The Road to Hell, or: The Direction of Travel - another Audit meeting

The direction of travel: where we are now


As anyone who has followed the course of events here in Broken Barnet over the last year or so will know, in the aftermath of the MetPro scandal, the state of procurement, contractual procedures and other financial systems used by our hapless council were found to be in a state of almost total collapse, with no control over the management of the administration's commercial relationships with private service providers. Many millions of tax payers' money has been paid to these companies without contracts, tendering processes, or proper payment arrangements. Remember the One Barnet motto? Better services for less money? Just tell me, Mr Walkley, and members of the Tory Cabinet - how the fuck would you know?

The scale of the incompetence uncovered by the Metpro audit is hard to explain: an undertaking to assess the number of irregular relationships was made last year, but as consequent events have shown, it really would have been much simpler to have compiled a list of arrangements which were properly compliant. This list, Mrs Angry imagines, could have been written on the back of a used envelope. Probably a used brown envelope, rescued from the back of someone's trouser pocket.

Over the last year, the Barnet bloggers have continued to point out numbers of non compliant contracts still being used by Barnet Council, and still it goes on - you may remember that Mrs Angry asked questions about this very subject at a Cabinet Resources meeting only the other week, at which our Tory councillors approved the necessary waivers needed to continue some of these cosy irregular arrangements - why? Because to sort the mess out would endanger the speedy progress of the £1 billion massive outsourcing scam which is being imposed on this borough.

In case you do not understand this programme, it means that every service the council provides will be handed over to global companies like BT or Capita to make profit from. This means services ranging from care of your disabled child, your elderly mother, or perhaps, as in my case, your deceased relatives in Hendon Cemetery.

Do I sound angry? I am really angry, for once - no joking.

You might reasonably think, I would suggest, that a senior management team and political leadership which has allowed the procurement mess to occur and has singularly failed to put it right in over a year simply is incapable of overseeing the sell off of all our council services to the private sector. And if you thought that, you would be right.

At last week's Full Council meeting, Mrs Angry was struck by a more than usually evident display of exasperation by Libdem councillor Lord Palmer, who twice expressed anger over the council's clear lack of committment to complying properly with its duties in relation to procurement and the audit process. Pretty strong, coming from the man who is in fact, Chair of the Audit Committee.

There is another Barnet Audit Committee meeting tonight, and the contents of the reports going to the meeting explain why Monroe Palmer is feeling quite so exasperated.

Mr Reasonable has written about the items for discussion in some detail here and Mrs Angry has taken a look at the agenda too.

Look at the list of services which still have limited assurance - including parking, contract management, libraries and facilities management.

Contract management officers, for example, have still not received management training. As we learn:

• All officers interviewed confirmed that they had not received contract management training in the past two years;

• Officers queried about contract variations were unclear about the specific Contract Procedure Rules (CPR) requirements for variations confirming a need for development / training in this area.

• Officers interviewed for 5 of 6 contracts confirmed the lack of a formal contract risk log, documenting risks relating to contractor delivery and performance. This was consistent with a review of the JCAD risk register (the Council’s risk management system) which did not consistently reflect risks relating to performance and delivery by therelevant contractor. In particular, there was no documented risk in JCAD for review and assessment linked to the
decision to cease monthly progress meetings (including KPI discussion) for the one contractor with an annual value of £30m.

• Officers interviewed for 5 of the 6 contracts confirmed that there were no formal documented business continuity plans to address delivery failure by the contractor (although some officers stated that informal business continuity arrangements existed)

• There was not always formal record of meetings held reflecting KPI output and discussions, and resulting actions that were agreed within the meetings;

• The management and the officer responsible for the administration of the EPR contracts register confirmed that central EPR processes for identifying contract management arrangements in the contracts register and reviewing for compliance were planned but had not been implemented;

• Central EPR processes for using the contracts register for the timely assistance of contract managers in initiating procurement for terminating contracts were planned but had not been developed, this had however been partly mitigated by the Council-wide work on the central contracts register and Forward Plan that resulted;

• The documentation of formal procedures/protocols for the administration of the EPR contracts register was planned but had not been completed;

• Arrangements for identifying variations to contracts needed to be developed and implemented; and

• Instances where noted where purchase orders were not raised prior to the invoice.

What else?

Oh good news, they are going to shut the stable door now that the horses have safely bolted to pastures new, and introduce a bribery policy. Good, well done.

Erm - a few housekeeping issues ... someone forgot to pay the rent. For the council. At NLBP - for some of the of the offices they use.

Or, oh dear, sign the lease.

Easily done.

Priority 1 recommendations
Recommendation

Management should liaise with the leaseholder to authorise and sign the lease for Building 1 Lower Ground Floor.

Management should review all leases to identify any unbilled amounts, and liaise with the leaseholder to calculate a final amount payable.

ManagementResponses
and agreed action dates

Management Response
All necessary authorities are now in place for Officers to complete the outstanding lease.
To be implemented by June 2012

Good idea, says Mrs Angry. Or: Mr Walkley, Mr Travers and Mr Cooper could all hold hands hide behind the sofa when the rent man comes calling.

Except, ha ha, don't be silly, Mrs Angry: as the leaseholders are the Comer Brothers, no need to worry. They are good landlords, as we know.

What else ... oh dear, Councillor Coleman, yet again your relentless drive for efficiency is slipping up over the implementation of your popular new parking scheme: look here -

• There is not currently a formal service level agreement between the Customer Service Organisation (CSO) and the Parking Service.

• Within our audit sample there were instances where the daily cash-up reconciliation were not independently checked and evidenced as such.

• There are currently unexplained differences between the parking system and SAP income reconciliations which have not been followed up promptly or resolved.

Unexplained differences? Dear me.

Perhaps the most serious observation from these reports is this conclusion on the subject of procurement controls:

A further five medium priority issues were noted in the work performed against the Procurement Controls and Monitoring Action Plan. These are summarised below:

• New contracts: 20% of our sample of new contracts tested could not be verified as compliant with CPRs. This was because the contracts could not be obtained/located.

• Existing contracts: 10% of our sample of contracts tested were still non-compliant, despite being recorded as compliant. Additionally, 80% of contracts within our sample were waived in order to become compliant. Whilst the option to waive is in accordance with the CPRs, this should be used as an exception to the rule; the Council should consider whether the CPRs provide the necessary framework to enable compliance, however training should start to address knowledge gaps across services.

• New vendors: In 80% of the sample of cases we tested there was not an appropriate level of
authorisation evidenced and recorded on the new vendor form. Of these, 62% were not authorised through the correct form, rather this was achieved by email.

• Corporate Oversight: There are limitations with the reporting in place for the completeness of the contracts register, meaning management cannot easily assess their data spend for the current financial year, it currently covers 3 year historical spend but doesn’t indicate where there is current spend. Additionally, there are still some contracts not added to the corporate repository for contracts without valid reasons.


So, there you go.

Apart from that, Mr Paul Hughes, of Grant Thornton, my pen twiddling external auditor friend, everything in the Garden is fecking wonderful, as usual.

Any comments?

Probably not.

Mr Reasonable has submitted two questions to the committee tonight. One is addressed to the Chair himself:

ITEM 16 - Internal Audit Report Contract Procedure Rules – April 2012

2. As Audit Committee Chairman do you understand that some residents will be shocked at the
continuing problems with Contract Management, that after 12 months this still only receives a
limited assurance opinion and what actions are open to you as Committee Chairman to ensure
that in 12 months time we are not faced with yet another limited assurance opinion?

Response

The Audit Committee have been monitoring improvement within Procurement since the Internal Audit Annual Report as far back as June 2011. Through-out that period it has been reported through internal audit and management that there has been progress against those recommendations raised. The direction of travel has continued to improve, however it is recognised that the time originally estimated to affect change in culture was understated. As the Committee has accepted the action plan as being adequate to address the concerns raised in June 2011 we welcome the Council continuing its improvement work, however we ask that further satisfactory assurances are obtained for those ‘amber’ ratings for the June 2012 Audit Committee.

So as Committee Chairman I cannot ensure that these procurement problems will not reoccur. My role and the role of this Committee is to highlight problems and promote solutions to those problems. Our role is not the administration of Barnet Council, nor are we its Public Relations officers.

The 'direction of travel' is a phrase which recurrs throughout these council reports. In One Barnet speak it refers to the uncomfortable fact that this council not only does not know where it is going, it has no idea where it is now, or where it has been in the past. In short, it does not know its arse from its elbow, and cares even less.

It is clear that as an opposition councillor, Palmer feels a deep sense of frustration and no doubt some fury over the continuing mess illustrated by the findings of these reports. As he says, his role and his sphere of influence is limited. It is the responsibility of the senior management team, and, ultimately - in theory anyway - the Tory leadership to get a grip on this appalling state of affairs, once and for all. Are they capable of doing so? Do they even want to?

As a report revealed yesterday see here Barnet Council is now top of the national list for highly paid senior council officers. Chief Executive Nick Walkley earns a cool £200,000 plus £50,000 in pension payments, and the man in charge of our finances, deputy CEO Andrew 'Black Hole' Travers earnt £206,000 last year.

Do you, citizens of Broken Barnet, think that they deserve such high reward, in the light of what we read in these reports? Do you think that this senior management team is capable of overseeing a billion pounds procurement package, when they have still not sorted out the mess of council procurement that they had not even noticed, until the Barnet bloggers pointed it out to them?

Do you trust the competence and integrity of the Tory councillors who are sitting back and allowing this situation to continue?

If you are happy with the way things are now, here in Broken Barnet, you will no doubt be flocking to the polling stations in a week's time to register your support for Brian Coleman and the Conservative candidates on the GLA.

If you have any regard for the future of this borough, however, you will be supporting Andrew Dismore next Thursday, kicking Brian Coleman out of his seat, and sending a clear message to the treacherous fools running this council: we have had enough, and we are not putting up with it anymore.