Have IBM/SW1 recompensed taxpayers for costs of £3m+ of duplicate payments

The request was successful.

Dear Somerset County Council,

It was reported on the BBC Somerset Sounds yesterday that the £30m SAP system (purchased by Somerset County Council [SCC] with additional borrowing) had resulted in over £3m of duplicate payments since its introduction in April 2009.

a) Did IBM/SW1 pay back to SCC taxpayers the loss of interest on the duplicate payments? If so, how much to date and how much is outstanding?

b) Did IBM/SW1 pay back any unrecovered/written off debts? If so, how much to date and how much is outstanding?

c) Did IBM/SW1 pay SCC for the additional time & effort required e.g. legal services and legal debt chasing? If so, how much to date and how much is outstanding?

d) Why in the case of large bills (like the reported £800K to FirstBus) didn’t the SCC Client Management Team simply ask IBM/SW1 to stop the large duplicate electronic payment and keep the remittance advice that was printed without posting it out?

e1) What formal & recorded acceptance testing by SCC took place before SAP went live with these inherent problems? Please supply details.

e2) Why didn't the SCC acceptance testing detect these problems? What was the role of the contractor IBM/SW1 in formal acceptance testing by SCC?

e3) Who in SCC signed off SAP as fit for "go live"?

e4) Did SAP "go live" with known problems, subject to contractor IBM/SW1 assurances? If so, please detail known problems and supply the action plan for correction agreed with the contractor IBM/SW1 at that time.

e4) Please supply a copy of the SAP Risk and Issue Logs as they stood at the SAP "go live" implementation date.

f) For those staff responsible for ordering on SAP and authorising supplier payments on delivery & invoice, then how much formal training in days did they receive?

Yours faithfully,

Dave Orr

Somerset Direct - Generic, Somerset Council

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Somerset Direct - Generic, Somerset Council

Dear Mr Orr

Thank you for your email

I have logged this for you now, your case reference number is 1705447

Kind regards

Somerset Direct
Somerset County Council
The Deane House
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Tel: 0845 345 9166
Email: [email address]
SMS Text: 07781 482858
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Information Governance, Somerset Council

Dear Mr Orr

 

Thank you for your request made under the Freedom of Information Act
(FOIA) 2000.

 

We are currently dealing with your request and will be in touch shortly
concerning disclosure of the information you have requested.

 

The legislation obliges us to provide you with this information within 20
working days, so our response will be sent to you by 15-09-2011.

 

Please be aware that we now publish all responses to requests for
information made under the FOIA, without any details of the requestor, on
the Council’s website.

 

Please see:

 

[1]http://www.somerset.gov.uk/disclosurelog

 

Yours sincerely

 

Information Governance Team

 

 

This communication is intended solely for the person (s) or organisation
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Information Governance, Somerset Council

Somerset Direct ref: 1705447

Council Directorate ref: Res 1132

Date of request: 16-08-2011

Due date of response: 15-09-2011

Actual date of response: 16-09-2011

 

Dear Mr Orr

 

I am writing regarding your recent request for information to Somerset
County Council, which has been dealt with under the provisions of:

 

• The Freedom of Information Act (FOIA) (2000)

 

Your request made to the Council concerned: 10 questions relating to
duplicate payments made by Somerset County Council.

 

Firstly, I can confirm that we hold this information.

 

In response to your questions below, please find the corresponding answers

 

a)     Did IBM/SW1 pay back to SCC taxpayers the loss of interest on the
duplicate payments? If so, how much to date and how much is outstanding?

 

No

 

b)     Did IBM/SW1 pay back any unrecovered/written off debts? If so, how
much to date and how much is outstanding?

 

The Council is still in the process of recovering monies owed from
duplicate payments. The Council will invoice SWOne for any debts that are
not recovered.

 

c)      Did IBM/SW1 pay SCC for the additional time and effort required
e.g. legal services and legal debt chasing? If so, how much to date and
how much is outstanding?

 

No

 

d)     Why in the case of large bills (like the reported £800k to
FirstBus) didn’t the SCC Client Management Team simply ask IBM/SW1 to stop
the large duplicate electronic payment and keep the remittance advice that
was printed without posting it out?

