Food Costs Bonus (Jersey) Order 2013

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A decision made on 12 July 2013:

Decision Reference: MD-S-2013-0063
Decision Summary Title :	Food Cost Bonus (Jersey) Order 2013		Date of Decision Summary:	10 July 2013
Decision Summary Author:	Policy Principal		Decision Summary: Public or Exempt? (State clauses from Code of Practice booklet)	Public
Type of Report: Oral or Written?	Written		Person Giving Oral Report:	N/A
Written Report Title :	WR – Food Cost Bonus (Jersey) Order 2013		Date of Written Report:	10 July 2013
Written Report Author:	Policy Principal		Written Report : Public or Exempt? (State clauses from Code of Practice booklet)	Public
Subject: Food Cost Bonus (Jersey) Order 2013
Decision(s): The Minister made the Food Cost Bonus (Jersey) Order 2013
Reason(s) for Decision: The Food Costs Bonus (Jersey) Regulations 2011 commenced in July 2011 and provide for an annual Food Costs Bonus to be paid in each of the years 2011, 2012 and 2013. The Regulations allow for the value of the bonus to be adjusted upwards and the Minister has decided to increase the bonus for 2013 by the Jersey RPI Food Group value (March 2013), of 1.2% to total to £220.98
Resource Implications: There are no manpower implications. The total cost of the bonus is estimated to be £332,000 for 2013. This sum is available within the existing cash limit.
Action required: Policy and Strategy Director to notify the Greffe and the Law Draftsman that the Order has been made and forward the signed and sealed Order to the States Greffe for notification to the States.
Signature:		Position: Minister
Date Signed:		Date of Decision (If different from Date Signed):

Food Costs Bonus (Jersey) Order 2013

Social Security Department Ministerial Decision Report
Subject:	Food Cost Bonus (Jersey) Order 2013
Exempt: Clause:		Date:	10 July 2013

Author:	Policy Principal, Social Security

Introduction

The Food Costs Bonus Regulations were approved during 2011 and provide for a bonus for each of the years 2011, 2012 and 2013. The Regulations allow for an increase in the rate of bonus in 2012, as follows:

“5 Rate of bonus

(1) For 2011 and subsequent years the amount of the bonus is £193.36.

(2) For either or both of the years 2012 and 2013 the Minister may, by Order, specify an increased amount of bonus instead of the amount specified in paragraph (1).

(3) Any amount specified under paragraph (2) for 2013 must not be less than the amount for 2012.”

Value of Food Costs Bonus

The table below shows the value of the bonus since 2008 and summarises the rationale by which the Bonus has been uprated as it has responded to the introduction of GST.

In the value rests at £218.36 in 2012

Year	Rate	Note
2008	£50	Original GST Bonus: To cover 8 months from May 2008
2009	£150	Renamed Food Costs Bonus: Extra sum added to compensate for food costs as well as GST on food (“Le Fondre” decision)
2010	£153.60	Automatic update in line with Sept 2009 food element
2011	£193.36	New Regulations: Bonus reset to include element for increase in GST from 3% to 5% for 7 months, as well as Sept 10 food element
2012	£218.36	Increased by £25 to fully compensate for GST and include food inflation

As in 2010, the Food Costs Bonus will be uprated in line with the Jersey RPI Food Group, drawing on data published in March 2013. As shown below this suggests an uprate of 1.2% bringing the bonus to £220.98

Jersey: RPI March 2013 Report

GROUP

2012

Mar

2012

Jun

2012

Sep

2012

Dec

2013

Mar

Annual

change

(percent)

Quarterly

change

(percent)

Food

163.1

161.5

162.3

161.2

165.0

1.2

2.4

Number of Claimants and Costs

The bonus makes a single payment to households which do not claim income support but are ‘low income’ (defined as not paying income tax). At least one member of the household must have five years residency.

The number of low income households in receipt of the bonus and the cost (monies paid, excluding administration) are shown below.

Year	Number of Claimants (Households)	Total
2008	2,153	£107,650
2009	1,745	£261,750
2010	1,350	£207,360
2011	1,416	£273,798
2012	1,296	£282,995

Resource Implications

There are no manpower implications in respect of this decision. The uprate of £2.62 to bring the bonus to £220.98 would total £331,470 if paid to 1,500 claimants. This amount is available within the departmental cash limit.