Note 17 to the Departmental Resource Accounts
17. Provisions for liabilities and charges
| Description | Early departure costs £000 |
Other £000 |
Total £000 |
|---|---|---|---|
| Balance at 1 April 2011 | 10,798 | 5,121 | 15,919 |
| Provided in the year | 186 | 7,516 | 7,702 |
| Provisions not required written back | (315) | (1,863) | (2,178) |
| Provisions utilised in the year | (3,294) | (1,837) | (5,131) |
| Borrowing costs | - | - | - |
| Balance at 31 March 2012 (Note a) | 7,375 | 8,937 | 16,312 |
| Description | Early departure costs £000 |
Other £000 |
Total £000 |
|---|---|---|---|
| Balance at 1 April 2010 | 24,830 | 4,089 | 28,919 |
| Provided in the year | 3,655 | 3,615 | 7,270 |
| Provisions not required written back | (11,320) | (1,498) | (12,818) |
| Provisions utilised in the year | (6,652) | (1,085) | (7,737) |
| Borrowing costs | 285 | - | 285 |
| Balance at 31 March 2011 | 10,798 | 5,121 | 15,919 |
Analysis of expected timing of discounted flows 2011-12
| Description | Early departure costs £000 |
Other £000 |
Total £000 |
|---|---|---|---|
| Not later than one year | 2,250 | 3,167 | 5,417 |
| Later than one year and not later than five years | 4,507 | 3,838 | 8,345 |
| Later than five years | 618 | 1,932 | 2,550 |
| Balance at 31 March 2012 | 7,375 | 8,937 | 16,312 |
Analysis of expected timing of discounted flows 2010-11
| Description | Early departure costs £000 |
Other £000 |
Total £000 |
|---|---|---|---|
| Not later than one year | 3,328 | 4,482 | 7,810 |
| Later than one year and not later than five years | 6,145 | 639 | 6,784 |
| Later than five years | 1,325 | - | 1,325 |
| Balance at 31 March 2011 | 10,798 | 5,121 | 15,919 |
Note a – The balance comprises £5.417 million current liabilities and £10.895 million non current liabilities.
Early departure costs
The CPS meets the additional costs of benefits beyond the normal PCSPS benefits in respect of employees who retire early by paying the required amounts annually to the PCSPS over the period between early departure and normal retirement date. The CPS provides for this in full when the early retirement programme becomes binding on the CPS by establishing a provision for the estimated payments discounted by the HM Treasury discount rate of 2.8 (2010-11: 2.9) per cent in real terms with effect from 31 March 2012.
Other provisions
Other provisions comprise outstanding compensation claims for personal injury, employment tribunal, civil legal claims and dilapidation claims served by landlords at the expiry of a lease on a property occupied by the CPS. In respect of compensation claims, provision has been made for the litigation against the Department.
The provision reflects all known legal claims where legal advice indicates that it is more than 50 per cent probable that the claim will be successful and the amount of the claim can be reliably estimated. Expenditure on employment tribunal claims is likely to be incurred within one year and on personal injury claims within two years. Dilapidations claims are analysed as payable within one year, between two and five years and later than five years. Legal claims which may succeed but are less likely to do so or cannot be estimated are disclosed as contingent liabilities in Note 22. A provision is made against all anticipated dilapidation claims at a rate per square metre which reflects actual dilapidations discounted to reflect the time value of money. Other provisions are assessed quarterly. The balances for “provided in year” and “written back” therefore reflect the quarterly movements in provision.
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