Written evidence
APPENDIX 1
Memorandum submitted by the Northern Ireland
Office
THE NORTHERN
IRELAND OFFICE
2003 ANNUAL REPORT
Your letter of 23 July raised a number of questions
on the 2003 Report. The answers to each are attached below.
11 September 2003
Breakdown of NIO Expenditure
1. With regard to table 2.1(Pg 9) please
confirm the following:
(i)
That the year indicators in the top row of the
table are misaligned (2001-02 should appear over "Outturn"
in the far right column, 2002-03 over "Estimated outturn"
in the next column and 2003-04 should appear immediately to the
left of the extended vertical white line).
The Table was misaligned in the final print,
the 2001-02 should appear over "Outturn" in the far
right column, 2002-03 over "Estimated outturn" in the
next column and 2003-04 should appear immediately to the left
of the extended vertical white line. A replacement table is provided
overleaf.
(ii)
Does the staff column refer to actual numbers
of staff employed, or to expenditure on staff as suggested by
note 3? Please provide a replacement table showing necessary amendments.
The staff numbers column in Table 2.1 refers
to actual numbers of staff employed. A replacement table is provided
overleaf, with an additional note to clarify this.
Public Service Agreement and Service Delivery
Agreement
2. With regard to the Public Service Agreement
and Service Delivery Agreement, please respond to the following:
(i) It is noted that a new Public Service
Agreement for 2003 to 2006 has been agreed following the Spending
Review 2002. Under the new PSA the NIO only appears to have four
targets as opposed to the nine targets set under the PSA associated
with the Spending Review 2002. The "abandoned" targets
include "Progress towards a normal peaceful society"
(2000 target 4, p17), "continued protection for the community
by ensuring that no high-risk prisoner escapes" (2000 target
6, p20) and "Secure ongoing efficiency savings of 3% (2000
target 8, p20). Please confirm whether these targets have been
continued in any form and (if not) explain why they have been
abandoned.
The main focus of the 2002-03 Departmental Report
was to report progress against the 2000 PSA. Hence paragraph 3.3
and table 3.1 reports on the seven objectives and nine targets
in the 2000 PSA. The main policy aims of the NIO as set out in
the PSA associated with SR2000 were retained through the seven
objectives set in the PSA associated with SR2002. However in line
with the Governments desire for all Departments to focus more
on key targets during SR2002 the NIO concentrated on those fewer
targets seen as the key indicators of success. In consultation
with HMT the NIO reduced the targets from nine down to four and
as a forward look paragraphs 3.4 to 3.25 indicate the main action
points being taken to deliver these four targets.
(ii) Please provide a table setting
out the NIO Objectives, PSA targets in support of Departmental
Objectives and SDA Mechanisms for both SR2000 and SR2002, so that
they may be readily compared.
Table A overleaf details the NIO Objectives,
PSA targets in support of these objectives and SDA mechanisms
in relation to SR2000. Table B details this information in relation
to SR2002.
(iii) Please confirm that the text boxes
at paragraphs 3.8, 3.18 and 3.24 of the report all refer to targets
under SR2002, not SR2000 as printed.
The text boxes at paragraphs 3.8, 3.18 and 3.24
of the report all refer to targets under SR2002, and not SR2000
as printed. This was an error at the printing stage.
(iv) Targets 2, 3 and 4 at paragraphs
3.8, 3.18 and 3.24 all refer to targets/limits due to be published
in 2002. Please confirm what these target/limits are or, if they
have not yet been set, explain the reason for the continuing delay.
SR2002 Target 2
The target 2 set out at paragraph 3.8 relates
to the composition of the PSNI. The target is to achieve 30% Catholic
representation in PSNI by 2011, with interim targets of 13.5%
by March 2004 and 18.5% by March 2006.
SR2002 Target 3
Target 3 has 2 parts. The first refers to measures
on confidence in the criminal justice system and the Department
is still considering the issue of interim targets for the overall
crime reduction targets. It is currently in discussion with a
number of organisations that have a direct interest in this, including
the police and Northern Ireland Policing Board. The issue has
been complicated by changes to the way in which vehicle crime
(and in particular theft of vehicles) has been recorded by the
PSNI (in line with Home Office counting rules) with consequential
effects on recorded crime figures. Until this matter is resolved
and agreed, it will be difficult to set meaningful interim targets,
though work continues to achieve this.
The second refers to final reconviction rate.
