Fiscal Stimulus Plan: Reversal of previous fiscal stimulus budget allocation to Social Security for extension of transitional relief

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While there is a presumption toward publication to support of transparency and accountability, detailed information may not be published if, for example, it would constitute a breach of data protection, or disclosure would prejudice commercial interest.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 27 September 2010 regarding: Fiscal Stimulus Plan: Reversal of previous fiscal stimulus budget allocation to Social Security for extension of transitional relief.

Decision Reference: MD-TR-2010-0138
Decision Summary Title:	Fiscal Stimulus – reversal of budget allocation to Social Security department - transitional relief		Date of Decision Summary:	21st September 2010
Decision Summary Author:	Interim Treasurer of the States		Decision Summary: Public or Exempt?	Public
Type of Report: Oral or Written?	Written		Person Giving Oral Report:	N/A
Written Report Title:	Reversal of fiscal stimulus funding for extension of transitional relief		Date of Written Report:	21st September 2010
Written Report Author:	Acting Fiscal Stimulus Programme Manager		Written Report : Public or Exempt?	Public
Subject: Economic Stimulus Plan: reversal of previous fiscal stimulus budget allocation to the Social Security department for the extension of transitional relief.
Decision(s): The Minister reversed the previous allocation of £1,440,000, awarded to Social Security in MD-TR-2009-0132 and instructed that the funds to remain in the fiscal stimulus allocation for award to another scheme or return to the stabilisation fund on completion of the fiscal stimulus programme overall.
Reason(s) for Decision: The bid to extend transitional relief for 12 months at a cost of £1,440,000 was approved by the Minister on 27th August 2009 following an evaluation to confirm its compliance with the key criteria for fiscal stimulus being timely, targeted and temporary and benefiting local individuals. However, as set out in the accompanying report, the actual cost of transitional relief between October 2009 and July 2010 was significantly lower than Social Security had previously forecast (and on which the original funding decision was made). As a result the department has sufficient existing budget, without contribution from the fiscal stimulus allocation, to fund transitional relief in 2010 and beyond to its cessation in 2015. Now that the department has confirmed the fiscal stimulus funding will not be needed it is necessary to formally reverse the allocation and ensure that the funds remain in the fiscal stimulus allocation for award to another scheme or return to the Stabilisation Fund following completion of the fiscal stimulus programme overall.
Resource Implications: No financial resource implications other than those explained above and in the accompanying report. No manpower resource implications.
Action required: Treasury to be informed of decision to reverse previous authority to transfer £1,440,000 to the Social Security department budget; the funds instead to be retained within the fiscal stimulus funding allocation currently managed as a specific vote in the Consolidated Fund.
Signature:		Position: Senator P F C Ozouf, Minister for Treasury and Resources
Date Signed:		Date of Decision:

Fiscal Stimulus Plan: Reversal of previous fiscal stimulus budget allocation to Social Security for extension of transitional relief

Treasury and Resources

Ministerial Decision Report

Reversal of fiscal stimulus funding for extension of transitional relief

1. Purpose of Report

To set out the detailed reasons for the reversal of a fiscal stimulus funding decision made on 27th August 2010, through which the Minster awarded £1,440,000 to the department for Social Security (MD-TR-2009-0132).

2. Background

The fiscal stimulus bid to extend transitional relief for 12 months beyond the first planned reduction, scheduled to come into effect in October 2009, was successful, with the Minister awarding £1,440,000 to Social Security on 27th August 2010. The evaluation supported the bid’s compliance with the key criteria for fiscal stimulus being timely, targeted and temporary and benefiting local individuals, and included a review of the forecast cost of extending the benefit at the 100% level to ensure that the department’s existing available budget did not allow for transition to continue without assistance from the fiscal stimulus fund.

3. Current position

As at Q2 2010 the Social Security department had not drawn on this available budget due to a declining total monthly cost of transition between October 2009 and July 2010 in spite of the extension of 100% support in accordance with Income Support (Transitional Provisions) (Jersey) Order 2008 (Revised Edition – 1 January 2010), which prompted a revision of the financial forecasts.

Revised financial forecasts, submitted to the fiscal stimulus programme in August, show an expected total spend on transitional relief that is significantly lower than previous forecasts which appropriately reflected the maximum potential exposure to pay out transition benefit (and on which the original funding decision was based). As a result, the Chief Officer of Social Security has confirmed that the department has sufficient existing budget, without contribution from the fiscal stimulus allocation, to fund transitional relief in 2010 and beyond, to its cessation in 2015.

It is noted that the Minister’s commitment of funding in MD-TR-2009-0132 has resulted in a successful fiscal stimulus initiative despite the fact that the department now has no need to draw on the fiscal stimulus funds. The commitment in August 2009 provided the funding assurances needed by Social Security at the time to commit to extension of the maximum level of transitional support. This has delivered financial benefit to lower income groups at a time when it a withdrawal of support would have had a significant impact on individuals as well as likely reductions in spend.

The £1,440,000 previously allocated and accounted for as committed to the project can now be released and retained by the Treasury within the fiscal stimulus allocation. These funds may be later utilised for another scheme, or will be returned to the Stabilisation Fund on completion of the fiscal stimulus programme overall.

4. Recommendation

It is recommended that the Minister approve the reversal of the funding allocation of £1,440,000 approved in MD-TR-2009-0132 and instruct the retention of the funds in the fiscal stimulus allocation to be later awarded, if appropriate, to other schemes or returned to the Stabilisation Fund (together with any other unspent fiscal stimulus monies) on final completion of the programme.

5. Reason for Decision

The department for Social Security has sufficient existing budget, without contribution from the fiscal stimulus allocation, to fund transitional relief in 2010 and beyond to its cessation in 2015.

As a result it is necessary to formally reverse the allocation and ensure that the funds remain in the fiscal stimulus allocation for award to another scheme or return to the Stabilisation Fund following completion of the fiscal stimulus programme overall.

6. Resource Implications

No financial resource implications other than those explained above.

No manpower resource implications.