Budget transfer from Central Contingency to Education Department: Rescindment of means-tested nursery education

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While there is a presumption toward publication to support of transparency and accountability, detailed information may not be published if, for example, it would constitute a breach of data protection, or disclosure would prejudice commercial interest.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 29 March 2018

Decision Reference: MD-TR-2018-0042
Decision Summary Title:	Provisional transfer from Central Contingency to the Education Department following the Education Minister’s decision to rescind means-tested Nursery education		Date of Decision Summary:	28th March 2018
Decision Summary Author:	Head of Decision Support		Decision Summary: Public or Exempt?	Public
Type of Report: Oral or Written?	Written		Person Giving Oral Report:
Written Report Title:	Transfer from Central Contingency to the Education Department following the Education Minister’s decision to rescind means-tested Nursery education		Date of Written Report:	28th March 2018
Written Report Author:	Head of Decision Support		Written Report : Public or Exempt?	Public
Subject: The provisional transfer of up to £250,000 in 2018 and up to £467,000 in 2019 from Central Contingency to the Education Department revenue head of expenditure following the Education Minister’s decision to rescind means-tested nursery education from September 2018.
Decision(s): The Minister approved the provisional transfer of up to £250,000 in 2018 and up to £467,000 in 2019 from Central Contingency to the Education Department revenue head of expenditure following the Education Minister’s decision to rescind means-tested nursery education from September 2018. The Contingency funding provisionally allocated is subject to the Department demonstrating that it is not able to meet the costs from existing resources, through efficiency savings or underspends, in 2018 and 2019. If the department is in an overspend position for either year after meeting costs of the decision to rescind means-tested nursery education the Contingency funding allocated by this decision will be that required to achieve a break-even position, up to a maximum of the above sums.
Reason(s) for Decision: Article 17(2) of the Public Finances (Jersey) Law 2005 states that the Minister for Treasury and Resources is authorised to approve the transfer from contingency expenditure of amounts not exceeding, in total, the amount available for contingency expenditure in a financial year. The current Contingency Allocation Policy (published as R.110/2017) sets the requirement for all allocations from Contingency over £100,000 to be considered by the Council of Ministers prior to submission to the Minister for approval. The purpose of introducing means testing in 2016 was to enable the Education Department to meet its savings commitment for the MTFP and to control the expenditure of the Nursery Education Fund. The MTFP savings target is £250,000 in 2018 rising to £467,000 in 2019. Withdrawing the means testing proposal will mean this saving will have to be found elsewhere, either from another part of the Education Department’s budget or from central funds (e.g. contingency). The Education Minister recognises both these options present challenges, particularly as education has been recognised as a strategic priority by the Council of Ministers. The Education Minister’s decision to rescind means-tested nursery education was discussed at the CSB meeting on 23rd January 2018 and the position noted at the Council of Ministers meeting on 7th February 2018.
Resource Implications: Central Contingency to decrease by up to £250,000 in 2018 and up to £467,000 in 2019 and the Education Department revenue head of expenditure to increase by identical amounts if required. This decision does not change the total amount of expenditure approved by the States for 2017-2019 in the Medium Term Financial Plan.
Action required: Head of Decision Support to advise the Director Policy & Planning – Education Department once this decision has been approved.
Signature:		Position: Senator A J H Maclean, Minister for Treasury and Resources
Date Signed:		Date of Decision:

Budget transfer from Central Contingency to Education Department: Rescindment of means-tested nursery education

- 1 -

Treasury and Resources

Ministerial Decision Report

provisional Transfer from Central Contingency to the Education Department following the Education Minister’s decision TO RESCIND means-tested Nursery education

Purpose of Report

To enable the Minister to approve the provisional transfer of up to £250,000 in 2018 and up to £467,000 in 2019 from Central Contingency to the Education Department revenue head of expenditure following the Education Minister’s decision to rescind means-tested nursery education from September 2018.

Background

In September 2016 the States Assembly approved P.68/2016, the addition to the Medium Term Financial Plan, which included a proposal to means-test nursery education from September 2018 in privately-owned nurseries that receive subsidies from the Nursery Education Fund (“NEF”). The means-testing was extended to States primary schools after Amendment No.4 was approved.

The reason for the means-testing proposal was two-fold:

To help meet the Education Department’s MTFP savings commitments while protecting core, statutory services.
To control the rising cost of the NEF, which was exceeding its budget and was therefore not financially sustainable.

Reason for rescindment

Following the announcement of the means-testing proposal, a number of fundamental questions were raised about the early years education provision in Jersey and the direction it should take in future in order to be of maximum benefit pre-school to children and their families.

The Education Minister confirmed that broader discussions were required in order to develop a strategy for the future of early years and to review the immediate funding problems experienced by the NEF.

In April 2017 the Early Years and Childhood Partnership (EYCP), which included representatives of private nurseries, the voluntary sector providers and States departments, was formally requested to undertake a review.

