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Chief Minister's Department: Budget Carry Forwards

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A decision made 17 January 2012:

Decision Reference:  MD-C-2012-0006

Decision Summary Title:

Approval in principle of Chief Minister’s Department Carry Forwards

Date of Decision Summary:

6th January 2012

Decision Summary Author:

Finance Manager – Corporate Group

Decision Summary:

Public or Exempt?

Public

Type of Report:

Oral or Written?

Written

Person Giving

Oral Report:

N/A

Written Report

Title:

Approval in principle of Chief Minister’s Department Carry Forwards

Date of Written Report:

6th January 2012

Written Report Author:

Finance Manager – Corporate Group

Written Report :

Public or Exempt?

Public

Subject: To request approval in principle from the Treasury and Resources Minister for the carry forward of unspent 2011 revenue budgets in the Chief Minister’s Department to fund the 2012 cost pressures described in this report.

Decision(s): The Chief Minister agreed to request that the Treasury and Resources Minister approves in principle the carry forward of the Chief Minister’s Department unspent 2011 revenue budget up to a limit of £277,000 with effect 1st January 2012, as described in the accompanying report.

Reason(s) for Decision: Under Article 15(1) of the Public Finances (Jersey) Law 2005 the Minister for Treasury and Resources can permit all or any part of the amount appropriated by a head of expenditure to:

  1. be used for the purposes of another head of expenditure; or
  2. In the case of revenue expenditure, be withdrawn from the Consolidated Fund after the end of the relevant financial year.

Financial Direction 3.6 section 5.1 states that departments wishing to transfer funds between heads of expenditure must obtain the approval of their minister.

Resource Implications: The amount of the carry forward for these purposes will be limited to £277,000 and will not exceed the under-spend achieved by CMD in 2011. Funding for 2013 and future years will be considered as part of the first Medium Term Financial Plan.

Action required:  Project and Research Officer to inform the Finance Director – Corporate Group of the Chief Minister’s decision. Minister for Treasury and Resources to agree ministerial decision approving the carry forward.

Signature:

 

Position:

 

Senator  I.J. Gorst, Chief Minister

Date Signed:

Date of Decision:

Hide report
Chief Minister's Department: Budget Carry Forwards

 - 1 -

Chief Minister’s Department

Ministerial Decision Report

 

 

 

APPROVAL IN PRINCIPLE OF Chief Minister’s Department CARRY FORWARDS

 

  1. Purpose of Report

To approve in principle the carry forward of unspent 2011 revenue budgets in the Chief Minister’s Department   to fund the 2012 cost pressures described in this report.

 

  1. Background

The Chief Minister’s Department (CMD) has identified an underlying revenue budget deficit of £577,000 for 2012 arising predominantly from the International Affairs Department.

 

At the start of the Comprehensive Spending Review (CSR) process in early 2010, it was accepted that International Affairs would need to be an area of growth, rather than an area for reduction.  The Director of International Affairs identified that £750,000 growth funds were required to ensure that the Department for International Affairs was put onto a proper financial footing.

 

However, such significant growth in recurring revenue budgets was deemed unacceptable in the context of the CSR and the requirement to reduce recurring expenditure budgets. The growth request was reduced to £200k (August 2010) representing the estimated additional funding required to establish the Channel Islands Brussels Office on top of the base budget of £150,000. This growth sum was subsequently consolidated into the Annual Business Plan 2011(ABP). (Nb the actual cost is now known to be £400,000 per annum and the £50,000 shortfall is part of the current deficit).  

 

All other programmed activities were funded from the Fiscal Stimulus programme in 2010 and 2011 as the focus of international effort has been the protection of Jersey’s economy from external threat during the economic downturn in these years.

 

In 2011, an additional issue emerged and growth of £152,000 was approved to fund two new posts needed as a result of the UK Ministry of Justice withdrawing from routinely intermediating with UK Government departments and Westminster on our behalf. This was an unrelated pressure which emerged due to change in UK policy.

 

CMD has lodged requests via the ‘Carry forward and Cost Pressure’ process to cover the anticipated funding deficit in 2012 and will make a formal bid for recurring funding in 2013 through the Medium Term Financial Plan Process.

 

The International Affairs’ programme has to be organised in advance of the outcome of the carry forward process. International activity includes visits to and from overseas jurisdictions such as London, Brussels, India, China, and the Middle East, and active participation in fora such as the OECD Global Forum and G20 summits. Once arranged, such visits cannot be stood down without risk of reputational damage or financial loss.

 

CMD is therefore requesting approval in principle for £277,000 of its underspend in 2011 to be carried forward with effect from 1 January 2012.  This will allow sufficient certainty for the Chief Minister to commit to the International Affairs programme for the first 8 months of 2012, pending the outcome of cost pressure bids.

 

 

 

 

  1. Detail of CMD’s 2012 deficit and proposed funding sources

The table below shows the detail of the underlying deficit in CMD and proposed funding sources for 2012.

 

 

The Assisting Developing Countries Conference (£100,000) and British Irish Council (£10,000) take place biennially in even years. At 2011 prices, the annual funding shortfalls over the period of the Medium Term Financial Plan 2013 to 2015 are £467,000 in 2013, £577,000 in 2014 and £467,000 in 2015. The average shortfall is £522,000 every two years.

 

A bid will be made to address the underlying average shortfall of £522,000 per annum through the Medium Term Financial Plan 2013 to 2015 which will reflect the spending profile as directed.

 

  1. Recommendation

That the Chief Minister requests the approval in principle of the carry forward of CMD’s unspent 2011 revenue budget up to a limit of £277,000 to fund the 2012 cost pressures described in this report.

 

  1. Reason for Decision

Under Article 15(1) of the Public Finances (Jersey) Law 2005 the Minister for Treasury and Resources can permit all or any part of the amount appropriated by a head of expenditure to:

(a)   be used for the purposes of another head of expenditure; or

(b)  In the case of revenue expenditure, be withdrawn from the Consolidated Fund after the end of the relevant financial year.

  1. Resource Implications

The amount of the carry forward for these purposes will be limited to £277,000 and will not exceed the under-spend achieved by CMD in 2011. Funding for 2013 and future years will be considered as part of the first Medium Term Financial Plan.

 

 

 

 

 

 

Report author :Finance Director – Corporate Group

Document date  4 January 2012

Quality Assurance / Review : Head of Decision Support

File name and path: l:\treasury\sections\corporate finance\ministerial decisions\dss, wrs and sds\2012-0003 -\1.draft wr cmd 2011 carry forwards.docm

MD sponsor : Chief Executive

 

 

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