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Allocation of Consolidated Fund: Approval of Additional Expediture: Covid-19

A formal published “Ministerial Decision” is required as a record of the decision of a Minister (or an Assistant Minister where they have delegated authority) as they exercise their responsibilities and powers.

Ministers are elected by the States Assembly and have legal responsibilities and powers as “corporation sole” under the States of Jersey Law 2005 by virtue of their office and in their areas of responsibility, including entering into agreements, and under any legislation conferring on them powers.

An accurate record of “Ministerial Decisions” is vital to effective governance, including:

  • demonstrating that good governance, and clear lines of accountability and authority, are in place around decisions-making – including the reasons and basis on which a decision is made, and the action required to implement a decision

  • providing a record of decisions and actions that will be available for examination by States Members, and Panels and Committees of the States Assembly; the public, organisations, and the media; and as a historical record and point of reference for the conduct of public affairs

Ministers are individually accountable to the States Assembly, including for the actions of the departments and agencies which discharge their responsibilities.

The Freedom of Information Law (Jersey) Law 2011 is used as a guide when determining what information is be published. While there is a presumption toward publication to support of transparency and accountability, detailed information may not be published if, for example, it would constitute a breach of data protection, or disclosure would prejudice commercial interest.

A decision made 24 April 2020:

Decision Reference: MD-TR-2020-0047

Decision Summary Title:

Approval of additional expenditure from the Consolidated Fund for the General Reserve

Date of Decision Summary:

23rd April 2020

Decision Summary Author:

Head of Financial Governance

Decision Summary:

Public or Exempt?

Public

Type of Report:

Oral or Written?

Written

Person Giving

Oral Report:

n/a

Written Report

Title:

Approval of additional expenditure from the Consolidated Fund for the General Reserve

Date of Written Report:

23rd April 2020

Written Report Author:

Head of Financial Governance

Written Report :

Public or Exempt?

Public

Subject: Approval of additional expenditure from the Consolidated Fund for the General Reserve

Decision(s):

 

The Minister decided to approve additional expenditure from the Consolidated Fund of £99,990,000, to be added to the General Reserve head of expenditure for the purposes of reallocation to meet additional Covid-19 costs.

 

Reason(s) for Decision:

 

P.28/2020 Draft Public Finances (Amendment of Law) (Jersey) Regulations 202-, approved by the States Assembly on 24th March 2020, agreed a number of temporary modifications to the Public Finances (Jersey) Law 2019. The added modifications affect the way in which the Stabilisation Fund may be used, by allowing the Minister –

•          to transfer an amount from the Stabilisation Fund to any other fund and direct that amount to be expended directly from that fund;

•          to direct that an amount be expended directly from the Stabilisation Fund;

•          to direct that an amount be transferred to the Stabilisation Fund from any other fund;

•          to arrange for overdraft and other financing for the Stabilisation Fund;

•          to arrange that repayments of loans made from the Stabilisation Fund are credited to that Fund.

There are other added modifications, which –

•          allow the Minister to transfer up to and including £400 million from the Strategic Reserve Fund to the Stabilisation Fund;

•          remove the requirement in Article 18 that if the Minister proposes to give a direction to re-allocate a head of expenditure, the Minister gives the States at least 4 weeks’ notice;

•          increase from £10 million to £100 million the amount which may be appropriated from the Consolidated Fund by the Minister without amending the government plan;

•          increase the limit on financing that the Minister may arrange in a financial year from £3 million to £500 million and the limit on total outstanding financing from £20 million to £500 million;

•          allow the Minister to make loans from the Stabilisation Fund (instead of only from the Consolidated Fund), and increase the limit on loans that the Minister may make in a financial year from £3 million to £100 million and the limit on total outstanding loans from £20 million to £100 million;

•          increase the limit on guarantees and indemnities that the Minister may provide in a financial year from £3 million to £100 million and the limit on the total outstanding guarantees from £20 million to £100 million.

 

The amendment to P.28/2020, brought by the Corporate Services Scrutiny Panel and adopted by the Assembly, clarified that:

•          the amended powers expire on 30th September 2020; and

•          where the Minister has obtained financing, lent money or provided guarantees or indemnities under Articles 26 to 28 while Article 24(8) applied, the financing, lending or provision of guarantees or indemnities remain valid and are not included in any monetary limits set out in Articles 26 to 28 as those Articles apply after the expiry of the modifications.

 

The Minister brought these amended powers into effect through MD-TR-2020-0029 by deciding that she considered there exists an immediate threat to the health or safety of any of the inhabitants of Jersey and to the stability of the economy in Jersey.

 

Article 24 of the Public Finances (Jersey) Law 2019, as amended by P.28/2020, requires, in 24(1) that the Minister be satisfied that:

(a) the circumstances described in paragraph (2) require an immediate expenditure; and

(b) no other amount, or an insufficient amount, may be withdrawn from the Consolidated Fund under the applicable approved government plan.

 

Article 24(2) states:

(2) The circumstances referred to in paragraph (1)(a) are –

(a) a state of emergency has been declared under the Emergency Powers and Planning (Jersey) Law 1990; or

(b) the Minister is satisfied that there exists an immediate threat to the health or safety of any of the inhabitants of Jersey, to the stability of the economy in Jersey or to the environment.

 

The Minister has satisfied Article 24(1)(a) through MD-TR-2020-0029. The Minister is also satisfied, upon the advice and recommendation of the Treasurer, that expenditure approvals under the Government Plan 2020-2023, including those for the General Reserve, will be insufficient to meet imminent funding needs, in particular phase 2 of the Co-funded Payroll Scheme.

 

 

Resource Implications: The General Reserve head of expenditure will increase by £99,990,000.

Action required: Head of Financial Governance to ensure this decision is published on www.gov.je and notify the Group Director – Strategic Finance.

 

Signature:

 

 

Position:  Deputy S J Pinel, Minister for Treasury and Resources

Date Signed:

 

Date of Decision:

 

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