Public Finances (Amendment No. 4) (Jersey) Law 2013

Public Finances (Amendment No. 4) ( Jersey) Law 2013 Arrangement Article part 1 3 preliminary 3 1 Interpretation . 3 part 2 3 Establishment of insurance fund 3 2 Article 1 amended . 3 3 Article 5A inserted . 4 4 Article 6 amended . 4 5 Article 17 amended . 4 6 Article 46 amended . 4 7 The Schedule renumbered . 4 8 Schedule 2 added . 4 part 3 6 medium term financial plan and heads of expenditure 6 9 States income . 6 10 Variation of medium term financial plan . 7 11 Central planning vote . 7 12 Permitted variations of heads of expenditure . 8 part 4 8 administration 8 13 Duties of Treasurer 8 14 Reporting of unlawful financial management 9 15 Accounting Standards . 9 16 Accounting officers . 10 17 Duties of States employees . 10 part 5 10 fiscal policy panel 10 18 Article 1(1) amended . 10 19 Establishment of Fiscal Policy Panel 11 part 6 14 MISCELLANEOUS AND closing 14 20 Special funds . 14 21 Power to amend principal Law by Regulations . 14 22 Amendments consequential upon Article 21 . 14 23 Citation, commencement and transitional arrangements . 15 Public Finances (Amendment No. 4) ( Jersey) Law 2013 A LAW to amend further the Public Finances (Jersey) Law 2005 Adopted by the States 11th September 2013 Sanctioned by Order of Her Majesty in Council 7th November 2013 Registered by the Royal Court 15th November 2013 THE STATES , subject to the sanction of Her Most Excellent Majesty in Council, have adopted the following Law – part 1 preliminary 1 Interpretation In this Law “principal Law” means the Public Finances (Jersey) Law 2005 [1] . part 2 Establishment of insurance fund 2 Article 1 amended In Article 1 of the principal Law – (a) in paragraph (1), after the definition “independently audited States body” there shall be inserted the following definition – “ ‘insurance fund’ means the fund established by Article 5A;”; (b) in paragraph (1), in the definition “non-Ministerial States funded body” for the words “the Schedule” there shall be substituted the words “Schedule 1”; (c) in paragraph (3), for the words “the Schedule” there shall be substituted the words “Schedule 1”. 3 Article 5A inserted After Article 5 of the principal Law there shall be inserted the following Article – “5A Insurance fund (1) There is established an insurance fund. (2) Schedule 2 has effect to specify the purposes of the insurance fund and make provision for its administration. (3) The States may by Regulations – (a) amend Schedule 2; or (b) wind up the insurance fund and, in so doing, repeal this Article and Schedule 2 and make any consequential amendments to other provisions of this Law.”. 4 Article 6 amended In Article 6(1)(a) of the principal Law for the words “and the currency fund” there shall be substituted the words “, the currency fund and the insurance fund”. 5 Article 17 amended In Article 17(2) of the principal Law after the words “heads of expenditure” there shall be inserted the words “or the insurance fund”. 6 Article 46 amended In Article 46(2)(a) of the principal Law for the words “or the currency fund” there shall be substituted the words “, the currency fund or the insurance fund”. 7 The Schedule renumbered The Schedule shall be renumbered as Schedule 1. 8 Schedule 2 added After Schedule 1 there shall be added the following Schedule – “SCHEDULE 2 (Article 5A) Insurance Fund 1 Purpose of insurance fund (1) The purpose of the insurance fund is to facilitate the provision of mutual insurance arrangements (the ‘mutual insurance arrangements’) for – (a) States funded bodies; (b) any fund or money for which an accounting officer is appointed; and (c) any other bodies and persons participating in those arrangements pursuant to paragraph 2. (2) Financial directions – (a) may prohibit a States funded body or accounting officer appointed for a fund or money from arranging any insurance otherwise than through the mutual insurance arrangements; and (b) shall specify the descriptions of liabilities and persons insured by, the terms of, and the administrative processes connected with, the mutual insurance arrangements. 2 Participation by other persons and bodies The Minister may permit persons or bodies that appear to the Minister to be connected with the States to participate in the mutual insurance arrangements on such terms and conditions as the Minister specifies. 3 Income of insurance fund (1) There shall be transferred from the consolidated fund to the insurance fund, upon the establishment of the insurance fund, the sum of £7.5 million. (2) There shall be transferred from the consolidated fund to the insurance fund such amount as the States may decide – (a) in a budget, in accordance with Article 10(3)(f); or (b) at any time, on a proposition lodged by the Minister. (3) There shall be paid into the insurance fund such amounts, due from bodies or persons in respect of their participation in the mutual insurance arrangements, as are required by financial directions to be paid in. (4) There shall be paid into the insurance fund such amounts, received by or on behalf of the States or bodies or persons participating in the mutual insurance arrangements from insurers or otherwise in settlement of an insurable claim, as are required by financial directions to be paid in. (5) Amounts paid into the insurance fund do not form part of the annual income of the States. (6) Article 17(2) provides for the approval of transfers from contingency expenditure to the insurance fund. 4 Withdrawals from insurance fund (1) Money shall only be withdrawn from the insurance fund – (a) in accordance with financial directions, for the purposes of the mutual insurance arrangements; (b) in accordance with an approval under sub-paragraph (3); or (c) as approved by the States in a budget, in accordance with Article 10(3)(f). (2) Financial directions may permit payments to be made from the insurance fund, in accordance with the terms of the directions, in settlement of insurable claims without any admission of liability. (3) If it appears to the Minister that the amount in the insurance fund exceeds the amount required for the mutual insurance arrangements, the Minister may, at any time, approve the transfer of all or part of the excess to the consolidated fund and may further approve that all or part of the amount transferred shall be taken to have been appropriated to contingency expenditure. (4) The Minister must report to the States, within 6 months, any approval given under sub-paragraph (3).”. part 3 medium term financial plan and heads of expenditure 9 States income In Article 1(1) of the principal Law, in the definition “income”, after sub-paragraph (d) there shall be inserted the following sub-paragraph – “(e) a capital receipt, where the receipt is intended to be used for a capital project and the amount allocated for capital expenditure in a medium term financial plan, or the amount appropriated to a capital head of expenditure in a budget, is shown net of the receipt,”. 10 Variation of medium term financial plan In Article 9(2) of the principal Law after sub-paragraph (c) there shall be inserted the following sub-paragraph – “(ca) if the Council of Ministers is satisfied, on the recommendation of the Minister – (i) that there is an urgent need for expenditure, and (ii) that – (A) the balance currently available for contingency expenditure is insufficient to fund the expenditure that is urgently needed, and (B) the expenditure that is urgently needed cannot reasonably be funded out of existing heads of expenditure;”. 11 Central planning vote (1) In Article 1(1) of the principal Law, after the definition “capital head of expenditure” there shall be inserted the following definition – “‘central planning vote’ means a capital head of expenditure described in Article 10(3A);”. (2) In Article 10 of the principal Law – (a) after paragraph (3) there shall be inserted the following paragraph – “(3A) A draft budget may seek the approval of the States, for the financial year to which it relates, to a capital head of expenditure (a ‘central planning vote’) to fund work to scope or assess the feasibility of proposed capital projects that the States have agreed, in principle, will start in the future.”; (b) in paragraph (6) for the words “paragraph (3)(d)” there shall be substituted the words “paragraphs (3)(d) and (3A)”. (3) In Article 16 of the principal Law – (a) in paragraph (3), for the words “the approval by the States of a capital head of expenditure” there shall be substituted the words “the approval of a capital head of expenditure by the States or, under paragraph (3A), by the Minister,”; (b) after paragraph (3) there shall be inserted the following paragraph – “(3A) The approval by the States of a central planning vote authorizes the Minister to approve – (a) capital heads of expenditure to fund work to scope or assess the feasibility of proposed capital projects that the States have agreed, in principle, will start in the future; and (b) the transfer of amounts to such capital heads of expenditure, for such purposes, from the central planning vote.”; (c) in paragraph (5) after the words “as described in Article 10(3)(d)” there shall be inserted the words “, or by the Minister under paragraph (3A),”. 12 Permitted variations of heads of expenditure (1) In Article 17(1)(c) of the principal Law for the words “Article 18(1)(d)” there shall be substituted the words “Article 18(1A)”. (2) In Article 18 of the principal Law – (a) in paragraph (1) – (i) the word “or” shall be inserted following sub-paragraph (b); (ii) for sub-paragraphs (c), (d) and (e) there shall be substituted the following sub-paragraph – “(c) be transferred from one head of expenditure to another head of expenditure for any purpose not mentioned in sub-paragraph (a) or (b).”; (b) after paragraph (1) there shall be inserted the following paragraph – “(1A) All or any part of the amount appropriated by a head of expenditure may, with the approval of the Minister, be transferred from the head of expenditure to contingency expenditure, within or after the end of the relevant financial year.”; (c) in paragraph (2) for the words “or (d)” there shall be substituted the words “or (1A)”; (d) in paragraph (3) for the words “paragraph (1)(b) or (c)” there shall be substituted the words “paragraph (1)”; (e) after paragraph (3) there shall be inserted the following paragraph – “(3A) The Minister may approve the withdrawal from the consolidated fund, after the end of the relevant financial year, of all or part of the amount appropriated by a revenue head of expenditure.”; (f) in paragraphs (4) and (6)(a) for the words “paragraph (1)” there shall be substituted the words “this Article”. part 4 administration 13 Duties of Treasurer In Article 28(3) of the principal Law for sub-paragraph (a) there shall be substituted the following sub-paragraph – “(a) to set financial management standards and ensure that financial systems are provided – (i) for their administration, and (ii) for monitoring compliance with those standards;”. 14 Reporting of unlawful financial management For Article 30(2) there shall be substituted the following paragraph – “(2) If the Treasurer is satisfied – (a) that any person has in any way – (i) dealt with money of the States, including money forming part of any trust assets or any other money controlled or managed on behalf of the States or by a Minister, (ii) dealt with money lent or borrowed in the name of or on behalf of the States, or (iii) given a guarantee or provided an indemnity in the name of or on behalf of the States, in each case, otherwise than in accordance with this or any other enactment or financial directions; and (b) that – (i) any action taken in accordance with this or any other enactment or financial directions has been insufficient to correct the situation, or (ii) the person’s actions described in sub-paragraph (a) had or, if the situation had not been corrected, would have had, material consequences, the Treasurer may, after consulting the Comptroller and Auditor General, provide a written report on the matter to the Greffier of the States who shall lay the document before the States.”. 15 Accounting Standards (1) In Article 18(1)(a) of the principal Law for the words “generally accepted accounting principles or an Order made under Article 32;” there shall be substituted the words “accounting standards issued for the purposes of Article 32(2);”. (2) In Article 32 of the principal Law – (a) for paragraph (2) there shall be substituted the following paragraph – “(2) The statement must be prepared in accordance with accounting standards issued by the Treasurer with the approval of the Minister.”; (b) in paragraph (3) for the words “accounting practice and standards” there shall be substituted the words “accounting standards”; (c) after paragraph (6) there shall be added the following paragraph – “(7) The Minister shall lay before the States any accounting standards issued for the purposes of paragraph (2).”. (3) Notwithstanding the substitution of Article 32(2) of the principal Law by paragraph (2)(a) of this Article, any Order made under Article 32(2)(b) of the principal Law and in force immediately before paragraph (2)(a) of this Article of this Law comes into force shall continue in force until such time as accounting standards are first issued for the purposes of Article 32(2) as substituted and shall then expire. 16 Accounting officers (1) At the end of the heading to Article 38 of the principal Law there shall be added the words “of States funded bodies”. (2) In paragraphs (3) and (4) of Article 38 of the principal Law after the words “an accounting officer” there shall be inserted the words “of a States funded body”. (3) After Article 38 of the principal Law there shall be inserted the following Article – “38A Accounting officers of funds, etc. (1) The Minister may appoint a person to be the accounting officer of any fund established in Part 2, any special fund, any States income, any money derived from taxation or any money forming part of trust assets. (2) The accounting officer of any fund or money is personally accountable for the proper financial management of that fund or money. (3) Although a function of an accounting officer appointed under paragraph (1) may be carried out by another person the accounting officer remains personally accountable. (4) Financial directions may otherwise specify the functions of an accounting officer appointed under paragraph (1) and how they are to be carried out.”. 17 Duties of States employees (1) In the cross heading preceding Article 39 after the words “Duties of” there shall be inserted the words “States employees and”. (2) At the beginning of Article 39 of the principal Law there shall be inserted the words “A States employee or”. part 5 fiscal policy panel 18 Article 1(1) amended In Article 1(1) of the principal Law, after the definition “non-Ministerial States funded body” there shall be inserted the following definition – “ ‘Panel’ means the Fiscal Policy Panel established by Article 56A(1);”. 19 Establishment of Fiscal Policy Panel After Part 6 of the principal Law there shall be inserted the following Part – “part 6A Fiscal policy panel 56A Establishment of Fiscal Policy Panel (1) There shall be a Fiscal Policy Panel. (2) There shall be at least 3 members of the Panel. (3) The Minister shall appoint the members of the Panel. (4) The persons appointed by the Minister as members of the Panel must have the appropriate qualifications and experience to discharge the functions described in Articles 56C, 56D and 56E. (5) Before appointing a member of the Panel, the Minister must seek the views of the Appointments Commission established by Article 17 of the Employment of States of Jersey Employees (Jersey) Law 2005 [2] on the appointment. (6) The Minister must, at least 2 weeks before appointing a member of the Panel, present to the States a notice of his or her intention to make the appointment. (7) The Minister shall appoint a member of the Panel for a period not exceeding 5 years. (8) The Minister may appoint a person as a member of the Panel more than once. (9) A member of the Panel may resign by notice in writing given to the Minister. (10) The appointment of a member of the Panel may be terminated by the Minister on any of the following grounds – (a) that the person is incapable, by reason of illness, of discharging his or her duties as a member; (b) that the person has been made bankrupt; (c) that the person has not, through absence, discharged his or her duties as a member; or (d) that the person is otherwise unable or unfit to discharge his or her duties as a member. (11) The Minister must, not more than 2 weeks after terminating the appointment of a member of the Panel, present to the States a notice that the Minister has terminated the appointment. (12) The Minister must ensure that the Panel is provided with appropriate and sufficient resources to discharge its functions. (13) The Minister must provide the Panel with such information as it reasonably requires to discharge its functions. 56B Independence of Panel The Panel may not be directed on the advice given by it, and the comments and recommendations made by it, in any report prepared by it in the discharge of its functions under Articles 56C, 56D and 56E. 56C Annual report (1) The Panel must prepare an annual report upon the state of the economy in Jersey and States finances. (2) The matters commented upon in the report must include – (a) the strength of the economy in Jersey; (b) the outlook for the economy in Jersey and, generally, world economies and financial markets; (c) the economic cycle in Jersey; (d) the medium and long-term sustainability of the States finances, having regard to the foregoing matters; and (e) transfers to or from, the strategic reserve fund and stabilisation fund, having regard to the foregoing matters. (3) The Panel must publish its annual report – (a) in a year in which a draft medium term financial plan must be lodged – no later than 2 weeks before the date by which an amendment to the draft medium term financial plan must be lodged in order to be debated during the same meeting of the States as that draft plan; or (b) in any other year – no later than 2 weeks before the date by which an amendment to the draft budget must be lodged in order to be debated during the same meeting of the States as that draft budget. (4) The Council of Ministers and the Minister must have regard to the Panel’s annual report. 56D Report before preparation of draft medium term financial plan or amendment to plan (1) The Panel must prepare a report, in a year in which a draft medium term financial plan must be lodged, for the purposes of the preparation of that draft plan. (2) The report required by paragraph (1) must provide advice and recommendations on the prevailing economic conditions and on the medium and long-term sustainability of the States finances. (3) The Panel must publish the report required by paragraph (1) sufficiently early in the year in which the draft medium term financial plan must be lodged that regard may be had to it in the preparation of that draft plan. (4) The Minister must request that the Panel prepare a report, and the Panel must comply with the request, if the Council of Ministers is preparing a proposition to amend a medium term financial plan. (5) The Panel must publish a report required under paragraph (4) sufficiently early that regard may be had to it in the preparation of the proposition to amend a medium term financial plan. (6) The Council of Ministers, when preparing a draft medium term financial plan or a proposition to amend a medium term financial plan, must have regard to the relevant report prepared and published under this Article. 56E Other reports prepared on request (1) The Minister may, for the purposes of the preparation of a draft budget, request that the Panel prepare a report and the Panel must comply with the request. (2) The Panel must publish a report required under paragraph (1) sufficiently early in the year in which the draft budget must be lodged that regard may be had to it in the preparation of that draft budget. (3) The Minister may request that the Panel prepare a report – (a) in respect of proposals for any significant change in, or new, States expenditure or for a disposal of significant States assets; or (b) at any time that the Minister is of the opinion that, by reason of a significant change in economic conditions, the advice and recommendations previously given by the Panel in compliance with Article 56C requires reconsideration, and the Panel must comply with the request. (4) The Panel must publish a report required under paragraph (3) as soon as is practicable. (5) The Minister, when preparing a draft budget, and the Council of Ministers, when being consulted on a draft budget, must have regard to a report prepared and published following a request under paragraph (1). (6) The Council of Ministers and Minister must have regard to a report prepared and published following a request under paragraph (3).”. part 6 MISCELLANEOUS AND closing 20 Special funds (1) In Article 3 of the principal Law – (a) in paragraph (2) after the words “any other enactment” there shall inserted the words “or by a proposition under paragraph (3)”; (b) in paragraph (3), after sub-paragraph (a) there shall be inserted the following sub-paragraphs – “(aa) permit money received by a fund so established to be credited to that fund; (ab) direct that money credited to a fund so established does not form part of the annual income of the States;”. (2) After Article 23(1) of the principal Law there shall be inserted the following paragraph – “(1A) An authorization of the States referred to in paragraph (1) may take the form of an authorization for any Minister to lend or authorize the lending of money on behalf of the States, from any special fund established for the purpose in such circumstances, in such amounts and otherwise subject to such terms, conditions and limitations as are specified in the authorization.”. 21 Power to amend principal Law by Regulations (1) After Article 69 of the principal Law there shall be inserted the following Article – “69A Power to amend Law by Regulations (1) Subject to paragraph (2), the States may by Regulations amend Parts 3 and 4 (apart from Articles 15, 21(5), 22, 23(3) and (5) and 24(2)). (2) Only the Minister may lodge Regulations under paragraph (1). (3) Regulations under paragraph (1) may amend other provisions of this Law consequentially upon the amendment of Part 3 or 4. (4) Regulations under paragraph (1) may also contain savings and transitional provisions.”. 22 Amendments consequential upon Article 21 The following provisions of the principal Law are repealed – (a) Article 7(5); (b) Article 8(8); (c) Article 10(10); (d) Article 21(5)(a); (e) Article 23(5)(a). 23 Citation, commencement and transitional arrangements (1) This Law may be cited as the Public Finances (Amendment No. 4) (Jersey) Law 2013 and shall come into force 7 days after it is registered. (2) The Minister may by Order make transitional arrangements for the purposes of this Law. a.h. harris Deputy Greffier of the States [1] chapter 24.900 [2] chapter 16.325