Monday, 13 August 2018

Barnet Senior Salaries July 2018 - Who's Missing

Each month Barnet publish the salaries of senior staff. I screen the list down to those earning more than an MP (£77,379) as that provides a (crude) benchmark as to responsibility of the role.
In July Barnet staff received a 2% pay rise and the list of salaries is below. However what it doesn't identify are the consultants who are working as interim staff paid handsome day rates. How many there are we are not told. What it does do is make you realise that some of these staff are paid hugely compared to the private sector and one questions whether they are actually worth all this money?


Wednesday, 1 August 2018

Guest Post - Something is Brewing at Larches Community in Edgware



Larches Community are offering 12 people the opportunity to take part in Brazen Brewery!  A new beer brewing course from September 2018


London, 1st August 2018: Edgware based charity, Larches Community is launching Brazen Brewery! a craft beer brewing course for people with learning disabilities and autism. We are offering 12 people the opportunity to take part in the first course and gain valuable life skills - increased confidence, improved self-esteem, cooperation, initiative, memory retention, giving and receiving instruction, decision making, working as part of a team, having fun and learning how to make some wonderful craft beer!

“We are thrilled to offer three 12 week brewing courses in our first year, teaching people elements of the brewing process.  In years two and three we plan to offer our qualified brewers employment, working in our social enterprise brewery, based in our new building and selling craft beer within our local community.  At the heart of everything we do is Valuing People for Who They Are”
Linda Edwards MBE – CEO, Larches Community.

If you would like more information about Brazen Brewery! please call Charlie O’Sullivan on 020 8905 6333, email: charlie.brewery@larchestrust.org.uk or visit www.larchescommunity.org.uk


KEY INFORMATION

Larches Community is a registered charity established in 1995 by a group of families to create opportunities for young people and adults with learning disabilities and/or autism and Asperger's syndrome.

Larches Community was created out of a deep concern for who would provide a supportive family home with a creative and stimulating life for our children beyond our lifetime. People with a learning disability represent a section of the community that enjoy few privileges, who experience social discrimination and are generally undervalued and underestimated by society. Most are socially excluded, with few opportunities to develop their individuality or to develop and contribute their skills to the community.

We offer a Learning for Life programme where learners gain independent living skills - cooking, budgeting, drama, musical theatre, craft and laughter club which help to develop the individual to tap into their undiscovered potential and soar to new heights.  

In our 23rd year, the Board has set the most ambitious and challenging strategic goals in our history. We have been granted planning permission by Barnet Council to build a three-story building with a basement on our current site. This development has afforded Larches Community the opportunity to review our offer to people with learning disabilities and autism, refocus our work and transform our services to encourage people with learning disabilities and autism to be the Best They Can Be!

Tuesday, 31 July 2018

Supplier Payments for June - Agency Costs Still Look High

The supplier payments for June have just been published. This month the big winners are Capita  who billed £10.7 million on the CSG and Re contracts. Comensura billed £1.45 million and looks like we will hit £19 million over the full financial year.

For some reason NSL who administer parking and litter enforcement billed £1.77 million in June which seems excessively high.

PA Consulting also billed another £134,917 this month, on top of the £685,804 they bill last month. One of the invoices this month was for "Supp People Recharge". I wonder what this is for but  as it was billed to adults and communities I wonder if has anything to do with the failed implementation by Capita of the Mosaic case management system that we heard about earlier this month. I shall be asking a few follow up questions I think.

I also wonder what we paid OCS Group £110,161 in June, bringing the first three months billings to £278,541 given that we already have a cleaning contractor, Churchill Contract Services.

The payments to John Graham is for the construction of the two new leisure centres and the Conway Aecom is for highways work.


The latest payments to Capita on the CSG and Re contracts bring the running total to £350.8 million. I still cannot see where the mystical savings are being generated. 