 

It was not known at the time that this was a duplicate payment

 

e)     What formal & recorded acceptance testing by SCC took place before
SAP went live with the inherent problems? Please supply details.

 

Formal testing took place on all key areas within SAP prior to Go Live.

 

e 2) Why didn’t the SCC acceptance testing detect these problems? What was
the role of the contractor IBM/SW1 in formal acceptance testing by SCC?

 

      The SAP system processed invoices correctly in testing. The problem
was volume and speed which then led to copy invoices being submitted by
suppliers.

 

e 3) Who signed off SAP as fit for “go live“?

 

The Programme Board

 

e 4) Did SAP “go live” with known problems, subject to the contractor
IBM/SW1 assurances? If so, please detail known problems and supply the
action plan for correction agreed with the contractor IBM/SW1 at the time.

 

Problems were not known with the day to day processing. It was known that
some reports were not available at the time of Go Live.

 

e 4/2) Please supply a copy of the SAP Risk and Issue Logs as they stood
at the SAP “go live“ implementation date.

 

These will be sent to you w/c 19-09-2-11.

 

f) For those staff responsible for ordering on SAP and authorising
supplier payments on delivery & invoice, then how much formal training in
days did they receive?

 

Training was provided by IBM; however this was an area where the Council
was not satisfied with what was provided to staff.

 

If you feel your request has not been answered in sufficient detail or if
you wish to clarify the information given, please contact me and I will be
happy to address the issues you raise.

 

If you are not satisfied with the way we have dealt with your request, or
the information you have received, you can ask for an internal review of
our decision.

 

Please send your request to:

 

Peter Grogan

Corporate Information Governance Manager

Information Governance Team

Client Services Team

Resources Directorate / A2W

County Hall

Taunton

Somerset

TA1 4DY or email [1][email address]

 

We will carry out an internal review and we will write to you with the
results of our investigation.

 

If you are not content with the outcome of the internal review, you have
the right to apply directly to the Information Commissioner for an appeal.

 

The Information Commissioner can be contacted at:

 

Information Commissioner's Office

Wycliffe House

Water Lane

Wilmslow

Cheshire

SK9 5AF       Tel: 0303 – 123 1113

 

Please quote the reference numbers at the top of this letter in any future
correspondence.

 

Finally, please be aware that your response will appear, without your
contact details, on the Council’s website at:

 

[2]http://www.somerset.gov.uk/disclosurelog

 

Yours sincerely

 

Information Governance Team

Client Services Team

Resources Directorate / A2W

County Hall

Taunton

Som

TA1 4DY

 

Tel: 01823-357194

No mobile access

Web : [3]www.somerset.gov.uk

 

 

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This communication is intended solely for the person (s) or organisation
to whom it is addressed.  It may contain privileged
and confidential information and if you are not the intended recipient
(s), you must not copy, distribute or take any action
in reliance on it. If you have received this e-mail in error please notify
the sender and copy the message to
[email address]

Individuals are advised that by replying to, or sending an e-mail message
to Somerset County Council, you accept
that you have no explicit or implicit expectation of privacy.

In line with the Surveillance and Monitoring Policy, any e-mail messages
(and attachments) transmitted over the
Council's network may be subject to scrutiny.

References

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http://www.somerset.gov.uk/disclosurelog
3. http://www.somerset.gov.uk/

Dear Information Governance,

Can I clarify some of your answers please.

a) Does this answer mean that Somerset County Council (SCC) will not ever be seeking any compensation for loss of interest on late or unrecovered debts caused by duplicate payments (via SAP)?

b1) For debts caused by duplicate payments (via SAP) can you please supply an Aged Debt report showing debt by various ages. For example total debt greater than 3 months, total debt greater than 6 months, total debt greater than 12 months etc.

b2) This duplicate payments debt relates to 2009/10 and is over 12 months old and perhaps approaching 2 years old. How will the s151 Officer (or responsible finance officer) determine that SAP-related duplicate payments debt is unrecoverable? At what age of SAP-related duplicate payments debt would it be deemed as necessary to write off? Is any of this SAP-related duplicate payments debt currently impaired? If so, how much?

