14 June 2012
Senator Philip Ozouf made the following statement when presenting the Financial Report and Accounts for 2011:
- our independent auditors confirm the Accounts show a 'true and fair view'
- there is clear disclosure of how States money is being spent
- Total (Gross) Expenditure by Ministerial and Non-Ministerial Departments in 2011 was £725 million
- taking into account departmental income (£126 million), this gave Net Revenue Expenditure of Ministerial and Non-Ministerial Departments of £599 million – similar to that spent in 2010. This means a reduction in real terms in our spending
Prudent management
The Public Finances Law does not permit departments to be overspent. During 2011 they managed their expenditure well, resulting in an underspend of £27 million.
The decision to allow departments to carry these amounts forward to 2012 will allow them to make the best use of the funds, contributing to long-term efficiency and savings. It will also help departments meet their share of the £65 million savings target.
Departments are using their carry forwards to fund essential States projects in 2012, including initiatives to tackle unemployment (£7.4 million) and improvements to States Housing (£1.4 million).
Income
States Income was £587 million in 2011. That's £41 million more than in 2010 and £22 million more than forecast, largely because of higher than expected tax receipts from businesses and personal income tax (£19 million). This figure is within the prudent forecast range of plus or minus £20 million.
It is good news that our economy is standing up better than expected in these turbulent times.
The States consolidated fund held £47 million unallocated at the end of 2011. That’s £23 million better than forecast at the time of the 2012 Budget. This is mostly due to the additional income. As underspends will be carried forward to 2012 they don’t affect the available balance.
I am pleased that with the support of the States Assembly we have been able to use some of this additional income to bring forward spending of £27 million pounds on social housing projects. This delivers on our commitment to improve social housing and provides a much needed stimulus to the local construction industry.
Balance sheet
The accounts show a strong and healthy balance sheet and in the course of the coming year we will be taking steps to manage it more actively. I will be saying more about this as we continue with work on the Medium Term Financial Plan.
The holdings in States’ owned companies like Jersey Water, Jersey Post, Jersey Electricity and Jersey Telecom were valued at the end of the year at £326 million. This is an increase of £72 million from 2010, largely due to an increase in the value of Jersey Telecom. This is a consequence of the growth expected from investment in Gigabit Jersey and other new revenue generating activities.
The value of the States’ fixed assets, (land, property and infrastructure) is almost £3 billion pounds, an increase of £154 million pounds over the previous year.
States assets
In 2011 there was significant investment in States Assets: £64 million was spent from the Consolidated Fund on a variety of capital projects – including the Energy from Waste plant, more and better social housing for local people, improvements to the Prison, and the Town Park.
This investment in infrastructure is part funded from the sale of high value sites and surplus assets, to deliver best value for Jersey. This is all good news for our future.
Medium Term Financial Plan
Looking ahead we are bringing forward proposals for the first Medium Term Financial Plan in July. Work is continuing to strengthen financial management across the public sector and to deliver better value for Jersey.
We are continuing to tackle a structural deficit and should stick to our plans for ensuring sustainable finances. We need to continue to support the Island’s economy.
A great deal of hard work went into these accounts and I am grateful to the Treasury team and the departmental Finance Teams that prepare them. I was particularly pleased with the positive comments about the quality of work that underpins these accounts, from our independent auditors Price Waterhouse Coopers (PwC).
I look forward to the opportunity to brief States Members more fully on the accounts at St Paul’s Centre on Tuesday 19 June at 11am.
Minister for Treasury and Resources - Senator Philip Ozouf
Download States of Jersey Financial Report and Accounts 2011 (size 3.74mb)
gov.je