Targets have not been set and agreed with HMT because the three
years figures (1998, 1999 and 2000) needed to inform the work
on setting targets have not all been generated as yet. When they
are available, collective decisions, including discussion with
HMT, on setting targets will need to take place.
SR2002 Target 4
The cost per Prisoner Place for 2003-04 of £83,275
has been agreed by Treasury. The targets for 2004-05 and 2005-06
have not been approved, and will be revisited by Treasury at a
later date.
(v) It is noted that there has been
an increase in violence against the person, contrary to the SR
2000 PSA target 4. What plans does the NIO, together with relevant
agencies, have to tackle this problem? Has thought been given
to setting a specific target to reduce this crime, as for domestic
burglary and vehicle theft?
The Committee is correct in noting there has
been an increase in recorded crime in the category of offences
against the person. Some of this increase is however, due to changes
in counting rules which have affected the figures in relation
to certain offences, for example common assault.
The Community Safety strategy, published in
March 2003 identifies "Offences Against Individuals, particularly
Domestic Violence and Sexual Assault" as one of nine key
priority areas for action. One of the specific action points in
this priority area is to "Establish baselines for the extent
of male street violence by March 2004 and set a target for reduction".
Work will be taken forward to address this action point during
the course of this year.
(vi) Target 7 in the SR2000 PSA refers
to "reductions in the rate of re-offending.", but in
target 3 in the SR2002 PSA this appears to have been changed to
reductions in the rate of reconviction. Why?
The change reflects a shift to something that
can currently be measured, that is reconviction away from something
that can't, that is re-offending. It also brings the NIO approach
into line with that taken by England and Wales.
(vii) Paragraph 3.4 directs readers
to the NIO website to view the PSA 2003-06 Service Delivery Plan
and Technical Note. On three separate occasions in the last two
weeks I have attempted to access these documents through the website
and have found that the advertised link to the Service Delivery
Plan takes one to the Technical Notes, while the advertised link
to the Technical Notes takes one to an error. Similarly, errors
arise when one tries to access the SR2000 data via the advertised
links. Please confirm that this problem has been rectified.
This was a technical error and has now been
rectified.
Police Recruitment
3. Please confirm the timetable for
the review of 50:50 recruiting arrangements for the PSNI referred
to at paragraph 3.10.
The timetable for the review of the 50:50 recruiting
arrangements for PSNI is as follows:
(a) Launch of a consultation process by
the autumn 2003;
(b) Respond to the consultation, and preparation
of the renewal order if judged appropriate by the Secretary of
State.
(c) If so, laying the order early in 2004,
to complete the Parliamentary process ahead of the end of March
2004.
Access to information
4. Please provide an explanation of
the grounds on which seven of the 13 requests for information
under the Code of Practice on Access to Government Information
were refused in whole or in part (paragraph 3.34).
The seven requests refused were under a variety
of exemptions in the Open Government Code of Conduct. The main
reasons were:
2 Internal discussion and advice.
7b. Effective management and operations
of the public service.
Information whose disclosure would harm the
proper and efficient conduct of the operations of a department
or other public body or authority, including NHS organisations,
or of any regulatory body.
12 Privacy of an individual.
13 Third party's commercial confidences.
14 Information given in confidence.
Complaints procedure
5. Please confirm the whereabouts on
the NIO website of the complaints procedure (p28). I and another
member of staff have been unable to locate it, either through
the A-Z list or through the site search engine.
The NIO website was restructured recently and
the complaints procedure was removed. It is now re-instated.
Ministerial Correspondence with MPs
6. It is noted that the NIO core performance
in respect of Ministerial Correspondence with MPs (paragraph 3.36)
has risen from 49% within target in 2002, but at 59% is still
less than satisfactory. What future steps are being taken to improve
performance in this area?
An in-house review of the performance has been
conducted and recommendations made which include:
— Improvement of the internal monitoring
systems within Private Office.
— More training for the staff involved.
— Internal planning meetings to improve
co-ordination.
— Creation of a better follow up system
to monitor progress.
It is anticipated that the implementation of
these recommendations will improve performance in this area.
7. Please also explain the reasons why
the performance of the Compensation Agency in respect of the same
target has fallen in a year from 93% to 80%.
Although the Compensation Agency's performance
against the Ministerial Correspondence target has fallen by 13%,
the actual figure is distorted because it is a smaller sample.
In each year only two letters were not answered within the target
but in 2001 this represented 25 out of 27 (93%) whereas in 2002
it was eight out of 10 (80%).
8. Please confirm what steps have been
taken to improve the role and functioning of the Departmental
Board, and what costs (if any) have been involved (paragraph 3.43).
An internal review was carried out on the role
and functions of the Departmental Board. As a result of that review:
— The existing terms of reference were
clarified and restated to staff.
— A more structured agenda was put
in place with meetings planned up to a year in advance.
— Structured opportunities to deliberate
on the delivery of key business objectives were put in place,
this was taken forward linked to the Business Planning/risk project.
— Strategic Planning recommendations
were incorporated into the Board's forward planning.
— A consistent format was put in place
for papers presented to the Board, including timescale, importance
and risk so the Board knows exactly what is required of it.
— A deadline was set for the submission
of papers for the Board meeting has been established to enable
members adequate time to prepare to discuss the issues, therefore
improving the quality those discussions.
— A short summary of each Board meeting
is issued to all staff at an early stage.
There were no costs incurred in either conducting
or implementing the review to improve the role and functioning
of the Departmental Board other than those associated with the
time of the staff involved.
Bloody Sunday
9. Please explain why a "major
new IT system" was deemed necessary for the Bloody Sunday
Inquiry in London; what the cost of the system has been; and whether
it will be possible to put the system to other uses when the Inquiry
reports (currently due in 2004) (paragraphs 3.46, 4.15).
It was essential to the fair conduct of the
Bloody Sunday Inquiry that the facilities available in the Guildhall
in Londonderry should be replicated as far as possible at the
London site—Central Hall, Westminster.
In respect of the IT equipment needed, the independent
Inquiry gave careful consideration to three options:
— moving the existing equipment from
the Guildhall to Central Hall;
— purchasing new equipment; and
It was concluded that buying the additional
hardware outright was the most favourable in terms of (i) value
for money, (ii) maintaining continuity of service to the public,
press and Inquiry team staff remaining in Londonderry, (iii) minimising
risk of damage to the existing IT installation in Londonderry
and (iv) facilitating rapid moves (within one week) of the Inquiry
hearings back and forth between Londonderry and London.
The capital cost of the new equipment was £2,410,000
with additional operational expenditure of £1,017,000 to
end June 2003.
The Northern Ireland Office considers that most,
if not all, of the equipment will be re-usable either within the
NIO, the wider UK Government or by sale.
Meetings of the British-Irish IGC
10. Paragraph 4.25 refers to meetings
of the British-Irish IGC up to 18 December 2002. Did any further
meetings take place between 18 December 2002 and 31 March 2003,
and if so why were they not included?
No other meetings took place between 18 December
and 31 March.
Police Expenditure 2002-03
11. Please provide a new copy of Chart
5.3, indicating more clearly which parts of the "pie"
refer to the different elements of expenditure. For example, why
does the slice for accommodation (4%) appear to be bigger than
the slice for severance (6%)? Please also explain what is meant
by the term "non severance" in this chart and in Appendix
D.
Expenditure on Patton-related reforms was ringfenced
by the Treasury. It falls into two categories. The first is expenditure
on the police Early Retirement Voluntary Severance Programme.
This is shown separately under the heading "severance".
The second relates to expenditure on all other specific projects
which are being undertaken wholly or mainly as a result of Government
commitments contained in the Patten Report and we therefore term
these "Patten non-severance expenditure.
Sick Absence
12. Please update table 8.1 (p67) to
include sickness absence figures for 2002-03, and indicate why
these were originally omitted.
Sick absence figures for 2002-03 for both HCS
and NICS are not yet available. HCS statistics are provided by
the Cabinet Office in the autumn and NICS statistics, provided
by NISRA, will not be available until the end of the calendar
year. The figure for Prisons for 2002-03 is 11.5 days.
Offices, Agencies and Executive NDPB
13. The information provided by the
NIO's offices, agencies and executive NDPBs in this report is
very variable both in quantity and quality. To what extent does
the NIO exercise editorial control over such submissions? Has
any thought been given to setting a basic template for entries
by external bodies (for example requiring that each includes a
description of role, description of management structures, objectives,
actual performance against key targets, expenditure)?
