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A decision made 16 November 2009 regarding: States tenants - recharge by Housing of digital switch-over costs.

Decision Reference: MD-TR-2009-0180
Decision Summary Title:	Housing Department –Recharge to States Tenants for Analogue TV to Digital TV Switchover		Date of Decision Summary:	5 November 2009
Decision Summary Author:	Finance Manager, Decision Support		Decision Summary: Public or Exempt?	Public
Type of Report: Oral or Written?	Written		Person Giving Oral Report:	N/A
Written Report Title:	Housing Department –Recharge to States Tenants for Analogue TV to Digital TV Switchover		Date of Written Report:	5 November 2009
Written Report Author:	Finance Manager, Decision Support		Written Report : Public or Exempt?	Public
Subject: The Minister for Treasury and Resources to approve the Housing Department’s request to recharge States tenants for services rendered relating to the switchover from analogue TV to digital TV.
Decision(s): The Minister for Treasury and Resources approved the total recharge of £166,400 (net of GST) to States tenants in order to reflect the cost of converting the 3,200 properties from analogue TV to digital TV.
Reason(s) for Decision: Financial Direction 4.1 Increases in States Fees and Charges states that where a fee or charge increase exceeds the limit of 2.5% per annum the Minister for Treasury and Resources is responsible for approving the increase.
Resource Implications: There are no financial or manpower resource implications other than those noted in the report.
Action required: Finance Manager to inform Finance Director, Housing Department that the recharge has been approved.
Signature:		Position: Deputy E. J. Noel, Assistant Minister for Treasury and Resources
Date Signed:		Date of Decision:

States tenants - recharge by Housing of digital switch-over costs

TREASURY & Resources ITEM NO:

TREASURY AND RESOURCES MINISTER

housing department – RECHARGE to states tenants for analogue tv to digital tv switchover

Purpose of Report

Financial Direction 4.1 “Increases in States Fees and Charges” recognises that there are instances where one particular group receives a valuable service from a States Department at a charge which is below cost and they are, therefore, being subsidised by taxpayers generally. It is up to departments to carefully consider whether there is a case for the user to meet either the full cost or a greater proportion of the cost of service provided it does not exceed the cost of the service. Where a charge increase exceeds the limit of 2.5 percent per annum the Minister for Treasury and Resources is responsible for approving the increase.

The Housing Department request approval to recharge States tenants for services rendered relating to the switchover from analogue TV to digital TV.

Background

In November 2010 all Island residents will be required to switch from analogue to digital television in order to continue receiving free to air channels 1 .

The Housing Department has estimated the total cost of switching States tenants from analogue to digital television will be £214,000 or £67 for each of the approximate 3,200 properties. This cost only includes the instalment of the relevant cabling and replacement of aerial hardware in order for the digital signal to be received. It does not include the cost of purchasing the required ‘digital set-top box’ to decode the digital signal to analogue for residents who do not own a television with built in digital receiver, and this additional cost will need to be borne by tenants where necessary. In light of this, the Department proposes to absorb £47,600 and re-charge only £166,400 (net of GST) of the full installation cost.

The Department proposes to spread the cost over 52 weeks commencing 4 January 2010. This equates to £1.00 (net of GST) per week.

Consideration was given as to whether this unique one off charge falls under P.63/2003 ‘States Approval For New “User Pays” Charges’ requiring all new user pays charges to be approved via the Minister for Treasury and Resources taking a proposition to the States. The report attached to P.63/2009 states:-

“ We are faced with the possibility of a variety of new – so-called “user pays” – charges being introduced for services that have hitherto been funded through taxation. At present the proposed charge that has drawn most notice is the proposed sewerage charge.”

For the avoidance of doubt, the opinion of the States Greffe was sought who confirmed that because this service was not fully funded through taxation in the past, the charge does not fall under the remit of P.63/2009.

Recommendation

The Minister for Treasury and Resources to approve Housing Department’s request to recharge States tenants £166,400 over 52 weeks, at £1.03 per week per property, to reflected the cost of converting the 3,200 properties from analogue TV to digital TV.

Reason for Decision

Financial Direction 4.1 Increases in States Fees and Charges states that where a fee or charge increase exceeds the limit of 2.5% per annum the Minister for Treasury and Resources is responsible for approving the fee increase.

States Treasury Nick Collins, Finance Manager Decision Support

10 November, 2009

1 BBC, ITV, Channel 4 and Channel 5