Doctors Pay Award 2013: Contingency Funding Transfer

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A decision made 19 July 2013:

Decision reference: MD-TR-2013-0048
Decision Summary Title:	Central Contingency Funding for 2013 Doctors’ Pay Award		Date of Decision Summary:	24 June 2013
Decision Summary Author:	Director of Financial Planning and Performance		Decision Summary: Public or Exempt?		Public
Type of Report: Oral or Written?	Written		Person Giving Oral Report:		N/A
Written Report Title:	Central Contingency Funding for 2013 Doctors’ Pay Award		Date of Written Report:		24 June 2013
Written Report Author:	Business Manager		Written Report : Public or Exempt?		Public
Subject: Transfer of contingency funding from the Central Contingency (Pay Provision) to the Health and Social Services Department (H&SS) for costs associated with the Doctors’ Pay Award for 2013.
Decision(s): The Minister approved a recurrent budget transfer of £189,000 from the Central Contingency (Pay Provision) to fund the 2013-2015 pay award. The award is made with effect from 01 April 2013 and therefore the requested transfer for 2013 is £140,000.
Reason(s) for Decision: Article 17(2) of the Public Finances (Jersey) Law 2005 states that the Minister for Treasury and Resources (T&R) is authorised to approve the transfer from contingency expenditure to heads of expenditure of amounts not exceeding, in total, the amount available for contingency expenditure in a financial year.
Resource Implications: Central Contingency (Pay Provision) to decrease by £140,000 in 2013, £189,000 in 2014 and £189,000 in 2015 and the H&SS revenue head of expenditure to increase by an identical amount. This decision does not change the total amount of expenditure approved by the States for 2013 - 2015. The recurring transfers will be reflected in the next MTFP 2016 – 2018.
Action required: Business Manager to inform the Financial Performance Reporting Manager and the Director of Finance, H&SS that this decision has been approved.
Signature:		Position: Senator P F C Ozouf, Minister for Treasury and Resources
Date Signed:		Date of Decision:

Doctors Pay Award 2013: Contingency Funding Transfer

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Treasury & Resourses

Ministerial Decision Report

Central Contingency Funding for 2013 Doctors’ Pay Award

Purpose of Report

To enable the Minister for Treasury and Resources (T&R) to approve additional funding of £140,000 for 2013 (part year effect) and £189,000 (recurring from 2014) for the Health and Social Services Department (H&SS) for a Doctors pay award.

Background

On 14th March 2013, the NHS published the NHS Pay Circulars which recommended a pay award for Doctors of 1% (basic pay).

The final offer provides for:

1% on basic pay for all grades
No pay award in respect of Clinical Excellence Awards for Consultants – resulting in an average increase of 0.92% for Consultants.

This is in line with agreements made with the Local Negotiating Committee.

At this stage there is no further information on the likely level of any future awards in respect of Doctors’ pay. The Medium Term Financial Plan (MTFP) made provision for an assumed total increase of 3%, equivalent to £400,000, over the two years 2014 and 2015. Any pay awards in excess of this will require additional funding from Central Contingency (Pay Provision).

Funding for a Doctors’ pay award in 2013 was not provided as the best advice available from H&SS to T&R at the time of the drafting of the MTFP was that pay constraint was expected in the UK for 2013.

H&SS have also made T&R aware of negotiations ongoing with the Nurses employee group and States Employment Board (SEB) in respect of an enhanced Nurses pay award above the standard offer proposed in the MTFP. As negotiations are still ongoing it has not been possible to incorporate the costs of the Nurses award in this request but a further request for pay award funding will be forthcoming in due course.

Conclusion

Provision was made in the MTFP in the Central Contingency (Pay Provision) for anticipated pay awards for Doctors in 2014 and 2015. The expectation not to have to make an award for 2013 for Doctors was based on the expected UK pay constraint.

H&SS are committed through the agreement between SEB and the Local Negotiating Committee to honour pay awards in line with those in the UK and indeed have been paying from 01 April 2013.

There are insufficient funds within H&SS to meet the additional cost of the pay award.

Central Contingency exists for urgent and unforeseen events for which a department is unable to identify alternative funding.

The Central Contingency (Pay Provision) has sufficient unallocated funds to fund this award in 2013, 2014 and 2015 at a cost of £189,000 per annum (recurring, £140,000 for 2013).

The H&SS dept will request base funding in the next MTFP for this award.

Recommendation

The Minister is recommended to approve additional funding from the Central Contingency (Pay Provision) of £140,000 in 2013, £189,000 in 2014 and £189,000 in 2015 to the H&SS, in respect of a Doctors pay award, ahead of base funding being proposed in the next MTFP.

The recurring transfers will be reflected in the next MTFP 2016 – 2018.

Reason for Decision

Article 17(2) of the Public Finances (Jersey) Law 2005 states that the Minister for Treasury and Resources is authorised to approve the transfer from contingency expenditure to heads of expenditure of amounts not exceeding, in total, the amount available for contingency expenditure in a financial year.

Resource Implications

Central Contingency (Pay Provision) to decrease by £140,000 in 2013, £189,000 in 2014 and £189,000 in 2015 and the H&SS revenue head of expenditure to increase by an identical amount in 2013, 2014 and 2015. This decision does not change the total amount of expenditure approved by the States for 2013 - 2015.

Report author : Business Manager	Document date : 24th June 2013
Quality Assurance / Review : Head of Financial Planning	File name and path: L:\Treasury\Sections\Corporate Finance\Ministerial Decisions\DSs, WRs and SDs\2013-0048 - Central Contingency Funding for 2013 Doctors’ Pay Award\WR - Central Contingency Funding for 2013 Doctors’ Pay Award.docx
MD sponsor : Treasurer of the States