Of necessity the completion of a report of this
nature covering the activities of a Department with the diversity
of tasks undertaken by the NIO is a complex exercise. The information
on the detail of operational activity sits within the operational
Directorates and Divisions. The DR for the first time this year
put a corporate style on the various contributions from the core
of the NIO to provide consistency of reply. This will be further
refined for the 2003-04 Report. However this is not possible to
the same extent with the Agencies and the other executive NDPBs
who may have their own Boards of Management and often provide
extensive Annual Reports in their own right. In consultation with
HM Treasury it was agreed that it would not be necessary to repeat
in great detail all the information given separately in these
Annual Reports.
14. Why are no reports included in the
Departmental Report from the Policing Board, the Northern Ireland
Human Rights Commission and the Equality Commission, when each
is listed as an Executive NDPB on page 4, and all were included
in last year's Departmental Report?
It was agreed, in consultation with HM Treasury,
that it would more clearly signal their independence if they were
not included with the Northern Ireland Office especially since
they provide extensive public reporting through their own Annual
Reports.
15. It is noted that the workload of
the Compensation Agency in respect of criminal injuries compensation
has increased substantially in the last year. Please indicate
what the implications of this increase have been for the Agency
in terms of staffing and resources (paragraph 10.7).
The implications to Staffing and Resources of
the increase in workload of the Compensation Agency are set out
below:
| | Staffing
| Resources |
| 2001-02 | 132
| £2,596k |
| 2002-03 | 145
| £2,939k |
16. Please indicate what targets the Crown Solicitors
Office has set to measure its performance against its objectives
(paragraph 12.3).
The targets set by CSO to measure its objectives are:
— To demonstrate for the 2002-03 financial year
that the quality of the legal service provided by CSO met the
CSO legal quality standards.
— To demonstrate for the 2002-03 financial year
that clients are entirely satisfied with the level of service
provided by CSO.
— By 31 March 2003, to invoice clients to the value
of the full running cost of the CSO.
— By 31 March 2003, to invoice clients for all recoverable
outlay expended on their behalf during the financial year.
— By 31 March 2003, to make efficiency savings of
1% in CSO's running costs.
— By 31 March 2003 to be reaccredited as an Investor
in People.
17. It is noted that the data given for 2001-02 in
Table 13.1 (Files received and prosecution directions issued by
the Department of the DPP) is provisional, although the report
was not published until May 2003. Please confirm whether or not
the data for 2001-02 represents the final outcome and if not,
explain the delay in producing final figures.
Following the introduction of a new case management system
in June 2001, the Department of the DPP is undertaking a data
quality review of all records held on the system. Pending completion
of this exercise, all statistical releases by the Department have
been regarded as provisional in nature.
18. Table 15.2 (page 101) sets out the Probation
Board's key targets for 2002-03, but does not set out the Board's
performance against them. Please provide a new table setting out
both the targets and the actual performance. Please also explain
what is meant by "breaches of proceedings".
Table 15.2
THE PROBATION BOARD—KEY TARGETS FOR 2002-03
| Key Performance Indicator | March 2003Target
| March 2003Achievement |
| The proportion of induction interviews arranged within five working days of sentence
| 98% | 98% |
| The achievement of the agreed Standards regarding minimum levels of contact —offered
| 92% | 94% |
| —kept
| 60% | 73% |
| The proportion of supervision plans written to the agreed Standards
| 83% | 95% |
| *Where breaches of proceedings are appropriate, the proportion commenced within 10 working days of the incident occurring
| 87% | 94% |
| The proportion of offenders subject to an active community service order that work an average of five hours or more per week
| 87% | 91% |
| The proportion of Community Service Orders that complete their sentence within 12 months
| 97% | 98% |
| The proportion of offenders whose risk management is reviewed at least every four months
| 90% | 93% |
| The proportion of Pre-Sentence Reports or explanatory letters delivered to the courts by the date specified by the court
| 99% | 99% |
The term "breaches of proceedings" refers to a
failure to comply with any supervised order or licence.
19. In spite of helpful financial data, the Juvenile
Justice Board (p104-5) has not provided any information abouts
its performance against formal objectives and targets in the past
year, (or any reference to a separate Annual Report containing
such information). Please therefore provide a table setting out
its performance against formal objectives and targets, together
with a short note on the plan for capital investment following
the Estates Review, referred to in note 2 to Table 16.1.
