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Economic Development Ofcom and Digital Switchover Income: Carry forward to 2012

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.

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A decision made on 8 August 2011:

Decision Reference:  MD-TR-2011-0105

Decision Summary Title:

Carry Forward of EDD Ofcom and Digital Switchover Income to 2012

Date of Decision Summary:

2nd August 2011

Decision Summary Author:

Head of Decision Support

Decision Summary:

Public or Exempt?

Public

Type of Report:

Oral or Written?

Written

Person Giving

Oral Report:

N/A

Written Report

Title:

Carry Forward of EDD Ofcom and Digital Switchover Income to 2012

Date of Written Report:

2nd August 2011

Written Report Author:

Head of Decision Support

Written Report :

Public or Exempt?

Public

Subject:  Carry Forward of Economic Development Department (EDD) Ofcom and Digital Switchover income to 2012.

Decision(s):  The Minister decided to:

(a) agree that the unanticipated income of £714,984 to EDD in 2011 from Ofcom and Digital Switchover should be added to the Department’s approved net revenue expenditure for 2011; and

(b) agree that any such income not spent by the Department in 2011 can be carried forward for expenditure in 2012

 

subject to the amount of such income to be carried forward being no less than the total underspend for EDD in 2011.

Reason(s) for Decision:  Under Article 14(6) of the Public Finances (Jersey) Law 2005 the Minister for Treasury and Resources can authorise a States funded body to withdraw from the consolidated fund during a year an amount not exceeding the likely excess of income over the amount approved in that year’s Annual Business Plan.

 

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.

Resource Implications:  The maximum approved carry forward will be £714,984. If the total underspend for EDD is less than this amount then the amount approved to be carried forward is limited to the amount of the total departmental underspend.

The Minister is clear that this funding cannot be regarded as ‘ring fenced’ should the total underspend for EDD as a whole be less than the amount of the unspent portion of this income. For example, if the unspent income is £600,000 but the total underspend for EDD as a whole is £500,000 then the amount to be carried forward under this decision will be limited to £500,000.

2012 estimated income and expenditure has been included in the draft 2012 Annual Business Plan. Funding for 2013 will be considered as part of the first Medium Term Financial Plan.

Action required: Head of Decision Support to inform the EDD Finance Director and the Head of Financial Performance Reporting of this decision.

Signature:

 

 

 

 

Position: Senator  P F C Ozouf, Minister for Treasury and Resources

 

                 

 

Date Signed:

 

Date of Decision:

Hide report
Economic Development Ofcom and Digital Switchover Income: Carry forward to 2012

 - 1 -

Treasury and Resources

Ministerial Decision Report

 

 

Carry Forward of EDD Ofcom and Digital Switchover income to 2012

 

  1. Purpose of Report

 

To enable the Minister to consider whether to:

 

(a) agree that the unanticipated income of £714,984 to EDD in 2011 from Ofcom and Digital Switchover should be added to the Department’s approved net revenue expenditure for 2011; and

(b) agree that any such income not spent by the Department in 2011 can be carried forward for expenditure in 2012

 

subject to the amount of such income to be carried forward being no less than the total underspend for EDD in 2011.

 

2.   Background

 

EDD has received funding from the BBC in respect of under-spends on the UK-wide Digital Switchover publicity and Help programmes, funded by top-slicing the TV Licence fees in 2010 and 2011.

 

EDD has also recently received funding from Ofcom in respect of Wireless Telegraphy Licence fees which the Department believes will be annually recurring until at least 2014, when impending changes to the UK Wireless Telegraphy Act are due to come into effect. Fees are collected by Ofcom on behalf of the States of Jersey, under authority of various pieces of legislation, most notably the Communications (Jersey) Order 2003, SI 2003/3197, arts 6, 7, Sch 2, para 91 (as amended by SI 2006/3324, art 4(2), Sch 2, Pt 2) and SI 2003/3197, arts 1(3)–(5), 2.

