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Information and public services for the Island of Jersey

L'înformâtion et les sèrvices publyis pouor I'Île dé Jèrri

Voluntary Redundancy Payments: Transfer of Funding

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A decision made on 24 December 2010 regarding the transfer of funding for voluntary redundancy payments

Decision Reference:  MD-TR-2010-0189

Decision Summary Title:

Transfers of funding from Social Security Department for Voluntary Redundancy (VR) payments

Date of Decision Summary:

15th December 2010

Decision Summary Author:

Head of Decision Support

Decision Summary:

Public or Exempt?

Public

Type of Report:

Oral or Written?

Written

Person Giving

Oral Report:

N/A

Written Report

Title:

Transfers of funding from Social Security Department for Voluntary Redundancy (VR) payments

Date of Written Report:

15th December 2010

Written Report Author:

Head of Decision Support

Written Report :

Public or Exempt?

Public

Subject:

Transfers of funding from Social Security Department for Voluntary Redundancy (VR) payments

Decision(s):

The Minister approved the transfer of a total of £470,841 from the Social Security Department to the revenue heads of expenditure of the departments listed in the table below for the second tranche of approved VR applications:

 

                                                                         

Chief Minister's Department                   £96,372

Education, Sport and Culture                 £84,846

Treasury and Resources                      £177,725

Home Affairs                                         £111,898

 

                                                            

 

Reason(s) for Decision:  

MD-TR-2010-0159, signed on 12th November 2010, approved the initial allocation of £5,760,373 (out of the £6 million approved by the States in P64/2010) from Treasury and Resources to the Chief Minister’s Department, and onwards to departments, to meet the cost of approved voluntary redundancy payments.

 

MD-TR-2010-0186 approved further transfers to reflect:

  • transfer back of funding where VR applications are no longer going ahead;
  • uplift of previous transfers by 2% for agreed pay award where applicants are leaving after 31st December 2010; and
  • transfer of the balance of approved P64/2010 funding for VRs from the Treasury and Resources contingency to the Chief Minister’s Department revenue head of expenditure – this balance amounts to £239,627.

 

This decision approves transfers from the Social Security Department Head of Expenditure to a number of departments to complete funding for approved VR applications in 2010.

 

Article 15(1)(a) of the Public Finances (Jersey) Law 2005 permits the Minister for Treasury and Resources to approve that a head of expenditure may be used for the purposes of another head of expenditure.  This decision further implements the States’ approval of P64/2010.

Resource Implications:

There will be no increase to total approved States net revenue expenditure as a result of this decision.

Action required:

Head of Decision Support to inform the Head of Financial Performance Reporting that the transfers have been approved.

Signature:

 

Position: Senator  P F C Ozouf, Minister for Treasury and Resources

            

 

Date Signed:

 

Date of Decision:

Voluntary Redundancy Payments: Transfer of Funding

 - 1 -

Treasury and Resources

Ministerial Decision Report

 

 

 

Transfers of funding from Social Security Department for Voluntary Redundancy (VR) payments

 

 

  1. Purpose of Report

To enable the Minister for Treasury and Resources to make a number of transfers of funding between the Social Security Department revenue head of expenditure and other departments for VR payments.

 

  1. Background – previous transfers

In P64/2010: “Public Finances (Jersey) Law 2005: Funding Requests under Article 11(8)” the States approved funding of up to an additional £6,000,000 from the consolidated fund for the Chief Minister’s Department for a voluntary redundancy scheme. Following States approval on 7th July 2010 £6 million was withdrawn from the consolidated fund and held temporarily in a Treasury and Resources contingency fund. The States Employment Board approved an initial tranche of voluntary redundancies costing a total of £5,760,373 from this funding. This amount was transferred to CMD in MD-TR-2010-0159 for transfer, in turn, to departments to make VR payments as detailed below:

 

Judicial Greffe

£155,018

Education, Sport and Culture

£712,844

Lieutenant Governor's

£96,673

Resources - Information Services

£364,888

Planning and Environment

£605,774

Property Holdings

£135,081

Economic Development

£43,610

Home Affairs

£385,684

Health and Social Services

£1,761,212

Housing

£360,048

Human Resources

£179,087

Transport and Technical Services

£960,454

 

 

Total

£5,760,373

 

These redundancies will deliver savings of over £3 million in a full year.

