Public Accounts Committee - Approved Committee Minutes - 16 February 2009

A- 133 CH/JAC/54

PUBLIC ACCOUNTS COMMITTEE (1st Meeting)

16th February 2009

PART A

All members were present, with the exception Mr. K. Keen and Connétable A.S. Crowcroft of St. Helier , from whom apologies had been received.

Senator B.E. Shenton, Chairman Connétable J.M. Refault of St. Peter Deputy T.A. Vallois

Mr. P. Ryan

Mr. M. Magee

In attendance -

Mr. A.C. Fearn

Senator A. Breckon

C. Swinson, O.B.E., Comptroller and Auditor General Mrs A. Harris , Deputy Greffier

Miss A-C. Heuston, Clerk to the Public Accounts Committee

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

Appointment of A1. The  Committee  appointed   Connétable  J.M.  Refault  of  St.  Peter  as  Vice Vice Chairman. Chairman, in accordance with Standing Order 131(3) of the Standing Orders of the 512/1(1) States of Jersey.

Committee A2. The Committee approved the following meeting dates for 2009 – meeting dates.

16th March 17th August 20th April 21st September 18th May 19th October 15th June 23rd November 20th July 14th December 21st July (public hearing re annual accounts)

Annual Report A3. The  Committee  endorsed  the  Annual  Report  2008  of  the  Committee  as 2008. previously constituted, for presentation to the States within the States Assembly 512/1(6) Annual Report 2008.

Report to A4. The Committee noted a report concerning its constitution and possible work Chairmen's programme which would be presented to the Chairmen's Committee at its meeting Committee. of 19th February 2009.

512/1(28)

Comptroller and A5. The Committee received an oral report from the Comptroller and Auditor Auditor General: General and noted that work was continuing on a number of matters.

Report.

512/1(8) It  was  noted  that  a  review  was  being  undertaken  by  the  CAG  of  the  States' management of exchange risk arising from the procurement of an Energy from

Waste plant. It was also noted that the Environment Scrutiny Panel would be undertaking a review of the impact of the Energy from Waste Plant on Jersey's Ramsar Site.

Committee work A6. The Committee noted its terms of reference as set out in Standing Order 132 programme. of the Standing Orders of the States of Jersey, and considered the following items in 512/1(29) relation to its future work programme –

1. Procurement

The  Committee,  with  reference  to  Minute  No.  A3(B)  of  10th November  2008  of  the  Committee  as  previously  constituted, considered undertaking a review of States' procurement.

The Committee noted correspondence from the former Chairman of the Committee to the Director of Strategic Procurement, dated 12th November 2008, and the Director's reply, dated 26th November 2008.

The Committee heard from the CAG, who considered that a corporate approach had yet to be adopted throughout the States of Jersey and that the challenge was to establish a commitment to the required policy and organisational  changes  that  would  be  needed  to  control  States expenditure.

The Committee discussed undertaking a more holistic review, taking into account the findings of the reports of the CAG entitled: £35  million  cost  reductions' (R.C  12/2008  refers),  and States' Spending Review - Emerging Issues' (R.C. 48/2008 refers).

It was agreed that the Committee would write to States Departments to request an update on progress in relation to relevant aspects of the Emerging Issues report.

It was also agreed that a draft terms of reference be drawn up for a review of procurement.

The Committee Clerk was directed to take the necessary action.

2. Public Finances (Jersey) Law 2005

The  Committee  considered  possible  amendments  to  the  Public Finances (Jersey) Law 2005 in the light of the previous Committee's findings following its review of the States' accounts for the year ended 31st December 2007 (P.A.C.4/2008 refers).

The CAG informed the Committee that he planned to undertake a review  of  the  aforementioned  Law,  and  a  paper  was  due  to  be published in the next quarter in this regard.

It was agreed that the Committee would await the report of the CAG prior to considering the matter further, and that, following the release of the report, it would be likely that the Committee would wish to hold public hearings.

3. States of Jersey insurance arrangements

The Committee, with  reference to Minute  No. A3(A) of the  10th November 2008 of the Committee as previously constituted, noted a report  in  connexion  with  a  possible  review  of  the  insurance

arrangements of the States of Jersey.

The Committee noted that a draft contract had been drawn up between the Committee and Willis Limited. The Committee also noted the terms of reference of the proposed review, which were to –

1. establish the nature of the risks for which some form of insurance cover would be appropriate;
2. establish the extent of these risks and identify the extent of the risks that were effectively self-insured;
3. assess whether the balance between commercial cover and self-insurance was appropriate, taking into account any reserves established to deal with the risks of self- insurance and the scale of self-insured risks when compared with the overall reserves of the States.

It was agreed that the matter would be considered by the Committee at a later date.

4. Waterfront

The Committee, with reference to Minute No.A3(E) of 10th November 2008 of the Committee as previously constituted, noted a report in connexion with a possible review of contract practices in relation to the Waterfront.

The Committee acknowledged that two propositions had been lodged au Greffe' in January 2009 in relation to the Waterfront Enterprise Board (WEB) (P.12/2008 and P.13/2008 refer). The Committee also noted that the Corporate Services Scrutiny Panel had established a Sub Panel to review the current situation with regard to membership of the Board of Directors of WEB.

The Committee made reference to the report of the CAG published on 24th November 2008, entitled, Waterfront Enterprise Board, review of corporate governance'. The Committee considered whether it would be preferable for the CAG to have oversight of the finances of WEB, and noted that the Corporate Services Scrutiny Panel might also be minded to examine this as part of its review.

It was agreed that the Committee would await the report of the Corporate Services Scrutiny Panel prior to considering the matter further.

5. Historic Child Abuse Enquiry

The Committee, with reference to Minute No. A4 of 10th November 2008, of the Committee as previously constituted, noted a report in connexion with a possible review of budgetary control in relation to the historic child abuse enquiry, and the ministerial decision entitled: Historic Child Abuse Enquiry – Budget Transfers' (MD-TR-2009- 0011 refers).

The Committee considered the matter in relation to its discussions regarding States procurement and the Public Finances (Jersey) Law 2005.

6. Grant-making procedures

The Committee, with reference to Minute A3(e) of 10th November 2008 of the Committee as previously constituted, received a report in connexion with a possible review of the grant making procedures of the Economic Development; Education, Sport and Culture; and Health and Social Services Departments.

Senator A. Breckon and Mr. A. Fearn declared an interest in the matter and did not take part in discussions.

The  Committee  noted  that  the  matter  had  arisen  following  the publication in October 2006 of the report of the CAG concerning the governance arrangements of the Battle of Flowers Association.

The CAG informed the Committee that he was currently carrying out a corporate  governance  review  of  the  States-owned  companies.  The Committee considered that it would await the report of the CAG prior to considering the matter.

Committee A7. The Committee considered its procedures in relation to holding meetings in procedures. public or in private.

512/1(30)

The Committee considered that it would endeavour to hold the majority of its discussions in public session wherever possible. However, it agreed that the CAG's report to the Committee regarding his ongoing work programme should be held in private session at future meetings and that preparation for public hearings should be held in private to enable full and frank discussions to take place in accordance with the Code of Practice on Public Access to Official Information.