When you’re at work, have you ever wondered why the receptionist doesn’t order £75,000 of luxury office furniture on a whim and the admin assistant doesn’t decide on a boring Friday afternoon to order a new £2m fleet of Mercedes trucks?
Quite simply it’s because they’re not authorised to do so and if they were to do so, they’d be dismissed pronto for gross misconduct. The documentation in an organisation that usually governs who can spend what amount of money, when and why are the financial standing orders and they are probably the single most important and useful management tool (if you’re in charge of anyway) an organisation has.
Whatever your job – whether you’re a budget holder or not – we’re all working to financial standing orders whether they’re implicit or explicit. Find us a person who doesn’t know how much money they’re allowed to spend on behalf of their employer and we’ll show you an idiot on the way to the dole queue, a convenient fall guy or a dysfunctional organisation headed for bankruptcy and the courts.
There’s a number of reasons why organisations have financial standing orders. First, they provide clear lines of accountability from the bottom to the top of the organisation. Especially in a large organisation, they make it possible for all expenditure to be tightly controlled and carefully monitored. They make staff – particularly if their budgets have also been clearly explained and allocated as well – directly, personally and transparently accountable for the money they’re spending.
Financial standing orders are also the basis of sound financial management. If you have an organisation where your staff spend whatever sum of money they like on whatever they like, you’re not going to have an organisation for very much longer as you are not controlling your expenditure.
Standing orders are also useful tools for preventing fraud, embezzlement, theft and financial malpractice and they are a handy management tool too. Forget all this crap about yearly comprehensive performance assessments, work plans, supervisions and all the other box-ticking exercises beloved of bureaucrats to prove what a grand job they’re doing.
Instead, if you know a widget usually costs £1 and you give your staff permission to spend £500 and instruct them to get 1,000 widgets, you’re soon going to find out who’s doing what.
Since a chimpanzee can pick up a telephone and buy 500 widgets for £500, anyone who comes back with 500 widgets hasn’t done very much have they? And the person who comes back with 300 widgets, £200 of expense claims and a series of excuses about the lack of budget, the quality of the management and how busy they are should probably be shown the door. Then there’s the one who’ll come back with 750 widgets feeling pretty smug until the smartarse (who’s probably an anarchist) shows up with 1,000 widgets and asks you what they should do with the £50 they’ve still got left in their budget.
Financial standing orders also have another function peculiar to democratic organisations. They represent the the democratic will of the people.
For instance, if you’re a Bristol City Councillor responsible for £300m of expenditure and employ thousands of people its pretty much impossible to personally monitor Sharon in accounts expenditure on paper clips. So you don’t. Instead you create a policy that does it for you.
In the same way that elected councillors, say, set a policy to build a road on a cyclepath or build a new museum or employ a load of PCSOs and then council officers implement them, regardless of their personal views on the matter, so councillors set the more mundane, but equally important policies, around how they want their organisation to function.
For instance things like the council’s personnel policies, the daft equalities crap, the sustainability waffle – whether you agree with them or not and whether council officers agree with them or not – are decided by councillors and are therefore the democratic will of the people and need to be implemented in full and to the letter by the city council’s officers. If they do not, they have broken their contacts of employment.
It is not the job of council officers – at any level – to ignore, alter, countermand, override or rewrite these policies at their convenience. These simple facts also apply to the city council’s financial standing orders, which are a policy of the council as much as any other. They are there to be followed by officers and that should be the end of the story.
So it’s fairly extraordinary when you read the auditor’s report into the Redland Green School £6m overspend to find the following:
10.8 … This is not in accordance with the financial regulations …
10.9 … Given the amounts were over £75,000, in most cases, this would require the procurement regulations to be applied. They were not …
10.10 … Subcontractors were then appointed based on the tender returns. These appointments were not formally approved by the Council [as per the financial regulations] …
10.11 Our concern about the above process is the lack of formal approval by the Council [as per the financial regulations] …
10.12 … the process was not in accordance with the financial regulations …
[10.14 The financial regulations state that “Projects will be the subject of consultation with the relevant Executive Member prior to commencement.” …]
10.17 We have not seen evidence of approval of the commencement of the project from the relevant Executive Member …
10.20 … a process should have been established to require the Consultant to seek formal approval for cost overruns [as per the financial regulations] …
10.21 There was no formal system within the Council for recording and approving these changes [as per the financial regulations] …
10.22 … There was also no formal process in place for the approval and recording of decisions [as per the financial regulations] …
10.26 … We conclude that the Council’s Financial Regulations, in place at the time of the project, were not complied with …
10.27 … Education may not have complied with the financial regulations requirement to provide a report of the full cost position to Cabinet on a quarterly basis …
It’s even more extraordinary when you find out that the person fully involved and right at the centre of running and agreeing – time and again – this complete lack of process in financial management was the Director of Central Services, the council’s chief of finance Carew Reynell.
And it’s even more extraordinary that Reynell – handsomely paid over £100k a year and who personally drew up the council’s financial regulations, recommended them to councillors to adopt and is personally responsible for monitoring that they are used correctly across the council – has taken it upon himself to ignore them.
And it is totally beyond belief that he’s presented us, the council tax payer – with a £6m bill for this conduct.
This is not just a serious failure of management from Reynell either, it’s also a complete abrogation of the democratic process. Perhaps he thinks because he earns £100k a year and has the term ‘director’ in his job title the law and the rules don’t apply to him and he doesn’t have to do what he’s told by us?
Reynell, ignorant, incompetent, arrogant and anti-democratic in equal measure, has form for this kind of behaviour too. Can it be only three years ago that financial consultant Captain Haddock delivered his report into the financial crisis in social services, which cost us £18m?
