Audit of States aided independent bodies

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While there is a presumption toward publication to support of transparency and accountability, detailed information may not be published if, for example, it would constitute a breach of data protection, or disclosure would prejudice commercial interest.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 (11.12.06) to agree to an order to set a financial limit above which the Comptroller and Auditor General may audit States aided independent bodies.

Subject:	Agreement of Order – Financial limit above which the Comptroller and Auditor General may audit States aided independent bodies
Decision Reference:	MD-TR-2006-0125		Exempt clause(s):	N/A
Type of Report: (oral or written)	Written		Person Giving Report (if oral):	N/A
Telephone or e-mail Meeting?	N/A		Report File ref:	MW/3/30/11/06
Written Report – Title	Agreement of Order – Financial limit above which the Comptroller and Auditor General may audit States aided independent bodies		Written report - author	Maria Washington – Regulatory Adviser
Decision(s): The Minister requested the Law Draftsman to prepare a draft an Order specifying a figure of “£5,000 or more” being the figure above which the Comptroller and Auditor General is authorised to audit States aided independent bodies.
Reason(s) for decision: The Public Finances (Jersey) Law 2005 allows for the Minister for Treasury and Resources to prescribe in an Order an amount above which the Comptroller and Auditor General is able to audit States aided independent bodies.
Action required Order to be drafted by the law Draftsman and then reported to the States at the next sitting after it is made by the Minister.
Signature: (Minister / Assistant Minister)		Date of Decision: 11th December 2006

Audit of States aided independent bodies

TREASURY AND RESOURCES MINISTER

Agreement of Order – Financial limit above which the Comptroller and Auditor General may audit States aided independent bodies

1. Purpose of Report

1.1 The purpose of this report is to gain approval of the financial limit to be inserted into an Order, required under the Public Finances (Jersey) Law 2005, above which the Comptroller and Auditor General may audit the sum paid by the States to States aided independent bodies.

2. Background

2.1 The Public Finances (Jersey) Law 2005 (Article 49 refers) states that:

“Comptroller and Auditor General may audit States aided independent bodies

(1)This Article applies to a body (including an individual and a corporation sole), whether or not incorporated, that in a financial year receives from the States to aid it to carry out its activities such amount as may be prescribed by the Minister by Order.

(2)It applies to such a body if, in a financial year, it receives from the States less than the amount so prescribed but receives instead an amount that is at least half of the total amount it received from all sources to carry out its activities during that financial year.

(3)The Comptroller and Auditor General may audit the accounts of the body in so far as it is necessary to do so to ensure that the amount it received from the States by way of aid during the relevant financial year was used for the purpose intended by the States”.

2.2 The important issue here is that the Comptroller and Auditor General (C and AG) is not compelled to audit the amount provided by the States to States aided independent bodies but may do so if he feels it necessary. It has been identified by the Solicitor General that the current lack of an Order is in contravention of the requirements of the Public Finances (Jersey) Law 2005 and is therefore compromising the C and AG’s position to audit States aided independent bodies.

2.3 In order to assist in ensuring that value for money is obtained from the payment of grants the Treasurer has issued a financial direction - “Obtaining value for money from grants”. This direction places an obligation on States departments to ensure that those bodies which receive grant aid use the money for the purposes intended.

2.4 When the Law was originally drafted it was intended to set the grant limit at £50,000 with the final figure being subject to agreement when a C and AG was appointed. The C and AG has indicated that a much lower sum would be more pertinent. States departments make numerous grants or similar payments throughout the year to various bodies and organisations, with the amounts paid varying from a few thousand pounds to several million pounds. A review of payments made to various grant aided bodies in 2005 indicates that about 20 bodies received funds below £50,000 – with 4 receiving payments below £10,000. In order to give the C and AG the greatest flexibility it is recommended that the limit in the first instance be set at £5,000. This figure has been notified to the Comptroller and Auditor General. The £5,000 in the “Order” could be amended if it is found to be unworkable.

3. Recommendation

3.1 That the Law Draftsman be requested to draft the necessary Order for signing by the Minister for onward transmission to the next available States sitting.

5. Reason for Decision

5.1. To set by Order a financial limit of £5,000 above which the Comptroller and Auditor General may audit States funds granted to States aided independent bodies.

States Treasury Corporate Finance

14 December, 2006 for Decision Meeting 11/12/2006