Could this be one of the reasons public sector pay rises were only 1%?

Reposted from accountingweb

 
NAO Aspire report
 

The National Audit Office identified a “lack of rigour” in HMRC’s commercial management of the Aspire IT outsourcing project that helped double the department’s expected costs on the 10-year deal to £10.4bn.

Reactions to the NAO’s report on Managing and replacing the Aspire contract zeroed in on the discovery that the contractors’ profits had also doubled to £1.2bn up to March 2014, representing 15.8% of the revenue made in that period and more than twice the £500m originally projected in 2004.

Changes in the project scope requested by HMRC in 2006, 2007 and 2009 were the main cause for the extra costs, which were incurred by:

  • Merging Inland Revenue and Customs and Excise in 2005-06 (Cost: £1.0bn)
  • Investing in new PC-based infrastructure and contact centre services, commissioning more new development work and storing more data than originally envisaged (Cost: £3.0bn)
  • Extending the contract by three extra years in 2007 (Cost: £2.3bn). Doing this just three years into the contract is likely to have constrained its ability to change the contract since then, the NAO noted. “Further, it chose to increase spend by £3bn knowing that the contract may not consistently provide market prices.”

As a result of these scoping changes the contract went through a series of renegotiations. During the most recent review in 2012, HMRC undertook to spend £104m each year. 

HMRC has the right to examine the Aspire consortium’s books and to share in extra profits earned. But during the 2012 negotiations the department gave Capgemini and Fujitsu reliefs against this arrangement. As a result, where the department would have been entitled to £71m, it has only received £16m.

HMRC switched suppliers from EDS to the Aspire consortium led by Capgemini in 2004 due to significant cost overruns on the previous contract. In its report, the NAO described Aspire as “an appropriate means” of working through its long-term technology challenges and limiting risks.

But since then costs have continued to go up – with the projection rising to £8.5bn by 2007 and eating up 44% of HMRC’s supplier budget by 2011.

HMRC has maintained in the past that Aspire has helped it achieve more than £1bn in cost savings, but the NAO estimated the project’s costs would rise to £10.4bn by 2017, reporting that department did not have the independent expertise to challenge its suppliers.

Having recognised its shortcomings in this area, HMRC is trying to rebuild its internal capability, but faces a further struggle to renegotiate the contract until 2017 while it defines its post-Aspire technology strategy, said Amyas Morse, the head of NAO.

“There are serious risks to HMRC’s business if the programme to replace the contract fails to meet its objectives by June 2017 when the contract ends,” the NAO warned.

Those risks include: HMRC having to pay over the odds to extend the Aspire arrangement due to a lack of competition; inability to continue switching to efiling and collection process due to limitations in its legacy systems; a fall in service quality to taxpayers, “putting the amount of tax collected at risk”, the NAO said.

To date, Aspire has cost the government around £8bn since it took over in July 2004. Aspire was seen as the only way to maintain continuity and improve the department’s technology performance at the time, but in 2011 the Cabinet Office decided that Aspire was no longer a suitable way of providing value for money.

The NAO report acknowledges that Aspire delivered the continuity of service to ensure HMRC collects around £500bn of tax each year. with few significant service failures.

“The contract has helped HMRC to improve its operations by reducing operating costs, increasing tax yield and improving service to customers,” the NAO said.

Reactions to the NAO’s report on Managing and replacing the Aspire contract zeroed in on the discovery that the contractors’ profits had also doubled to £1.2bn up to March 2014, representing 15.8% of the revenue made in that period and more than twice the £500m originally projected in 2004.

Changes in the project scope requested by HMRC in 2006, 2007 and 2009 were the main cause for the extra costs, which were agreed through a series of renegotiations (see partial timeline above). In 2012 for example, HMRC undertook to spend £104m each year.

HMRC achieved year-on-year savings through these negotiations, but conceded many of the controls that had been built into the contract to safeguard value for money, the NAO noted.

HMRC has the right to examine the Aspire consortium’s books and to share in extra profits earned. But during the 2012 negotiations the department gave Capgemini and Fujitsu reliefs against this arrangement. As a result, where the department would have been entitled to £71m, it has only received £16m back from the extra profits earned.

