Bonfire of the Quangos

Recent news that the Audit Commission is to be axed is an interesting one for Nottingham.

Given the council's necessarily close relationship with the Commission you might have expected our political leaders to have felt the need for some comment on its planned demise. After all they're not normally shy on criticising the new government's policies, JoCo was quite vocal on elected mayors, the budget and the scrapping of EMDA. But not a peep about the Audit Commission.

Of course, NCC has always had a somewhat difficult relationship with the Audit Commission. There was the Public Interest Report into the mess at Nottingham City Homes, none too flattering corporate inspection reports followed by a slap on the wrist for dishonestly spinning the findings of those Commission assessments.

Even the bizarre love affair between the Commission and the Housing Benefits service seems to have cooled. Recently the Commission caught Housing Benefits out for having overclaimed their subsidy to the tune of £2m. Now, after happily accepting its judgment when awarding them 4 star ratings HB are now challenging the Commission's assessment of the level of overclaim, reckoning it to be out by a factor of nearly 5 (see 'Housing and Council Tax Benefit Subsidy Claim 2008/09' p23 of this document)-

"The housing benefit and council tax benefit subsidy claim 2008/09 was qualified by the Audit Commission. Their qualification letter extrapolated financial errors found in the claim to calculate that there was potential for the subsidy claim to be overstated by £2.1m. The DWP has since written to the City Council requiring a response to the qualification letter...Additional work has been undertaken to challenge the calculation of the potential impact of the errors that could reduce the adjustment of subsidy to £0.430m, subject to agreement by the DWP. In summary the City Council is challenging some of the statistical extrapolation calculations used to derive the final figure. "

So, perhaps NCC isn't really that upset about the loss of the Audit Commission after all. And their smiles no doubt widened when the alternative of allowing councils to appoint their own private sector auditors was announced.

You see, NCC is known for sending quite a lot of business to private sector consultants, spending nearly 9% of all staffing costs on them. Now, clearly some of this is spent on the Harold Tinworths and Bill Trattles types, one-man-band former local government bods who set up in business with what are essentially a series of temporary jobs. However, it also includes big firms like PricewaterhouseCoopers who NCC has a long and cosy relationship with. Well, as luck would have it, PwC can provide accountancy services as well!

Now lets imagine a scenario where PwC as auditors are charged with assessing the VFM of a decision to outsource a service or award a contract to PwC, you're not going to get an entirely independent viewpoint are you? What you probably will get is the answer you want and have paid to hear. That will be right up JoCo and the gang's street.

Another issue that bodes badly for us the taxpayer is that these big accountancy/outsourcing firms don't exactly have sparkling records of brilliance in the projects they have undertaken, a lack of talent they will probably bring to public sector auditing.

So incompetence and an in-built conflict of interest. Just what councils need.

In a related matter, have a read of this article by Johann Hari in the Indy on the pernicious effect of management consultants on the organisations they prey on.

(Post updated with links 21/8/10)

Let's Throw Away Some MORE Money

Well, we have a computer again although I'm seriously thinking of starting a 'Curry's Warranty Repair LOLs' blog. Have a look at my Twitter stream for an idea of the absolute shitness of these people.

Anyway, to business as there's quite a bit of catching up to do. We'll start small.

Last October I wrote about the decision to pay PricewaterhouseCoopers to provide a temporary Head of Service for Neighbourhood Regeneration at a massively inflated cost.

Well, it seems that there is a similar arrangement for provision of a temporary Head of City Services, although I don't know which of the 'framework interim management companies' it is this time although I'd bet £1.50 of my own money that it's PwC.

Bizarrely, the person they have provided is a consultant themselves called Phil Matley of PPM Consultancy.

So NCC has in fact employed a consultant to find them a consultant. Madness.

Anyway, finally the penny has dropped and somebody has realised that NCC might save a bit of money by contracting with Mr Matley directly, although they don't seem to want to admit how much was being paid before and how much was being creamed off by a profiteering private sector corporate robber baron will be saved by the new arrangements.

Now why didn't they think of doing that in the first place?

Another Day, Another 'Cash to PwC' Story...

I sometimes wonder if NCC is keeping PwC in profit single handedly.

Apparently, the Head of Service for Neighbourhood Regeneration at NCC has left/is leaving. Apparently it's absolutely VITAL that a replacement is found immediately because of all the high profile projects the previous postholder was leading on.

So, presumably the previous incumbent gave at least two months notice of leaving, due to the urgency recruitment got underway quickly, advert out, say, after a month, interviews approximately six weeks later, new person has to give notice on their current job, vacancy is open for three months max. Somebody acts up in the meantime, after all there is bound to be somebody who has been closely involved in at least some of these vital projects no?

No. That's not the Nottingham City Council way. What you do is go straight to old mates PricewaterhouseCoopers and get them to supply somebody. Maximum of 22 weeks mind, we don't want to go mad. After all that will only cost us £68,000.

Uh what? £68k for 22 weeks? An equivalent cost of £161k a year? You serious?

A Head of Service is not a particularly senior manager, they normally report to a Director, who reports to a Corporate Director who in turn reports to the Chief Executive (the lovable JoTo). So what's referred to as '4th tier' then, a middle manager. Not normally the level of post whose loss causes the wheels to fall off the wagon, even though NCC's wheels are mostly held on with chewing gum.

Oh look here's a clue as to what might be going on. In the box for comments from human resources we find

"It is understood that the person identified, while known to the Director, has been identified by PwC based on..." (my emphasis).

When in doubt, get one of your mates in, THAT'S the NCC way. In return you've got somebody putting a good word in should you find yourself looking for alternative employment at a 'leading' consultancy firm sometime in the future.

Update; comment under 'Sneaky' suggests that using consultants in this way is to get round the recruitment freeze due to the upcoming redundancies. Makes sense. The analysis that is, not the recruitment freeze...

Sneaky

I often write about NCC's prolific use of consultants and generally like to mention how much cash said consultant's trouser each time.

However, they've found a new trick to stop me doing this. Although they have to report a decision to use a firm of consultants they are hiding behind their 'framework agreement' with PricewaterhouseCoopers in order to avoid disclosing the cost of each project. See this decision notice to use PwC for a review of business support.

Ah yes. This was in the local media a while back but I forgot to mention that NCC spends 8.7% of its staffing budget on consultants (approx £12.1m), the highest proportion in Nottinghamshire. It also spends 7.1% of the staff budget on agency workers.

See this report from UNISON for more details.

Kerchingagain

There's nothing like helping out old buddies eh? That warm feeling of familiarity, mutual backscratching etc and NCC is no different.

Old pals Invigor8, whose name is more reminiscent of a boy band than a management consultancy, have got the job training human resources about competence. And believe me, someone needs to.

If you're a regular reader you'll remember that we last heard from Invigor8 when they were named as NCC's latest 'culture' consultants and we made one or two snide remarks about their apparent obedience and ability to provide the right answers. Purely in the spirit of satire obv.

This time they've got the job under special procedures allowing the normal financial regulations to be bypassed, following the portfolio decision made by Cllr Chapman. They'll be getting another £15k for this. Hmmm...

In another blast from the past. PricewaterhouseCoopers make a welcome return to conduct a review of the NCC's internal audit procedures.

I last mentioned Internal Audit when they confirmed many of my criticisms of the Housing Benefits service, albeit a bit late. Housing Benefits are one of NCC's bright shining stars because they are the most successful at hiding how shit they are from the Audit Commission, so its perhaps not so surprising that the spotlight has fallen on anybody who blows the gaff on them.

This decision appears to have been made under a 'framework agreement' agreed by the Executive Board in November 2008. I'd like to have a look at what that entails but unfortunately I can't find the minutes anywhere so if anybody can help...?

Whatever it involves it appears that individual projects are subject to the normal decision making rules, this time via yet another portfolio decision from Cllr Chapman.

Anyway the costs. PwC Partner Richard Bacon charges £2,142 per day for his time, Principal Consultant Chris Dickens gets £1,533 per day and the two Senior Consultants get £1,350 per day. Bringing up the rear is the Junior Consultant (special responsibilities, fetching sandwiches from Pret, coffee from Starbucks) on £315 per day. Nice work if you can get it.

In all PwC expect to be paid £14,217 for a total of 11.5 person days work, not including expenses which are capped at 10% or £1,422. As well as the coffee and sarnies that should cover them for a couple of Easyrider passes and a box of biros.

We Pays Our Money...Or Rather JoCo Does

Days after reports of Nottingham City Council overspending by £3.4m (it was actually formally announced at the last Executive Board meeting), we hear that NCC has decided to hand over £30k to PricewaterhouseCoopers (as we're legally obliged to write it, fuck knows why) for

"a report identifying the financial costs and savings of providing a range of services through a trust or Non Profit Distributing Organisation."

This is just the first phase of the investigation, if it concludes positively then a 'detailed business assessment' will be undertaken. How much that will cost isn't mentioned.

I touched on this briefly before as the intention to look into these alternative management arrangements was mentioned in the Budget. The whole idea baffles me as I can't for the life of me see any real prospect of saving any money. I'm also concerned that NCC's first step is to chuck a load of cash at some accountants when surely the expertise in this sort of thing already exists either in other authorities or the LGA. Its not as if it's never been done before, a quick search found two general reports on the issue (here and here if you fancy some background reading), the second of which certainly has an ideological rather then pragmatic flavour to it.

So why haven't you heard of this elsewhere? Well it's one of those 'portfolio' decisions where one of the portfolio holders on the Executive Board gets to decide things without discussing it with anybody. I'm not sure of what exactly makes a decision a 'portfolio' decision* as opposed to one that's got to be discussed with other people but I presume the process is for minor decisions of relatively low expenditure, although clearly £30k is quite a bit.

The last one of these 'portfolio' decisions that I wrote about was the one to pay Carl Froch £1000 an hour to have a pic of Robin Hood on his dressing gown and open a few supermarkets. So I'm pleased to see that he will be earning some of that money next Monday.

Mr Froch will be in the Market Square for £3,000 worth of his time promoting the 'Proud of You' awards, another chance to vote for your favourite bin man or whatever.

Actually we could have some fun with these as it includes a 'Champion of the Environment' award. Anybody know the name of the person behind the abortive Ratcliffe power station protest?

*Actually I've now found the definition of a portfolio decision (or Executive Portfolio to give its full title), it's on page 23 of this document.