One Barnet - 447,197 Reasons to Pull the Plug

Barnet's supplier payments for September have just been released and yet again Barnet's Implementation Partner have submitted a huge bill. In September they billed £447,197.21. That is £22,360 every working day of September. Since January 2012 Agilisys have billed over £2.5 million, more in 9 months than Councillor were told in would cost over the entire three year contract. So far this contract alone has cost us £4.2 million and there are numerous other consultants and legal advisors who are merrily billing us with great delight.

Trowers & Hamlins, who are providing legal advice on One Barnet, have also billed £123,259.79 in September or £6,163 per day.  Oh, and welcome to new consultancy supplier Sticky Change Limited who were paid a rather modest £6,539.50 for some consultancy work for the commercial department.

Barnet Councillors keep saying there is no alternative to One Barnet. Frankly I cannot see how we can keep paying out such huge sums to consultants when the two outsourcing contracts still haven't been let. It's a bit like a gambler who, every time they lose their bet, double up on the next bet in the hope of winning back their losses. The council needs to go consultant cold turkey, break this costly addiction and start using common sense to make savings.

One Barnet Joint Venture - "There is a risk that the focus on commercial goals and development of new business can be at the cost of service delivery".

Someone kindly reminded me of a report published back in September 2010 when Barnet Council asked their expensive consultants to look at what would be the best structure for the One Barnet (FutureShape as it was still called then) project. You can read the report here. This is what they said about Joint Ventures which, on Friday, became the chosen option for Barnet:

Private Sector Joint Venture:

Price: Whilst capable of delivering a low price this would be a costly option to implement ‐ the joint
venture procurement being more complex than a straightforward partnering arrangement. Joint
ventures are best suited to situations where there is significant potential and appetite to develop
third party business.

Flexibility & risk: Where third party business is a more secondary goal it may be possible to build
many of the benefits that a JV can provide, such as gain sharing and a reasonable degree of flexibility,
into a more conventional partnership contract. It is likely to provide a good degree of flexibility due
to the control the Council could retain.

Performance: Whilst performance can be high in joint ventures there is a risk that the focus on
commercial goals and development of new business can be at the cost of service delivery.
Citizens & stakeholders: JVs have the potential to enshrine old operating assumptions, which can
limit the scope for transformation and therefore more radical change is less likely.

Pace: Due to the complexity in developing the arrangement this option is likely to take a relatively long time to implement.

Here is the Scoring Matrix they included in the report:

Note that Joint Venture scores lower than Strategic partnership or Incremental Partnership and only just ahead of a management buyout or consulting led solution.

It is also interesting to note that the outsourcing programme is now running 14 months behind schedule and has gone more than £1 million over budget on the consultancy costs.

The One Barnet programme is dead and the sooner Councillors accept it and start running the day to day services of the council cost effectively and efficiently the better for every single resident.

One Barnet Consultants - another £272k last month

The Barnet Council supplier payments for June are now out and once again Barnet's Implementation Partner, Agilisys, have done well. In June they billed £272,787.30 bringing their total invoices for the first six months of 2012 to £1.56 million.

Every single penny of that money is discretionary spend. It didn't have to be spent. There was a clear Officer/Cabinet decision to spend that money. Last month I thought their spend was slowing down as it was 'only' £165,575, but in June it is back to the levels we saw in January and February.

Cllr Cornelius, how much longer are you going to let the senior officers and your young but entirely inexperience cabinet colleague pull the wool over your eyes. This is a budget that is out of control and someone needs to get a grip. If you don't take any action a quarter of a million pounds every month is going to continue to be squandered on just one firm of consultants to give you a solution which 70% of local authority Chief Executives and senior officers believe reduces control and increases risk.

Off Payroll Public Sector Pay Arrangements - Barnet Bloggers Joint Statement

The subject of Town Hall Tax Dodging (a phrase coined by the Rt Hon Eric Pickles MP, Secretary of State for Communities and Local Government) is one of enormous interest to the Barnet bloggers, and we applaud the attention paid to this issue by the parliamentary Public Accounts Committee (chaired by the Rt Hon Margaret Hodge MP) which took place on Monday 16 July 2012. 

 

This investigation of the issue of tax avoidance by individuals in publicly funded posts came about following the disclosure by Westminster journalist David Hencke that Ed Lester, the head of the Student Loan Company, was being paid through a service company, and that there are similar arrangements on a very significant scale throughout the civil service and the wider public sector.

 

One witness before the committee was Carolyn Downs, the Chief Executive of the Local Government Association (LGA). She stated that the LGA had found only 13 examples of off-payroll public sector pay.