This was the expensive report that had to carefully explain that budget holders in social services should monitor their budgets on spreadsheets. An idea clearly beyond finance guru Reynell who didn’t seem to know about this most simple of financial management tools let alone ensure it was implemented.
Now we’re back here again with another expensive report. And its complex conclusion that nobody could ever have thought of?
“We would recommend that, for future projects, the Financial Regulations are complied with in respect of reporting to Cabinet”
This is fucking ridiculous. This incompetent arsehole has now cost the city £24m (that we know of) through his inability to implement the simplest of financial processes and procedures. And he’s still in post taking home £2,000 of our money every week?
He should resign immediately. And if he won’t resign, our councillors need to clearly assert themselves, protect our hard earned cash, show that their policies and our democracy cannot be overridden whenever an officer feels like it and sack the bastard.
But will our piss weak, powerless councillor cowards do that? Will they fuck. Just wait for the excuses …
Said Financial Regulations are available from the Council’s Constitution.
A related document worth reading is the one on Member/Officer Relations.
Best quote:
Members [Councillors] have a right to information and support on a “need to know” basis.
Yes Carew Reynell is culpable. But may I refer the Blogger to an article he penned some time ago.
https://thebristolblogger.wordpress.com/2007/09/05/mooney-and-the-bristol-education-loonies/
Peter Mooney, the £750 a day CONsultant was, I believe, officially in charge of education finances. Brought in from Crapita to oversee Redland Green and other things, he’s now conveniently gone off and is possibly wreaking havoc for some other poor sods’ council tax bills.
Members [Councillors] have a right to information and support on a “need to know” basis.
Surely that sentence should read:
Members [Councillors] have a need for information and support on a “right to know” basis?
It’s ridiculous that council officers are deciding whether or not elected councillors “need to know” information. They have a right to know. It’s even more ridiculous that there’s 63 councillors (outside the cabinet) with bugger all to do that aren’t addressing anti-democratic, disempoweering nonsense like this.
Rich,
With Reynell on £2k a week and Mooney on £3k that means £0.25m a year was being spent on project managing the Redland Green School build internally at the council. A £6m overspend hardly represents value for money does it?
You’re right BB, it’s an absolute scandal of mind-blowing proportions. But it’s worse than the figures you quote. Don’t forget that when Mooney was appointed there was already an Assistant Director in post (Mooney was doubling up) whose job was also meant to be managing projects and dealing with finances.
BB this is truly shameful. Have you by chance had time to reflect upon what exactly sustainable communities are doing to our fine city.?
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I agree that’s it’s shameful but at the end of the day what will actually change – nothing!!
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Re: “Reynell – handsomely paid over £100k”
Interested to hear where you found this figure? I’m a little skeptical about this, even considering the fabulous salary of the new chief exec, and your other claims about council salaries.
Any chance you can you start referencing claims like this?
Lucy,
if you really must use our time and spend our money surfing the internet on behalf of your hopelessly incompetent boss, perhaps you could at least have the decency to provide us with some facts rather tha spreading very vague (and unreferenced!) disinformation. How much exactly does he earn then? You obviously know.
And you also well know senior officers at Bristol City Council refuse to be in any way accountable to us – and that includes releasing full details of the salaries that we pay them.
I could find out the exact figure through FOI obviously, but frankly I can’t be fucked and I’m perfectly happy with the accuracy of the figure I’ve stated.
Reynell, of course, is perfectly free, if he wants – for once in his pitiful life – to be honest with the people of Bristol, come on this blog and deny this figure and tell us what we are paying him for his deceitfulness and incompetence. As are you.
Why don’t you? Rather than spreading vague disinformation on behalf of the wealthy, the powerful and the unaccountable of this city?
Must you be such a blatant conspiracy theorist? Obviously I don’t work for BCC. WordPress logs the IP addresses of commenters, a quick search could have told you this. But, as you’ve said, you don’t actually research your allegations.
So you just picked a figure at random and repeatedly quoted it?
and i thought i was going to be let in on some sort of useful journalistic secret!
Never mind, i’ll try asking someone who knows, since you can’t be bothered to even do that.
I said:
Where does is it say it’s not researched? If you’re disputing it or anyone else is, tell us on what basis.
As for journalistic secrets. There are none. It’s all very simple and straightforward. You find things out and you publish them.
As I’ve already said if you want the exact figure Reynell earns put in an FOI request. It needs to go in to the chief officer of the department concerned, which in this case is HR, which is run by Central Support Services whose director is Carew Reynell!
His email is carew.reynell@bristol.gov.uk (you might also want to cc it to the city’s legal boss, he’s at stephen.mcnamara@bristol.gov.uk). Put “Freedom of Information Request” in the title, include your name address in the email and words along the lines of:
“I would like to obtain the following information under the Freedom of Information Act: the current salary of the Director of Central Support Services”
Wait 20 working days and you should have your answer, which will reflect what I’ve already told you.
Quite why you want to attack some blog – produced in someone’s lunch hour – for criticising a highly paid public official who’s squandered £6m of public money, has been demonstrably unaccountable for his work and has deliberately undermined our democratic processes is most confusing. But it takes all sorts I guess?
Best attack the messenger eh?
If you add his expenses & the oncosts that we council tax payers have to pick up, Reynell’s bill will be well ovr 100,000 a year. But as in the post above, he should not be seen to be alone in taking responsibility for the Redland Green financial mess. The Education dept employed a highly-paid assistant Director, Steven Robertson, as chief dept accountant and also bought in Peter Mooney from Crapita to double-up on this role (at a rumoured £750 a day). Those two are also culpable, though the person responsible for employing Mooney depsite there already being someone in place to do the job can’t be left out of the equation either. Step forward 140k a year Director Heather Tomlinson.
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