Customer and Local Services
Social Security Ministerial Decision Report
Approval of 2021 management charge from customer and Local services department to the funds
- Purpose
The purpose of this report is to seek the Minister’s approval of a management charge of £7,660,000 to be charged from the Customer and Local Services Department to the three Funds to reflect the operational and management costs of running the Department in 2021.
- Background
For 2021 the funds will continue to cover the costs of administering benefit payments via the Management Charge which consists of administration and other costs, the total of which will not change from 2020.
The calculation for administration costs is based on estimated staff and administration activity for the year for each operational area supporting benefit payments which are then apportioned appropriately between each of the funds and the Customer and Local Services department. In addition, the funds will also continue to cover certain costs where they are incurred under the legislation relating to the fund in question or are specific expenditure of the funds. These costs include, but are not limited to, audit, actuarial and investment management fees, the contribution from the Health Insurance Fund cost of the Primary Care Governance Team and Jersey Quality Improvement Framework payments.
The level of Management Charge will be fully reviewed in 2021 for the reminder of the current Government Plan reporting period. If there is a need to incur further expenditure from the funds in the years (e.g. for specific projects) then the Minister will be asked to approve further withdrawals from the funds, either directly or as a payment to the Customer and Local Services Department (recorded as income to match the additional expenditure).
- Recommendation
It is recommended that the Minister approve the management charge of £7,660,000 to be charged from Department to the three Funds to reflect the operational and management costs of running the Department in 2021.
- Reason for Decision
Under Article 30 (2) of the Social Security (Jersey) Law 1974, Article 21 (1) of the Health Insurance (Jersey) Law 1967 and Article 2 of the Long-Term Care (Jersey) Law 2012, the Minister can make payments from the fund for expenses incurred by the Minister in carrying the Law into effect.
- Resource Implications
There is no change to the Customer and Local Services Department’s revenue head of expenditure for 2021 caused by this decision.
This decision does not change the Department’s total FTE.