b3) When SAP-related duplicate payments debt is formally written off then will SCC cross-charge SW1 for the whole of that debt?

b4) Please supply a copy of the SCC contract schedule with IBM/SW1, that will cover the recovery of SAP-related duplicate payments debt that could be written off, due to problems with duplicate payments through SAP (redacted only for margin sensitive information).

e1) The FOI request asked for details and none have been supplied e.g. written acceptance test plans and formal sign offs.

e2) This answer appears to be incomplete. Press reports of SCC statements (corroborated by SAP themselves) have identified that the invoice scanning solution implemented by IBM was a large part of the problem with duplicate payments under real world volumes. Can you confirm that the acceptance testing undertaken and signed off covered an "end to end" test where the invoice scanning solution into SAP and on to payment was tested fully?

f) The FOI request asked for the number of days training and these figures have not been supplied. Please answer the question.

Yours sincerely,

Dave Orr

Dear Information Governance,

Apologies - I missed one other clarification.

d1) On what date was the reported £800K duplicate payment made to First Bus?

d2) On what date was the reported £800K duplicate payment to First Bus detected by SW1 Finance?

d3) On what date was the reported £800K duplicate payment to First Bus reported to SCC by SW1 Finance?

d4) On what date did First Bus pay back SCC the reported £800K duplicate payment (through SAP & SW1 Finance?

d5) Using 4% as a typical interest cost for prudential borrowing by SCC and using the information above regarding term, how much would the £800K to First Bus have cost to finance?

Yours sincerely,

Dave Orr

Information Governance, Somerset Council

Dear Mr Orr

Thank you for both your emails this morning; please accept this email reply as being for both the email below and also the one which I received at 07.73.

I will pass on your questions to the SW1 Finance team and ask them to respond to you.

Yours sincerely

Information Governance Team
Client Services Team
Resources Directorate / A2W
County Hall
Taunton
Som
TA1 4DY

Tel: 01823-357194
No mobile access
Web : www.somerset.gov.uk


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Dear Information Governance,

As a part of my FOI follow up, I sought clarification through follow up questions on the £800K of reported overpayment to First Bus and have not yet had a reply.

The web site tracker has sent me a notification that the responses are now overdue.

Can you please now promptly answer the questions of clarification.

Yours sincerely,

Dave Orr

Information Governance, Somerset Council

Dear Mr Orr

I can confirm that the report is being prepared for you currently and will shortly be with you.

Information Governance Team

Client Services Team
Resources Directorate / A2W
County Hall
Taunton
Som
TA1 4DY

Tel: 01823-357194
No mobile access


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Jon Bazley, Somerset Council

1 Attachment

Dear Mr Orr

 

Please find below the answers to your follow on questions to your recent
FOI request:

 

[1][FOI #82866 email]

 

  a) Does this answer mean that Somerset County Council (SCC) will

     not ever be seeking any compensation for loss of interest on late

     or unrecovered debts caused by duplicate payments (via SAP)?

 

This is still to be confirmed

    

     b1) For debts caused by duplicate payments (via SAP) can you please

     supply an Aged Debt report showing debt by various ages. For

     example total debt greater than 3 months, total debt greater than 6

     months, total debt greater than 12 months etc.

 

           

┌──────────┬───────────┬───────────┬────────────┬─────────────┬──────────┐
│0-30 Days │31-60 Days │61-90 Days │91-180 Days │181-365 Days │365 Days+ │
├──────────┼───────────┼───────────┼────────────┼─────────────┼──────────┤
│£ │£ │£ │£ │£ │£ │
├──────────┼───────────┼───────────┼────────────┼─────────────┼──────────┤
│3,201.91 │20.00 │20.00 │3,252.35 │38,986.01 │1,630.92 │
└──────────┴───────────┴───────────┴────────────┴─────────────┴──────────┘

 

    

     b2) This duplicate payments debt relates to 2009/10 and is over 12

     months old and perhaps approaching 2 years old. How will the s151

     Officer (or responsible finance officer) determine that SAP-related

     duplicate payments debt is unrecoverable? At what age of

     SAP-related duplicate payments debt would it be deemed as necessary

     to write off? Is any of this SAP-related duplicate payments debt

     currently impaired? If so, how much?

