Budget Transfer: revenue to capital heads of expenditure (General Hospital emergency generators)

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A decision made on 16 December 2017:

Decision Reference: MD-T-2017-0107
Decision Summary Title :	Budget transfer from the Department for Infrastructure Revenue Head of Expenditure to the DfI Replacement Assets Capital Head of Expenditure		Date of Decision Summary:	14 December 2017
Decision Summary Author:	Finance Manager		Decision Summary: Public or Exempt? (State clauses from Code of Practice booklet)	Public
Type of Report: Oral or Written?	Written		Person Giving Oral Report:
Written Report Title :	Budget transfer from the Department for Infrastructure Revenue Head of Expenditure to the DfI Replacement Assets Capital Head of Expenditure		Date of Written Report:	14 December 2017
Written Report Author:	Finance Manager		Written Report : Public or Exempt? (State clauses from Code of Practice booklet)	Public
Subject: Non-recurring budget transfer of up to £610,000 from the Department for Infrastructure Revenue Head of Expenditure to the Department for Infrastructure Replacement Assets Capital Head of Expenditure (Q00MC10012) in relation to the purchase and construction of new Emergency Generators at the General Hospital site in 2017 in order to comply with States accounting policies. The 2016 works were transferred under decision MD-T-2017-0006.
Decision(s): The Minister approved a non-recurring budget transfer of up to £610,000 from the Department for Infrastructure Revenue Head of Expenditure to Department for Infrastructure Replacement Assets Capital Head of Expenditure (Q00MC10012) in relation to the purchase and construction of new Emergency Generators at the General Hospital site in 2017 in order to comply with States accounting policies.
Reason(s) for Decision: 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. Delegation 1.2 delegates authority for non-contentious transfers between heads of expenditure with no financial limit where the transfer is solely to ensure that financial transactions are accurately reflected in the States’ Accounts in accordance with IFRS or an Order made under Article 32 of the Law. Under International Financial Reporting Standards (IFRS) expenditure that meets the definition of capital expenditure must 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 IFRS.
Resource Implications: The Department for Infrastructure Revenue Head of Expenditure to decrease by up to £610,000 and the Department for Infrastructure Replacement Assets Capital Head of Expenditure (Q00MC10012) to increase by up to £610,000 in 2017. This transfer does not change the amount of expenditure agreed by the States.
Action required: The Department for Infrastructure Finance Manager to let Treasury and Resources Business Support team know that the decision has been signed.
Signature:		Position:
Date Signed:		Date of Decision (If different from Date Signed):

Budget Transfer: revenue to capital heads of expenditure (General Hospital emergency generators)

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Department for Infrastructure

Ministerial Decision Report

budget transfer from the dfi revenue head of expenditure to the dfi replacement assets capital head of expenditure

Purpose of Report

The Minister is asked to approve a budget transfer in 2017 from the Department for Infrastructure (DfI) Revenue Head of Expenditure to the DfI Replacement Assets Capital Head of Expenditure (Q00MC10012).

Background

In 2016 Jersey Property Holdings (as part of DfI) received an additional revenue budget of £4 million for ‘Additional Property Maintenance – HSSD Properties’. £610,000 of this has been allocated to replacing the emergency generators at the General Hospital. The current generators were installed in the late 1970’s and have reached the end of their working life making them increasingly difficult to maintain to ensure the safety of the Hospital in the case of mains power interruption. In 2016 £501,078 was spent and transferred (MD-T-2017-0006), as this piece of work spanned 2016 and 2017 this decision transfers the remaining spend that has been incurred in 2017.

3. Recommendation

In line with States of Jersey accounting policies the Minister is recommended to approve a non-recurring budget transfer of £610,000 from the DfI Revenue Head of Expenditure to the DfI Replacement Assets Head of Expenditure (Q00MC10012) in 2017.

4. Reason for Decision

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.

Delegation 1.2 delegates authority for non-contentious transfers between heads of expenditure with no financial limit where the transfer is solely to ensure that financial transactions are accurately reflected in the States’ Accounts in accordance with IFRS or an Order made under Article 32 of the Law.

Under International Financial Reporting Standards (IFRS) expenditure that meets the definition of capital expenditure must 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 IFRS.

5. Resource Implications

The Department for Infrastructure Revenue Head of Expenditure to decrease by £610,000 and the Department for Infrastructure Replacement Assets Capital Head of Expenditure (Q00MC10012) to increase by £610,000 in 2017.

These transfers do not change the amount of expenditure agreed by the States.

Report author : Finance Manager	Document date:
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