Stabilisation Fund to Consolidated Fund: Transfer

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While there is a presumption toward publication to support of transparency and accountability, detailed information may not be published if, for example, it would constitute a breach of data protection, or disclosure would prejudice commercial interest.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 18 September 2020

Decision Reference: MD-TR-2020-0112
Decision Summary Title:	Transfer from Stabilisation Fund to Consolidated Fund		Date of Decision Summary:	18 September 2020
Decision Summary Author:	Head of Financial Governance		Decision Summary: Public or Exempt?	Public
Type of Report: Oral or Written?	Written		Person Giving Oral Report:	n/a
Written Report Title:	Transfer from Stabilisation Fund to Consolidated Fund		Date of Written Report:	18 September 2020
Written Report Author:	Head of Financial Governance		Written Report : Public or Exempt?	Public
Subject: Transfer from Stabilisation Fund to Consolidated Fund
Decision(s): The Minister decided to transfer £50 million from the Stabilisation Fund to the Consolidated Fund and direct that it be added to the General Reserve head of expenditure to address direct and consequential impacts of Covid-19.
Reason(s) for Decision: P.28/2020 Draft Public Finances (Amendment of Law) (Jersey) Regulations 202-, approved by the States Assembly on 24th March 2020, agreed a number of temporary modifications to the Public Finances (Jersey) Law 2019. The added modifications affect the way in which the Stabilisation Fund may be used, by allowing the Minister – • to transfer an amount from the Stabilisation Fund to any other fund and direct that amount to be expended directly from that fund; • to direct that an amount be expended directly from the Stabilisation Fund; • to direct that an amount be transferred to the Stabilisation Fund from any other fund; • to arrange for overdraft and other financing for the Stabilisation Fund; • to arrange that repayments of loans made from the Stabilisation Fund are credited to that Fund. There are other added modifications, which – • allow the Minister to transfer up to and including £400 million from the Strategic Reserve Fund to the Stabilisation Fund; • remove the requirement in Article 18 that if the Minister proposes to give a direction to re-allocate a head of expenditure, the Minister gives the States at least 4 weeks’ notice; • increase from £10 million to £100 million the amount which may be appropriated from the Consolidated Fund by the Minister without amending the government plan; • increase the limit on financing that the Minister may arrange in a financial year from £3 million to £500 million and the limit on total outstanding financing from £20 million to £500 million; • allow the Minister to make loans from the Stabilisation Fund (instead of only from the Consolidated Fund), and increase the limit on loans that the Minister may make in a financial year from £3 million to £100 million and the limit on total outstanding loans from £20 million to £100 million; • increase the limit on guarantees and indemnities that the Minister may provide in a financial year from £3 million to £100 million and the limit on the total outstanding guarantees from £20 million to £100 million. The amendment to P.28/2020, brought by the Corporate Services Scrutiny Panel and adopted by the Assembly, clarified that: • the amended powers expire on 30th September 2020; and • where the Minister has obtained financing, lent money or provided guarantees or indemnities under Articles 26 to 28 while Article 24(8) applied, the financing, lending or provision of guarantees or indemnities remain valid and are not included in any monetary limits set out in Articles 26 to 28 as those Articles apply after the expiry of the modifications. The Minister brought these amended powers into effect through MD-TR-2020-0029 by deciding that she considered there exists an immediate threat to the health or safety of any of the inhabitants of Jersey and to the stability of the economy in Jersey. The Minister, on the advice of the Treasurer, considers that there is a need to increase the available balance on the General Reserve, thus preserving as much as possible of the additional expenditure approval of £99.99 million to address the pandemic and its consequences. That balance, which remains available beyond 30th September 2020, will be used to address the economic consequences during the period to 31st December 2020. The Minister has published her Covid-19 Financial Policy as R.96/2020.
Resource Implications: The balance of the Stabilisation Fund will decrease by £50 million. The balance of the Consolidated Fund will increase by an identical amount, with that amount being added to the General Reserve head of expenditure to address direct and consequential impacts of Covid-19. This transfer will reduce the balance on the Stabilisation Fund to nil.
Action required: Head of Financial Governance to ensure this decision is published on www.gov.je.
Signature:		Position: Deputy S J Pinel, Minister for Treasury and Resources
Date Signed:		Date of Decision:

Stabilisation Fund to Consolidated Fund: Transfer

Treasury and Exchequer

Ministerial Decision Report

Transfer from Stabilisation Fund to Consolidated Fund

Purpose of Report

To enable the Minister to consider a recommendation to transfer £50 million from the Stabilisation Fund to the Consolidated Fund and direct that it be added to the General Reserve head of expenditure.