 

Debts will be deemed irrecoverable once all recovery methods as specified
in the Council’s financial procedures have been followed.

    

     b3) When SAP-related duplicate payments debt is formally written

     off then will SCC cross-charge SW1 for the whole of that debt?

           

Yes

     

     b4) Please supply a copy of the SCC contract schedule with IBM/SW1,

     that will cover the recovery of SAP-related duplicate payments debt

     that could be written off, due to problems with duplicate payments

     through SAP (redacted only for margin sensitive information).

 

This is not specified within the contract with SWOne.

    

     d1) On what date was the reported £800K duplicate payment made to

     First Bus?

 

August 2009

    

     d2) On what date was the reported £800K duplicate payment to First

     Bus detected by SW1 Finance?

 

March 2011

    

     d3) On what date was the reported £800K duplicate payment to First

     Bus reported to SCC by SW1 Finance?

    

March 2011

 

     d4) On what date did First Bus pay back SCC the reported £800K

     duplicate payment (through SAP & SW1 Finance?

 

July 2011

    

     d5) Using 4% as a typical interest cost for prudential borrowing by

     SCC and using the information above regarding term, how much would

     the £800K to First Bus have cost to finance?

 

The council considers that you can work out the calculation for yourself
given the new data here.

 

     e1) The FOI request asked for details and none have been supplied

     e.g. written acceptance test plans and formal sign offs.

 

These documents relate to the SAP Programme Phase 1 launch in 2009 which
has been operational for two years.  During the life of the SAP programme
all documents were deposited and accessible to SCC Programme Team on RPM
(an IBM depositary - this was necessary as a tool that all project team
members (across SCC/TDBC/ASP and SWo/IBM) could jointly access and share
documents etc.  At the end of the programme we agreed with SWo which
documents SCC would need to continue to have access to that relate to the
contractual and ongoing day to day running and maintenance of the SAP
system.  Unfortunately the documents you have requested are no longer
available to us on RPM.

    

     e2) This answer appears to be incomplete. Press reports of SCC

     statements (corroborated by SAP themselves) have identified that

     the invoice scanning solution implemented by IBM was a large part

     of the problem with duplicate payments under real world volumes.

     Can you confirm that the acceptance testing undertaken and signed

     off covered an "end to end" test where the invoice scanning

     solution into SAP and on to payment was tested fully?

 

The SCC Senior Responsible Owner was given assurances by the IBM Project
Team that relevant testing had been completed, and this informed the
decision to Go-Live.  Given the problems that manifested following the
Go-Live decision, and reviewing lessons learned, SCC took a very different
approach for the remaining elements of the SAP Implementation – insisting
on participating in full, end-to-end testing in both pre-Production and
the Live Environment prior to full roll-out to staff.

    

     f) The FOI request asked for the number of days training and these

     figures have not been supplied. Please answer the question.

 

We are unable to answer this question fully, as the majority of the
training provided was for SWO secondees delivering the shared service to
SCC. However I can confirm that SCC staff attended eight training days
(approx 360 spaces) for procurement and webcycle training and follow up
sessions continue to be provided as and when needed to staff (e.g. new
appointments, refresher training). We also provided Quick Reference Guides
which are available to all SCC staff via our intranet site called SAPNav.

 

    

      

 

This communication is intended solely for the person (s) or organisation
to whom it is addressed.  It may contain privileged
and confidential information and if you are not the intended recipient
(s), you must not copy, distribute or take any action
in reliance on it. If you have received this e-mail in error please notify
the sender and copy the message to
[email address]

Individuals are advised that by replying to, or sending an e-mail message
to Somerset County Council, you accept
that you have no explicit or implicit expectation of privacy.

In line with the Surveillance and Monitoring Policy, any e-mail messages
(and attachments) transmitted over the
Council's network may be subject to scrutiny.

