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Budget transfer from Central Contingency to various departments: 2017 Pay Award and Workforce Modernisation

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A decision made 29 March 2018:

Decision Reference:  MD-TR-2018-0041

Decision Summary Title:

Contingency Funding for 2017 Pay Award

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:

N/A

Written Report

Title:

Contingency Funding for 2017 Pay Award

Date of Written Report:

28th March 2018

Written Report Author:

Head of Financial Planning and Performance

Written Report :

Public or Exempt?

Public

Subject: Transfer of contingency funding from the Central Contingency (Pay Provision) to various departments for costs associated with the 2017 pay award and impact of Workforce Modernisation (WFM) for 2017.

Decision(s):

The Minister approved a non-recurring allocation of £3,046,115.36 in 2017 from the Central Contingency (Pay Provision) to the departments listed in the written report to fund the revised pay offer and impact of WFM in 2017.

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 to heads of expenditure of amounts not exceeding, in total, the amount available for contingency expenditure in a financial year.

 

The Contingency Allocation Revised Policy published by the Minister for Treasury and Resources (R.110/2017) states that requests for £100,000 or more from Contingency must be considered by the Council of Ministers following examination by the Treasurer of the States and Minister for Treasury and Resources.  In lieu of consideration by the full Council of Ministers, this allocation was approved by the States Employment Board at their meeting on 2nd March 2018.

 

The recurring impact of the initial 1% pay award across all pay groups will be managed from within existing base budgets from 2018. The recurring impact of pay awards in excess of 1% will be met from the Central Contingency (Pay Provision) for the remainder of this MTFP period.

 

Resource Implications: Central Contingency (Pay Provision) to decrease by £3,046,115.36 in 2017 and departmental revenue heads of expenditure to increase by a total identical amount, detailed in the table in the written report.

 

Action required: Head of Decision Support to inform the Financial Performance Reporting Manager and the department Finance Directors that this decision has been approved.

Signature:

 

 

Position: Senator A J H Maclean, Minister for Treasury and Resources

 

 

     

Date Signed:

Date of Decision:

Hide report
Budget transfer from Central Contingency to various departments: 2017 Pay Award and Workforce Modernisation

 - 1 -

Treasury & Resourses

Ministerial Decision Report

 

 

Contingency Funding for 2017 Pay Award

 

  1. Purpose of Report

To request approval for a non-recurring allocation of £3,046,115.36 in 2017 from the Central Contingency (Pay Provision) to fund the 2017 element of the pay award with effect from 1st January 2017 and WFM from 1st July 2017.

 

  1. Background

Non-recurrent provisions were made in the Central Contingency (Pay Provision) for anticipated pay awards across all pay groups and the impact of the Workforce Modernisation Project (WFM) in 2017.

 

Workforce Modernisation

 

As part of the public sector reform programme WFM worked in partnership with public sector unions to develop a unified equality driven, affordable and sustainable new reward framework encompassing a new grade/pay structure, and new harmonised terms and conditions of service.

 

 After many months of negotiation the final offer for Workforce Modernisation was provided to the Trades unions on 3rd November 2017 and personal statements setting out the impact of the offer on individuals were sent out to the affected staff (c5000) on 8th November 2017. The offer included significant pay improvements for Nursing/Midwifery and manual workers, improvements for many covering unsocial hours, standby and callout payments etc. and improvements for all staff in respect of holidays, sick pay and other terms and conditions which created a single status public servant.

 

The affected Unions put the final offer to a ballot and the results on 13th February 2018 provided the following outcomes:

 

  • Rejection by Civil Servants, Nurses and Midwives, and Manual Workers.
  • Acceptance by a number of the smaller groups comprising Ambulance, Family Support Workers, Residential Child Care Officers and Youth Service.

The way forward was discussed with Unions on 20th and 27th February 2018.  In the absence of more funding and any realistic proposals from the Unions, the Chief Executive met with the Unions on 6th March 2018 and confirmed the following:

 

  • The formal withdrawal of the WFM offer from those groups that voted to reject it.
  • The WFM offer will be honoured for those groups that voted to accept it.  Arrangements are in hand to implement the award and any backdating.
  • The 2% consolidated pay offer (with effect 1st January 2017) that was made to the non WFM groups for the 2017 pay review will be extended to the WFM groups that rejected the WFM offer.
  • Nurses and Midwives will be offered 2.5% (with effect 1st January 2017) in line with the commitments given by the States Employment Board to achieve pay comparability for this group with Allied Health Professionals.

 

2017 Pay Review

 

As at 25th March 2018, the final offer of 2.0% with effect 1st January 2017 (dated 20th the October 2017) has for those pay groups outside of WFM:

 

  • Been accepted by Head Teachers, Police, and Fire.
  • Been implemented for Teachers.
  • Is in the process of being determined by independent binding arbitration for members represented by the Prison Service Association.

On a separate basis, Doctors’ pay for 2017 as part of a three year deal is still in progress.

Those pay groups that rejected WFM have now accepted the revised offer.

 

The States Employment Board wishes to move on from the 2017 pay review and start negotiations on the 2018/2019 pay review and separately progress the proposed Uniformed Services Review and Teachers Review in the near future.

 

The Board remain fully committed to establishing an equality driven reward structure which is affordable and sustainable. 

 

Accounting standards require the cost associated with the 2017 pay awards and 2017 WFM impact to be recognised in 2017 so an accounting adjustment has been made to reflect this expense.  

 

The initial 1% element across pay groups has been self-funded by departments. This Decision provides Central Contingency (Pay Provision) funding to match the accounting adjustment for:

 

  • The additional 1% offered to the WFM pay groups (excluding Nurses and Midwives) with effect from 1st January 2017.
  • The additional 1.5% offered to Nurses and Midwives with effect from 1st January 2017.
  • The cost of honouring the WFM offer to those pay groups who accepted it (Ambulance, Family Support Workers, Residential Child Care Officers and Youth Service) with effect from 1st July 2017)
  1. Recommendation

The Minister is recommended to approve allocations from the Central Contingency (Pay Provision) to the following departments for costs associated with the 2017 pay award and WFM as per the table below:

 

 

 

  1. 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 to heads of expenditure of amounts not exceeding, in total, the amount available for contingency expenditure in a financial year.

 

The Contingency Allocation Revised Policy published by the Minister for Treasury and Resources (R.110/2017) states that requests for £100,000 or more from Contingency must be considered by the Council of Ministers following examination by the Treasurer of the States and Minister for Treasury and Resources.  In lieu of consideration by the full Council of Ministers, this allocation was approved by the States Employment Board at their meeting on 2nd March 2018.

 

The recurring impact of the initial 1% pay award across all pay groups will be managed from within existing base budgets from 2018. The recurring impact of pay awards in excess of 1% will be met from the Central Contingency (Pay Provision) for the remainder of this MTFP period.

 

  1. Resource Implications

Central Contingency (Pay Provision) to decrease by £3,046,115.36 in 2017 and departmental revenue heads of expenditure to increase by a total identical amount, detailed in the table in the written report.

 

Report author : Head of Financial Planning and Performance

Document date : 28/3/2018

Quality Assurance / Review : Director of Financial Planning and Performance

 

File name and path:   L:\Treasury\Sections\Corporate Finance\Ministerial Decisions\DS, WR and SD\2018-0041 - C31 Contingency funding Pay Award 2017

MD sponsor : Director of Financial Planning and Performance

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

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