As for the Comensura contract, the current forecast for this financial year is £19.1 million, some £1.2 million higher than last year, at a time when there are supposed to be cuts to interim and agency costs so as to avoid another massive financial overspend.  We were due to have an update of the council's financial performance on 18 September (which was too late in my opinion)  but that meeting has now been postponed another three weeks till 9 October. My very real fear is that by the time we reach October everyone will be throwing their hands up in horror at the overspend but by then it will be too late to do anything about it.

As always I will continue to keep a close eye on Barnet's spending.

Thursday, 19 July 2018

A look back in time and a tribute to Barnet Bugle

Tonight Barnet are going to be making decisions on which services will be brought back in house and which will be retained by Capita. Casting my mind back to 5 years ago when decisions were being made on the Re Contract I remembered some of those meetings. Luckily for us the late, and very sadly missed, Dan Hope videoed most of the meetings. As the Barnet Bugle, he has provided us with an archive of evidence from those meetings which you can view here. Whilst Dan and I had very different political outlooks we shared one vital, common interest which was about openness and transparency in Barnet. Thanks to Dan we have a record of so many meetings. I thought I would dig out one clip when the Council was discussing the award of the Re contract and ask Richard Cornelius to consider whether ignoring the views of residents was such a good idea and to suggest that this time maybe he should listen a but harder.

One other thing to note was that 5 years ago we were given 5 minutes to speak. Thanks to austerity, democracy has also had to suffer cuts so we now only get 3 minutes. I will make sure my 3 minutes tonight count.





Wednesday, 18 July 2018

Why Capita's Contract is a rip off for Barnet - Day Four Extra Charges

Over the past few days I have been looking at the gainshare payments. Today I am looking at the extra charges Capita have billed on the Barnet contract.

The first example is a bill for £128,000 for additional electronic data storage. Barnet agreed to pay this amount, set by Capita, "because the electronic storage levels are above the amount agreed in the contract". Now I may be wrong but that sound a great deal given that it is on top of an agreed level in the contract. I would welcome input from any IT experts out there but my own bit of digging suggests that is quite a lot. While I am no fan of Amazon whatsoever I know that their Amazon Web Services (AWS) is a huge and profitable part of their business. I took a look at some of the data rates for storage, both simple data storage and a more flexible file management system and the rates are below.
Now the reason I looked at AWS rates is because that is who Capita are using to store some of Barnet's data on the OpenBarnet data portal. It may be that we are using a huge amount of data storage but remember this is in addition to the storage levels agreed in the contract. That says to me that somebody either horribly underestimated how much data we would be using in the contract or we are being ripped off. Either way we are paying through the nose for it.

The second example is a bill for £247,000 for additional call volumes above the baseline figure. Now when the contract was signed everybody talked about 'channel shift', getting people to use on-line means of contacting the council such as webforms rather than by phone as this would save money.
It may be that the council set over-ambitious targets for the decline in phone calls but then wasn't Capita responsible for implementing 'channel shift'? To help channel shift along  and to cut costs, Capita have introduced something called the 'Virtual Agent' which is the automated telephone service that I am sure many residents have experienced. Because it is automated it shouldn't cost more to run (in terms of additional call centre staff). However, my experience of the automated system is that because it is very difficult to get put through to the right department first time, you end up ringing in multiple times.  However, what I did was look at the performance stats published by Barnet comparing the most recent data with the year 2014/15. Barnet haven't published telephony data for Q4 of 2017/18 yet, so I used Q4 2016/17 to give a complete year of four consecutive quarters.

What that data tells me is that call volumes haven't risen over the last three years but the use of the Virtual Agent has as can be seen in the table below:


So how come Capita want an extra £247,000 for providing a service where call volumes are pretty static but they have reduced the calls answered by an operator by more than a third, saving a fortune in call centre staff . I simply don't see how this charge can be justified.