On 27th November 2017 the Education Minister advised the States Assembly that, following receipt of a report from the Early Years Childhood Partnership entitled ‘Review of Early Years Education in Jersey’, he wished to withdraw the means-testing proposal so that it would not be implemented in either States Primary schools or privately-owned nurseries.

The resulting EYCP report, ‘Review of Early Years Education in Jersey’ was published on 4th December 2017.

The EYCP report proposed that the removal of free nursery care for some children on the basis of their parents’ income was a retrograde step. It felt that the States should be attempting to expand the amount of provision, possibly expanding free or subsidised early childhood education to younger children, particularly if they were at risk of underperformance at school because of social disadvantage. The same principle underpins the Jersey Premium scheme in Jersey and the Pupil Premium scheme in the UK.

The EYCP report presented a series of immediate, short-term and medium-long term recommendations, the first of which is to:

“Retract current proposals to means test families for access to the 20 free hours in both the private and the public sector. Revisit the Nursery Education Fund (NEF) partnership agreement and consider reviewing the number of places of registered nurseries in line with demand.”

The report also challenged the Education Department to explore partnership arrangements with both the private sector and parishes in order to deliver more integrated services to parents. The EYCP calls for investment to enable the development of children’s centres that could focus on supporting early childhood education at every stage, starting before conception to babies, toddlers and young children. The concept of prioritising and supporting young families aligns with the Education Department’s four key priorities, particularly ‘Families’ and ‘Standards’.

The EYCP vision for an integrated and universal childhood education service for Jersey is shared by the Education Department and is embedded in research, which shows the clear benefits of investment in early years education. The EYCP has identified three principles, which it believes should be at the heart of early years education services. These are:

Principle 1: High quality for all
Principle 2: Accessible
Principle 3: Choice and flexibility

Having considered these principles alongside the recommendations outlined in the report, the Education Minister has concluded that it would be inappropriate to continue with the means-testing proposals. What is now required is a fresh look at the delivery of Early Childhood Education in accordance with these principles and recommendations. The Education Minster fully recognises the importance of subsidising nursery hours for all families, but particularly those that find it difficult to afford childcare costs in Jersey. However, the discussions must now be broadened so that the NEF funding is not seen as the main issue but as part of a continuum of integrated and universal services that span all the pre-school years.

The Education Minister maintains that changing the NEF and States nurseries to introduce means testing at this stage could increase uncertainty for parents and, more significantly, lead to a fall in the number of children accessing nursery. It would be preferable to retain the current system until a new funding scheme has been created to replace the NEF.

3. Recommendation

The Minister is recommended to approve the provisional transfer of up to £250,000 in 2018 and up to £467,000 in 2019 from Central Contingency to the Education Department revenue head of expenditure following the Education Minister’s decision to rescind means-tested nursery education from September 2018.

The Contingency funding provisionally allocated is subject to the Department not being able to meet the costs from existing resources, through efficiency savings or underspends, in 2018 and 2019. If the department is in an overspend position for either year after meeting costs of the decision to rescind means-tested nursery education the Contingency funding allocated by this decision will be that required to achieve a break-even position.

4. Reason for Decision

Article 17(2) of the Public Finances (Jersey) Law 2005 states that the Minister for Treasury and Resources is authorised to approve the transfer from contingency expenditure of amounts not exceeding, in total, the amount available for contingency expenditure in a financial year.

The current Contingency Allocation Policy (published as R.110/2017) sets the requirement for all allocations from Contingency over £100,000 to be considered by the Council of Ministers prior to submission to the Minister for approval.

The purpose of introducing means testing in 2016 was to enable the Education Department to meet its savings commitment for the MTFP and to control the expenditure of the NEF. The MTFP savings target is £250,000 in 2018 rising to £467,000 in 2019. Withdrawing the means testing proposal will mean this saving will have to be found elsewhere, either from another part of the Education Department’s budget or from central funds (e.g. contingency). The Education Minister recognises both these options present challenges, particularly as education has been recognised as a strategic priority by the Council of Ministers.

The Education Minister’s decision to rescind means-tested nursery education was discussed at the CSB meeting on 23rd January 2018 and the position noted at the Council of Ministers meeting on 7th February 2018.

5. Resource Implications

Central Contingency to decrease by up to £250,000 in 2018 and up to £467,000 in 2019 and the Education Department revenue head of expenditure to increase by identical amounts.

This decision does not change the total amount of expenditure approved by the States for 2017-2019 in the Medium Term Financial Plan.

Report author : Head of Decision Support	Document date 28th March 2018
Quality Assurance / Review : Director of Financial Planning and Performance	File name and path: L:\Treasury\Sections\Corporate Finance\Ministerial Decisions\DS, WR and SD\2018-0042 – NEF £250k from Contingency to Education Department
MD sponsor: Treasurer of the States