Spending of £242,000 by employees on council credit cards.

Barbara Jones made this Freedom of Information request to Dumfries and Galloway Council This request has been closed to new correspondence. Contact us if you think it should be reopened.

The request was successful.

Dear Dumfries and Galloway Council,

It has been reported that council employees spent £242,000 in one year using their council credit cards. Some of the expenditure was not for business purposes and could be considered as extravagant and excessive.

What steps have been taken to prevent further occurrences of such expenditure on council credit cards?

Have any employees been asked to reimburse the council in respect of personal, or excessive, expenditure?

Will amounts for personal, or excessive, expenditure, be entered on end of year details for the relevant employees Benefits in Kind for tax purposes?

Have any employees had their credit cards withdrawn due to inappropriate spending using their council credit card?

Has any other disciplinary action been taken against anyone?

Yours faithfully,

Barbara Jones

Dumfries and Galloway Council

Thank you for your request for information which was received on 27/07/2015 which we are dealing with in terms of the above legislation. We have given your request the unique reference 133764 and we would appreciate it if you could quote this on all correspondence to us.

Under the terms of the legislation, we have an obligation to respond to your request within 20 working days from the day after your request was received. We will therefore aim to respond to your request by 24/08/2015.

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Kind Regards

FOI Unit
Dumfries and Galloway Council

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Dumfries and Galloway Council

Please find below the Council's response to your request 133764 which was received on 27/07/2015.

Details of request: Dear Dumfries and Galloway Council,

It has been reported that council employees spent £242,000 in one year using their council credit cards. Some of the expenditure was not for business purposes and could be considered as extravagant and excessive.

What steps have been taken to prevent further occurrences of such expenditure on council credit cards?

Have any employees been asked to reimburse the council in respect of personal, or excessive, expenditure?

Will amounts for personal, or excessive, expenditure, be entered on end of year details for the relevant employees Benefits in Kind for tax purposes?

Have any employees had their credit cards withdrawn due to inappropriate spending using their council credit card?

Has any other disciplinary action been taken against anyone?

Response: It has been reported that council employees spent £242,000 in one year using their council credit cards. Some of the expenditure was not for business purposes and could be considered as extravagant and excessive.

All the expenditure made was appropriate for Council business, and had been approved, reviewed and authorised by senior management in each department. None of the expenditure was personal.

What steps have been taken to prevent further occurrences of such expenditure on council credit cards?

None ? the Council already has thorough systems in place for the control of its Purchase Cards and the spend made against the cards. This is described in detail below.

The use of Purchase Cards is controlled through robust guidance and operating procedures. These procedures were approved by the Council?s Internal Audit section and are underpinned by Financial Code 21 ? Purchase Cards and Credit Cards. This can be accessed on the Council?s website at
http://www.dumgal.gov.uk/CHttpHandler.as...

The Council?s Financial Codes form part of Financial Regulations, and these apply to every financial transaction and to every member of staff. Failure to observe Financial Regulations may be regarded as a breach of trust and lead to disciplinary action or dismissal.

Before any goods or services can be ordered by Purchase Card a formal purchase requisition / order form needs to be completed and authorised by a departmental authorised signatory officer i.e. a senior officer. This must be sent to the Purchase Cardholder who will then raise the order.

Each Cardholder keeps a Transaction Log of all purchases made, and each month this log is reconciled to the monthly Purchase Card Statement provided by the purchase card provider. Next the Transaction Log and the Monthly Purchase Cardholder Statement should then be sent to the Departmental Purchase Card Administrator for independent review. Once the Departmental Administrator is satisfied, then the Transaction Log and the Monthly Purchase Cardholder Statement should be sent to the appropriate Authorised Signatory Officer/s within the Department. The Authorised Signatory Officer should review both the Transaction Log and the Monthly Purchase Cardholder Statement, and when satisfied should certify both documents.

Both the Guidance and the Financial Code stress that the Purchase Cardholder must never procure goods or services with the Purchase Card for non-legitimate or personal use.

Therefore the Council?s Purchase Card guidance and operating procedures ensure, firstly, that it is not possible for one person to be able to influence a financial transaction from inception to completion ? that is there is a separation of duties between individuals so that the purchase card transaction is monitored at stages by different people. Secondly, the Purchase Card transactions must be subject to internal check within each stage to reduce the likelihood of errors. Thirdly, there is regular management review of financial transactions both before the order is made, as well as at the end of each month.