The third example relates to a bill for £692,759 for dilapidations to North London Business Park Building 4 (NLBP4). Originally the plan was to employ Capita who would use their offices in Coventry, Belfast, Blackburn, Darlington and so on, to house services and we could then trigger the break clause to vacate NLBP4 in late 2015. A good idea in theory but one that didn't happen. LBB staff were moved out and consolidated into Barnet House and NLBP2 but the Capita staff remain located in NLBP4. My thought was, no problem but Capita must be footing the bill. Well actually no they aren't, we are and hence we have been stung with a bill for dilapidations on NLBP4 for nearly £700k.

These three examples alone amount to more than £1 million being paid to Capita which could have been used to provide vital services such as 40+ care staff or refuse/street cleaning staff. I know where I would prefer that money to go.

The Conservatives keep saying how much outsourcing is saving but the evidence is clear that while we are making savings on the core contract, all the extras, all the gainshare, all those special projects at consultancy rates mean that by my reckoning we aren't saving anything especially when you include the millions of pounds making so many council staff redundant, the huge investment we funded in IT and the £11 million of consultants and lawyers fees to get us to a signed contract.

Tomorrow, Councillors will be looking at which services to bring back in house. Unless they have all the information about all these extras, how can they make a properly considered decision? Sadly I suspect the decision has already been made and any opposition will simply be out voted.

Monday, 16 July 2018

Why Capita's Gainshare is Such a Rip Off - Day Three - who made the saving?

For the last couple of days I have set out details of gainshare payments on the Capita contract in Barnet. There are numerous payments and I have just picked out a selection. Today I have included a couple of other examples where the issue relates to who generated the saving and was any value added to warrant a gainshare payment.

The first is an example of where it looks like all the benefit was generated by a Barnet Council officer yet Capita are still able to claim the gainshare. Up till 2012 (pre Capita) Barnet were full members of the not for profit London Housing Consortium (LHC) set up to provide "effective procurement solutions for local authorities, housing associations, schools and other public sector bodies".  In 2015 it was decided that Barnet should rejoin the LHC as an associate member; you don't get as big a share of any rebates but there is no liability for any losses nor is their a membership fee.  At the time Barnet were about to embark on two construction projects, Monkfrith School and the refurbishment of Barnet House with a value of £5.3 million. The report was submitted as a delegated powers report and signed off by the Council's Commercial Director, not a Capita employee. The rebates from LHC are small as a percentage but when you are dealing with large projects it all mounts up. As a result of our membership Barnet received a rebate from LHC of  £47,797.32. Not a fortune but that is enough to fund two care staff. Problem is Capita say they are entitled to a gainshare so we end up handing back 31% or £14,817.17.

The second is where Barnet's bank withdrew from the local authority market so there had to be a new contract. The new contract was less expensive so yes there is a saving. However the paperwork states clearly that "procurement support has been delivered from within the LBB Core Team". Now we pay for the core procurement service in the core contract payment. Nevertheless Capita say this is a gainshare so Barnet pay them £35,381.25 - enough for a social worker.

The third example is focused around the assumption that costs always rise. Barnet tendered their interpreter and translation service. Assumptions were made about volumes and by looking at historic prices. When the current bids came in lower than the historic prices, charged Capita claimed a gainshare of £22,155.91.  What I was also aware of was that there has been a lot of downward pressure on translator and interpreter pricing.  I have used translations services in the past and have been told that prices are at best static and in many cases falling, obviously depending on skill level and language. The problem with the Capita contract is that if market prices fall, Capita see the benefit in additional gainshare.

Tomorrow I will be looking at the "extras", additional charges made by Capita which in my opinion are excessive.

Sunday, 15 July 2018

Why Capita's Gainshare is Such a Rip Off - Day Two

Yesterday I blogged about three gainshare payments which you can read here. Today I have three more examples of why the idea of gainshare seems at odds with the principles of public money being used for public service.

(Just in case anyone isn't aware, "Gainshare" is a contractual mechanism by which Capita is entitled to a share in savings they make for Barnet).