The Juvenile Justice Board was a temporary arrangement and
acted in a caretaking capacity pending its replacement by the
Youth Justice Agency. Because the Agency was due to be in place
by 1 August 2002 it was considered unnecessary to have formal
objectives and targets for a part year. However the Youth Justice
Agency was not created until 1 April 2003 and it has published
corporate and business plans setting out its objectives and targets
for the year ahead. The Agency's performance against these objectives
and targets will be subject to ministerial scrutiny and will be
reported on in the next Departmental Report.
The Estate Review concluded with the Minister announcing
to Parliament on 29 November 2000 that none of the existing Juvenile
Justice Centres were suitable and the best way forward was to
construct a new purpose-designed facility on land available at
Rathgael. While the new Centre was being built, children already
in the system would be transferred to the existing Rathgael campus.
As a result of the Review, a phased development programme
has commenced. The number of Juvenile Justice Centres has reduced
from four to two. However, the total rationalisation process will
take a number of years—estimated at four to five, to reach
completion. The process has been advanced in two phases.
Phase 1 involved upgrading security and refurbishing the
accommodation on the existing Rathgael site and transferring the
boys currently in Lisnevin. This will be finalised in September
2003 and the refurbished Centre will then function as a new single
Juvenile Justice Centre for Northern Ireland, operating until
such times as Phase 2, a new purpose designed Centre is constructed
and satisfactorily commissioned. In this respect, Phase 1 is an
interim solution with a limited life expectancy. The estimated
cost of Phase 1 is £5.7 million. The final account is expected
to be furnished by the end of the year.
Financial and other
20. Please explain why, in Table 2, page 125 the
NBV of the capital base and assets is given for 1999-2000. If
this is the most recent date of valuation, when will the value
next be reviewed? Please also explain why NIO housing stock is
not included in the capital base.
Although more up-to-date valuation information is available,
it would not have been appropriate to include these the 2002-03
Departmental Report, as these would have related to the later
SR2002 spending review. The valuation figures quoted in the DR
were part of the Departmental Investment Strategy (DIS) for the
2000 spending review. References from the 2000 spending review
documents (such as the DIS) included in the DR were provided to
ensure consistency with the DR's reporting of other aspects of
the department's performance in relation to the 2000 spending
review (for example the DR's reporting on the progress of achievement
of SR2000 PSA targets).
The footnote referred to is an error and the capital base
does include the NIO Housing Stock.
21. Please confirm that page 132 is meant to be a
blank page.
The information on Page 133 should have been on Page 132,
and 2 further pages should have followed on from Request for Resources,
RfRs. These pages were left out in the final printing. The short
timescale prevented final proof reading before binding. An amended
Glossary of Terms and concepts is attached at Annex A.
22. With regard to Appendix D please confirm that
all figures are shown in £000, not £million, as marked
in table 1-5.
In respect of Appendix D the tables should have been marked
as follows:
— Table 1 to Table 3 should have been marked as
£000.
— Table 4 and Table 5 are correctly marked as £million.
23. Please provide a detailed explanation as to the
division of expenditure between the resource budget and the capital
budget. For example, why are Patten severance costs reported as
divided between the two budgets?
The move from Cash Budgeting to Resource Budgeting has emphasised
the difference between the consumption of financial resources
and capital investment. The Resource Budget reflects the full
consumption of all the Department's resources, and the Capital
Budget is there to record the purchase of all new capital assets.
The Department's Capital budget therefore sits totally outside
the Resource Budget to reflect this change. Once assets are purchased
from the Capital Budget, they are then depreciated over their
expected life, and this depreciation charge is included in the
Resource Budget, in order to give a full resource consumption.
24. Please confirm:
(i) Whether the line "other" in Table 2—NIO
Resource Budget and in Table 5 (three reference) refers to expenditure
on Central Administration, Ministers and the Political Directorate,
as set out in the Central Government Supply Estimates 2003-04.
In table 2 the term "other" is meant to refer to
other NIO Divisions; this is the same for Table 5 except the first
reference, which simply breaks down administration costs into
pay bill and other, that is other types of administration costs.
The expenditure is included in the 2003-04 Supply estimates
(but is not referred to as "other" in that document).
(ii) Please explain the significant drop in outturn
for Forensic Science in 2002-03 and for the Compensation Agency
in 2001-02, from the years immediately preceding and following.
The information on the Compensation Agency omitted its grant
payments line of £78 million which is an error.
FSNI's expenditure figures across each year show the Agency's
net expenditure, that is the difference between its gross expenditure
and its income. In previous years some of its receipts have taken
it over its voted limit for receipts and so it could not retain
them thus creating a larger variance in its net expenditure. From
2003-04 onwards the Agency will have expenditure relating to its
restructuring which will not be recovered from its customers,
again increasing its net expenditure.