In addition the use of Purchase Cards by departments is regularly audited by the Internal Audit Section, and are independently administered and reviewed by Finance.

Have any employees been asked to reimburse the council in respect of personal, or excessive, expenditure?

No, because no personal or excessive expenditure was made.

Will amounts for personal, or excessive, expenditure, be entered on end of year details for the relevant employees Benefits in Kind for tax purposes?

No

Have any employees had their credit cards withdrawn due to inappropriate spending using their council credit card?

No

Has any other disciplinary action been taken against anyone?

No

Please be aware that the Council holds the copyright, where applicable, for the information provided and it may be reproduced free of charge in any format or media without requiring specific permission. This is subject to the material not being used in a misleading context. The source of the material must be acknowledged as Dumfries and Galloway Council and the title of the document must be included when being reproduced as part of another publication or service.

If you require any further clarification, please contact us. However, if you are not satisfied with the way in which your request has been dealt with, you can request us to carry out an internal review of the decision by emailing [email address] within 40 working days of receiving this response. Thereafter, if you remain dissatisfied with our review decision, you can appeal in writing to: The Office of the Scottish Information Commissioner, Kinburn Castle, Doubledykes Road, St Andrews, Fife, KY16 9DS.

Kind Regards

FOI Unit
Dumfries and Galloway Council

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Dear Dumfries and Galloway Council,

Please pass this on to the person who conducts Freedom of Information reviews.

I am writing to request an internal review of Dumfries and Galloway Council's handling of my FOI request 'Spending of £242,000 by employees on council credit cards.'.

In view of the details reported in the press, will you please reconsider the response you have provided.

http://www.dailyrecord.co.uk/news/local-...

A full history of my FOI request and all correspondence is available on the Internet at this address: https://www.whatdotheyknow.com/request/s...

Yours faithfully,

Barbara Jones

FOI, Dumfries and Galloway Council

Dear Ms Jones,

Thank you for your email below requesting a review of the way in which the Council responded to your request for information.

A review can be undertaken by either myself or one of my colleagues however, I'm afraid we are both genuinely unsure under what basis we are to review the response.

We understand that you have specified that it is as a result of the details reported in the press release you provided the link to however, I'm afraid this does not make it clear to us what actually you wish for us to review. Do you believe some of the responses to your questions are inaccurate, do you feel we hold more information than we provided etc?

Section 20(3)(c)(ii) of the Freedom of Information (Scotland) Act 2002 requires that an applicant must specify the matter which gives rise to their dissatisfaction with the initial response. To enable us to progress with your review request, can you please, considering the examples above, specify why you are dissatisfied with the Council's initial response and what aspects of it you wish to have reviewed?

If it would be helpful to discuss this on the phone, please call 030 33 33 3000 and ask for the Information Management and Complaints Unit.

Kind regards,

Aaron

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Dear FOI,

The question concerning use of council credit cards was based on press reports that employees had run up expenditure of £242,000 in one year, the analysis indicated much of this was extravagant, of a dubious nature, ie not plainly for business and of doubtful justification, not being wholly and necessarily for business purposes.

The response you provided stated that all the expenditure is regulated and subject to a process to validate items. I question the details supplied on the grounds of the press reports being in contradiction to the official council line. The way it looks on the face of it is that Dumfries and Galloway Council is content to allow extravagant expenditure by employees which is not wholly and exclusively for business purposes in some instances. In other cases, the expenditure exceeds permitted limits set down by HMRC. It appears that excessive and/or personal expenditure is tolerated as it is the Council Tax payers who pick up the tab. It seems that the fact that none of this expenditure is shown as being a Benefit in Kind for tax purposes may be in breach of guidelines set by HMRC.

Please review in the light of the above.

Yours sincerely,

Barbara Jones

FOI, Dumfries and Galloway Council

Dear Mrs Jones,

To confirm, the basis for your review is that you are questioning the accuracy of the information provided to you as you believe the information contained in the press release to be accurate?

Regards,

Aaron

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Dear FOI,

Your response describes the correct position. The press report would have been checked in order to verify the contents before they would publish it. Otherwise, there would be the risk of action for defamation.

Yours sincerely,

Barbara Jones

FOI, Dumfries and Galloway Council

1 Attachment

Dear Ms Jones

Please find attached the response to your review request.

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