Budget transfer from capital to revenue: IT Strategy: Thinking Differently 2013

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A decision made 6 June 2013:

Decision Reference: MD-ESC-2014-0012
Decision Summary Title:	Budget transfer from capital to revenue covering the IT Strategy “Thinking Differently 2013-2015”		Date of Decision Summary:	27th May 2014
Decision Summary Author:	Finance Manager		Decision Summary: Public or Exempt?	Public
Type of Report: Oral or Written?	Written		Person Giving Oral Report:	N/A
Written Report Title:	Budget transfer from capital to revenue covering the IT Strategy “Thinking Differently 2013-2015”		Date of Written Report:	27th May 2014
Written Report Author:	Finance Manager		Written Report : Public or Exempt?	Public
Subject: Budget transfer from capital to revenue covering the IT Strategy “Thinking Differently 2013-2015”.
Decision(s): The Minister for Education, Sport and Culture approved a budget transfer of up to £1,750,000 in 2014 and up to £1,250,000 in 2015 from the ESC capital head of expenditure to revenue head of expenditure.
Reason(s) for Decision: The Capital Programme 2013-2015 provided for funding of £3,000,000 (£1,000,000 each year) for the introduction of an ICT broad strategy across education to ensure the Island is equipped for the future and to enable Jersey students to excel in IT and computing. The IT Strategy “Thinking Differently 2013-2015” was subsequently launched on 15 October 2013 and was followed by consultation with schools including the submission of school business cases. School spending plans contain a mixture of capital and revenue expenditure and in total require a transfer from the ESC capital head of expenditure to revenue head of expenditure of up to £1,750,000 in 2014 and up to £1,250,000 in 2015 to fund planned revenue expenditure in the form of equipment purchases under £10,000 and teacher training. Under Generally Accepted Accounting Principles (GAAP) expenditure that meets the definition of capital expenditure only can 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 GAAP. 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 GAAP or an Order made under Article 32 of the Law.
Resource Implications: The ESC revenue head of expenditure will increase by up to £1,750,000 in 2014 and up to £1,250,000 in 2015 and the capital head of expenditure will decrease by an identical amount in 2014 and 2015. This decision does not change the total amount of expenditure approved by the States for 2014 and 2015.
Action required: The Minister for ESC to seek approval of the Treasurer of the States for the transfer.
Signature:		Position: Deputy Patrick Ryan, Minister for Education, Sport and Culture
Date Signed:		Date of Decision:

Budget transfer from capital to revenue: IT Strategy: Thinking Differently 2013 - 2015

Education, Sport and Culture

Ministerial Decision Report

Budget transfer from capital to revenue covering the IT Strategy “Thinking Differently 2013-2015”

Purpose of Report

To enable the Minister for Education, Sport and Culture (ESC) to request that the Minister for Treasury and Resources (T&R) approve a budget transfer of up to £1,750,000 in 2014 and up to £1,250,000 in 2015 from the ESC capital head of expenditure to revenue head of expenditure covering the IT Strategy “Thinking Differently 2013-2015”.

Background

The Capital Programme 2013-2015 provided for funding of £3,000,000 (£1,000,000 each year) for the introduction of an ICT broad strategy across education to ensure the Island is equipped for the future and to enable Jersey students to excel in IT and computing.

The IT Strategy “Thinking Differently 2013-2015” was subsequently launched on 15 October 2013 and proposes:

a new approach to teaching the subject;
a new IT curriculum;
closer links with businesses;
an upgrade to the IT infrastructure used in States schools.

The strategy focuses on three key priorities and details projects for each one:

teaching and learning;
infrastructure and technology;
business and education.

Following the launch of the IT Strategy extensive consultation was carried out with schools including the submission of business cases detailing individual school IT plans for the future. All school business cases have now been reviewed and assessed and individual funding allocations agreed.

Recommendation

The Minister for ESC is recommended to request that the Minister for T&R approve a budget transfer of up to £1,750,000 in 2014 and up to £1,250,000 in 2015 from the ESC capital head of expenditure to revenue head of expenditure covering the IT Strategy “Thinking Differently 2013-2015”.

Reasons for Decision

School business cases and spending plans contain a mixture of capital and revenue expenditure and in total require a transfer from the ESC capital head of expenditure to revenue head of expenditure of up to £1,750,000 in 2014 and up to £1,250,000 in 2015 to fund planned revenue expenditure in the form of equipment purchases under £10,000 and teacher training.

Under Generally Accepted Accounting Principles (GAAP) expenditure that meets the definition of capital expenditure only can 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 GAAP.

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 GAAP or an Order made under Article 32 of the Law.

Resource Implications

The ESC revenue head of expenditure will increase by up to £1,750,000 in 2014 and up to £1,250,000 in 2015 and the capital head of expenditure will decrease by an identical amount in 2014 and 2015. This decision does not change the total amount of expenditure approved by the States for 2014 and 2015.

Report author: Finance Manager	Document date : 27 May 2014
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