References

Visible links
1. mailto:[FOI #82866 email]

Information Governance, Somerset Council

Dear Mr Orr

 

We have just been informed that a correction is needed for your recent FOI
response (D4) at the link below:

 

[1]http://www.whatdotheyknow.com/request/ha...

 

The duplicate payment for First Bus was detected in March 2010 not July
2011 -- could a correction please be made.

 

We apologise for this error.

 

Information Governance Team

Client Services Team

Resources Directorate / A2W

County Hall

Taunton

Som

TA1 4DY

 

Tel: 01823-357194

No mobile access

 

Web : [2]www.somerset.gov.uk

 

 

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This communication is intended solely for the person (s) or organisation
to whom it is addressed.  It may contain privileged
and confidential information and if you are not the intended recipient
(s), you must not copy, distribute or take any action
in reliance on it. If you have received this e-mail in error please notify
the sender and copy the message to
[email address]

Individuals are advised that by replying to, or sending an e-mail message
to Somerset County Council, you accept
that you have no explicit or implicit expectation of privacy.

In line with the Surveillance and Monitoring Policy, any e-mail messages
(and attachments) transmitted over the
Council's network may be subject to scrutiny.

References

Visible links
1. http://www.whatdotheyknow.com/request/ha...
2. blocked::http://www.somerset.gov.uk/
http://www.somerset.gov.uk/

Dear Information Governance,

Can you clarify the position regarding fully responfing?

It appears that a number (in red) have not been fully finalised; such as “Donna/Rob to provide answer”.

Yours sincerely,

Dave Orr

Dear Information Governance,

Can you clarify the position regarding fully responding?

It appears that a number (in red) have not been fully finalised; such as “Donna/Rob to provide answer”.

Yours sincerely,

Dave Orr

Information Governance, Somerset Council

Dear Mr Orr

 

Please find below the outstanding answers.

 

With many thanks

 

 

e1) The FOI request asked for details and none have been supplied

     e.g. written acceptance test plans and formal sign offs.

 

 These documents relate to the SAP Programme Phase 1 launch in 2009 which
has been operational for two years.  During the life of the SAP programme
all documents were deposited and accessible to SCC Programme Team on RPM
(an IBM depositary - this was necessary as a tool that all project team
members (across SCC/TDBC/ASP and SwO/IBM) could jointly access and share
documents etc.  At the end of the programme we agreed with SwO which
documents SCC would need to continue to have access to that relate to the
contractual and ongoing day to day running and maintenance of the SAP
system.  Unfortunately the documents you have requested are no longer
available to us on RPM.

 

      e2) This answer appears to be incomplete. Press reports of SCC

     statements (corroborated by SAP themselves) have identified that

     the invoice scanning solution implemented by IBM was a large part

     of the problem with duplicate payments under real world volumes.

     Can you confirm that the acceptance testing undertaken and signed

     off covered an "end to end" test where the invoice scanning

     solution into SAP and on to payment was tested fully?

 

 

The SCC Senior Responsible Owner was given assurances by the IBM Project
Team that relevant testing had been completed, and this informed the
decision to Go-Live.  Given the problems that manifested following the
Go-Live decision, and reviewing lessons learned, SCC took a very different
approach for the remaining elements of the SAP Implementation – insisting
on participating in full, end-to-end testing in both pre-Production and
the Live Environment prior to full roll-out to staff.

 

     f) The FOI request asked for the number of days training and these

     figures have not been supplied. Please answer the question.

 

We are unable to answer this question fully, as the majority of the
training provided was for SWO secondees delivering the shared service to
SCC. However I can confirm that SCC staff attended eight training days
(approx 360 spaces) for procurement and webcycle training and follow up
sessions continue to be provided as and when needed to staff (e.g. new
appointments, refresher training). We also provided Quick Reference Guides
which are available to all SCC staff via our intranet site called SAPNav. 

 

 

Information Governance Team

Client Services Team

Resources Directorate / A2W

County Hall

Taunton

Som

TA1 4DY

 

Tel: 01823-357194

No mobile access

 

 

Web : www.somerset.gov.uk

 

 

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