 

MD-TR-2010-0186 approved the transfer of the balance of the States approved funding (£239,627) from the Treasury and Resources contingency fund to the Chief Minister’s Department revenue head of expenditure to comply fully with P64/2010. That decision also approved other transfers:

 

As a result of a number of successful VR applications not going ahead, it was necessary to transfer some of the funding approved by MD-TR-2010-0159 (see above) back to CMD. The transfers approved were from the following departments:

 

 

 

 

£

Planning and Environment

113,734

Health and Social Services

82,188

CMD - Human Resources

70,490

 

 

 

 

Total for return

 

266,412

 

In addition, when the initial VR applications were considered, some leaving dates were unclear. Where applicants were leaving after 31st December 2010 they are entitled to receive their VR payment at the 2011 rate i.e. including the agreed 2% pay award. Some departments included this element in their original submissions, some did not. As a result the following transfers were necessary from CMD to ensure that departments are fully funded from the P64/2010 approval to meet their VR payments:

 

 

 

 

 

£

 

Judicial Greffe

 

3,100

 

CMD - Information Services

2,085

 

Planning and Environment

9,841

 

T&R - Jersey Property Holdings

2,702

 

Home Affairs

 

2,416

 

Health and Social Services

27,668

 

Transport and Technical Services

10,282

 

 

 

 

 

Total additional 2% allocations

 

58,093

 

Finally, the transfer was approved of the remaining balance of the States approved funding (£239,627) that was held in the Treasury and Resources contingency fund to the Chief Minister’s Department revenue head of expenditure to comply fully with P64/2010

 

The net effect of the above transfers is that a balance of £447,946 remains from the approved £6 million P64/2010 funding within the Chief Minister’s Department:

 

 

£

Transfers back from depts

266,412

Transfers to Depts for 2%

-58,093

Transfer of Balance from T&R

239,627

 

 

Balance remaining in CMD

447,946

 

Of the above balance, the T&R Minister has been notified that £11,550 will be spent on actuarial valuations relating to VR applications. Therefore the total unallocated balance of P64/1010 funding remaining was £436,396.

 

 

  1. Background – final transfers for 2010 approved VR applications

The Minister for Treasury and Resources has now made a decision on a second tranche of VR applications approved by the States Employment Board. The total cost of this second tranche is £907,237. Departments with VR applications approved in this tranche are as follows:

 

 

£

Chief Minister's Department

247,488

Education, Sport and Culture

84,846

CMD - Information Services

285,280

Treasury and Resources

177,725

Home Affairs

 

111,898

 

 

 

 

 

907,237

 

The Chief Minister’s and Information Services Departments’ VRs are proposed to be funded from the £436,396 balance described in paragraph 3 above. This leaves a shortfall of £96,372 required to fund the Chief Minister’s Department VRs. It is proposed to fund this, and the other departments listed in the table above, from the 2010 underspend of the Social Security Department. As at the end of October 2010 this was forecast to be £6.7 million. Transfers will therefore be as follows:

 

Social Security Department to:

 

 

 

 

£

 

Chief Minister's Department

96,372

 

Education, Sport and Culture

84,846

 

Treasury and Resources

177,725

 

Home Affairs

 

111,898

 

 

 

 

 

 

 

470,841

 

 

  1. Recommendation

That the Minister approves the transfer of a total of £470,841 from the Social Security Department to the revenue heads of expenditure of the departments listed in the table below for the second tranche of approved VR applications:

 

 

 

£

Chief Minister's Department

96,372

Education, Sport and Culture

84,846

Treasury and Resources

177,725

Home Affairs

 

111,898

 

 

 

 

 

470,841

 

 

  1. Reason for Decision

Article 15(1)(a) of the Public Finances (Jersey) Law 2005 permits the Minister for Treasury and Resources to approve that a head of expenditure may be used for the purposes of another head of expenditure. 

 

  1. Resource Implications

There is no increase to total approved States net revenue expenditure as a result of this decision.

 

 

 

Report author : Head of Decision Support

Document date : 15/12/10

Quality Assurance / Review : Head of Financial Performance Reporting

File name and path: l:\treasury\sections\corporate finance\ministerial decisions\dss, wrs and sds\2010-0189 - y2 vr - kh\wr - vr dec 2010 kh no. 2.doc

MD sponsor : Deputy Treasurer

 

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