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Budget Transfers - PECRS & St. Helier Regeneration.

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A decision made (27/06/2006) regarding Budget transfers in respect of the: a) Departments' Contribution to the Public Employees Contributory Retirement Scheme (PECRS) Pre 1987 Debt Repayment; and b) St. Helier Development and Regeneration Strategy.

Subject:

Budget transfers in respect of the :

· Departments’ Contribution to the Public Employees Contributory Retirement Scheme (PECRS) Pre 1987 Debt Repayment ; and

· St Helier Development and Regeneration Strategy.

Decision Reference:

MD-PE-2006-0075

Exempt clause(s):

 

Type of Report (oral or written):

Written

Person Giving Report (if oral):

N/A

Telephone or

e-mail Meeting?

N/A

Report

File ref:

 

Written Report

Title:

Budget Transfers

Written report – Author:

Ellen Littlechild, Finance Director

Decision(s):

I. To agree a budget transfer amounting to £100,600 equivalent to 2% of members’ pay to a central HR vote within the Chief Minister’s Department.

II. To request that the Chief Minister transfer £238,000 to contribute towards the costs associated with the St Helier Regeneration Strategy.

Reason(s) for decision:

I. To ring fence the funds required to enable the repayment and servicing of the Public Employees Contributory Retirement Scheme pre 1987 debt for the period through to 2083.

II. To enable the Chief Minister to allocate funds in support of the St Helier Regeneration Strategy.

Action required:

To notify the Chief Minister and Minister for the Treasury and Resources Department of these decisions.

Signature:

(Minister/ Assistant Minister)

Date of Decision:

27 June 2006

Hide report
Budget Transfers - PECRS & St. Helier Regeneration.

PLANNING AND ENVIRONMENT

BUDGET TRANSFERS

Purpose of the Report

The purpose of this report is to seek the Minister for Planning and Environment’s approval to the following:

· to transfer budget, equivalent to 2% of members’ pay, to the Chief Minister’s Department in order to ring fence the funds required to enable the repayment and servicing of the Public Employees Contributory Retirement Scheme (PECRS) pre 1987 debt; and

· to request that the Chief Minister transfers a budget of £238,000 to contribute towards the costs of preparing a Development and Regeneration Strategy for St Helier.

·

·

Background

Finance Direction No.3.6 ‘Variations to Heads of Expenditure’ sets out the procedures for the transfer of revenue funds and states that requests for transfers of revenue funds from one Department to another require the prior approval of the Minister for Treasury and Resources and the relevant ministers party to the transfer.

Discussion

Public Employees Contributory Retirement Scheme (PECRS) pre 1987 debt repayment

On 27 September 2005 the States approved amendments to the PECRS to address the pre 1987 deficit of the scheme (P189/2005 and P190/2005).

A valuation at 31 December 2001 placed a value on the States’ share of the pre 1987 debt of £177.5 million.

A framework for dealing with the debt, approved by the former Policy and Resources Committee and the Committee of Management, agreed to increase the employers contribution to the scheme to 15.6% of which a repayment equivalent to 2% of members’ pay would be made over 82 years from 1 January 2002.

During the 2006 Budget process Departments’ revenue budgets included a provision to increase their PECRS contribution from 15.16% to the required 15.6%.

It has been proposed that the budget for the 2% element for repayment and servicing of the debt be transferred from all Departments’ budgets to a central HR vote held within the Chief Minister’s Department. This arrangement will lessen the burden on Departments to make monthly repayments and also insulate Departments should the costs of the repayments increase or staff numbers decrease.

Alongside this arrangement States Payroll has been adjusted such that Departments will be charged the reduced 13.6% PECRS contributions from January 2006.

Shown below is a calculation of the 2% provision applicable to the Planning and Environment:

 

2006 Budget PECRS

PECRS 2% Provision

Planning and Environment

£784,600

£100,600

Budget Transfers £238,000 – St Helier Regeneration Strategy

The Minister will recall that EDAW has recently been awarded the contract to prepare the Development and Regeneration Strategy for St Helier which will embrace social, economic and culture issues. The cost of recruiting EDAW amounted to £238,000.

The Minister will also recall that the former Policy and Resources Committee agreed to use funds from the Urban Park Landscape and Millennium Contingency Capital Vote to contribute towards the overall cost of this major initiative.

Recommendations

Public Employees Contributory Retirement Scheme (PECRS) pre 1987 debt repayment

It is recommended that the Minister agrees to transfer budget amounting to £100,600 equivalent to 2% of members’ pay to a central HR vote within the Chief Minister’s Department.

Budget Transfers £238,000 – St Helier Regeneration Strategy

It is recommended that the Minister request that the Chief Minister transfer £238,000 to contribute towards the costs associated with the St Helier Regeneration Strategy.

Reason (s) for Decision

Public Employees Contributory Retirement Scheme (PECRS) pre 1987 debt repayment

To ring fence the funds required to enable the repayment and servicing of the Public Employees Contributory Retirement Scheme pre 1987 debt for the period through to 2083.

Budget Transfers £238,000 – St Helier Regeneration Strategy

To enable the Chief Minister to allocate funds in support of the St Helier Regeneration Strategy.

Action Required

To notify the Chief Minister and Minister for the Treasury and Resources Department of these decisions.

Written by:

Ellen Littlechild, Finance Director

 

 

Approved by:

John Richardson, Chief Officer

 

 

Attachment:

 

 

 

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