Budget Transfers: Revenue and Capital Heads of Expenditure for various projects

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A decision made on 30 November 2015:

Decision Reference: MD-T-2015-0094

Decision Summary Title

Budget transfers for the replacement of DVS vehicle test centre equipment, provision of additional bus shelters and Beaumont road safety scheme.

Date of Decision Summary:

25 November 2015

Decision Summary Author:

Finance Manager

Decision Summary:

Public or Exempt?

Public

Type of Report:

Oral or Written?

Written

Person Giving

Oral Report:

N/A

Written Report

Title :

Budget transfers for the replacement of DVS Vehicle Test Centre Equipment, provision of additional bus shelters and Beaumont road safety scheme.

Date of Written Report:

25 November 2015

Written Report Author:

Finance Manager

Written Report :

Public or Exempt?

Public

Subject: Increase of budgets and subsequent transfer between Revenue and Capital Heads of Expenditure totalling £240,000, being £165,000 for the replacement of DVS vehicle test centre equipment, £45,000 for provision of additional bus shelters and £30,000 for road safety schemes.

Decision(s): The Minister approved the following:

A) An increase of £240,000 to the Transport and Technical Services (TTS) income budget and an identical increase to the TTS expenditure budget.

B) An internal budget transfer of £75,000 from the TTS revenue head of expenditure to the capital head of expenditure for Road Safety Improvements (Q00MF15037), and an internal budget transfer of £165,000 from the revenue head of expenditure to the capital head of expenditure for Replacement Assets (Q00MC10012).

Reason(s) for Decision: Under Generally Accepted Accounting Principles (GAAP) expenditure that meets the definition of capital expenditure must be capitalised. This budget transfer is the movement in budget between capital and revenue required to align the budgeting treatment of expenditure with the accounting treatment, in order to comply with GAAP.

Under Section 5.12 of Financial Direction 3.6 Variations to Head of Expenditure, additional surplus income of not more than 10% or £100,000 of the estimated income notified to the States for that particular service area and of a non-contentious nature, may be used automatically. Where the additional surplus income is greater than these limits, and the use is of a non-contentious nature, approval has been delegated to the Treasurer of the States. In all other instances, the approval of the Minister for Treasury and Resources must be obtained.

Section 5.1 of Financial Direction 3.6 Variation to Heads of Expenditure states that Departments wanting to transfer funds between heads of expenditure must obtain the approval of their minister or of their accounting officer where a scheme of delegation exists prior to obtaining approval from the Treasury Minister or Treasurer.

Article 18(1)(a) of the Public Finances (Jersey) Law 2005 states that all or any part of the amount appropriated by a head of expenditure may, with the approval of the Minister for Treasury and Resources, be transferred from a revenue head of expenditure to a capital head of expenditure, or vice versa, in order to comply with accounting standards issued for the purposes of Article 32(2). Delegation 1.2 delegates authority for non-contentious transfers between revenue and capital heads of expenditure (and vice versa) with no financial limit where the transfer is solely to ensure that financial transactions are accurately reflected in the States’ Accounts in accordance with accounting standards issued under Article 32(2) of the Law.

Resource Implications: The TTS revenue head of expenditure will show an additional income budget of £240,000 and an additional expenditure budget of £240,000, a net nil change. This expenditure budget will subsequently be transferred to the TTS capital heads of expenditure for Replacement Assets (Q00MC10012) and Road Safety Improvements (Q00MF15037), being £165,000 and £75,000 respectively, reducing the TTS Revenue Head of Expenditure by £240,000.

Action required: The Minister for Transport and Technical Services to request the Treasurer of the States to approve the use of additional income, the creation of the income and expenditure budgets, and the budget transfer from revenue to capital as referred to in the accompanying report.

Signature:

Position:

Minister for Transport & Technical Services

Date Signed:

Date of Decision (If different from Date Signed):