 

Given their source and purpose, EDD considers it is not appropriate for the States to use this income in any way it wishes. This money is collected under statutory provisions to cover the costs of licensing, and therefore EDD considers it should be utilised in a manner consistent with the legislation.

 

EDD considers that this funding provides the opportunity of ensuring ongoing investment in the development of the Island’s economy, without the need for further public funds to do so.

 

To date in 2011 EDD has received £342,505 from the Digital Switchover and £372,479 from Wireless Telegraphy Licence Fees. The Department is requesting that the T&R Minister agrees the carry forward of any unspent amounts from the total (£714,984) to be spent for the above purposes in 2012.

 

Further income of approximately £82,000 from the Digital Switchover is expected over the next 2 years, and £350,000 per annum for each of the years 2012 – 2014 from Wireless Telegraphy Licence Fees (although is the exact sums are not certain).

 

 

 

3.   Proposed use of carry forward funding by EDD

 

The Department has proposed the following as the uses of the additional income:

 

  • Provision of matched or seed-corn funding for key priority initiatives in the new Economic Growth Strategy focused on IT, media, E-commerce, Tourism and renewable energy, namely:
  •            E-Commerce Commission
  •            ICT Strategy
  • Promotion of Jersey as a location for technology testing, particularly in ICT & Broadband
  • Support of future Development and maintenance of broadcasting, communications and digital economy legislation and policy (including broadcasting and wireless telegraphy) in Jersey, to secure future economic advantage for local businesses and the population
  • Greater exploitation of newly introduced legislation in areas such as E-Commerce, E-Gaming & intellectual property
  • Mapping and developing on-island capacity in the media/creative industries, through the creation of a network capable of servicing local & off-island requirements
  • Delivering, in conjunction with the Skills Executive, against the potential to create future employment opportunities for young people within the tourism, broadcast, media, e-commerce or wider creative industries
  • Marketing Jersey to outside media interests as a location for film/TV making, media conference hosting and future development of e-commerce/creative industries focused events.

It is unlikely that all of the additional income will be spent in 2011. EDD has therefore requested that it be allowed to carry forward the unspent amount into 2012 so it can be used for the purposes that the Department feels are appropriate.

 

4.   Recommendation

 

It is recommended that the Minister agrees that:

 

(a) the unanticipated income of £714,984 to EDD in 2011 from Ofcom and Digital Switchover should be added to the Department’s approved net revenue expenditure for 2011; and

(b) any such income not spent by the Department in 2011 can be carried forward for expenditure in 2012

 

subject to the amount of such income to be carried forward being no less than the total underspend for EDD in 2011.

 

5.   Reasons for Decision

 

Under Article 14(6) of the Public Finances (Jersey) Law 2005 the Minister for Treasury and Resources can authorise a States funded body to withdraw from the consolidated fund during a year an amount not exceeding the likely excess of income over the amount approved in that year’s Annual Business Plan.

 

 

 

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.

 

6.   Resource implications

 

The maximum approved carry forward will be £714,984. If the total underspend for EDD is less than this amount then the amount approved to be carried forward is limited to the amount of the total departmental underspend.

 

The Minister is clear that this funding cannot be regarded as “ring fenced” should the total underspend for EDD as a whole be less than the amount of the unspent portion of this income. For example, if the unspent income is £600,000 but the total underspend for EDD as a whole is £500,000 then the amount to be carried forward under this decision will be limited to £500,000.

 

2012 estimated income and expenditure has been included in the draft 2012 Annual Business Plan. Funding for 2013 will be considered as part of the first Medium Term Financial Plan.

 

Report author : Head of Decision Support

Document date : 2nd August 2011

Quality Assurance / Review : Director of Financial Planning and Performance

File name and path: L:\Treasury\Sections\Corporate Finance\Ministerial Decisions\DSs, WRs and SDs\2011-0105 - Carry Forward of EDD Ofcom Funding to 2012 - KH\WR - Carry Forward of EDD Ofcom Funding to 2012 - KH.doc

MD Sponsor : Treasurer of the States

 

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