Example 1 - the Double Bubble Trick
For the last four years I have been complaining about the gainshare Capita has claimed on the Interim and Agency contract with Comensura. I remain convinced that we have been ripped off to the tune of several million pounds and it formed the basis on my objection to the accounts both in 2014 and last year. Interim and agency costs have risen alarmingly since 2011/12 :


In 2016/17 we paid a gainshare on the Comensura contract of approximately £1.3 million. Last year there was a big push to reduce the number of interim and agency staff as can be seen in the chart above. So imagine my surprise when I saw a gainshare claim for £250,000 for "HR Agency Transfer". When I queried this payment I was told that "this relates to work undertaken by HR to convert agency workers onto permanent contracts thereby helping to reduce agency spend and stabilise workforce, which led to a cost reduction of circa £800k per annum".  So for the last four years Capita have claimed  millions in gainshare on agency costs as more and more agency staff are used and then they get another £250,000 gainshare for helping to convert those agency staff to back to full time employees. I have no confidence that the £800,000 saving figure is real, but as is the way with all gainshare payments, Capita put in a claim of forecast savings and then carry out a "true up" at the end of the year when the actual savings are reconciled against the initial claim. To me this just seems plain wrong, especially as part of the switch from agency to full time staff has been driven by HMRC's clampdown on IR35 tax avoidance which has forced a large number of interim staff across the public sector to change their employment status.

Example Two - Pile up the costs and still claim the saving
If you are a single person in a property you can apply for a single persons discount (SPD) of 25% on your council tax bill. Capita get a gainshare for reducing the number of people claiming this discount. What they can also claim is the costs of carrying out the work. In 2017/18 Capita submitted a gainshare bill for £174,117.77 for the SPD reduction. When I asked for the supporting evidence I was surprised.  The gainshare is calculated based on the "total payments collected above the baseline". This was £315,000. However, the cost of carrying out the work to achieve that saving was  £127,000  giving a net saving of  £188,000 on which we paid 25% gainshare, equivalent to £47,000. Now bear in mind that Capita can charge their staff out at consultancy rates as set out here to carry out this work and on which they also make a very sizeable mark up. So from an increased council tax income of £315,000, Barnet actually gets to keep just £138,000.

Examples Three/Four/Five - It's all about the budget
There are a number of gainshare claims which are all broadly similar. Capita ask what is the budget for a service.They then tender the service and where it come in below the budget, Capita take a gainshare on the difference.
One example is for Family Systemic Training. Capita asked for Barnet's budget which Barnet said was £30,000. Capita tendered the training and picked the lowest price bid at a price of £11,400. Capita said fantastic we have saved you £18,600 so with a gainshare of 31% they billed and were paid a gainshare of £5,766. So for a service that cost £11,400 we ended up paying £17,166. In my world that is plain wrong.
A similar situation arose when tendering a tree policy consultation. The council set a budget, there was a tender on the council's own etender portal, the bid came in much lower than the budget so Capita picked up 31% of the difference.
The third example of budget driven gainshare is on document storage. Previously archive boxes were stored at the archive section of the Mill Hill Depot which has now been flogged off for housing. Barnet House and NLBP are tight for space so Barnet needed to make use of an external storage provider. Capita, asked for Barnet's budget for storage and were told it was a round £500,000. Capita went to Stor-a-file who offered them a price forecast to be £359,296 over the next five years, including an initial free 6 month period. Capita said woohoo that's a saving of  £140k or £28,200 a year so we are entitled to £11,280 of that each year. In addition, they claimed (I believe incorrectly) an additional gainshare on the 6 month free period. In total the gainshare fees over the next five years is £68,370 just because an officer set the budget too high. So instead of paying £359,296 which is the actual cost the supplier charges, we are paying £427,666.
Maybe now you can understand why I compare this gainshare process to BBC Rogue Traders and why we must take back control of this money spinner from Capita.