HMRC switched suppliers from EDS to the Aspire consortium led by Capgemini in 2004 due to significant cost overruns on the previous contract. In its report, the NAO described Aspire as “an appropriate means” of working through its long-term technology challenges and limiting risks.

But since then costs have continued to go up – with the projection rising to £8.5bn by 2007 and eating up 44% of HMRC’s supplier budget by 2011.

HMRC has maintained in the past that Aspire has helped it achieve more than £1bn in cost savings, but the NAO estimated the project’s costs would rise to £10.4bn by 2017, reporting that department did not have the independent expertise to challenge its suppliers.

Having recognised its shortcomings in this area, HMRC is trying to rebuild its internal capability, but faces a further struggle to renegotiate the contract until 2017 while it defines its post-Aspire technology strategy, said Amyas Morse, the head of NAO.

“There are serious risks to HMRC’s business if the programme to replace the contract fails to meet its objectives by June 2017 when the contract ends,” the NAO warned.

Those risks include: HMRC having to pay over the odds to extend the Aspire arrangement due to a lack of competition; inability to continue switching to efiling and collection process due to limitations in its legacy systems; a fall in service quality to taxpayers, “putting the amount of tax collected at risk”, the NAO said.

To date, Aspire has cost the government around £8bn since it took over in July 2004. Aspire was seen as the only way to maintain continuity and improve the department’s technology performance at the time, but in 2011 the Cabinet Office decided that Aspire was no longer a suitable way of providing value for money.

The NAO report acknowledges that Aspire delivered the continuity of service to ensure HMRC collects around £500bn of tax each year. with few significant service failures.

“The contract has helped HMRC to improve its operations by reducing operating costs, increasing tax yield and improving service to customers,” the NAO said.

The Aspire project is such a big, long-running and complex saga, that very few individuals can get a global overview of exactly what is going on and whether it really is delivering value for money and better quality service. The self assessment online system, for example, appears to work well and cope with its peak workload each January, but the jury is still out for real time information (RTI) for PAYE.

For students of the project, the NAO’s periodic reports present a rare opportunity to gauge progress and assess whether HMRC’s technology performance is likely to improve. The latest report, for instance, includes some revelations that will surprise even the most cynical of observers.

Since 2004, for example, HMRC has been paying Capgemini to maintain the financial model that the department uses to maintain control over the prices per unit paid. HMRC is content with the way Capgemini is maintaining the financial model, which the NAO found was using out of date data on workload volumes. By not adjusting the model to reflect changes in actual and forecast volumes, HMRC missed the opportunity to control costs better over the contract lifecycle, the auditors noted. [Para 3.11-3.18]

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Nothing to do with us guv!

A short post regarding my response from Age UK and their use of workfare; I shall leave you draw your own conclusions and would welcome your comments.

 

Dear Mrs M

 

Thank you for your email and for sharing this link with us.

 

As we have stated before, Age UK (including Age UK Training) is not involved with mandatory work schemes.  Local Age UKs are independent charities in their own right and using such schemes would be their decision and not something we would have a position on. 

 

To view our statement, please visit: http://www.ageuk.org.uk/latest-press/archive/age-uk-statement-on-the-workfare-scheme/

 

Yours sincerely

 

Emma Chin

Customer Engagement Executive

Age UK

 

 

From:
Sent: 21 July 2014 19:30
To: Karen Richards
Subject:

 

Workfare placements

 

Dear Madam,

 

I note that your website states that you DO NOT use workfare; however, I found this article which seems to contradict this. (See link below)

 

I would be interested to receive your comments

 

http://johnnyvoid.wordpress.com/2014/07/18/liars-the-national-charity-who-is-deceiving-the-public-about-their-role-in-workfare/

 

Regards

 

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Two MPs to sue government over data law ‘stitch-up’

Reposted from Channel 4 news

Two MPs, Tom Watson and David Davis, are to sue the government for introducing “ridiculous” emergency legislation allowing police and security services access to people’s phone and internet records.

