2014 year end Carry forward report
Treasury & Resources Department
1. Purpose of the Report
To provide a summary of proposed carry forward requests from departments and Allocation of Contingency based on 2014 year end near cash unspent expenditure.
2. Overview
- Department’s final outturn is an underspend of £26 million.
- Includes the unidentified procurement savings of £994,331 held in Treasury.
- Adjusted department carry forward requests of £7.8 million and additional requests of £5.2 million totalling £13 million which represents 1.8% of total budget.
- £13 million of department underspends (£11 million required as part of Budget Measures in Appendix 2) to be returned to the Consolidated Fund from;
- £7.4 million from Social Security with £2 million ring fenced in Allocation of Contingency for the Long Term Care Fund,
- £6.6 million balance of reduced departmental requests, of which £280,607 is Restructuring Provision and in addition to achieving the Budget Measures in 2015.
- Procurement savings of £994,331, yet to be identified and held in Treasury, have been offset across departments against underspends not requested.
- Allocation of Contingency - Central Reserves and Restructuring Provision – unallocated £22.1 million
- £10 million to be carried forward, £9.9 million into Central Contingency and £96,200 into Restructuring Provision, in 2015.
- £12.1 million to be returned to the Consolidated Fund as part of the agreed Budget Measures, (£7.8 million from Rephasing of Unspent Capital, £2.7 million from Restructuring Provision and £3.6 million from Court and Case Costs (Smoothing Reserve) less £2 million from Social Security ring fenced for Long Term Care Fund).
Rounding applied
The year end underspend is summarised by department in Appendix 1 on page 19 but is split by Original Requests and Additional Requests, as a result of increased underspends and includes requests relating to any balances remaining in Allocation of Contingency. This report which is based on the final year end outturn position also includes the returns to the Consolidated Fund as part of the proposed measures included in the MTFP Annex to balance the Consolidated Fund at the end of 2014, detailed in Appendix 2 on page 20.
3. Departmental Carry Forwards - £7,777,150
Department carry forward requests have been adjusted to provide the required contribution to the consolidated fund proposed as part of the 2015 Measures to Balance the Consolidated Fund.
The amounts being requested to be carried forward by departments, following the adjustments to reduce requests, are as follows:-
Chief Minister’s - £411,230
Public Sector Reform £211,230
Culture Workstream:
The two major elements are Leadership Training which has slipped into 2015 and also Performance Management which although CMB has recently approved, will slip into next year. These are all project monies.
Workforce Modernisation:
All this funding relates to specific projects and both Terms & Conditions and also Job Evaluation have both slipped in timescales due to both lack of resource within departments and also delay in finalising new policies.
LEAN:
The Lean rollout has slipped into the first part of 2015 and this expenditure relates to the completion of the contract with the supplier.
Programme Management Office:
These funds relate to external support which has not been required in 2014 but is likely in 2015.
Financial Services £100,000
Jersey Finance Ltd have a full programme of activity scheduled for 2015 to progress the McKinsey recommendations. This programme was adjusted to cope with the 2% budget reduction in 2015 but further reductions will mean cutbacks in some of the promotional effort in our remote locations.
Professional Development Programmes £61,000
HR has received no significant professional development for the past 5 years. As part of developing into a modern HR function we have committed to support both professional qualifications and a bespoke development programme which will focus on providing a quality, commercial, flexible and customer focused proposition. The Professional Development programmes have commenced in 2014 and will be ongoing into 2015.
Modern Manager Programme £39,000
It was intended to commence another MMP Level 7 in the second half of 2014 as there is a waiting list of senior managers for this Programme. A decision was taken to postpone delivery pending the re-tendering of the middle management development Programme. It is therefore important that these funds are retained for development in 2015.
Economic Development - £168,500
Jersey Aircraft Registry £110,000
The Jersey Aircraft Registry is due to commence in 2015. A proportion of the initial set up costs were made in 2014 with the additional funding required for 2015 and the online registration system.
Cattle Testing £58,500
The programme to support cattle exports and trade in bovine embryos requiring compliance with EU legislation. Cattle testing started later than expected and will continue into 2015.
Education, Sport and Culture - £2,136,672
School and Colleges – Delegated Financial Management £1,615,272
Historically schools have been able to carry forward up to 3% of budgets under the delegated financial management arrangement to manage the differential between the academic and financial year. The carry forward allows schools to manage finances over a couple of years to react to demographic changes, minimise fee increases and to build funds for improvement works, significant maintenance or one off minor capital projects.
Higher Education Underspends Required for Unfunded Pressures £365,000
The department would like to carry this forward to assist with known pressures in 2015 including school demographics.
