Jim Fitzpatrick (Parliamentary Under-Secretary, Department of Trade and Industry; Poplar & Canning Town, Labour)

The clause is a transitional provision that is needed so that the limit on the amount by which the assembly may increase its own component budget requirement in the first year in which the new arrangements operate can be calculated. The clause provides for the GLA’s chief finance officer to designate amounts as the component budget requirements for both the Mayor and the assembly for the financial year preceding the first financial year in which the new arrangements will operate.

There is currently one component budget for the GLA; component budget requirements are not calculated separately for the Mayor and the assembly, as we know. For the first year of the new arrangements, the budget requirements of the Mayor and the assembly will not be known. For the percentage increase in the Mayor’s and the assembly’s budgets to be calculated and for a limit to the amount that the assembly may increase its own budget to be set,the chief finance officer must designate the amounts of the Mayor’s and the assembly’s component budget requirements for the previous year. The chief finance officer must make her designation no later than31 December in the year preceding the first financial year of the new arrangements and must consult the Mayor and the assembly before doing so.

The clause will ensure that the new arrangements for separate budgets for the Mayor and the assembly may operate smoothly and sensibly in the first year of their operation.