Financial planning disclosures for the 6 month period ended 30 June 2007

Information about the publication of Ministerial Decisions

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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

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A decision made (08.10.07) to approve the financial planning disclosures for the 6 month period ended 30 June 2007.

Decision Reference: MD-TR-2007-0103
Decision Summary Title:	Financial planning disclosures for the 6 month period ended 30th June 2007		Date of Decision Summary:	4th October 2007
Decision Summary Author:	Kevin Hemmings – 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:	Report on the disclosure requirements relating to Financial Planning.		Date of Written Report:	4th October 2007
Written Report Author:	Kevin Hemmings – Head of Decision Support		Written Report : Public or Exempt?	Public
Subject: Financial planning disclosures for the 6 month period ended 30th June 2007
Decision(s): The Minister approved the report detailing financial planning disclosures for the six month period ending 30th June 2007 and requested that it be laid before the States.
Reason(s) for Decision: The Public Finances (Jersey) Law 2005 and its associated financial directions require the Minister for Treasury and Resources to report to the States twice yearly on a number of issues relating to States finances.
Resource Implications: There are no financial or manpower implications as a direct result of this decision.
Action required: Head of Decision Support to send the attached report to the States Greffe and to request that it be laid before the States at the earliest possible opportunity.
Signature:		Position: Senator Terry Le Sueur, Treasury and Resources Minister
Date Signed: 8th October 2007		Date of Decision: 8th October 2007

Financial planning disclosures for the 6 month period ended 30 June 2007

TREASURY & RESOURCES MINISTER

Report on the disclosure requirements relating to Financial Planning

1. The administration of the public finances of Jersey

In accordance with the Public Finances (Jersey) Law 2005 (the ‘Law’) (including Regulations approved under that Law and Financial Directions) certain matters are required to be reported to the States twice yearly by the Minister for Treasury and Resources (the ‘Minister’).

This report sets out those matters for the 6 month period ended 30th June 2007.

2. Financial Directions

Matters to be reported by the Minister twice yearly relate solely to financial planning. The Financial Directions (‘FD’) referred to in this report – which have all been issued under certain Articles of the Law and provide instructions and guidance on the Law and any Regulations that are in place – are all relevant.

2.1 FD 3.1 – Financial administration of Trading Operations (Article 26)

This Direction supports paragraphs (2) and (3) of Regulation 22, which states that the Minister may in certain circumstances approve the use of money standing to the credit of the trading fund of a States trading operation for a capital project, or for a purpose other than one approved as part of an annual business plan (FD sections 5.13-5.15 refer).

2.2 FD 3.2 – Borrowing (Article 21)

Under Regulation 9, the Minister may authorise certain borrowings in the name of, and on behalf of the States. The ‘Borrowing by the Minister for Treasury & Resources’ section of this Direction provides guidance on the aforementioned. This function has partly been delegated to the Treasurer of the States (the Treasurer) – as permitted by Regulation 10 -, and FD sections 5.12 and 5.18 refer.

2.3 FD 3.3 – Lending (Article 23)

Sections 5.6 and 5.7 of this Direction support Regulation 13, which authorises the Minister to lend certain money of the States. ‘Lending by the Treasurer of the States’ (FD section 5.9) relates to Regulation 14, which authorises the Minister to delegate to the Treasurer, wholly or partly, a function vested in the Minister by Regulation 13.

2.4 FD 3.6 – Variations to heads of expenditure (Article 15)

This Direction specifies how and when an application for the Minister’s approval under paragraph (1) of Article 15 (a) of the Law may be made. Transfers between heads of expenditure are covered in FD sections 5.7-5.13, and the carry forward of revenue balances is referred to in section 5.15 and FD 6.1 Carry forward of revenue balances. Separate rules relate to designated States trading operations.

3. Reporting on Ministerial and delegated approvals

The areas of administration which are to be reported on for the period ended 30th June include the use of trading funds, borrowing, and variations to heads of expenditure.

3.1 Use of trading funds

During the first 6 months of the year, the Minister approved the use of Jersey Airport’s trading fund for two capital projects, namely the Airside/Landside Split project (£750,000) and the replacement of the mast at La Chasse (£84,500).

3.2 Borrowing

The giving of loan guarantees in the States’ name falls within the remit of FD 3.2, and the Treasurer approved four guarantees under the Small Firms Loan Guarantee Scheme (SFLGS) during the 6 month period. Under the terms of the scheme, EDD underwrites up to 75% of the value of a loan. The total amount guaranteed to date under the SFLGS is £262,500.

3.3 Variations to heads of expenditure

Direction 3.6 identifies requirements and provides advice on the procedures when variations to revenue and capital heads of expenditure are being considered.

A ‘head of expenditure’ is defined in section 5.1 of the FD as either:-

§ the annual net revenue budget of a States funded body [1]; or

§ the amount allocated for each capital project.

Please note that unless otherwise indicated in the Appendices, transfers have been approved via delegated authority.

3.3.1 Transfers between revenue heads of expenditure

Transfers between revenue heads are categorised in section 5.7 as:-

§ non-contentious transfers of up to £100,000, in which case the approval of the Treasurer of the States, or in his absence another person nominated by the Treasurer is required; and

§ all other instances, where the approval of the Minister is required.

Revenue transfers during the period ended 30th June 2007 amounted to £4,229,278 (Appendix A refers).

3.3.2 Transfers between capital heads of expenditure

Capital to capital transfers are categorised in sections 5.8-5.10 as:-

§ non-contentious transfers of up to £100,000 (5.8), which require the approval of the Treasurer of the States, or in his absence another person nominated by the Treasurer is required;

§ all other transfers between existing capital heads (5.9), in which case the approval of the Minister is required; and

§ transfers to new capital heads [2] of expenditure (5.10), which require the approval of the Council of Ministers (‘CoM’) and the Minister.

Transfers between existing capital heads of expenditure amounted to £15,324,562 for the period (Appendix B refers).

3.3.3 Transfers between revenue and capital heads of expenditure

Transfers between revenue and capital heads are categorised in sections 5.11-5.13 as:-

§ non-contentious transfers of up to £100,000 (5.11), in which case the approval of the Treasurer of the States, or in his absence another person nominated by the Treasurer is required;

§ all other transfers (5.12), which require the approval of the Minister; and

§ transfers to new capital heads of expenditure (5.13), in which case the approval of the CoM and the Minister are required.

Transfers between revenue and capital heads of expenditure amounted to £2,064,943 (Appendix C refers). There were no transfers to new capital heads of expenditure during the period.

3.4 Carry forwards

Total carry forwards of £1,583,869 were approved during the 2006 annual Accounts process, all of which had been allocated by departments as at 30thJune 2007 (Appendix D refers).

APPENDIX A – TRANSFERS BETWEEN REVENUE HEADS OF EXPENDITURE TO 30TH JUNE 2007

APPENDIX B – TRANSFERS BETWEEN CAPITAL HEADS OF EXPENDITURE TO 30TH JUNE 2007

APPENDIX C – TRANSFERS BETWEEN REVENUE & CAPITAL HEADS OF EXPENDITURE TO 30TH JUNE 2007

APPENDIX D – CARRY FORWARDS TAKEN TO 30TH JUNE 2007

[1] NMSFB – Non-Ministerial States Funded Body.

[2] ‘New’ capital heads of expenditure refers to capital projects that have been initiated without States approval.