Left to right: David Davis MP and Tom Watson MP (pictures: Getty)

The MPs from either side of the House of Commons have applied for a judicial review of the Data Retention and Investigatory Powers Act (Drip).

This act of parliament was driven through the House of Commons with ridiculous and unnecessary haste to meet a completely artificial emergency.David Davis MP

Drip was rushed through parliament in just three days after receiving backing from all three major party leaders. It is a response to a European Court of Justice (ECJ) ruling in April, which essentially ruled that what’s happening in the UK – under the Data Retention Regulations Act of 2009 – was illegal.

David Davis, the former Home Secretary and Conservative MP for Haltemprice and Howden, said: “This act of parliament was driven through the House of Commons with ridiculous and unnecessary haste to meet a completely artificial emergency.

You cannot make good laws behind closed doors.Tom Watson MP

“As a result members of parliament had no opportunity to either research it, consider it or debate it properly and the aim of this legal action is to make the government give the House the opportunity to do what it should have been allowed in the first place. Proper, considered and effective law making.

“The overall aim is to create law which both protects the security of our citizens without unnecessarily invading their privacy.”

Tom Watson, Labour MP for West Bromwich East, said: “The three party leaders struck a private deal to railroad through a controversial bill in a week. You cannot make good laws behind closed doors.

“The new Data Retention and Investigatory Powers Act does not answer the concerns of many that the blanket retention of personal data is a breach of fundamental rights to privacy.”

This private cross party stitch-up, railroaded onto the statute book inside three days, is ripe for challenge in the courts.James Welch, Liberty

David Cameron insists the legislation is needed to prevent the risk of information on terror suspects being deleted – and says the new legislation does not expand on existing powers. However, critics have raised concerns that the act is an extension of powers.

Mr Davis and Mr Watson, backed by human rights charity Liberty, have written to the Home Office to give them seven days’ notice of their intention to apply for judicial review.

James Welch, Legal Director for Liberty, said: “It’s as ridiculous as it is offensive to introduce an ‘emergency’ law in response to an essay crisis.

“The court ruling that blanket data retention breached the privacy of every man, woman and child in the UK was more than three months ago.

“The government has shown contempt for both the rule of law and parliamentary sovereignty, and this private cross party stitch-up, railroaded onto the statute book inside three days, is ripe for challenge in the courts.”

If successful, the case – which could be heard in the autumn or early next year – would not strike down the act but would require the government to take action to ensure it is compatible with human rights law.

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Work and Pensions Committee urge Ministers to pay disabled benefits during appeals

Sheila Gilmore MP today welcomed a report from the Work and Pensions Select Committee – of which she is a member – that calls on the Government to pay sick and disabled people benefits while they appeal against incorrect ‘Fit for Work’ decisions.

Employment and Support Allowance (ESA) provides support for people who cannot work due to a health condition or disability. Entitlement is determined by the controversial Work Capability Assessment (WCA). Previously claimants who were declared ‘Fit for Work’ and wished to challenge their decision were paid ESA at a reduced rate throughout the appeal process. However since October 2013 claimants have had to submit an informal appeal – known as a mandatory reconsideration – to a DWP civil servant, and only if they are still refused benefit can they take their case to a judge.

During mandatory reconsideration, a claimant’s only option is to claim Jobseekers Allowance, which entails applying for jobs and attending an interview. As a result many sick and disabled people have been refused JSA or sanctioned, leaving them stuck between benefits and without any income. The DWP Committee have today called on the Government to pay claimants ESA during the mandatory reconsideration process.

In addition current statistics show that, since it replaced Incapacity Benefit in 2008, one in ten ESA claimants who are declared ‘Fit for Work’ successfully appeal this decision and are awarded ESA. However it emerged last year that the proportion of incorrect decisions could be a lot higher, as figures on the outcomes of mandatory reconsiderations were not being published. The DWP Committee have today called on Ministers to publish these statistics.

Sheila Gilmore said:

I regularly meet sick and disabled people who are unable to work but who have been declared fit to do so following a flawed ESA assessment.

Since last year people in this position have been forced to claim Jobseekers Allowance when they initially challenge an incorrect decision. Many are refused or quickly sanctioned, leaving them stuck between benefits for periods of up to ten weeks.

