Budget transfer from Social Security: Additional Student Places: Funding

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A decision made 16 November 2012:

Decision Reference: MD-ESC-2012-0023
Decision Summary Title:	Highlands Funding budget transfer from the Social Security Department to Education, Sport and Culture		Date of Decision Summary:	16th November 2012
Decision Summary Author:	Acting Head of Finance		Decision Summary: Public or Exempt?	Public
Type of Report: Oral or Written?	Written		Person Giving Oral Report:	N/A
Written Report Title:	Highlands Funding budget transfer from the Social Security Department to Education, Sport and Culture		Date of Written Report:	13th November 2012
Written Report Author:	Acting Head of Finance		Written Report : Public or Exempt?	Public
Subject: A 2012 non-recurring budget transfer of £456,516 from the Social Security Department to the ESC revenue head of expenditure in order to fund additional students at Highlands College from September to December 2012.
Decision(s): The Minister requested the transfer of £456,516 from the Social Security Department to ESC in order to fund additional students at Highlands College from September to December 2012
Reason(s) for Decision: Funding for an extra 150 students at Highlands college has been received from the Fiscal Stimulus programme until August 2012. In addition to this an additional 95 students have enrolled from September 2012. From January 2013 ESC have a growth bid in the Medium Term Financial Plan to cover these students. This leaves a funding gap from September to December 2012, funding for these students will be provided by Social Security from the Back to Work fund.
Resource Implications: The ESC revenue head of expenditure to increase by £456,516. This decision does not change the total amount of expenditure approved by the States as the Social Security budget will reduce by the corresponding amount.
Action required: Copy of signed decision to be submitted to the Treasury Department.
Signature:		Position: Minister for Education, Sport and Culture
Date Signed:		Date of Decision:

Budget transfer from Social Security: Additional Student Places: Funding

Education, Sport and Culture Department Senior Management Report
Subject:	Highlands Funding budget transfer from the Social Security Department to Education, Sport and Culture
Exempt Clause:		Date:	13th November 2012

Author:	Acting Head of Finance

1. Purpose of Report

The purpose of this report is to request a non-recurring budget transfer of £456,516 from the Social Security Department (SSD) to Education, Sport and Culture (ESC) in order to fund additional students at Highlands College from September 2012 until December 2012.

2. Background

Highlands College has experienced increased applications because of changes to the labour market as a result of the recession. A project was funded by the Fiscal Stimulus programme, starting in the 2010/11 academic year, to provide additional places on vocational courses for people who would otherwise be unemployed. The Fiscal Stimulus programme has provided funding for an additional 150 students on top of the 740 funded from the Education Department, making a total of 890 students. It is clear that unemployment levels show little sign of reducing and that young people are choosing to stay on in full time education to increase their chances of gaining employment, so far the college has met this challenge. The project has the support of Skills Jersey.

The fiscal stimulus funding ceased at the end of August 2012, meaning that there is no funding from September 2012. In addition to this, because of the worsening economic conditions, an additional 95 students have enrolled from September 2012, taking the total number to 985. ESC have a growth bid in the Medium Term Financial Plan to cover these additional students from January 2013. It has been agreed that this period would be covered by the Back to Work fund within Social Security.

This leaves a funding gap for the first term of the academic year, from September 2012 until December 2012. Based on student numbers of 985 the shortfall for the period will be £456,516. This is amount is based on an amount of £5,590 (reduced AWPU allowance) per student for the academic year. It has been calculated:

245 students at £1,863.33 per student (£5,590 divided by 3, one term): £456,516

This amount is to be funded by a budget transfer from SSD to ESC.

3. Discussion

Finance Direction No.3.6 ‘Variations to Heads of Expenditure’ sets out the procedures for the transfers between revenue heads of expenditure and states that budget transfers in excess of £1,000,000 require the approval of the Minister for Treasury and Resources and the relevant Minister party to the transfer. Authority to approve non-contentious budget transfers under £1,000,000 has been delegated to the Treasurer of the States.

4. Recommendation

To request the transfer of £456,516 from SSD to ESC in order to fund the temporary shortfall in Highlands funding.

5. Reason for Decision

To provide a revenue budget to fund the shortfall caused by the cessation of the Fiscal Stimulus Programme.

6. Resource Implications

The ESC revenue head of expenditure for 2012 to increase by £456,516. This decision does not change the total amount of expenditure approved by the States as the Social Security budget will reduce by the corresponding amount.

7. Action Required

Copy of signed decision to be submitted to Treasury and Resources, who will then process the budget transfer.