Health Insurance Fund: Transfer 2012 Funds to Consolidated Fund

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A decision made 16 November 2011 regarding:

Decision Reference: MD-S-2011-0089
Decision Summary Title :	DS – Transfer of funds in 2012 from Health Insurance Fund to Consolidated Fund.		Date of Decision Summary:	11 November 2011
Decision Summary Author:	Strategy and Policy Director		Decision Summary: Public or Exempt?	Public
Type of Report: Oral or Written?	Written		Person Giving Oral Report:	N/A
Written Report Title :	WR - Transfer of funds in 2012 from Health Insurance Fund to Consolidated Fund.		Date of Written Report:	11 November 2011
Written Report Author:	Strategy and Policy Director		Written Report : Public or Exempt?	Public
Subject: Transfer of funds in 2012 from Health Insurance Fund to Consolidated Fund.
Decision(s): The Minister decided to lodge ‘au Greffe’ a Report and Proposition relating to the transfer of funds in 2012 from the Health Insurance Fund to the Consolidated Fund.
Reason(s) for Decision: The Report and Proposition gives effect to two previous States decisions, to allow a transfer of funds from the Health Insurance Fund to the Consolidated Fund in 2012 (P.125/2010) and to set the value of that transfer at £6,131,000 (P.123/2011)
Resource Implications: There are no manpower implications. The transfer will be met from within the accumulated surplus of the Health Insurance Fund, which amounted to £83 million as at the end of December 2010
Action required: Strategy and Policy Director to request the Greffier of the States to arrange for the Report and Proposition to be lodged ‘au Greffe’.
Signature:		Position: Minister
Date Signed:		Date of Decision (If different from Date Signed):

Health Insurance Fund: Transfer 2012 Funds to Consolidated Fund

PROPOSITION

HEALTH INSURANCE FUND: TRANSFER TO HEALTH AND SOCIAL SERVICES DEPARTMENT FOR 2012

THE STATES are asked to decide whether they are of opinion –

to refer to their Act dated 18th November 2010 in which they adopted, subject to the sanction of Her Most Excellent Majesty in Council, the draft Health Insurance Fund (Miscellaneous Provisions) (Jersey) Law 201- and to their Act dated 15th September 2011 in which they adopted the Annual Business Plan 2012 and agreed, inter alia, that there should be a transfer of £6,131,000 from the Health Insurance Fund in 2012; and

to agree, in accordance with the provisions of Article 2 of the Health Insurance Fund (Miscellaneous Provisions) (Jersey) Law 2011, that there shall be withdrawn from the Health Insurance Fund and credited to the consolidated fund, for the purpose of funding primary care services in 2012, the sum of £6,131,000 with the sum to be treated as income of the Health and Social Services Department in accordance with the provisions of Article 2.

MINISTER FOR SOCIAL SECURITY

Report

This proposition arises from two previous States decisions:

On 18 November 2010, the States Assembly agreed P.125/2010. This proposition created a standalone piece of legislation (the Health Insurance Fund (Miscellaneous Provisions) (Jersey) Law 2011) to provide for up to two transfers from the Health Insurance Fund to the consolidated fund. The first transfer of £6,131,000 was included within the primary legislation and applied to the year 2011.

This legislation was registered in the Royal Court on 21 October 2011. A copy of the original proposition is included as an Appendix to this report.

On 15 September 2011, the States Assembly agreed the draft business plan for 2012 (P123/2011). This proposition identified the value of a second transfer in 2012 under the legislation, equal to £6,131,000. The proposition included the following section –

“to receive the draft Annual Business Plan 2012 and –

to approve the summary set out in Summary Table A, page 69, being the gross revenue expenditure of each States funded body, including depreciation, a proposed transfer from the Health Insurance Fund of £6,131,000, and the additional provisions of net revenue expenditure for central reserves of £12,485,000 and restructuring costs of £10,000,000 as part of the total net revenue expenditure of the Treasury and Resources Department and, having taken into account any income due to each of the States funded bodies, the total net revenue expenditure of £655,920,000,to be withdrawn from the consolidated fund in 2012; with any increase above this figure compensated by appropriate measures within the draft Budget 2012 to enable the Minister for Treasury and Resources to present a draft Budget which forecasts a return to balanced budgets by 2013 as set out in Figure 4.6.”

This proposition is needed to bring together these two existing decisions and to specify the value to be transferred in 2012. Article 2 of the Health Insurance Fund (Miscellaneous Provisions) (Jersey) Law 2011 is in the following terms –

“2 Authority to withdraw money from Health Insurance Fund for 2012

(1) Notwithstanding Article 21(1) of the Health Insurance (Jersey) Law 1967, there shall be withdrawn from the Health Insurance Fund and credited to the consolidated fund, for the purpose of funding primary care services in 2012, such sum (if any) as is specified in a proposition lodged by the Minister for Social Security and adopted by the States.

(2) Money credited to the consolidated fund pursuant to paragraph (1) is, for the purposes of the Public Finances (Jersey) Law 2005, to be treated as income of, and paid into the consolidated fund by, the Health and Social Services Department.”

This proposition is brought forward by the Minister in accordance with the above Article to give legal effect to the transfer of £6,131,000 as agreed in the Annual Business Plan. As can be seen the Article requires the transferred sum to be used for the purpose of funding primary care and the transfer is treated as income of the Health and Social Services Department when it is credited to the consolidated fund.

The release of the £6,131,000 to the Health and Social Services Department in 2012 will follow the same process as 2011. It will be tightly controlled by the Minister for Treasury and Resources. The Minister for Treasury and Resources will only sanction the release of funding upon receipt of evidence from the Health and Social Services Department confirming expenditure in respect of primary care services. The balance of the cost of primary care services administered through HSSD will continue to be funded directly from the HSSD revenue budget.

Financial and Manpower Implications

There are no manpower implications arising from this proposition.

The financial implications for the year 2012 will be met from within the accumulated surplus within the Health Insurance Fund, which amounted to £83m as at 31 December 2010.