Review of Islands Arts Organisations £156,400
A review of the Islands arts organisations has commenced with a view to establishing ways in which the various groups could more effectively work together. A sum of £250,000 has been estimated for this review which is to continue into 2015 and require investment in existing facilities.
Department of the Environment - £197,341
File Thinning £80,000
This funding was originally delayed due to issues surrounding the States office relocation strategy. Due to the uncertainty surrounding this, the Department have agreed on an internal solution which was implemented in Q3 2014. The Department expected to spend £40,000 in 2014 and will be requesting to carry forward the remaining balance of £80,000.
Water Framework Directive £61,295
The funding was awarded in the MTFP in one lump sum rather than over three years as originally requested. The programme was always designated to last three years and the Department will be continuing this work into 2015. £72,000 is currently committed on various studies which will be completed in 2014, therefore, it is anticipated that there will be £61,295 to carry forward into 2015.
Succession Planning – Building Control £31,046
2 staff members are required in building control (BC) over 2014 and 2015. As funding from 2016 is not certain, recruitment was delayed to ensure that by using carry forwards there would be enough funding available over 2014 and 2015 to fund two staff members.
Succession Planning – Met Office £25,000
This succession post requires a specific level of qualification and the Department have been unable to identify and recruit to this position within 2014. A new staff member will be appointed in 2015 and funding will be required to fund this.
Health and Social Services - £1,250,000
CAMHS/Children’s Services £900,000
In response to accumulating evidence of concern during 2014, the Health and Social Services CEO recruited both an experienced Interim Managing Director and Director of Children’s Services to CSS in August. The CEO commissioned the Interim Director of Children’s Services to conduct an urgent review, to advise on safety and quality, and advise on which areas require accelerated improvement. This was completed by the end of September. Excellent developments have been progressed in some parts of Children’s Services and there are aspects of practice and management that would stand up to scrutiny in any jurisdiction. However, there are areas where accelerated improvement is necessary to achieve the standards of practice and management that would be recognised as critical to being good enough to practice elsewhere.
Sustainable Primary Care Review £150,000
Completion of the Sustainable Primary Care Review, as agreed by the States in P82/2012.
Adult Mental Health Placements £150,000
The Department’s base budget includes funding for a number of high cost UK mental health placements. In 2014 four additional prisoner placements were confirmed and funding has been earmarked from the Criminal Offences Confiscation Fund to meet the cost pressure in the current year. There will continue to be a financial pressure on the Department through 2015 as one placement continues into the future year.
Health Leadership Development £50,000
An amount of £150,000 was allocated from the Restructuring Provision in 2014 for the provision of Senior Health Leadership Training. The provision of this training is expected to run into 2015 and therefore the funding is required to meet the costs in the following year.
Home Affairs - £367,500
Impact of Staff Recruitment £190,000
The underspend is required to fund the impact of the recruitment of Police Constables in 2014 which will take the numbers over the budgeted FTE until existing Police Officers are able to retire. It is essential that there is structured succession planning in place.
Slippage/Delay in CSR Projects £157,500
Slippage in the delivery of CSR savings projects including savings relating to terms and conditions (medical/dental/optical benefits for Uniformed Officers) which have not yet been negotiated by Human Resources.
Legal Resources to Support Jersey Customs and Immigration Services £20,000
UK legislation is changing and being updated in the light of terrorism issues and so Jersey legislation needs to be updated to reflect the changes. Funding is required to provide temporary legal resources for the JCIS.
Social Security - £588,145
Transfer to the Long Term Care Fund £18,145
Transfer into the Long Term Care Fund the remaining underspend as explained in item 5 in the letter to the Treasurer from Social Security’s Chief Officer dated 23 July 2014.
PC2 Benefits and Assessments £570,000
Funding is required for the ongoing assessment, administration and payment of the additional claims in respect of the amendment to special payment for child personal care level 2 (P.135/2014).
Transport and Technical Services - £916,424
Asbestos Backlog Disposal £866,424
Required to fund the disposal of the existing backlog of asbestos, once an appropriate disposal method is identified.
Funding for Corporate Health and Safety £50,000
In 2014, a total of £100,000 was allocated to provide additional funding to the Corporate Health and Safety function for the States of Jersey for the years 2014 and 2015. This is half of that amount and is required to be carried forward to allow the Corporate Health and Safety function to continue.
Treasury and Resources - £989,551
Procurement Transformation Project £527,893
This is required for the Procurement Transformation and has been funded from the Restructuring Provision. The carry forward is required to fund the Procure-to-Pay project (Supply Jersey).
Taxes Transformation Programme £180,944
Full funding has been received for the Taxes Transformation Programme project, which is implementing FATCA (a major international agreement) and other TTP initiatives. However as this is a multi-year project a carry forward has to be requested to fund future expenditure.
Procurement Category Managers £109,185
This is required for the Procurement Transformation and has been funded from the Restructuring Provision. The carry forward is required to cover the cost of three procurement category managers for the period of the MTFP.
2015 Interim Revaluation of Land and Buildings £100,000
States of Jersey accounting policy requires that Land and Building assets are revalued every five years with an interim valuation in the third year of the cycle. JPH had a growth bid request turned down as part of the MTFP process so have been carrying forward funds from 2012 to fund the cost of the valuation.
PECRS Pre-1987 Debt £50,000
Underspend has been carried forward from 2011/2012/2013. This is required to protect against the variability of future years debt. The number is calculated by the actuaries and is influenced by changes in pay structures.
Office Modernisation Project Planning Funding £21,529
JPH have worked with external suppliers during 2014 to develop a preferred Office Modernisation Programme. Further planning and feasibility work will be required in 2015 to develop the individual components of the programme so that it can be progressed in the 2016-2019 MTFP.
Non Ministerial Departments - £751,787 made up of:
Bailiff’s Chamber - £5,675
Liberation 70 / Royal Visits £3,325
Liberation 70th Anniversary programme/community arrangements and potential Royal visits to mark the special occasion in 2015 under the Civic Head.
Conference and Art Work Commissioning £2,350
Commonwealth Magistrates and Judges Association Conference and art work commissioning.
Law Officers’ Department - £410,000
Revise the Réglant la Procedure Criminelle (transferred from COCF) £410,000
A two year project to revise the Loi (1864) Réglant la Procedure Criminelle and associated amendments to the rules (including the rules of evidence) and procedures relevant to the Jersey Criminal Justice System and incorporate small but significant new substantive laws in order to maintain a body of law that is relevant to a modern jurisdiction.
Judicial Greffe - £2,875
Funding of the Split Judicial Greffier and Viscount Posts £2,875
Following the retirement of the current joint post holder (Judicial Greffier/Viscount), correspondence is ongoing between the Treasurer and the Chief Ministers Office regarding the funding of the two separate posts. It is anticipated that the departments will need to fund the change in employee numbers from within their current revenue budgets in the short term.
Viscount’s Services - £63,692
Funding of the Split Judicial Greffier and Viscount Posts £63,692
Following the retirement of the current joint post holder (Judicial Greffier/Viscount), correspondence is ongoing between the Treasurer and the Chief Ministers Office regarding the funding of the two separate posts. It is anticipated that the departments will need to fund the change in employee numbers from within their current revenue budgets in the short term.
Office of the Lieutenant Governor - £35,965
Refurbishment of House and Grounds £32,465
Ongoing refurbishment to Government House, the grounds and staff accommodation in 2015 and the additional expenses that will be incurred with the change of Governor in 2016.
Architectural Drawings £3,500
Architectural drawing relating to the refurbishment of the cadets headquarters.
Data Protection Commission - £26,081
Statutory Duties – Freedom of Information £26,081
This is needed to help cover their new statutory duties under FOI. There are going to be additional costs to the Department, most significant being legal advice as they are unable to use the Law Officers’ Department for FOI casework.
Probation - £11,806
Future of the ADAPT Programme and Victim Services Project £11,806
Two corporate cross departmental matters which Probation are leading on where the finance post for 2014 has not been agreed. These are the future of the ADAPT programme (Paper with Home Affairs Department) and the Victim Services Project (agreed by Criminal Justice Systems Board), both are likely to require some “bridge” funding.
Comptroller and Auditor General - £195,693
Restructuring of Team £195,693
To cover the costs of the Board to the C&AG and other costs associated with the extension of the C&AG’s role to appoint auditors to areas where the auditor was previously appointed by the Treasurer.
4. Departmental Carry Forward Additional Requests - £5,233,402
Departments have identified additional carry forward requests based on the 2014 outturn (Appendix 1)
The additional carry forward requests that have been identified are as follows:-
Chief Minister’s - £418,958
Committee of Inquiry into Historical Child Abuse £331,033
Net underspend within allocation of funding for Committee of Inquiry in to Historical Child Abuse - awaiting outstanding budget transfer (net allocation of £1,208,671.41 less expenditure of £877,638.34 leaving a balance of £331,033.07)
Financial Services £61,058
Jersey Finance Ltd have a full programme of activity scheduled for 2015 to progress the McKinsey recommendations. This programme was adjusted to cope with the 2% budget reduction in 2015 but further reductions will mean cutbacks in some of the promotional effort in our remote locations.
