NI civil service fast-track payments system costs £4m

A Northern Ireland Executive system introduced to speed up the payment of bills has cost more than £4 million (€4.79 million), it was revealed.

A common accounting service for the Northern Ireland civil service was successfully delivered and produced general customer satisfaction, an audit office report said.

But an extra 18 staff were employed to fulfil a promise that the government would pay invoices within 10 days following complaints from supply firms that delays were causing cash flow problems.

Prompt payment contributed to a 17 per cent increase in the cost of operating the centralised unit compared to what was originally envisaged.

Comptroller and auditor general Kieran Donnelly said: "Account NI has not sufficiently focused on the cost of the services it provides and it has not routinely measured its performance against comparable organisations."

Account NI, designed to simplify financial processes across the civil service and reduce service expenses, began work properly in July 2009. It checks and pays supplier invoices, makes grant payments, maintains accounting records and reimburses staff travel and expenses claims.

According to the audit office report, Account NI: Review of a Public Sector Shared Service Centre, reasons for the increase in the estimated cost of running it included the failure to achieve reduced staffing costs because of the introduction of the prompt payment target. That cost £4.5 million to deliver.

Last year, former minister for finance Sammy Wilson said construction accounted for more than £1.3 billion of the total spend each year by the Executive and, amid economic recession, it was important that suppliers for main contractors benefited speedily from government funding.

Account NI processes more than a million transactions a year. It has 215 civil service staff, but the technology supporting its operation is provided under a £54 million, 12-year contact with BT.

Other reasons for the increase in costs beyond that estimated in 2006 include the impact of Account NI absorbing payments for public bodies, such as the Driver and Vehicle Agency and Public Prosecution Service, which was not included in the original plan, the audit office said.

In 2011/12 Account NI had the highest cost per transaction (£9.73) when measured against four other public bodies, including Northern Ireland Water and the Housing Executive, the public spending watchdog added.

Auditors said Account NI usually processes payments in seven days, compared to 17 taken by the top performer in an international comparison. It also outperformed public health, education and local government bodies.

Mr Donnelly added: “Account NI has successfully delivered a common accounting service for the Northern Ireland civil service.

“My review shows that customers are generally satisfied with the service provided and that it performs to a very high standard on quality and timeliness of invoice processing.”

Press Association