We know that this national figure of 13 is an understatement since the draft (i.e. unaudited) Annual Accounts of Barnet Council for 2011-2012 show that there are 14 such arrangements recorded as having been in place during the year for senior officers. 

 

Far from being a practice that is diminishing it is noted that in the previous year's accounts there were only 8 such arrangements.

 

The evidence to the committee was that these arrangements were used in the short-term. We can show that this is not true and that, on the contrary, these arrangements are used routinely for long term appointments.

In Barnet, one ‘interim’ post paid through a private company has lasted for more than three years. An appointment lasting over 3 years cannot be described as short-term. In addition, a Freedom of Information request has revealed that there have been no efforts to replace this individual with a permanent staff member.

Evidence to the committee also suggested that there was virtually no difference between the tax paid under PAYE or via a service company. That is to ignore two factors. If a service company is used certain expenses, such as travelling, can be reclaimed whereas an employee does not get tax relief for home to work travel costs. In addition, service companies are able to pay out their profits as dividends and National Insurance Contributions are not paid on those. The overall contribution to the Exchequer will be less if a service company is employed.

 

We look forward to the day when Barnet Council ensures that all its officers (employees) are treated equally and that all those people who receive their pay from the public purse recognise what Mrs Hodge referred to as a ‘moral duty’ to make their fair contribution to the taxes which contribute to the good of society.

We call on Nick Walkley, the Chief Executive of Barnet Council, to negotiate the return to the payroll of the officers concerned as this will reduce the penalties that will have to be paid as a consequence of the inevitable HM Revenue & Customs PAYE compliance visit.

 

We also look forward to following the evolution of this story in front of the Public Accounts Committee once the summer recess is over.

 

Derek Dishman

John Dix

Vicki Morris

Theresa Musgrove

Roger Tichborne

£98k for another interim manager at Barnet Council

Today's crop of Delegate Powers reports shows the appointment of an interim finance manager at a cost of £98,000. Interestingly, although the report is dated yesterday this is in fact a retrospective approval for someone who has been in post since 1 April this year. This interim finance manager will be working on the SAP Optimisation project. For those who aren't up with the jargon SAP is the giant computer system which helps run Barnet Council and which has so far cost over £23 million. On a day when some of the council staff are on strike for trying to protect front line jobs, it seems somewhat ironic that the council is appointing yet another highly paid 'interim' manager on this monster IT project. Perhaps if the council spent a bit less on all the expensive IT systems, consultants and interim managers (Chief financial officer £1,000 a day, Assistant Director HR £140k last year,to name but two) then they wouldn't be needing to make so many cuts to essential services.

Yet another consultant running Barnet Council

It has puzzled me for some time that Barnet Council's Head of HR is nether mentioned in the list of senior officers salaries nor mentioned in the supplier payments. Following the submission of a Freedom of Information request I can reveal that Jacquie McGeachie HR Consulting Limited was paid £140,803.28 in 2010/11.

I think it would be terribly helpful if all the senior officers who are paid as consultants were listed in the official list of senior officers salary that are included in the councils annual accounts. This is somethinmg I shall be taking uo with the Auditors, Grant Thornton when I meet them in a couple of weeks.

Another consultant - but is everything as it seems?

I noticed today a delegated powers report signed on 15th February 2011 authorising the use of a company called CCMPS ltd to fill the role of Assistant Director Commercial Assurance for the next 12 months. The report states that having searched for a new Assistant Director they have failed to recruit a suitable candidate so they have gone to a company CCMPS to supply a qualified consultant. "CCMPS Ltd. (consultancy) identified a professional with the skills, experience and commercial acumen required to lead delivery of the Council’s objectives in relation to commercial activity". This makes CCMPS sound like a big firm. However on closer scrutiny it transpires that this company was only formed in February 2010 and has yet to submit accounts. The directors of CCMPS are a Mr and Mrs Malyon. Now would that be Mr Chris Malyon who was the interim Assistant Director of Finance at Barnet Council from February 2010 and according to his linkedin profile has been the in the post of assistant Director Commercial Services (the one for which they are seeking authorisation) for last four months.

So to summarise the Commercial Director is seeking authorisation to appoint a consultant:

- who has already been working for the council since last February;

- has been in the post for which they are seeking authorisation for the last four months;

- who has identified himself as being the right man for the job;

- who will be at the council for the next year at a cost of £650 a day (£169,000 per annum).

The report states that any shortfall in the salary costs between the permanent post (£119,560 - £130,300 inc on costs) and the consultants cost will be met from "the Council’s Transformation Reserve as approved by the Chief Finance Officer" (another consultant).

The report concludes that, "After 12 months the Council will go through the necessary recruitment procedures to appoint permanently to the AD Commercial Assurance role".

Maybe I'm old fashioned but something here just doesn't seem right to me.