(iii) Please explain the significantly higher estimated
outturn for Criminal Justice in 2002-03, compared to the preceding
and following years.
Criminal Justice expenditure in 2002-03 allowed for a number
of projects being taken forward under the Criminal Justice Review,
which were not included in previous years. From 2003-04 onwards
Criminal Justice expenditure is lower because just over £7
million has been transferred to a new spending line for the new
Youth Justice Agency.
(iv) Please explain the significantly increased expenditure
on "Other" in 2002-03 under Gross administration in
Table 5, and similarly for Prisons under Total Net Administration
Costs in the same table (p141).
The increase in "other" and Prisons administration
costs in 2002-03 is directly related, and is explained by the
inclusion of two large non-cash administrative costs which were
included under Prisons (and therefore included in the "other"
total). One of the items was for a large "provision"
which prisons had to take in their 2002-03 accounts, and the other
was for a loss relating to the transfer of the Maze prison from
the NIO to the NI Executive. These are both one off items in 2002-03.
25. In Table 6 (NIO staffing figures, p142) please
explain why a significant expansion of permanent staff in the
NICS is planned for 2003-04.
The increase in NICS staff in 2003-04 is explained largely
by the creation of a new Youth Justice Agency within the Department,
which brought staff who had worked in the Juvenile Justice Board,
an NDPB, into the Department's official manpower figures for the
first time. The other main factor is the recruitment of staff
to facilitate the creation of a new prosecution service, which
is covered briefly in chapter 13, page 95 of the DR.
26. Please explain what steps have been taken, including
resource implication if appropriate, as a consequence of the Security
Service Review. How will these improvements be monitored?
We have accepted all the recommendations in principle. Some
of them raise deeper issues and will take longer than others to
implement. They have been grouped into three separate but related
projects that are being taken forward under the supervision of
a programme board chaired by the NIO's Resources Director.
Annex A
PLANNING AND MANAGEMENT OF RESOURCES: A GLOSSARY OF TERMS
AND CONCEPTS
Accruals accounting: Financial statements may be compiled
on one of two bases: cash or accruals. In cash accounting, only
monies paid and received in the period are brought to account.
No attempt is made to match expenditure incurred in the period
with revenue earned (or output achieved). Under accruals accounting,
costs and revenue are recognised as they are respectively incurred
and earned and dealt with in the period to which they relate.
In addition, the accruals system recognises assets held and liabilities
outstanding at the end of the financial period. These are disclosed
in a balance sheet. (see also Assets, Balance sheet, Liabilities,
Resource accounting and budgeting).
Administration costs: these lie within Departmental
Expenditure Limits (DELs). They cover departments' current expenditure
on staff, accommodation and equipment used in the administration
of central government and the direct delivery of services by departments
and their agencies. In practice, the main items of administration
costs are:
(a) civil service staff costs—wages and
salaries, social security costs and superannuation costs;
(b) other employee-related costs, including those
for training, travel and subsistence;
(c) current expenditure on accommodation, including
rent, rates and maintenance, etc;
(d) current expenditure on office services including
stationery, postage, telecommunications, computer maintenance,
etc;
(e) comparable contracted-out services, and consultants'
fees where these relate to activities otherwise covered by administration
costs controls or ordinarily performed by civil servants;
(f) depreciation and cost of capital charges
on fixed assets held for the purpose of managing the delivery
of services;
(g) cost of capital charges on working capital
related to managing the delivery of services; and
(h) other non-cash items such as auditors' remuneration
and expenses, loss or gain on disposal of fixed assets held for
administration purposes, and provisions for early departure costs.
(see also programme costs.)
Annually Managed Expenditure (AME): this is spending
included in Total Managed Expenditure (TME), which does not fall
within Departmental Expenditure Limits (DELs). Expenditure in
AME is generally less predictable and controllable than expenditure
in DEL. (see also Departmental Expenditure Limits, Total Managed
Expenditure.)
Assets: anything of value owned or controlled by an
organisation as a result of past transactions or events. Assets
may be current or fixed. (see also Liabilities.)
Examples of current assets
Stocks—Raw materials
Work-in-progress
Debtors and prepayments
Cash in bank or in hand
Examples of fixed assets
Tangible—Land
Buildings
Plant and machinery
Vehicles
Furniture
Computers
Intangible—Computer software
Balance sheet: a statement of organisational wealth
(assets less liabilities) at a point in time. (see also Assets,
Liabilities.)