Public Sector Reform £26,867
Culture Workstream:
The two major elements are Leadership Training which has slipped into 2015 and also Performance Management which although CMB has recently approved, will slip into next year. These are all project monies.
Workforce Modernisation:
All this funding relates to specific projects and both Terms & Conditions and also Job Evaluation have both slipped in timescales due to both lack of resource within departments and also delay in finalising new policies.
LEAN:
The Lean rollout has slipped into the first part of 2015 and this expenditure relates to the completion of the contract with the supplier.
Programme Management Office:
These funds relate to external support which has not been required in 2014 but is likely in 2015.
Overseas Aid Commission - £147,363
Bequest for Community Works Projects £135,779
To continue projects not completed in 2014.
Various Minor Underspends £11,584
Economic Development - £163,500
Jersey Aircraft Registry £105,000
The Jersey Aircraft Registry is due to commence in 2015. A proportion of the initial set up costs were made in 2014 with the additional funding required for 2015 and the online registration system.
Cattle Testing £58,500
The programme to support cattle exports and trade in bovine embryos requiring compliance with EU legislation. Cattle testing started later than expected and will continue into 2015.
Education, Sport & Culture - £745,000
Higher Education Underspends Required for Unfunded Pressures £445,000
Raising Standards £250,000 Improvement in standards will require investment to manage and analyse the data provided by schools both for monitoring and publication purposes together with investment in professional partners to utilise this data to advise, mentor and monitor and then hold schools to account.
Trackers Apprenticeship Programme £195,000 This programme has proved far more successful than initially anticipated with the target number of apprentices already exceeded. Based on present student numbers, which have been capped at 200, there is a spending pressure of £150,000 in 2015 (£180,000 in 2016). There is also pressure to develop new courses for digital and/or financial apprentices with estimated costs of £45,000.
Committee of Inquiry into Historical Child Abuse £300,000
The department received funding of £300,000 from Central Reserves in 2014 to cover costs associated with the Committee of Inquiry into Historic Child Abuse. No costs were incurred by the department in 2014 but are expected in 2015.
Department of the Environment - £55,062
Contingency to Offset Income Shortfalls £31,380
These savings have emerged from general underspends amongst all areas, work being funded centrally and slight over achievements in income. The Department’s income is hugely dependent upon the building industry and as a result will need to carry forward this funding to offset any future shortfalls in income.
File Thinning £16,815
This is the additional underspend on File Thinning, over and above the £80,000 identified at September 2014.
Water Framework Directive £6,867
This is the additional underspend on the Water Framework Directive, over and above the £61,295 identified at September 2014.
Health and Social Services - £1,361,426
CAMHS/Children’s Services £1,200,000
Following a recent scrutiny report, a number of recommendations to improve Children’s Services were identified. One of the recommendations was to provide appropriate space for young people with mental health issues when they require acute medical care. It is recognised that the current facilities on Robin Ward are not appropriate for these young people. In addition there are recognised concerns with the current IT provision for Children’s Services and a replacement system is required. Furthermore the current accommodation for CAMHS in Royde House requires work.
Contribution to workforce modernisation planning £100,000
Prior agreements with CMD HR to provide a workforce planning function have not been implemented. The development of an Acute Services Plan and the Future Hospital are dependent on a comprehensive plan.
Sustainable Primary Care Review £61,426
Completion of the Sustainable Primary Care Review, as agreed by the States in P82/2012.
Home Affairs - £318,530
Impact of Staff Recruitment £75,000
The underspend is required to fund the impact of the recruitment of Police Constables in 2014 which will take the numbers over the budgeted FTE until existing Police Officers are able to retire. It is essential that there is structured succession planning in place.
Slippage/Delay in CSR Projects £69,500
Slippage in the delivery of CSR savings projects including savings relating to terms and conditions (medical/dental/optical benefits for Uniformed Officers) which have not yet been negotiated by HR.
Replacement Assets £68,230
Due to pressures on the capital programme the Home Affairs Department agreed to forgo its allocation for replacement assets in 2015 for one year only. This funding would allow for some high priority assets to be replaced in 2015.
Eco Active Project for the Jersey Fire and Rescue Service £40,000
Eco Active project to be delivered at the JFRS Headquarters. Project was to be funded by resources managed by Jersey Property Holdings but the JFRS has been advised that these are no longer available. The project will deliver recurring revenue savings.
Legal Resources to Support Jersey Customs and Immigration Services £30,000
UK legislation is changing and being updated in the light of terrorism issues and so Jersey legislation needs to be updated to reflect the changes. Funding is required to provide temporary legal resources for the JCIS.
Continuation of Jersey Customs and Immigration Services Pilot Project £29,000
Pilot project undertaken in 2014. Discussions are to be held with the new Minister and Treasury and Resources Minister regarding the future funding of these temporary resources from 2016 (next MTFP).
Project funded from COCF £6,800
Balance of funds received from the COCF required for Body Worn Videos in 2015.
Transport and Technical Services - £498,401
Asbestos Backlog Disposal £314,216
Additional funding required for the disposal of the existing backlog of Asbestos, once an appropriate disposal method is identified.
Project and Feasibility study funding £184,185
Funding to investigate and establish the basis of potential measures to support the 2016-19 MTFP cash limits, service redesign and financial modelling.
Procurement Savings held within Treasury and Resources - £994,331
Unallocated CSR/Procurement Savings £994,331
CSR / Procurement Savings – recurring pressure of £994,331 held within Treasury and Resources.
Non Ministerial Departments - £688,228 made up of:
Bailiff’s Chambers - £90,286
Liberation 70 / Royal Visits £57,936
Liberation 70th Anniversary programme/community arrangements and potential Royal visits to mark the special occasion in 2015 under the Civic Head.
Crowne Dependency Book £30,000
New Crowne Dependency Book.
Conference and Art Work Commissioning £2,350
Commonwealth Magistrates and Judges Association Conference and art work commissioning.
Law Officers’ Department - £178,000
Refurbishment Costs £100,000
As part of the office modernisation programme, managed by JPH to rationalise the use of office space by the various departments located in Morier House, the Law Officers' Department will incur refurbishment and higher rental costs. This plan creates a predominantly open-plan working environment, in line with the office modernisation programme. The funding covers the refurbishment and additional rental costs.
Cost Pressures Associated with New Case Management System £78,000
Funding is required for essential upgrades to the Practice Management System (PMS), Prescient Plus. The PMS is currently two versions out of date and its search functionality has been out of use for the whole of 2014. The upgrade, originally scheduled for Q4 2014, will transfer the application to a new server, correct system errors and allow management information to be gathered to improve efficiencies. The funding covers training for all users and IT staff, and licence fees for staff and any staff seconded to the LOD. The PMS is the storage for all electronic documents, files and emails relating to matters and is therefore the FoI repository for all case-specific information. The upgrade will pave the way for complete electronic storage of all documents, and the move away from the cost of printing and maintaining paper files.
Judicial Greffe - £57,112
Funding of the Split Judicial Greffier and Viscount Posts £57,112
Following the retirement of the current joint post holder (Judicial Greffier/Viscount), correspondence is ongoing between the Treasurer and the Chief Ministers Office regarding the funding of the two separate posts. It is anticipated that the departments will need to fund the change in employee numbers from within their current revenue budgets in the short term.
Viscount’s Department - £26,308
Funding of the Split Judicial Greffier and Viscount Posts £26,308
Following the retirement of the current joint post holder (Judicial Greffier/Viscount), correspondence is ongoing between the Treasurer and the Chief Ministers Office regarding the funding of the two separate posts. It is anticipated that the departments will need to fund the change in employee numbers from within their current revenue budgets in the short term.
Office of the Lieutenant Governor - £73,731
Refurbishment of House and Grounds £73,731
Ongoing refurbishment to Government House, the grounds and staff accommodation in 2015 and the additional expenses that will be incurred with the change of Governor in 2016.
Data Protection Commission - £31,416
Statutory Duties – Freedom of Information £31,416
This is needed to help cover their new statutory duties under FOI. There are going to be additional costs to the department, most significant being legal advice as they are unable to use the Law Officers' Department for FOI casework.
Probation - £28,262
DAISY project £16,455
There will be unplanned additional expenditure from the DAISY rewrite project in 2015 and the existing capital sum is looking as though it will be just about adequate to purchase a replacement system. The project manager was initially loaned to the department by Home Affairs at no cost but is now being recharged at an estimated cost of £7,500 in 2015. The high level specification required by Corporate Procurement and ISD is being prepared by a contractor for a fixed fee of £9,800. These are significant costs bearing in mind the overall sum available and therefore the remaining underspend is required for the DAISY capital project.
Future of the ADAPT Programme and Victim Services Project £11,807
Two corporate cross departmental matters which Probation are leading on where the finance post for 2014 has not been agreed. These are the future of the ADAPT programme (Paper with Home Affairs Department) and the Victim Services Project (agreed by Criminal Justice Systems Board), both are likely to require some “bridge” funding.
Comptroller and Auditor General - £45,716
Restructuring of Team £45,716
To cover the costs of the Board to the C&AG and other costs associated with the extension of the C&AG’s role to appoint auditors to areas where the auditor was previously appointed by the Treasurer.
5. Allocation of Contingency
The balance of the provision for Restructuring Provision and Central Reserves, after returning £12.1 million to the Consolidated Fund, is requested for carry forward to 2015.
Of the £22,083,623 budget available to carry forward, it is proposed that £96,200 is allocated to Restructuring Provision and £9,869,808.35 is allocated to Central Reserves as detailed in the table above. The balance of £12.1 million will be transferred to the Consolidated Fund as part of the MTFP Proposed Measures to Balance the Consolidated Fund in 2014. Details can be found below and can also be seen in Appendix 1 and 2 on pages 19 and 20.
Central Reserves - £9,869,808
A balance of £9,869,808 will remain in the Central Reserves after the proposed return of £9.4 million to the Consolidated Fund and it is proposed that this balance is carried forward in 2015 to supplement that year’s budget allocation. The carry forward will be allocated to Central Reserves in 2015 in the following way:
AME - £2,000,000
Transferred from the Social Security underspend and ring fenced for the Long Term Care Fund if required.
Insurance - £1,271,099.67
One Off - £2,301,506
It is proposed that the balance of the Central Reserves, not identified above, is carried forward to the One-Off element for 2015.
Pay Provision - £1,865,600
The carry forward for the pay provision is in respect of pay awards for nurses, firefighters, doctors and consultants that have been agreed and exceed the provisions made in the original MTFP Pay Provision.
Emerging Items - £2,431,602.68
This will add to the £4,000,000 provision already in 2015 for a number of emerging items such as Freedom of Information, Historic Child Abuse Enquiry and Legal Aid for which the exact cost and timing is uncertain. The Council of Ministers has already approved sums which can be drawn down as required by these projects and as part of the MTFP Proposed Measures to Balance the Consolidated Fund in 2015, £1 million will be transferred to the Consolidated Fund reducing the allocation for Freedom of Information.
Restructuring Provision - £96,200
It is proposed that an amount of £96,200 is ring-fenced and carried forward into the Restructuring Provision in 2014 to supplement the £7,170,000 budget allocated in the MTFP. This budget is required to fund previously approved sums by the Council of Ministers. £2.7 million is proposed to be returned to the Consolidated Fund as part of the Budget Measures for 2015, but as funds are available will be returned in 2014.
Note: There is a return from Health and Social Services (£110,792) and Treasury and Resources (£169,815) as budget is no longer required and this is included in the return of departmental underspends to the Consolidated Fund.
6. Identified Risks as a Consequence of Reduced Carry Forwards to Departments
As a result of achieving Budget Measures, departments were required to revise and reduce their carry forward requests for 2015 and as a result some potential risks have now been identified as detailed below totalling £3,345,695.
Chief Minister’s - £376,987
Public Sector Reform
Original Request £581,084
Revised Request £238,097
Shortfall £342,987
Professional Development Programmes
Original Request £95,000
Revised Request £61,000
Shortfall £34,000
Economic Development - £200,000
Tourism Transition to Visit Jersey
Original Request £200,000
Revised Request £ 0
Shortfall £200,000
Department of the Environment - £184,627
Contingency to Offset Income Shortfalls
Original Request £216,007
Revised Request £ 31,380
Shortfall £184,627
Education, Sport & Culture - £739,000
Higher Education Underspends Required for Unfunded Pressures
Original Request £1,284,000
Revised Request £ 810,000
Shortfall £ 474,000
Schools and Colleges - Delegated Financial Management
Original Request £1,815,272
Revised Request £1,615,272
Shortfall £ 200,000
Review of Islands Art Organisations
Original Request £221,400
Revised Request £156,400
Shortfall £ 65,000
Health and Social Services - £1,206,000
New and High Cost Drugs
Original Request £606,000
Revised Request £ 0
Shortfall £606,000
(£500,000 has been identified as a Spending Pressure in Section 7)
Hospital Fire Alarm
Original Request £600,000
Revised Request £ 0
Shortfall £600,000
Social Security - £155,795
Transfer to the Long Term Care Fund
Original Request £2,173,940
Revised Request £2,015,145
Shortfall £ 155,795
Treasury and Resources - £483,286
PECRS Pre-1987 Debt
Original Request £325,000
Revised Request £ 50,000
Shortfall £275,000
Procurement Category Managers
Original Request £279,000
Revised Request £109,185
Shortfall £169,815
Office Modernisation Project Planning Funding
Original Request £60,000
Revised Request £21,529
Shortfall £38,471
7. Spending Pressures
Spending Pressures have been identified and submitted by departments totalling £13,617,000 and details can be found below and in Appendix 4 on page 23.
