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Currency Notes (Jersey) Law 1959: Amendment: Law drafting instructions

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While there is a presumption toward publication to support of transparency and accountability, detailed information may not be published if, for example, it would constitute a breach of data protection, or disclosure would prejudice commercial interest.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 2 September 2015:

Decision Reference:  MD-TR-2015-0094

Decision Summary Title:

Increase in Jersey currency notes issue limit to £125 million

Date of Decision Summary:

18th August 2015

Decision Summary Author:

Head of Treasury and Investment Management

Decision Summary:

Public or Exempt?

Public

Type of Report:

Oral or Written?

Written

Person Giving

Oral Report:

N/A

Written Report

Title:

Increase in Jersey currency notes issue limit to £125 million

Date of Written Report:

18th August 2015

Written Report Author:

Head of Treasury and Investment Management

Written Report :

Public or Exempt?

Public

Subject:

Increase in the States of Jersey maximum issuance of currency notes to £125 million.

Decision(s):

The Minister for Treasury and Resources approved the increase in the Jersey currency notes issue limit to £125 million and agreed that a Regulation should be prepared by the Law Draftsman.

Reason(s) for Decision:  

Under Article 1 of the Currency Notes (Jersey) Law 1959 the Minister has the power to issue Currency Notes but requires States approval for the maximum amount that can be issued.

 

Throughout the year, the amount of currency in circulation varies in line with demand by the banks, however demand rises steeply and peaks during the Christmas period. During the Christmas period of 2014 notes in issue peaked at approximately £95 million, close to the current issue limit of £100 million. Accordingly, an increase in the ceiling to £125 million is recommended to ensure the Treasury is able to issue sufficient notes to meet potential demand.

 

The last increase to the maximum value of currency in circulation was in 2009 when the limit was increased from £75 million to £100 million.

Resource Implications:

The increased limit does not directly increase costs as currency issued to retail banks is exchanged for sterling which is retained in the Currency Fund.

Action required:

Head of Treasury and Investment Management to ensure that required steps are undertaken to draft Currency Notes (Variation of Maximum Amount of Issue) (Jersey) Regulation.

Signature:

 

 

 

 

Position:

Senator A J H Maclean

Minister for Treasury and Resources

 

                 

 

Date Signed:

Date of Decision:

 

 

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Currency Notes (Jersey) Law 1959: Amendment: Law drafting instructions

 - 1 -

Treasury and Resources

Ministerial Decision Report

 

 

 

 

 

INCREASE IN THE STATES OF JERSEY CURRENCY NOTES ISSUE LIMIT TO £125 MILLION

 

  1. Purpose of Report

To approve the increase in the Jersey currency notes issue limit to £125 million.

 

  1. Background

The amount of Jersey Currency Notes in circulation is governed entirely by the demands of the retail banks, which in turn is driven by the cash demands of their customers. As the Treasury issues Currency Notes only to the retail banks, it exercises only minimal control over movements in currency in circulation. In addition, unlike the U.K., Jersey has a fully backed currency, with every pound in circulation being matched with a one pound investment.

 

Under article 1 of the Currency Notes (Jersey) Law 1959, an extract of which is included below, the Minister has the power to issue Currency Notes but requires States approval for the maximum amount that can be issued.

1      Power to issue currency notes

(1)    The Minister shall have power to issue notes (in this Law referred to as “currency notes”) of such denominations, not exceeding £100, as the Minister may determine, and to put such notes into circulation in Jersey:

Provided that –

(a)     no currency notes shall be issued without the authority of the States previously obtained; and

(b)     the amount of the currency note issue shall not at any time exceed £100,000,000.

(2)    The States may by Regulations vary the maximum denomination of currency notes and the amount of the currency note issue in circulation at any one time.

 

The last increase to the maximum value of currency in circulation was in 2009 when the limit was increased from £75 million to £100 million.

 

 

 

 

 

 

  1. Increase in Jersey currency notes issue limit to £125 million

Throughout the year, the amount of currency in circulation varies in line with demand by the banks. However demand rises steeply and peaks during the Christmas period. During the Christmas period of 2014 notes in issue peaked at approximately £95 million, close to the current issue limit of £100 million. Accordingly, an increase in the ceiling to £125 million is recommended to ensure the Treasury is able to issue sufficient notes to meet potential demand.

 

  1. Recommendation

It is recommended that the Treasury and Resources Minister approves the increase in the Jersey currency notes issue limit to £125 million and requests that a Regulation should be prepared by the Law Draftsman.

 

  1. Reason for Decision

The amount of Jersey currency notes in circulation is governed entirely by the demands of the retail banks, which in turn is driven by the cash demands of their customers. Over the last 50 years a consistent trend of rising circulation has continued year on year, driven by inflation and demand by the public.

 

The proposed limit of £125 million should be sufficient to meet the public’s demands for currency over the next five years and avoid inadvertently breaching the currency limits.

 

  1. Resource Implications

The increased limit does not directly increase costs as currency issued to retail banks is exchanged for sterling which is retained in the Currency Fund.

 

 

 

Report author : Assistant Accountant, Treasury and Investment Management

Document date : 21/08/15

Quality Assurance / Review : Head of Decision Support

File name and path:  L:\Treasury\Sections\Corporate Finance\Ministerial Decisions\MD-TR-2015-00xx -Currency Notes increase

MD sponsor : Minister for Treasury and Resources

 

Page 1 of 2  Printed: 14/9/2024

 

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