Bus profit income transfer for bus network and road safety improvements

Information about the publication of Ministerial Decisions

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While there is a presumption toward publication to support of transparency and accountability, detailed information may not be published if, for example, it would constitute a breach of data protection, or disclosure would prejudice commercial interest.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 25 September 2017:

Decision Reference: MD-T-2017-0070
Decision Summary Title :	Use of Bus Contract Income to Fund Bus Network and Road Safety Improvements		Date of Decision Summary:	20 September 2017
Decision Summary Author:	Finance Manager		Decision Summary: Public or Exempt?	Public
Type of Report: Oral or Written?	Written		Person Giving Oral Report:	N/A
Written Report Title :	Use of Bus Contract Income to Fund Bus Network and Road Safety Improvements		Date of Written Report:	20 September 2017
Written Report Author:	Finance Manager		Written Report : Public or Exempt?	Public
Subject: Transfer of the bus profit share income to Capital to allow bus network and road safety improvements as set out in the contract with the bus operator.
Decision(s): The Minister approved an increase in the DfI Revenue Head of Expenditure income and expenditure budget of up to £115,000 and the subsequent transfer of up to £75,000 expenditure budget to the Road Safety Improvements Capital Head of Expenditure (Q00MF15037) in order to allow capital spend on bus network and road safety improvements..
Reason(s) for Decision: Article 19 (1) (a) of the Public Finances (Jersey) Law 2005 states that if, during a financial year, the Minister is satisfied that the income of a States funded body which has a revenue head of expenditure for the year is likely to exceed its estimated income taken into account in approving that head of expenditure – (a) the Minister may authorize the body to withdraw from the consolidated fund during that year an amount not exceeding the likely excess of income. Article 18(1)(a) of the Public Finances (Jersey) Law 2005 states that all or any part of the amount appropriated by a head of expenditure may, with the approval of the Minister for Treasury and Resources, be transferred from a capital head of expenditure to a revenue head of expenditure, or vice versa, in order to comply with generally accepted accounting principles or an Order made under Article 32. Delegation 1.2 delegates authority to agree non-contentious transfers between heads of expenditure up to £1,000,000 to the Treasurer of the States and authority for non-contentious transfers between heads of expenditure with no financial limit to the Treasurer of the States where the transfer is solely to ensure that financial transactions are accurately reflected in the States’ Accounts in accordance with GAAP or an Order made under Article 32 of the Law. Delegation 1.3 authorises the Treasurer of the States to approve the use of additional income in all non-contentious cases where any such additional income matches additional expenditure. Delegation 1.3 also authorises the Treasurer of the States to approve the use of additional income in excess of increased expenditure (i.e. additional surplus income) required to generate that income but the excess income is more than 10% (up to a maximum of £500,000 for a States trading operation and £100,000 for all other States funded bodies) of the estimated income notified to the States for that particular service area.
Resource Implications: The DfI Revenue Head of Expenditure income and expenditure budget to increase by up to £115,000 and a subsequent transfer of up to £75,000 to the Road Safety Improvements Capital Head of Expenditure.
Action required: The Finance Director to request the Treasurer of the States to approve the creation of the income and expenditure budgets, and the budget transfer from revenue to capital as referred to in the accompanying report.
Signature:		Position: Minister for Infrastructure
Date Signed:		Date of Decision (If different from Date Signed):

Bus profit income transfer for bus network and road safety improvements

DEPARTMENT FOR INFRASTRUCTURE

USE OF BUS CONTRACT INCOME TO FUND BUS NETWORK AND ROAD

SAFETY IMPROVEMENTS

Purpose of Report

To enable the Minister for Infrastructure to approve the creation of up to £115,000 income and expenditure budgets within the Department for Infrastructure (DfI) revenue head of expenditure, and the subsequent internal budget transfer in 2017 of up to £75,000 from the DfI revenue head of expenditure to the Road Safety Improvements capital head of expenditure (Q00MF15037).

Background

As part of the bus operator contract with CT Plus Jersey Ltd (CT Plus), DfI receive a share of the profits generated locally, to be reinvested in further road safety improvements. The total profit share relating to the calendar year 2017 is £265,000, the budget for the profit share is £150,000 which has resulted in a surplus of £115,000; some of this was used within revenue to fund:

- Shortfalls within the main bus contract budget, including lower than expected revenue from bus station advertising

- Bus station maintenance and replacement of life-expired equipment, such as the CCTV system and automatic door componentry

- Passenger information improvements, for example further development of the TrackMyBus online bus locator facility

- Contribution towards additional concessionary costs as a result of growing demand for travel by senior citizens leading to increased reimbursement

- Route infrastructure improvements, including branch trimming, bus shelter repairs and other minor works

The revenue items identified above can be covered by the £150,000 already in the budget and the additional share of the £115,000 that remains within the revenue head of expenditure.

Some of the profit share will be used within capital to fund:

- Construction of bus shelters where other sources of funding, such as Planning Obligation Agreement developer contributions, are insufficient to cover the full costs

- Improvements to bus terminus facilities, including improvement works at Liberation Station to reconfigure the footways to better accommodate the types of vehicle now being operated

Recommendation

The Minister for Infrastructure is recommended to approve the use of income and the creation of up to £75,000 additional income and expenditure budgets within the DfI revenue head of expenditure, and the subsequent internal budget transfer in 2017 of up to £75,000 from the DfI revenue head of expenditure to the Road Safety Improvements capital head of expenditure (Q00MF15037).

Reason for Decision

Article 19 (1) (a) of the Public Finances (Jersey) Law 2005 states that if, during a financial year, the Minister is satisfied that the income of a States funded body which has a revenue head of expenditure for the year is likely to exceed its estimated income taken into account in approving that head of expenditure –

(a) the Minister may authorize the body to withdraw from the consolidated fund during that year an amount not exceeding the likely excess of income.

Article 18(1)(a) of the Public Finances (Jersey) Law 2005 states that all or any part of the amount appropriated by a head of expenditure may, with the approval of the Minister for Treasury and Resources, be transferred from a capital head of expenditure to a revenue head of expenditure, or vice versa, in order to comply with generally accepted accounting principles or an Order made under Article 32.

Delegation 1.2 delegates authority to agree non-contentious transfers between heads of expenditure up to £1,000,000 to the Treasurer of the States and authority for non-contentious transfers between heads of expenditure with no financial limit to the Treasurer of the States where the transfer is solely to ensure that financial transactions are accurately reflected in the States’ Accounts in accordance with GAAP or an Order made under Article 32 of the Law.

Delegation 1.3 authorises the Treasurer of the States to approve the use of additional income in all non-contentious cases where any such additional income matches additional expenditure. Delegation 1.3 also authorises the Treasurer of the States to approve the use of additional income in excess of increased expenditure (i.e. additional surplus income) required to generate that income but the excess income is more than 10% (up to a maximum of £500,000 for a States trading operation and £100,000 for all other States funded bodies) of the estimated income notified to the States for that particular service area.

Resource Implications

The DfI revenue head of expenditure will show an additional income budget of up to £75,000 and an additional expenditure budget of up to £75,000, a net nil change. Up to £150,000 of this expenditure budget will subsequently be transferred to the capital head of expenditure for Road Safety Improvements (Q00MF15037), increasing it by up to £75,000 and reducing the DfI revenue head of expenditure by up to £75,000.

6. Action Required

The Finance Director to request the Treasurer of the States to approve the creation of the income and expenditure budgets, and the budget transfer from revenue to capital as referred to in the accompanying report.

Written by:	Finance Manager
Approved by:	Director of Finance