Economic Development - £849,000
Reduction of grants requested by grantee £849,000:
Digital Jersey £325,000
Digital Jersey Ltd requested a grant of £1,150,000 but the Minister reduced this to £825,000 due to savings requirement and other priorities with the EDD budget.
Jersey Finance Ltd £314,000
Jersey Finance Ltd requested a grant of £5,185,000 but the Minister reduced this to £4,870,600 due to savings requirement and other priorities with the EDD budget.
Jersey Business Ltd £210,000
Jersey Business Ltd requested a grant of £825,000 but the Minister reduced this to £615,000 due to savings requirement and other priorities with the EDD budget.
Education, Sport and Culture - £1,100,000
Schools and Colleges £1,100,000:
Data Management £300,000
In order to significantly raise standards, good and timely management information is required. The department’s current data system has reached the end of its contract and a new more versatile and inclusive data management system is needed. Preference would be given to a system with the ability to link across the States, in particular with Health.
Nursery Charges Shortfall £250,000
There has been a poor take up of additional hours (i.e. over and above free 20 hours per week) resulting in an ongoing spending pressure of £250,000 pa in nursery charges.
Changing Demographics £200,000
Primary and secondary school numbers have been increasing greater than predicted in the MTFP due to net immigration and more students opting to stay on at school (e.g. secondary school numbers up 82 compared to MTFP assumptions) with job opportunities limited.
Demand for UK Placements £150,000
The Special Educational Needs budget for UK placements is insufficient to meet the number of children in the UK. There are presently 4 children in the UK with educational requirements not available in the island.
Head Teacher Training £100,000
A requirement for succession planning and training has been identified for existing and future deputy and head teachers with particular emphasis on professional development (possibly in the form of the National Professional Qualification for Headship) to enable local teachers to progress to more senior positions within education.
Jersey Music Service £100,000
The Jersey Music Service has introduced fees for existing school lessons for the first time from September 2014 covering approximately 1,000 pupils. Whilst this has been widely reported there has been some initial negative reaction from parents and based on UK experience pupil numbers may initially fall before recovering to normal levels. A significant investment in new instruments has been made to mitigate the introduction of fees and limit the fall in pupil numbers.
Health and Social Services - £4,330,000
CAMHS / Children's Services £1,230,000
In response to accumulating evidence of concern during 2014, the HSS CEO recruited both an experienced Interim Managing Director and Director of Children's Services to CSS in August. The CEO commissioned the Interim Director of Children's Services to conduct an urgent review, to advise on safety and quality, and advise on which areas require accelerated improvement. This
was completed by the end of September. The review highlighted funding requirements for 2015 of £2.4m. £0.9m has been requested through the carry forward process to implement change in the key service areas. An additional £0.3m has been allocated within the Department's 2% funding allocation for 2015. There is a resultant funding shortfall of £1.2m for 2015. £0.7m relates specifically to investment in staffing for the Greenfields site to extend the secure facility from school age residents to incorporate young offenders, under the age of 25, transferring from HMP La Moye.
New and High Cost Drugs £500,000
Each year, new drugs are licensed and recommended for use by the National Institute for Health and Clinical Excellence. Also, each year a small number of individuals are diagnosed with conditions requiring exceptionally high cost drugs. Eg in 2015 there may be a small number of people returning to Jersey who will require lifelong treatment with clotting agents (factor 8) and it is statistically probable that a small number of patients will be deemed eligible for experimental cancer drugs on the same basis as residents of England access the Cancer Drugs Fund in England. The sum of £500,000 represents the approximate potential cost of these high cost drugs pro rata to the UK, based on their relative populations.
UK Acute Referrals £500,000
The Department has experienced a significant increase in low volume high cost UK acute referrals through the second half of 2014 that has put pressure on financial budgets. It is expected that each year the Department will experience these types of referrals that without foresight are difficult to financially manage.
Waiting List Initiatives £400,000
The Department aims to reduce the length of time patients wait for surgical procedures. Growing demand and public expectation requires an increase in capacity to maintain / reduce waiting times. A number of schemes have been identified to reduce waiting times.