Control Total: the measure used by the government
to plan public expenditure for the medium term, and monitor and
control it within each financial year.
Creditors: suppliers or others to whom the organisation
owes money. (see also Debtors.)
Debtors: customers or others who owe money to the
organisation. (see also Creditors.)
Departmental Expenditure Limits, DEL: expenditure
which departments can control overall, though some elements may
be demand-led. (see also Administration costs, Annually Managed
Expenditure, Total Managed Expenditure.)
Depreciation: the fall in value of a fixed asset as
a result of use, physical deterioration, obsolescence or the passage
of time.
End-Year Flexibility, EYF: a mechanism to allow unspent
provision in the Departmental Expenditure Limit in one year to
be carried forward to the next to encourage good financial management.
Estimate: a statement of how much money the government
needs in the coming financial year, and for what purpose(s), through
which Parliamentary authority is sought for the planned level
of expenditure and receipts.
Grant: payments made by departments to outside bodies
to reimburse expenditure on agreed items or functions.
Grant-in-aid: regular payments made by departments
to outside bodies (usually non-departmental public bodies) to
finance expenditure on agreed items or functions.
Liabilities: the obligation to confer future economic
benefit as a result of past transactions or events. May be long-term
(eg, provisions for the costs of early retirement) or current
(eg, creditors and accruals). (see also Assets.)
Notional items of expenditure: expenditure which does
not involve an actual cash transaction but which must be reflected
in the accounts to show the full costs of a body's activities.
Sometimes referred to as non-cash costs. They include:
Cost of capital (interest): Services received but
not charged, eg, Northern Ireland Audit Office fees.
Prepayments: expenditure on goods and services for
future benefit, which is to be charged to the cost of future operations.
Programme costs: all of the non-administration costs
of the department, including grants and direct programme expenditure.
Elements of cost will include depreciation on assets and the cost
of capital charge for assets and liabilities in respect of programme
expenditure. (see also Administration costs.)
Public Service Agreement, PSA: a plan setting out
what the department will deliver, in the form of measurable targets,
over the public expenditure review period, in return for its agreed
spending. PSAs set for each department explicit aims, objectives
and targets to be achieved in return for funding provided in the
respective spending reviews. (see also Service Delivery Agreement.)
Request for Resources, RfR: the functional level into
which departmental Estimates may be split. RfRs contain a number
of functions being carried out by the department in pursuit of
one or more of that department's objectives.
Resource accounts: these are accruals-based accounts
for government departments. They comprise:
— Schedule 1 Summary of resource outturn—compares
actual costs and cash to Estimate
— Schedule 2 Operating cost statement—administrative
and programme costs, less income
— Schedule 3 Balance sheet—with assets and
liabilities
— Schedule 4 Cash flow statement—net cash
spent to run the department and to buy capital items
— Schedule 5 Statement of resources by departmental
aim and objectives—analysis of costs by each of the department's
objectives
— Notes—analysis and more detail, including
accounting assumptions
Resource accounting: a method of recording expenditure
as it is incurred, and income as it is earned, during an accounting
period.
Resource accounting and budgeting, RAB: introduces
generally accepted accounting practice (GAAP) into government
accounting. The main changes are the adoption of accruals accounting
for all departmental expenditure and the inclusion of depreciation
and cost-of-capital charges in departmental budgets. (see also
Accruals accounting.)
Resource Budget: the means by which the government
plans and controls the expenditure of resources to meet its objectives.
Resource Estimates: these are the government's formal
request to Parliament for finance for most central government
expenditure. Each department normally has one Estimate, broken
down by "Requests for Resources" (RfRs).
Service Delivery Agreement, SDA: sets out the more
detailed outputs that departments need to focus on to achieve
their objectives, and the modernisation processes they will go
through to improve the productivity of their operations. (see
also Public Service Agreement.)
Spending Review: this sets DEL and plans AME for the
following three years.
Subhead: individual elements of departmental expenditure
identifiable in Estimates as single items.
Total Managed Expenditure, TME: a Treasury budgeting
term which covers all current and capital spending carried out
by the public sector. (see also Annually Managed Expenditure,
Departmental Expenditure Limits.)
Vote: refers to the process by which Parliament approves
funds in response to Resource Estimates.
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