I had asked 34 questions and fellow blogger Roger Tichborne had asked another three yet most of the answers were crafted to tell us nothing about what we had asked. Mrs Angry and Mr Mustard were also there to document the goings on but I think all four bloggers found the meeting entirely unsatisfactory.
Residents need to be aware of what a financial mess Barnet Council are in but the use of words in the reports discussed last night would have created a different perspective. Overspends were "reduced" not by cutting the amount spent but by topping up from reserves. In total last year we used £21 million from reserves to balance the budget, something which clearly isn't sustainable.
One of the serious problems occurred in the Capita run joint venture Re. Last year the external auditor identified a problem with £4.6 million of guaranteed income from Re that had not been paid. At that Audit meeting the S151 Officer who is the head of finance reassured everyone that the money would be recoverable. I had my doubts when the Capita partnership manager called the amount "disputed". I asked again about this money and whether it was going to be recovered at the performance and contract management committee on 27 February just 4 weeks before year end. The reply from the council then was “The benefit to the council of additional income under the RE contract is guaranteed and does not, therefore, impact on RE’s budget performance” Four weeks later at year end and following legal advice they decided that it wasn't recoverable and it was written off. I don't doubt that writing it off is the right thing to do but what makes me so cross is that for nine months the council was in denial that it was a problem. We were also told that another £2.6 million of contractual liability had to be paid to Re and that it been "omitted from the forecast in error" but corrected before year end. Well technically that may be true but it wasn't corrected 4 weeks before year end. This tells me two things. One: take everything Barnet says with a massive pinch of salt and Two: we have a contract with Re which seems unenforceable and is costing Barnet a fortune. Set out below shows the impact of these late amendments on the accounts.
On gainshare, the nice little earner for Capita, we were promised back in January that this would be dealt with by this committee. Six months on and it is now being passed around a number of committees like a toxic pass the parcel. In my previous blog I gave one example of the sleight of hand which is the gainshare process. However the argument from Barnet Tories has always been that we may pay Capita for gainshare but we are saving money. I have always disputed this and last night I asked a question as to whether the savings were real. The wording of the response tells you everything you need to know about this process which assesses "contractually compliant savings". What that means is that who ever wrote the contract made it very easy for Capita to claim gainshare whether or not they provided any added value to the procurement process. I have a very serious example of where Capita have claimed a gainshare which I suspect most people will find morally wrong but because the contract allowed it Capita have claimed it and Barnet have paid it.
On the rest of the CSG contract Capita are failing on a number of key performance indicators (KPIs) but it doesn't matter because it doesn't count as a contract fail.
At the end of last night's meeting I felt that I had just wasted 2 hours of my life. A meeting of complacency, and casual indifference with few questions from Tory members. Mr Mustard's tweet summed it up:
I didn't get any feeling of urgency about dealing with the massive annual overspend.— Mr Mustard (@_MrMustard) July 2, 2018
Set out below is the speech I gave, sadly falling on deaf ears.
"Narrative too positive –
needs to reflect true picture"
"Doesn’t highlight use of
reserves. With this the £4 million overspend changes to an underlying variation
of £8.5 million"
"CSG narrative not full
picture been told the true picture is
much higher overspend"
"Family services net variance
wrong"
"Satisfaction with website
artificially inflated especially planning"
"Figures don’t match those
published by NHS digital"
"Problems with payments
Council owed £2 million"
Not my words but those of
the Strategic Commission Board on 6 February discussing papers coming to this
committee. I asked Richard Cornelius if he was aware of these issues before the
year end – he said no he wasn’t but that they should have been reported.
You as a committee can only
scrutinise what you are given and if you aren’t given a clear picture you can’t
make the right decisions. I do not think you got a clear picture then and I am
worried you aren’t getting a clear picture now. I’ve submitted 34 questions yet
many of the answers show an organisation in denial, scared to be honest. We are
in a financial mess and you all need to be honest as to how it is going to be
addressed.
Back in February I asked you
a specific question about the Re guaranteed income and you said “The benefit to
the council of additional income under the RE contract is guaranteed and does
not, therefore, impact on RE’s budget performance. Performance against the
guarantee will be reconciled and published as part of the annual accounts
process”. Yet now we find that was wrong.
In January former Audit
Committee Chair Hugh Rayner said they were referring Gainshare to this
committee. I asked about this in February and you said "Both referrals to PCM
committee from Audit Committee (on benefits realisation and gainshare) will be
formally noted at this PCM committee, and then scheduled into the forward plan.
Now you are saying that it has been pushed to Policy and Resources and will be
brought to the appropriate committee in due course". This smacks of pass the
parcel.
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