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A decision made (18/05/2006) regarding 2007 - 2009 Cash Limits and 2005 Carry Forwards.

Subject:	2007 – 2009 Cash Limits and 2005 Carry Forwards
Decision Reference:	MD-T-2006-0039	Exempt clause(s):
Type of Report (oral or written):	Written	Person Giving Report (if oral):		N/A
Telephone or e-mail Meeting?	N/A	Report File ref:		I:Minister:2006:Ministerial Decisions:MD 0039 2007-2009 Cash Limits & 2005 Carry Forwards
Written Report Title:	Cash Limit and Carry Forward	Written report – Author:		Ellen Littlechild, Finance Director
Decision(s): I. To accept the Treasury and Resources Minister’s cash limit allocation for the Transport and Technical Services Department for 2007 to 2009. II. To accept the amount of £612,000 to be carried forward from 2005 to 2006 from the former Environment and Public Services Committee.
Reason(s) for decision: To accept the both the Department’s 2007 – 2009 cash limit and the carryforward balance as requested by the Treasury and Resources Department.
Action required: To notify the Minister for Treasury and Resources of these decisions.
Signature: (Minister/ Assistant Minister)			Date of Decision: 18 May 2006

2007 - 2009 Cash Limits and 2005 Carry Forwards

TRANSPORT AND TECHNICAL SERVICES

CASH LIMIT AND CARRY FORWARD

Purpose of the Report

The purpose of this report is to ask the Minister for Transport and Technical Services to:

· accept the Department’s cash limit for 2007 – 2009; and

· accept the Department’s 2005 carry forward request of £612,000.

Background

Cash Limit 2007 – 2009

The Treasury and Resources Minister has agreed the cash limits for 2007 – 2009, following the consideration and comment of both the Corporate Management Board (CMB) and the Council of Ministers (CoM).

	2007	2008	2009
	£'000	£'000	£'000
Cash Limit b/fwd	26,965.9	28,153.7	28,055.6
Departmental Transfers Removal of 2% PECRS provision for pre 1987 debt Departmental Transfers	(242.8)
Service Reduction	(97.7)	(113.1)
Pay Awards – June 2006 (Jan – May)	172.7
Pay Awards – June 2007 (Jun – Dec)	244.3
Pay Awards – June 2007 (Jan - May)		174.5
Pay Awards – June 2008 (Jun – Dec)		246.9
Pay Awards – June 2008 (Jan – May)			177.7
Pay Awards – June 2009 (Jun – Dec)			251.4
Non-staff inflation (2.5%)	116.7	112.3	110.2
Allocation of Efficiency Saving	(192.3)	(198.3)	(27.0)
Cash Limit for States Business Plan	21,246.2	21,468.5	21,980.8

The three-year cash limits proposed include provision for:

· The outcomes of the 2006-2008 revenue resource allocation process;

· The outcomes of the Strategic Plan review;

· Pay awards from June 2006 through to June 2009, at 2.5% per annum;

· Inflation on prices at 2.5% per annum; and

· A further revision to the allocation of efficiency savings to reflect the new Ministerial departments, changes to procurement, property and VOIP.

Department’s 2005 Carryforward

The Department submitted its 2005 Annual Financial Report and Account to the Minister for Treasury and Resources and requested that the carryforward amounting to £612,000, or 1.68% of its gross revenue budget, should be carried forward from 2005 to 2006 in accordance with the Financial Code of Direction No9 – Carry Forward of Revenue Balances.

Discussion

Cash Limit 2007 – 2009

The States will be asked to confirm the 2007 cash limits and 2008-2009 revenue expenditure allocations to Departments during the course of the States Business Plan debate planned for 12 September 2006.

This is the first year that the States Business Plan and Budget will be approved under the Public Finances (Jersey) Law 2005. The States Business Plan will now approve all the expenditure proposals, comprising:

· overall expenditure targets for 2007 – 2011;

· detailed revenue expenditure allocations to Departments for 2007;

· revenue expenditure allocations to Departments for 2008 and 2009,

· a capital programme for 2007 – 2011

· the operating account and capital expenditure of States Trading Operations.

The Budget 2007 will now only approve the tax and funding proposals required as a result of the expenditure decisions.

Department’s 2005 Carryforward

On the 23 March 2006 the Council of Ministers reviewed the balances of Departments carry forward and agreed that the funding would be made available for the following:

Markets: £189,600

The Minister will recall that an independent structural survey had concluded that approximately £5 million is required to be invested in the infrastructure of the Markets over the next 10 years. On-going funding of £250,000 per annum has been earmarked from the Capital fund for this period. It was previously anticipated that the shortfall of £250,000 per annum would be met from surpluses arising from the proposed rental income over service cost.

In 2005, the Markets achieved an underspend amounting to £189,600 and it has been agreed that these funds are carried forward to the Markets capital vote in 2006.

Waste Strategy: £191,300

In order for the department to meet its proposed recycling targets by 2009 it will require additional annual revenue costs of £450,000 per annum. This additional revenue was identified in the waste strategy and will be subject to a growth bid during the next revenue allocation process, and in, the interim, the initiatives will be rolled out subject to availability of funds.

During 2005 the Transport and Technical Services Department was able to fund a pilot project relating to the collection of domestic paper and cards and studies into recycling waste and wood and waste electrical and electronic goods. Due to the success of these schemes the department would like to use its 2005 carryforward to expand these schemes in 2006 for example expanding, the existing ‘bring system’ to at least one ‘mini recycling centre’ per Parish with extra facilities as required in built up areas. It is proposed that each site will initially include banks for paper, metal packaging, plastic bottles and textiles. The department aims to use the 2005 carry forward for recycling initiatives, identified in the Waste Strategy, during 2006 and the department will try to identify alternative funding routes long-term.

Buses: £231,100

It has been agreed that the additional income generated from the bus services during 2005 is ‘ring-fenced’ and used to fund transport initiatives during 2006.

Recommendations

Cash Limit 2007 – 2009

It is recommended that the Minister accepts the Department’s 2007 to 2009 Cash Limits as shown below:

Year	£’000
2007	21,246.2
2008	21,468.5
2009	21,980.8

Department’s 2005 Carryforward

It is recommended that the Minister accepts the amount of £612,000 to be carried forward from 2005 to 2006 from the former Environment and Public Services Committee.

Reason (s) for Decision

To accept the both the Department’s 2007 – 2009 cash limit and the carryforward balances as detailed in the report.

Action Required

To advise the Minister for Treasury and Resources Department of the acceptance of the Department’s 2007 to 2009 Cash Limits as shown below:

Year	£’000
2007	21,246.2
2008	21,468.5
2009	21,980.8

To also inform the Treasury and Resources Minister that the carryforward balance allocated to Transport and Technical Services is accepted.

Written by:	Ellen Littlechild, Finance Director

Approved by:	John Richardson, Chief Officer

Attachment: