What should a list of payments look like ?

In the rest of the Country a list of payments looks like a list of payments but we are in One Barnet where things are different, and usually just plain wrong. Mr Mustard has obtained the guidance produced by the Local Government Group which you can find in full here and has extracted the most relevant parts for you from the 29 pages and will comment in red as usual.

1. Introduction

In June 2010, the Secretary of State for Communities and Local Government wrote to local authorities informing them they would have to publish expenditure on items over £500 by January 2011. This included tenders, contracts and actual payments.

This guide offers practical help on how to meet immediate targets and add the maximum value for local people ( including bloggers / armchair auditors ) and public services over the longer term.

2. Scope: what do you mean by “publishing expenditure data”?

For the purposes of this guide, ‘expenditure’ includes all:

· individual invoices

· grant payments

· expense payments

· other transactions over £500.

Expenditure also include:

· payments for goods and services

· grants to third-party providers

· grant in aid

· expenses ( not seen any of those listed, no payments to one B Coleman Esq )

· rent and policy-related lending

· credit notes over £500

· transactions with other public bodies.

You should exclude:

· transactions relating to income or the financing or underwriting of debt

· financing and investment expenditure

· payments made to Her Majesty’s Revenue and Customs (HMRC) for value added tax

(VAT), pay as you earn (PAYE) and National Insurance Contributions (NIC) or pensions ( none of the last 2 for the Chief Finance Officer anyway )

For the purposes of this guidance, the term ‘payments’ only applies to payments made directly from local authorities’ budgets. It does not include payments to schools, benefits payments etc.

So that it can be produced quickly, the published data should reflect how each item was originally recorded in financial systems. ( badly then )

click to enlarge and then back to return

3.1. Data content: which data should be published

We recommend that councils use a common approach and format for publishing the content of data. This will help users share and analyse data and, hopefully, it will also reduce additional requests and FOI questions. 

Authorities should provide content for eight minimum and eleven additional desirable fields as indicated in the template. The fields are designed to provide enough information for users to analyse the data, and link spending data to services and categories of spend.

We acknowledge that authorities have different systems and procedures in place for extracting data. Some authorities may not be able to match all the fields recommended here  ( especially if the name of the council begins with Ba )

Body

‘Body’ identifies the local authority

Description of services and purchase details

Service categorisation
This is the service that spends the money. Local authorities have different structures and undergo frequent organisational change. So we recommend using an acknowledged service classification for describing the service. This will allow comparisons to be made between service spend in different organisations.

The Service Reporting Code of Practice for Local Authorities (SeRCOP) replaces the Best Value Accounting Code of Practice (BVACoP) provided by the Chartered Institute of Public Finance & Accountancy (CIPFA).

CIPFA’s SeRCOP recommends an objective breakdown of services that can be used here. This is presented at two levels of hierarchy:
· Service – for example Adult social care 101
· Division – such as 'Older People (Aged 65 or over) Including Older Mentally Ill' (1002)– if
this level of detail is available.

A digit code has been added to the SeRCOP, which still includes the descriptive code used previously in the BVACOP. 

CIPFA codes must be used in expenditure returns to central government ( so you would expect that Barnet Council could easily publish this in their spending lists - not so )

Organisational unit

As well as mentioning the generic service area, you may also want to say which unit in the authority is responsible for spending the money. Naming the unit would make individual departments in the organisation more accountable. 

Expenditure categorisation

Spending must be clearly and consistently categorised so that users can easily compare the expenditure at different periods and between different local authorities. ( Barnet Council's is consistently inconsistent )

 

Most financial systems use an expenditure type or a code that describes the service or goods received. Categorisation may vary between different systems. 

Most commonly, the CIPFA SeRCOP subjective code (formerly BVACOP) or ‘Proclass categorisation’ is used. But some authorities use their own internal code. ( or none at all as Barnet Council )

CIPFA’s SeRCOP recommends a subjective breakdown of goods and services that can be used here. This is presented at two levels of hierarchy:
· groups – for example transport-related expenditure 503
· sub-groups – such as direct transport costs 5016 – if this level of detail is available.
A digital code has been added to the descriptive code to make it easier to link data. 

Organisations  that use SeRCOP should publish in the greatest detail possible.

The Proclass procurement classification system – which is widely used in local authority procurement systems – offers an alternative expenditure categorisation.

We recommend that local authorities, where possible, should publish whichever classification they can. 

All authorities should, however, publish a consistent purchase type. Where none of the above codes is available, an internal code – possibly the nominal code on the chart of accounts – should be added. ( Barnet Council = no published codes whatsoever )

Narrative

Some authorities may wish to add a narrative to describe services and goods received in more detail. This is optional. You may only wish to use a narrative to explain a payment in certain cases where you want to reduce future requests and enquiries. For example, you may want to indicate that the payment was for hiring equipment at a charity event.

Payment details

Transaction number

This should be the system transaction number for the payment held by the individual department.
This may be useful to the authority if there are any follow-up questions about an individual transaction.
The National Anti Fraud Network (NAFN) has advised us that invoice and order numbers should not be used, as they can be used for fraudulent claims.

Date

This is the date when the transaction took place. The date should ideally be the payment date that is recorded on your purchase or general ledger. ( Not, as is often the case in Barnet, the date when someone entered a goods received note into the system and sometimes the date on which two identical notes were entered )

If it is not possible to find the payment date, look first at the possibility of using the date the invoice was added to the system ( not used in Barnet )

Otherwise use the invoice date. ( Not in Barnet )
Using the date field should ensure that transactions are only disclosed once, and are consistently applied (Often twice in Barnet and then a balancing credit has to be entered)
If you are not using the payment date, make a note in the metadata of the date you are using and why it is not possible to use the payment date. ( Mr Mustard didn't see a note )

Amount in sterling

The amount disclosed is the amount recorded on the finance system for each individual transaction. The amount should be the net amount excluding recoverable value added tax (VAT).

Capital and revenue

The authority might wish to distinguish between different kinds of expenditure and provide additional classifications to promote transparency. For example: ‘Expenditure type: capital and revenue’. Ensure that spend is properly classified as being revenue or capital. ( There is lots of talk about transparency in Barnet but not much action ).

Supplier details

Details of the supplier should include:
· the name of the supplier ( remind Mr Mustard what it was? was it MetPro Emergency Response Ltd or MetPro Rapid Response Ltd? )
· a publicly available supplier identification number where available, for example a Companies House number or charity registration number. ( this does not happen in Barnet )

The name of the supplier should be as it appears on your vendor record. It should be written in full. ( A bold assumption that Barnet Council know the precise nature of their suppliers? )

Links to contracts and tender documents

The publication of expenditure data includes the publication of contracts and tenders. ( Oh dear oh dear oh dear - but Barnet Council don't know who they have contracts with do they ? )

It may be useful to provide a link to those contracts and tender documents, possibly through the transaction number. ( Why does Mr Mustard think that Barnet Council are going to find this difficult )

A guide for the publication of contracts and tenders is being developed and will be published soon. (Mr Mustard is looking forward to this a lot more than Barnet Council are - he wonders if "arrangements" will be recorded such as the £1.4m paid to MetPro and the verbal extensions to contracts like the one with Garfield Associates Ltd  )

3.3. How to process data before publication

Data will need to be processed before it is in a form that can be published. Processing includes:
· extracting data from the system and matching it to template headings
· coding data where necessary
· checking for inaccuracies ( see Mr Reasonable's blog where an entry for £258,153.96 has been shown twice. If entries for this amount are wrong what can you rely on ? nothing )

 · redacting data that is exempt from publication ( this has been overdone in Barnet! )
· internal review and sign-off ( whoever has been signing this off in the past has fudged the issue )
· converting it into an open format.

3.5. Publication

Once the data is in the right format, it should be published on your website. 

Wherever you publish the data, you should give further information and contact details to help those with enquiries. This will improve relationships with those using the data. It will also stop them having to go down more formal routes, such as issuing Freedom of Information (FOI) requests.

The more you explain your data, the fewer FOI requests you are likely to get that relate to it. ( Given the lack of accuracy in the published data there is no choice for armchair auditors but to make one FOI request after another )

For example, if you explain unusual or high-spend items, you will reduce criticism, suspicion and FOI requests. (unless of course the items you have spent on should be criticised)

Supplementary information

Authorities are also expected to start publishing new contract and procurement information from January 2011. ( Oh dear, Barnet Council are at least 7 months behind schedule. Mr Mustard wonders if that fact is related to the current state of procurement which is less than good )

All information linking procurement and accounts systems should also be published, so that spending can be linked to contracts and tenders.

Publishing the supplier list – matching it to the supplier ID – and the authority’s Chart of Accounts may help users make sense of the data. ( Mr Mustard seems to recall that Barnet Council don't even have unique supplier numbers. )

3.7. Timing

Ideally, data should be published each month, as soon as possible after the month ends and certainly no later than 30 days after. ( Barnet Council do release information on time but as it is inaccurate Mr Mustard would prefer that they issue the information late but accurately - although obviously on time and accurate would be the ideal but that doesn't exist in One Barnet )

Next in the document was a huge table which Mr Mustard has cut down for you to a more sensible size. He has also added the final column and populated it with an example from the June list of over £500 spending, being the first entry by reference number. 

Field	Field name	What is required	Mandatory or Desirable	Barnet Council example
1	Body name	Name of paying organisation	M	Barnet Council
2	Body	Unique organisation code	D	OOAC
3	Service Label	Service responsible for spending the money	M	Environment & Regeneration
4	Service code	The code which represents the service	M	Minimum requirement but not supplied by Barnet Council
5	Service division label	Division within the service	D	Environment & Operations
6	Service division code	The code which represents the division	D	Not used / supplied by Barnet Council
7	Organisational unit	Department responsible for spending the money	M	Minimum requirement but not supplied by Barnet Council
8	Expenditure Category	General heading which describes the nature of expenditure e.g. travel costs	M	Agency/Interim Hays
9	Expenditure code	The account code which represents the expenditure type	D	Not used / supplied by Barnet Council
10	CIPFA detailed expenditure type	Headings that describe the nature of expenditure in more detail	D	Not used / supplied by Barnet Council
11	CIPFA detailed expenditure code	The account code which represents the expenditure type	D	Not used / supplied by Barnet Council
12	Narrative	A description in words for the details of the transaction	D	Not used / supplied by Barnet Council
13	Date	The payment date as recorded in the purchase or general ledger	M	28/06/2011 (but this is not the date of payment! )
14	Transaction number	A unique reference number for each individual expenditure transaction	M	100826890
15	Net Amount	The actual value of the transaction	M	677.47
16	Capital & revenue	A description of whether the expenditure is capital or revenue	D	Not supplied by Barnet Council
17	Supplier name	The full name of the supplier	M	Capita Resourcing Ltd
18	Supplier ID	An ID of the supplier	D	Not used / supplied by Barnet Council
19	Contract ID	Internal contract ID number	D	Not used / supplied by Barnet Council

Now what is obvious from the start is that the mandatory fields ( description later diluted to be minimum fields, no real difference between mandatory and minimum but let's not fret about that ) are not met by Barnet Council. How odd, the usually bloated council is a lightweight when it comes to supplying useful data. 

The home page of the council website gives a department name of Environment & Planning, not Environment & Regeneration as in the over £500 spending list. It used to be Environment & Operations not all that long ago and there is a move afoot to rename it Planning, Environment & Regeneration as it is headed on the corporate management structure chart. So as inconsistent as ever, that is 4 names for the department in 2 years or less. How can you expect the public to keep up if you can't keep up yourselves Barnet Council ?

The payment date as far as I can tell is the date that the goods or services were recorded as being supplied. We know that this date is unreliable. There is no guarantee that anything entered in the over £500 lists was actually paid. Barnet Council are not supplying what the Prime Minister, the Communities Minister, Mr Eric Pickles MP ( the bloggers' friend ) and what armchair auditors want or need. 

There is no clue as to what the supplier, Capital Resourcing Ltd, actually supplied and whether it was good value or not. Mr Mustard sees that they used to be called Supply Teaching Ltd so he can hazard a guess but he shouldn't have to be using guesswork. Instead, he just has to keep banging in FOI requests.

Contract ID: Mr Mustard is in convulsions at the thought that Barnet Council will have to marry up Internal contract ID numbers to supplier ID numbers. You are going to have to create quite a lot of contracts in a hurry Barnet Council which will of course mean they do not get properly thought through. Another disaster in waiting.

Mr Mustard looks forward to the day when the over £500 lists are properly compiled. Any advance on 2015 ?

Yours frugally

Mr Mustard