Ministers should implement the Work and Pensions Select Committee’s recommendation that claimants are paid ESA throughout the application process. This shouldn’t cost the Government any money, unless DWP are already factoring in sick and disabled people being unable to claim JSA.

Until recently we thought that the assessment was getting about one in ten fit for work decisions wrong – far too many in most people’s eyes – but since it emerged that the Government were withholding key figures, the reality could be much worse. Again the Government should do as the Select Committee says, and publish this data without delay.

Notes to Editors

  • The key paragraph of the Committee’s report reads: ‘However, DWP needs to set a reasonable timescale for the MR process, rather than this being left open-ended. The current illogical arrangement whereby claimants seeking MR are required to claim Jobseeker’s Allowance (JSA) instead of ESA should be abolished. Official statistics showing the impact of MR on the number of appeals and on outcomes for claimants should be published as a matter of urgency.’
  • Sheila Gilmore led a debate on mandatory reconsideration statistics in the House of Commons on 9 April 2014 where she summarised the issue as follows: ‘I acknowledge this is quite a hard argument to follow so let’s say, hypothetically, 100 people claim ESA. We are initially told that 50 are awarded benefit and 50 are declared Fit for Work. We are then told that 25 of this latter group successfully appeal their decision, so we can say that the assessment process is getting one in four decisions wrong. What if we then found out that 25 of the 50 who were initially awarded ESA only got benefit following an informal appeal to a civil servant? We would have to say that the assessment process was getting one in two decisions wrong – a level of performance significantly worse than previously thought.’
  • For more information Sheila Gilmore maintains dedicated pages on mandatory reconsiderations and reconsideration statistics on her website.
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Court orders DWP to name and shame workfare exploiters

View full decision: “The DECISION of the Upper Tribunal is to dismiss the [DWP] appeals” https://docs.google.com/file/d/0Bwd25z9g2tFPNzZfbVdQSFRZM3JwZzVwX1hDS01Kc0R0V05z/edit?pli=1 (download as a PDF) and the full history of one of the FOI request’s of 25 January 2012, concerning the names of Mandatory Work Activity placement hosts. This tribunal decision concerned DWP appeals against three ICO decision notices (FS50438037,FS50438502 and FS50441818) all requiring the DWP to name workfare placement hosts.

Above via https://www.whatdotheyknow.com/request/successful_bidders

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RIP David Clapson

Originally posted on Same Difference:

Is this how we treat our former soldiers?

“Lessons must be learned” from the death of a Stevenage diabetic who could not afford electricity to keep his insulin cool after his benefits were stopped.

One year ago on Sunday (July 20), former soldier David Clapson died aged 59 at his home in Hillside from fatal diabetic keto-acidosis, which the NHS calls “a dangerous complication of diabetes caused by a lack of insulin.”

His jobseeker’s allowance of approximately £70 a week – on which his family says he was reliant – had been suspended three weeks before onJune 28, for missing meetings.

According to his family, Mr Clapson was found “alone, penniless and starving” a short distance from a pile of printed CVs, with nothing to his name but £3.44, six tea bags, a tin of soup and an out-of-date tin of sardines.

The coroner found that David –…

View original 328 more words

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RIP David Clapson

Originally posted on Same Difference:

Is this how we treat our former soldiers?

“Lessons must be learned” from the death of a Stevenage diabetic who could not afford electricity to keep his insulin cool after his benefits were stopped.

One year ago on Sunday (July 20), former soldier David Clapson died aged 59 at his home in Hillside from fatal diabetic keto-acidosis, which the NHS calls “a dangerous complication of diabetes caused by a lack of insulin.”

His jobseeker’s allowance of approximately £70 a week – on which his family says he was reliant – had been suspended three weeks before onJune 28, for missing meetings.

According to his family, Mr Clapson was found “alone, penniless and starving” a short distance from a pile of printed CVs, with nothing to his name but £3.44, six tea bags, a tin of soup and an out-of-date tin of sardines.

The coroner found that David –…

View original 328 more words

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