Budget Transfer: Revenue and Capital Heads of Expenditure

Information about the publication of Ministerial Decisions

A formal published “Ministerial Decision” is required as a record of the decision of a Minister (or an Assistant Minister where they have delegated authority) as they exercise their responsibilities and powers.

Ministers are elected by the States Assembly and have legal responsibilities and powers as “corporation sole” under the States of Jersey Law 2005 by virtue of their office and in their areas of responsibility, including entering into agreements, and under any legislation conferring on them powers.

An accurate record of “Ministerial Decisions” is vital to effective governance, including:

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

Ministers are individually accountable to the States Assembly, including for the actions of the departments and agencies which discharge their responsibilities.

The Freedom of Information Law (Jersey) Law 2011 is used as a guide when determining what information is be published. While there is a presumption toward publication to support of transparency and accountability, detailed information may not be published if, for example, it would constitute a breach of data protection, or disclosure would prejudice commercial interest.

A decision made on 24 November 2015:

Decision Reference: MD-ESC-2015-0024
Decision Summary Title:	Increase of Budget and subsequent transfers between Revenue and Capital Heads of Expenditure as a consequence of capital grants received for the 3G Pitch and Playground Equipment.	Date of Decision Summary:	24 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:	Increase of budget and subsequent transfers between Revenue and Capital Heads of Expenditure as a consequence of capital grants received	Date of Written Report:	24 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 £410,000, being £400,000 for the Sports Division as a contribution towards the costs of the 3G pitch, and £10,000 from the Jersey College for Girls Preparatory School as a contribution towards the costs of the new playground equipment.
Decision(s): The Minister approved the following: The use of capital grant income received in the sum of £410,000 as contributions towards capital projects detailed above. An increase of £410,000 to the Education, Sport and Culture (ESC) income budget and an identical increase to the ESC expenditure budget. An internal budget transfer of £410,000 from the ESC Revenue head of expenditure to the Capital head of expenditure for Sports Strategy Infrastructure (£400,000) and Minor Capital (£10,000).
Reason(s) for Decision: In support of the 5 year strategy (“Fit for the Future”) for sport and physical activity in Jersey an extra £4.5 million in capital funding was allocated to Education, Sport and Culture in 2014/2015 to improve facilities in preparation for the 2015 NatWest Island Games and for the use by the community afterwards. One of the capital projects identified by the sport strategy was for a new 3G Pitch at Springfield Stadium. The Football Foundation agreed to grant Education, Sport and Culture £400,000 from their Premier League and FA Facilities Fund towards this project. The Ministerial Decision (MD-ESC-2015-2021) signed on 7 October 2015 covered a revenue to capital budget transfer for a new playground at Jersey College for Girls Preparatory School. A contribution from the school PTA of £10,000 has been received towards this project. Under Generally Accepted Accounting Principles (GAAP) expenditure that meets the definition of capital expenditure only can 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. 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. Under Article 19(1) of the Public Finances (Jersey) Law 2005 the Minister for Treasury and Resources can authorise a States funded body to withdraw from the consolidated fund during a year an amount not exceeding the likely excess of income over the amount approved in that year’s revenue allocation. Authority is delegated to the Treasurer of the States to approve any such income which matches additional expenditure.

Resource Implications:

The ESC revenue head of expenditure will show an additional income budget of £410,000 and an additional expenditure budget of £410,000. This expenditure will subsequently be transferred to the ESC capital head of expenditure which will increase by £410,000.

Action required:

The Minister for Education, Sport and Culture to request the Treasurer of the States to approve the use of capital grant income received, creation of income and expenditure budgets and the budget transfer from revenue to capital as referred to in the accompanying report.

Signature:

Position: Deputy Rod Bryans

Minister for Education, Sport and Culture

Date Signed:

Date of Decision:

Budget Transfer: Revenue and Capital Heads of Expenditure

Education, Sport and Culture

Ministerial Decision Report

Increase of Budget and subsequent transfers between Revenue and Capital Heads of Expenditure as a consequence of capital grants received for the 3G Pitch and Playground equipment.

Purpose of Report

To enable the Minister for Education, Sport and Culture (ESC) to approve the following:

The use of capital grant income received in the sum of £410,000 as contributions towards capital projects as detailed below.
An increase of £410,000 to the Education, Sport and Culture (ESC) income budget and an increase of an identical amount to the ESC expenditure budget.
An internal budget transfer of £410,000 from the ESC revenue head of expenditure to the Sport Strategy Infrastructure and Minor capital head of expenditure for capital grants received by the Sport Division and Jersey College for Girls Preparatory School respectively.

Background

In support of the 5 year strategy (“Fit for the Future”) for sport and physical activity in Jersey an extra £4.5 million in capital funding was allocated to Education, Sport and Culture in 2014/2015 to improve facilities in preparation for the 2015 NatWest Island Games and for the use by the community afterwards. One of the capital projects identified by the sport strategy was for a new 3G Pitch at Springfield Stadium. The Football Foundation agreed to grant Education, Sport and Culture £400,000 from their Premier League and FA Facilities Fund towards this project.

The Ministerial Decision (MD-ESC-2015-2021) signed on 7 October 2015 covered a revenue to capital budget transfer for a new playground at Jersey College for Girls Preparatory School. A contribution from the school PTA of £10,000 has been received towards this project.

Recommendation

The Minister for ESC is recommended to approve:

The use of capital grant income received in the sum of £410,000 as contributions towards capital projects as detailed above.
An increase of £410,000 to the Education, Sport and Culture (ESC) income budget and an increase of an identical amount to the ESC expenditure budget.
An internal budget transfer of £410,000 from the ESC revenue head of expenditure to the Sports Strategy Infrastructure and Minor capital head of expenditure for capital grants received by the Sport Division and Jersey College for Girls Preparatory School respectively.

Reasons for Decision

Under Generally Accepted Accounting Principles (GAAP) expenditure that meets the definition of capital expenditure only can 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.

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 capital head of expenditure to a revenue head of expenditure, or vice versa, in order to comply with generally accepted accounting principles or an Order made under Article 32.

Under Article 19(1) of the Public Finances (Jersey) Law 2005 the Minister for Treasury and Resources can authorise a States funded body to withdraw from the consolidated fund during a year an amount not exceeding the likely excess of income over the amount approved in that year’s revenue allocation. Authority is delegated to the Treasurer of the States to approve any such income which matches additional expenditure.

Resource Implications

Report author: Finance Manager	Document date : 24 November 2015
Quality Assurance / Review:	File name and path:
	File name and path: