2012-2014 BUSINESS PLAN BRIEFING

15 JULY 2011ST. HELIER TOWN HALL

Presented by:SENATOR TERRY LE SUEUR – Chief MinisterSENATOR PHILIP OZOUF – Treasury MinisterLAURA ROWLEY – Treasurer of the StatesCOUNCIL OF MINISTERS

Embargoed until 00:01 Monday 18 July 2011

2

Welcome and Introduction Chief Minister

Purpose• To brief States Members on the draft Business Plan, with particular

emphasis on 2012.

Treasurer of the States to set out:-– Economic and financial context. – Proposed spending in 2012.– What will be delivered.– How the books will be balanced.

Minister for Treasury and Resources– 2013 and 2014.– Summary.

Question and Answer

3

Welcome and Introduction Chief Minister

Guiding Principles• To deliver £65 million CSR savings.• Fiscal prudence continues so as to deliver

balanced budgets by 2013.• This will enable us to deliver key services to

Jersey people and build for the future.

4

Welcome and Introduction Chief Minister

Proposals• Three-year proposals for spending limits

– 2012 department cash limits.– 2013 and 2014 States indicative cash limits.– 2012-2014 Capital Programme within

spending limits.• Legislation Programme for 2012

Draft Annual Business Plan 2012- 2014

Treasurer of the States

Laura Rowley

6

The Financial Context - Jersey has a strong and healthy balance sheet

• NO debt on the Balance Sheet– (apart from property leases from the 1990’s).

• Structural deficit being addressed.

• Medium Term Financial Planning proposed – to strengthen financial management.

7

The Financial Context - Reminder of where we were in 2011 Budget

8

Balancing the books by 2013

Year

Business Plan 2012

Budget 2011

-120

-100

-80

-60

-40

-20

0

20

40

60

80

2009 2010 2011 2012 2013 2014

Sur

plus

/(D

efic

it) £

m

9

The Financial Context - How have things changed since the 2011 Budget

• Income has improved by £14 million at the end of 2010 – due to additional Income Tax collection of £15 million.

• Income Tax forecasts in early June confirm initial Business Plan forecasts.

• In 2011 £6 million income from the COCF is required to meet additional Court and Case Costs.

• Forecast is an ongoing £9 million improvement in States income from 2012.

10

The Financial Context - How have things changed since the 2011 Budget

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What will the Business Plan deliver? - CSR Summary of progress

Departments• Financial delivery confidence is high for all departments but

ESC is affected by P72/2011.

Terms and Conditions• On track to deliver £14 million by 2013.

Procurement• On track to deliver £6.5 million by 2013.

(Council of Ministers is still committed to deliver

£65 million savings)

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What will the Business Plan deliver? - Net CSR savings by department by 2013

0%

-3%-3%

-6%-6%

-7%

-9%

-10% -10%

-11%

-12%

-13%

-6%

-14%

-12%

-10%

-8%

-6%

-4%

-2%

0%

2%

13

What are CoM proposing to spend in 2012? - Department and central allocations

14

Balancing the books by 2013 - States Income

15

Balancing the books by 2013

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What will the Business Plan deliver in 2012? - Investment in priority services (revenue)

• Real terms growth of £3.5m for Health and Social services. • Almost £1m of funding to retain and recruit nurses.• Additional funding for infrastructure and property

maintenance.• Over £0.5m of funding to continue skills and training

initiatives beyond the fiscal stimulus.• An additional £0.6m for tax policy and collection to

increase revenues and compliance.• Additional contingency of £4m for emerging pressures of

Freedom of Information, HCAE Inquiry and Legal Aid.

17

What are CoM proposing to spend in 2012?

We may need to address emerging issues by providing an additional contingency

• Freedom of Information.• Committee of Inquiry.• Legal Aid.• Other emerging issues.

Proposal:• Increase Central Reserve in 2012-2014 to

provide additional contingency for emerging items.

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What are CoM proposing to spend in 2012?

How are we dealing with the ESC savings shortfall (P72/2011 as amended)

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What are CoM proposing to spend in 2012?

How are we dealing with the ESC savings shortfall (P72/2011 as amended)

20

Summary - 2012 Business Plan

• We are in a very strong financial position going into 2012.

• The CoM are still committed to meeting the £65 million savings by 2013.

• And, we have effective plans in place to correct the deficit, and avoid future deficits through permanent changes to our processes.

Draft Annual Business Plan 2012- 2014

Treasury Minister - Senator Ozouf

Proposals for 2013 and 2014

22

Key Messages - 2012 Business Plan

• Commitment to deliver £65 million savings.• Not a short-term plan – it is about cultural reform

towards a 5-10 year strategy.• Platform for economic growth and diversification.• Investing in Health, infrastructure, skills and

training and tax planning.• A balanced and sustainable financial position.

23

Balancing the books by 2013 - Proposals for 2013 and 2014

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What will the Business Plan deliver? - Investment in Capital Programme

• Over £6m to address the most urgent projects at the General Hospital.

• £0.5m advanced to accelerate the St. Martin’s school project to 2012.

• £3.6m for the Phillips Street Shaft project.• £2m to deliver the Police HQ relocation.• £11m for the review of the social housing

programme.• Almost £9m investment in infrastructure

maintenance for roads, sewers and sea walls.

25

How the books will be balanced by 2013 - Forecast of Fund balances

26

2012 Business Plan and Budget

- Timetable

• 15 July – Present Business Plan to States Members• 18 July - Lodge Business Plan 2012• 26 August - Deadline for Business Plan Amendments• 13 September – States Debate Business Plan 2012• 26 September - Present Budget 2012 to States Members • 27 September – Lodge draft Budget 2012• 19 October – Election Day• 25 October - Deadline for Budget Amendments• 8 November – States Debate Budget 2012

Draft Annual Business Plan 2012- 2014

Question and Answer

2012-2014 BUSINESS PLAN BRIEFING

15 JULY 2011ST. HELIER TOWN HALL

Presented by:SENATOR TERRY LE SUEUR – Chief MinisterSENATOR PHILIP OZOUF – Treasury MinisterLAURA ROWLEY – Treasurer of the StatesCOUNCIL OF MINISTERS

Embargoed until 00:01 Monday 18 July 2011