts Committee - Approved Committee Minutes - 29 January 2007

PM/vnl/088.07 38

PUBLIC ACCOUNTS COMMITTEE (12th Meeting)

29th January 2007

PART A

All members were present.

Senator J.L. Perchard Connétable T.J. du Feu Connétable D.J. Murphy Deputy A. Breckon Deputy J.G. Reed R. Bignell C. Evans M. Magee

In attendance -

C. Swinson, O.B.E., Comptroller and Auditor General

P. Monamy, Clerk to the Public Accounts Committee

Note: The Minutes of this meeting comprise Part A only.

Minutes. A1. The  Minutes  of  the  meeting  held  on  4th  December  2006,  having  been

previously circulated, were taken as read and were confirmed.

Battle of Flowers A2. The Committee, with reference to Note No. 2 of the notes of its inquorate report by Internal meeting held on 13th November 2006, considered a draft transcript of the Hearing Audit on issues surrounding the funding of the 2006 Battle of Flowers, which had been Department: held  on  4th  December  2006. The  Committee  recalled  that  the  Hearing  had Hearing of issues separately  interviewed  Messrs.  W.D.  Ogley,  Chief  Executive,  Chief  Minister's on the funding of Department and M. King, Chief Executive, Economic Development Department. the 2006 event.

530/6(13) Having noted that a version of the draft transcript of the interview with Mr. Ogley

had been annotated by Mr. Ogley with suggested amendments, the Committee agreed that it was minded not to adopt those amendments on the basis that the transcripts of such Hearings should be essentially verbatim records.

The Committee asked for a verbatim transcript of the Hearing to be circulated to members in time for the next meeting.

States Property A3. The Committee, with reference to Note No. 1 of the notes of its inquorate Plan: meeting held on 13th November 2006, considered a draft transcript of the Hearing Hearing. on the States Property Plan, which had been held on 11th December 2006. The 1447/1(8) Committee recalled that the Hearing had jointly interviewed Messrs. W.D. Ogley,

Chief  Executive,  Chief  Minister's  Department  and  E.H.  Le  Ruez,  Director  of Property Holdings.

The Committee recognised that, ideally, there should be regular updated valuation of properties so that accurate figures could be incorporated in the annual accounts of the States. In the absence of accurate valuations, it appeared that there was a tendency to re-state what had gone before, without careful review, and therefore little incentive for individual departments to reduce the extent of accommodation which they occupied.

The  Comptroller  and  Auditor  General  suggested  that,  historically,  States' procedures designed to restrain costs had been ineffective. There appeared to have been  little  resolve to make  savings, except when crisis loomed which  directly affected  a  particular  area. Whilst  it  was  noted  that  the  Property  Plan  would examine in detail at the inefficiencies surrounding the use of property throughout the States, there was recognition of the need for a realistic approach in this area.

The Committee welcomed confirmation that the proceeds of sales of capital assets would not be applied to revenue expenditure, but would be credited to the Land Acquisition  Vote  and  thence  to  the  Consolidated  Fund  in  order  that  it  might represent a part of the funding of the States' planned capital expenditure. However, although it was recognised that Social Housing properties were not encompassed by the Jersey Property Holdings proposals, the Committee expressed concern that the Minister for Housing had proposed the sale of some housing stock to contribute towards the revenue cost of undertaking a back-log of outstanding maintenance works  on  some  of  the  remaining  social  housing  properties. However,  the Comptroller and Auditor General emphasised that there was a rationale for that proposal, given that the Property Plan had different objectives to those relating to social housing. The Committee agreed that, as a matter of principle, the proceeds of the sale of capital assets should not be used to meet revenue expenditure and expected that this principle would be followed in all of the States' dealings with property irrespective as to whether they fell within the remit of Jersey Property Holdings.

The Committee also welcomed the explanation which had been given by the Chief Executive,  Director  of  Property  Holdings  in  relation  to  the  expectation  that, although  it would be  possible  for  the Minister  for Treasury  and  Resources to proceed with the disposal of property under the Standing Orders of the States of Jersey, such transactions - particularly in relation to significant property disposals - would be referred to the States Assembly for debate.

The Comptroller and Auditor General undertook to produce a report for the Committee on the 2007 Property Plan for consideration at its next meeting.

Annual Report A4. The Committee was advised by the Comptroller and Auditor General that the on the work of annual report on the Committee's work, which was envisaged under Standing Order the Public 143(d),  was  in  the  course  of  preparation  and  would  be  available  for  the Accounts Committee's consideration shortly.

Committee:

preparation.

512/1(6)

Comptroller and A5. The Committee received an oral report from the Comptroller and Auditor Auditor General: General regarding the undermentioned work currently in hand and noted that - report.

512/1(8) (a) a report on the Financial Services Commission would be finalised

shortly;

2. a report on States' control of aggregate public expenditure was being prepared;
3. a report on the long-term control of nursery education costs in order to address  increasing  revenue  expenditure  in  that  area  was  being prepared;
4. discussion had been held with the Chief Executive and the Director of Human Resources, Chief Minister's Department regarding Capability Reviews', whereby the Comptroller and Auditor General's programme for 2007 included the first of what would be a series of in-depth reviews of departmental capabilities and efficiency.

With regard to the work being undertaken in groups, the Committee was advised that a group had met the Managing Director and Finance Director of Jersey Post for discussion of the accounts of the business for 2005.

In addition, it was noted that 5 areas of investigation were to be incorporated into a single report of the Comptroller and Auditor General in due course, prior to the production of the Report for 2006.