Background

The States Assembly’s approval of P.28/2020 permits the Minister to transfer an amount from the Stabilisation Fund to any other fund and direct that amount to be expended directly from that fund.

Funding provisions were made in the Government Plan 2020-2023 in the General Reserve for funding needs that cannot be met from existing heads of expenditure in 2020. The Minister has increased the amount available in the General Reserve by transferring £65.3 million for the Treasury and Exchequer head of expenditure (MD-TR-2020-0035); approving an additional £99.99 million of expenditure (MD-TR-2020-0047) and approving the transfer of £28 million from the Stabilisation Fund, with associated authority to spend from the General Reserve (MD-TR-2020-0055).

There are further Covid-19 related requests for funding from the General Reserve that are likely to be approved once business cases have been reviewed. The approval of these business cases will result in the requirement for additional funding of the General Reserve.

The Minister is therefore requested to transfer £50 million from the Stabilisation Fund to the Consolidated Fund for this purpose, and to add that sum to the General Reserve head of expenditure. Allocations from the General Reserve are all made by public decision of the Minister.

Recommendation

The Minister is recommended to transfer £50 million from the Stabilisation Fund to the Consolidated Fund and direct that it be added to the General Reserve head of expenditure.

Reason for Decision

P.28/2020 Draft Public Finances (Amendment of Law) (Jersey) Regulations 202-, approved by the States Assembly on 24th March 2020, agreed a number of temporary modifications to the Public Finances (Jersey) Law 2019. The added modifications affect the way in which the Stabilisation Fund may be used, by allowing the Minister –

• to transfer an amount from the Stabilisation Fund to any other fund and direct that amount to be expended directly from that fund;

• to direct that an amount be expended directly from the Stabilisation Fund;

• to direct that an amount be transferred to the Stabilisation Fund from any other fund;

• to arrange for overdraft and other financing for the Stabilisation Fund;

• to arrange that repayments of loans made from the Stabilisation Fund are credited to that Fund.

There are other added modifications, which –

• allow the Minister to transfer up to and including £400 million from the Strategic Reserve Fund to the Stabilisation Fund;

• remove the requirement in Article 18 that if the Minister proposes to give a direction to re-allocate a head of expenditure, the Minister gives the States at least 4 weeks’ notice;

• increase from £10 million to £100 million the amount which may be appropriated from the Consolidated Fund by the Minister without amending the government plan;

• increase the limit on financing that the Minister may arrange in a financial year from £3 million to £500 million and the limit on total outstanding financing from £20 million to £500 million;

• allow the Minister to make loans from the Stabilisation Fund (instead of only from the Consolidated Fund), and increase the limit on loans that the Minister may make in a financial year from £3 million to £100 million and the limit on total outstanding loans from £20 million to £100 million;

• increase the limit on guarantees and indemnities that the Minister may provide in a financial year from £3 million to £100 million and the limit on the total outstanding guarantees from £20 million to £100 million.

The amendment to P.28/2020, brought by the Corporate Services Scrutiny Panel and adopted by the Assembly, clarified that:

• the amended powers expire on 30th September 2020; and

• where the Minister has obtained financing, lent money or provided guarantees or indemnities under Articles 26 to 28 while Article 24(8) applied, the financing, lending or provision of guarantees or indemnities remain valid and are not included in any monetary limits set out in Articles 26 to 28 as those Articles apply after the expiry of the modifications.

The Minister brought these amended powers into effect through MD-TR-2020-0029 by deciding that she considered there exists an immediate threat to the health or safety of any of the inhabitants of Jersey and to the stability of the economy in Jersey.

The Minister, on the advice of the Treasurer, considers that there is a need to increase the available balance on the General Reserve, thus preserving as much as possible of the additional expenditure approval of £99.99 million to address the pandemic and its consequences. That balance, which remains available beyond 30th September 2020, will be used to address the economic consequences during the period to 31st December 2020.

The Minister has published her Covid-19 Financial Policy as R.96/2020.

Resource Implications

The balance of the Stabilisation Fund will decrease by £50 million. The balance of the Consolidated Fund will increase by an identical amount, with that amount being added to the General Reserve head of expenditure. This transfer will reduce the balance on the Stabilisation Fund to nil.

Report author : Head of Financial Governance	Document date : 18th September
Quality Assurance / Review : Group Director, Strategic Finance	File name and path: L:\Treasury\Sections\Corporate Finance\Ministerial Decisions\DS, WR and SD\2020-0112 - Transfer from Stabilisation Fund to Consolidated Fund £50m
MD sponsor : Treasurer of the States