High Cost Children’s Placements £400,000
High cost UK placements for Children with high levels of need have increased rapidly over the past two years. The current level of placements will result in a cost pressure for 2014. P82/2012 proposals to develop Children's services should have a long term impact on the need for off-island provision but this is still in its early stages. Demand grows significantly in the short term which would place a significant pressure on the Department (a single case can equate to £200,000)
Francis Report Recommendations including Nursing Reviews £400,000
The Francis Report was produced as a result of a independent investigation into the high mortality rate at the Mid Staffordshire NHS Foundation Trust. The report focuses on measures to ensure patient safety. HSS is currently reviewing the recommendations of the Francis report, assessing current levels of compliance, and compiling a plan to implement any required changes. Further reviews into nursing staffing levels have indicated that the Department requires additional workforce investment to improve the overall effectiveness of the service to patients.
Adult Community Care Placements £400,000
The increase in adult care placements on and off the island continues to pose a financial risk to the Department, particularly in the area of Mental Health. HSSD has seen an increasing number of UK referrals through the past couple of years. The large majority of these placements tend to be long-term and therefore additional placements add to the ongoing cost pressure faced.
The Department is particularly susceptible to a continuing increase in high cost Mental Health UK placements. The lack of specialised staff on-islands means that any future cases would currently require off-island treatment. Significant investment in adult care homes has been included in the MTFP to better develop facilities for such patients, with the aim of providing this care on-island.
Voluntary and Community Sector Organisations £300,000
There are a number of potential demands from the voluntary and community sector organisations.
Winter Pressures £200,000
There is a risk that a bad winter would put significant pressure on hospital beds which may require the purchase of private beds in the Community.
Transport and Technical Services - £3,008,000
Income Shortfall £2,858,000:
Guernsey Waste £1,500,000 - the 2015 budget includes a net income of £1.5m due to the disposal of Guernsey Waste in the EfW plant. Based on the most recent information, it is not anticipated that Guernsey will choose Jersey as its preferred option of waste disposal. A growth request has been made for 2016, however if this funding is provided in 2015 this will enable the Department to start various projects that have been put off in the last few years.
Energy from Waste £1,358,000 - Since budgets were set in 2012, the unit rate has decreased by approximately 29.5%, while budgets have increased. A growth request has been made for 2016, however if this funding is provided in 2015 this will enable the Department to start various projects that have been put off in the last few years.
Funding Shortfall £150,000
Bus contract - The existing contract is greater than the budget allocated, due to misunderstandings made in 2012 during negotiations, and is being funded from STP monies at a greater extent than originally planned. A growth request has been made for 2016, however if this funding is provided in 2015 this will enable the Department to start STP initiatives that might otherwise be put on hold.
Treasury and Resources - £4,330,000
Reduced Backlog Maintenance £2,250,000
Reduction in backlog maintenance allocation resulting in fewer projects being undertaken leading to greater pressure on reactive maintenance budgets.
Property Maintenance transferred from Health £2,000,000
Amount required to bring the portfolio up to statutory maintenance requirements. The condition survey identified £10 million of funding required over the next five years, which has been evenly applied to arrive at the £2 million figure.
External Property Income Deficit £80,000
JPH external property income has a structural deficit of £80,000. This is due to income budget increases outstripping rental increases. Rental increases are predominantly linked to RPI which has been lower than the 2.5% budget increase for a number of years.
8. Recommendations
To consider the adjusted carry forward requests identified in this report, summarised as:-
- Departmental carry forward of £7,777,150 as detailed in Section 3 and Appendix 1 on page 19,
- Departmental carry forward of an additional £5,233,402 as detailed in Section 4 and Appendix 1 on page 19,
- Central Reserves and Restructuring Provision carry forward of £9,869,808 and £96,200 respectively as detailed in Section 5 and Appendix 1 on page 19,
- Review Spending Pressures of £13,617,000 identified by Departments and consider these in conjunction with the next MTFP 2016 – 2019 as detailed in Section 7 and Appendix 4 on page 23.
- Transfer of £12,117,615 to the Consolidated Fund as detailed in Appendix 1 on page 19 as follows:-
- £7,820,000 from Central Reserves, (rephasing of unspent capital approvals),
- £2,701,350 from the Restructuring Provision; and
- £3,596,265 from Court and Case Costs in the Smoothing Reserve; and
- Offset by £2 million ring fenced from Social Security underspend for Long Term Care Fund.
- Balance of Departmental underspends of £13,019,885, as a result of reduced carry forward request, to return to the Consolidated Fund as detailed in Appendix 1 on page 19.
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