Joint letter to CEO of Barnet Council from Barnet Bloggers - Capita “Not Minded”

At the Barnet Council Audit Committee on 1 May the External Auditor from BDO made some very worrying and serious statements about the controls systems in place. This follows a £2 million fraud last year, and pervasive problems with the pensions and payroll administration.

“You don’t have a particularly strong control environment”, the auditor reported, and then stated that Capita were “not minded” to provide assurance over systems running processes on Barnet Council’s behalf.

This is an astonishing response from Capita.

Responsibility for assurance of these systems, run from Capita’s offices around the United Kingdom, falls to Barnet Council’s Internal Audit Team.

As the External Auditor made clear, the Internal Audit team is doing good work “but it doesn’t give you that level of assurance that you would expect with so much of the service outsourced”.

Given that Capita provide so many of Barnet’s back office systems this is a very serious situation, especially as the external auditor raised this problem two years ago, before the £2 million fraud was discovered.

As bloggers who have closely followed and reported the story of Barnet’s partnership with Capita, we are deeply concerned about this situation and alarmed that neither the auditor nor committee members were aware that assurance of Capita’s systems is a contractual requirement, and not something that could be provided at their discretion.

We ask the following questions of the Council:

·             Why were the audit committee not made aware of the auditor’s concerns when they were raised two years ago?

·             Why are Capita “not minded” to provide assurance over their systems when the contract appears to indicate that they must provide that assurance?

·             Why did Grant Thornton not pick this matter up when they were the Council’s External Auditors or as part of their contract review following the fraud?

·             Why have the Council’s contract monitoring officers not identified this problem before now?

·             If BDO are saying the Council does not have a strong control environment, what are the risks of another fraud or systems failure happening?

And finally,

·             How can Capita continue to retain the confidence of the Council without such assurances?

We ask that the Council arranges for a forensic review/audit of both Capita contracts to address the contractual failures raised by the External Auditor as a matter of the utmost urgency, to be paid for by Capita, before any further decisions are made on what services Capita will continue to provide. Failure to do so can only have the most serious consequences for the financial security of this borough, and the well being of all residents.

Signed:

Derek Dishman

John Dix

Theresa Musgrove

Roger Tichborne

-------------------------------------------------------------------------------------------------------------------------------

The Barnet Eye was instrumental in setting up the Kick Out Capita Capita and I put together this song and video with The False Dots to launch the #KickOutCapita Campaign. 

The Tail Wagging the Dog: Capita and Barnet - Joint blog by the Barnet Bloggers

With credit to John Darkow

Barnet's Conservative led administration has never been so divided.

Since the local elections last May, new members of the Tory group have been confronted with the legacy of their longer serving colleagues’ failure in office: the crisis over the Capita contracts, a massive budget deficit, and the exposure of fraud by a Capita manager, enabled by a failure to put in place any adequate system of financial controls.

Members of the previous administration appear not to have grasped the seriousness of the situation, or at least are reluctant to acknowledge the extent of the problems facing this borough. 

After receiving payment of a paltry £4 million from Capita in ‘compensation’, Tory councillors have now voted to delay any immediate severance of ties, in favour of a long drawn out process of assessment, during which time Capita will continue its contractual partnership with this borough, and our services will continue to be left in their control. 

We believe this is quite wrong, and so, it seems, do some Tory members.

At last week's Audit meeting, for example, it was revealed that BDO, the authority's external auditors, are now obliged to visit Capita's offices in Darlington, where their administration of Barnet's Local Government Pension Scheme is based. This extra work will incur an additional charge on top of the audit fee. Capita continue to administer this scheme, despite very serious concerns about standards of performance. 

Also at last week's Audit meeting, there was discussion about why new systems that should have been implemented following the £2 million fraud by a Capita employee were not in use. 

Grant Thornton, Internal Audit, Senior Council Officers and Capita’s Partnership Manager in Barnet had all agreed these control systems should be implemented immediately. A Capita employee, however, based in Chichester, where these payments are handled, had taken it upon themselves not to implement this critical system, a failing only identified when Internal Audit carried out a follow up check. 

At least one of the Tory members had grave misgivings about the continuing partnership with Capita. 

Councillor for Hale, Laithe Jajeh, said at the meeting, “I find it really worrying that someone from Capita (can do this)..it’s almost the tail wagging the dog …’ He also commented on twitter that assurance from Capita on implementation of Grant Thorntons’ recommendations was ‘not reassuring whatsoever …’ 

Assurance from Capita on implementation of GT recommendations this evening was not reassuring whatsoever. Cllrs have the ability to scrutinise in a way that officers cannot. Pleased to say there is cross party agreement on the audit committee that things are not good enough atm

— Laithe jajeh (@Laithe_Jajeh) January 31, 2019

He added that Capita’s performance was not good enough and that he was not confident that promised dates for completion would be met.

Implementation of GT recommendation 15 was not completed due to a Capita employee instructing its’ staff not to undertake the instruction to do so from Cllrs, officers etc. As I put it to the Chair this evening, the tail is wagging the dog. Absolutely not good enough from Capita

— Laithe jajeh (@Laithe_Jajeh) January 31, 2019

 

At a further point in the audit meeting it was identified that 51% of the internal audit recommendations were not completed, the majority of which were the responsibility of Capita. Labour councillor Alison Moore suggested that such a high level of actions not implemented was a sign of an unhealthy organisation. The Head of Assurance said it was a very serious matter from the officers’ perspective. 

The Committee Chairman wanted to take a ‘positive’ view of the situation and suggested that we do not look at criticisms. There was a clear consensus, however, that Councillors, both Conservative and Labour, were not satisfied. 

At last there is an acknowledgement, at least from councillors who were not involved with the original outsourcing exercise, that the partnership with Capita may not be the great panacea we were promised, under the lure of ‘Better services for less money’.

We are facing a review of the contract in February, yet there is a very real concern that decisions have already been made. 

The dispersed structure of the contract, with Capita offices situated all around the country, makes it hard to implement change, hard to control, and hard to monitor. Different reporting lines in different organisations mean that it is difficult to pin down responsibility for actions or inaction. This exacerbates and complicates the failure in accountability between the management of local services, and the local community itself.

We call upon the council to make the outsourcing review as open and unbiased as possible, held in public, with full and meaningful consultation with residents - and with key roles for some of the new Conservative members such as Cllr Jajeh, and Cllr Prager, who seem to have a more clear sighted view of Capita’s performance - and we urge all members to look at how quickly services can be brought back to Barnet, where they can be properly managed, monitored and controlled. 

Derek Dishman

John Dix

Theresa Musgrove

Roger Tichborne

--------------------------------------------------------------------------------------------------------
The Barnet Eye adds - 
This blog is a joint statement, co written and agreed by all four Barnet Bloggers. We urge all Barnet Councillors to take note. The Barnet bloggers hae consistently warned of the risks to the finances of the Borough of Barnet since the One Barnet program was first conceived in 2008. Sadly we have been proven right on all of the concerns we raised. The time has come for the administration to finally accept that this whole scheme has been an unmitigated disaster and pull the plug on it.

Barnet Libraries Consultation: A Sham A Joint Letter from the Barnet Bloggers to the Leader of Barnet Council

Barnet Bloggers are appalled by reported plans to outsource libraries and make them available to commercial exploitation to companies such as Starbucks and Waterstones. The real purpose of proposals to cut and shut libraries in Barnet is now clear.

In April 2013, a High Court ruling found that Barnet Council had failed in its obligation properly to consult residents over the imposition of the whole scale privatisation of local public services, known then as ‘One Barnet’.

The Judicial Review which had reached this conclusion found that legal challenge had been brought too late, and therefore the two massive contracts with Capita, agreed by the Conservative administration, are now in place for a period of at least ten years.

After narrowly being returned to power the new administration has, as predicted, rushed ahead with new plans to outsource most of the remaining services, at the same time as launching plans to impose devastating cuts in budget.

As a result, we now face devastating plans to slash the funding of our library service by a staggering 60%, a disproportionate and punitive amount which is clearly agreed as a means of preparing the argument for yet another act of privatisation.

Councillors have been presented with a report with three equally damaging options for the future of Barnet Libraries, and residents encouraged to take part in what we believe to be a deeply flawed and subjective consultation process, one which an independent report has described as not fit for purpose:

https://www.scribd.com/doc/253017634/Topline-Findings-From-Research-Into-Barnet-Council-s-Library-Reforms

Topline Findings From Research Into Barnet Council's Library Reforms by MisterMustard

Now we are faced with new information which, if true, would suggest that far from learning the lessons of the Judicial Review, the authority’s latest consultation process, as well as being deliberately designed to minimise opposition to the three options, is itself a complete irrelevance, and that the outcome of the council’s consideration of the three options is already agreed in principle, if not in detail.

And if this is dialogue is typical of the way in which potential business partners negotiate with the authority, it would also raise serious and wider questions over the integrity of the procurement process in Barnet, past and present.

http://wwwbrokenbarnet.blogspot.co.uk/2015/01/exclusive-so-others-can-get-cut-of.html

 

Whatever the opinions of residents, it seems that there will be closure and sale of library buildings, and the outsourcing of our library service, engineered so as to provide opportunities for commercial exploitation by private contractors.

Such an outcome would be simply unacceptable, and indeed would be an unlawful decision taken in complete disregard of the democratic process.

We ask Councillor Richard Cornelius, leader of the Conservative administration, immediately to halt the discredited consultation currently in place, remove the library proposals from the budget cuts about to be imposed, and to launch an independent investigation into the alleged subversion of the due process of democratic engagement that should decide the governance of our borough, and hold the authority to account in a way that is fair, and transparent.

Derek Dishman

John Dix

Theresa Musgrove

Roger Tichborne