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Estimates cost of redacting MPs' receipts
FOI116
Disclosure Date:6 Jan 2011
Categories: IPSA - FINANCIAL COPIES OF RECEIPTS/INVOICES
Exemptions Applied: Section 22
Request

Below is a passage taken from your website ‘IPSA will not be publishing receipts proactively –the cost of preparing tens of thousands of receipts for publication would be more than £1 million a year and would not provide value for taxpayers’ money.’ Under The Freedom Of Information Act can you please provide me with a detailed breakdown of how the figure of 'more than £1 million a year' has been calculated. The costs should include a breakdown of all stages of procedures from the receipt of MP's receipts to publication on a
Website.

Has a costing exercise been carried out in determining the ‘over £1 million’ figure, if so, when was it carried out.

Response

In considering whether or not to publish, as a matter of routine, copies of receipts and invoices in addition to the many transactional details we are publishing, we thought hard about how we would best serve the interests of the public. As part of these considerations, we asked ourselves a number of questions, including:

  • what, by way of additional information, will the publication of receipts and invoices give the public?
  • how do we provide a high degree of transparency whilst ensuring we publish regularly in a sustainable manner?
  • how do we provide a high degree of transparency without incurring disproportionate cost?
  • where do we draw the line between what is a proportionate and disproportionate cost, taking into account IPSA’s statutory responsibility to discharge its functions efficiently and cost-effectively? and
  • what reassurance can IPSA provide the public that its interests are best served by pursuing any particular publication route?

In answer to these questions, we considered the importance of the new system of independent regulation provided by IPSA, with the new, stricter rules on what MPs can and cannot claim for. Our rules are open and transparent in a way that was not the case under the previous system.

Internal and external checks and controls

All claims are subject to very rigorous internal checks. Not only do we have a multiple-level system of expense claim validation, we also have further checks at the payment stage and a robust programme of post-payment assurance and review.

Nevertheless, we understand that not everyone will be reassured by our own assessment of our internal checks. For this reason, we have engaged internal auditors to carry out regular assessments of our programme of checks, and we are also audited by the National Audit Office.

In addition to the checks and audits set out above, where any member of IPSA’s staff or any member of the public believes that MPs are making claims that IPSA should not be reimbursing, it is open to them to contact the independent Compliance Officer to look into such cases.

The limited value of receipts and invoices

As set out above, we believe that the information we are publishing provides a significant amount of detail – and considerably more than was previously the case – which should give members of the public a clear picture of what MPs are claiming for and afford them the reassurance that claims are both appropriate for MPs to carry out their parliamentary functions, and in accordance with the rules set out in the MPs’ Expenses Scheme. It also mirrors the approach adopted by the National Assembly of Wales and the Scottish Parliament.

Our analysis of the additional information – and consequently additional reassurance – the publication of receipts would give the public, showed that once the receipts had been redacted appropriately, they would only rarely provide further details.

 

Given the very high cost of redacting receipts in preparation for publication, we judged that the information we would be publishing would, in the great majority of expense claims, provide the public with sufficient information to assess whether or not an MP should have claimed an expense – and IPSA should have reimbursed it. It remains, of course, open to members of the public to make individual requests for further information.

The cost of publishing receipts

Turning to your particular questions, an initial costing exercise in July 2010 based on volumes of claims received at that time suggested that the annual cost of publishing and redacting receipts would be in the region of £240,000. This was stated as follows:

“Based on volumes of claims received to date, and discussions with House of Commons staff, it is estimated that a minimum of 5 Full Time Equivalents will be required to undertake redaction and quality assurance of this work ongoing. Assuming a combined cost of £20K per month this equates to an annual budgetary cost of £240K”.

This estimate was very quickly shown to be significantly out following a very steep rise in the number of claims received between July and September. In light of this, and the results from trialling redaction, the case for publishing all receipts was revisited in September. The estimate made at this time was revised upwards following an analysis revealing that the rate of receipts being received by IPSA was outstripping receipts being redacted by a ratio of 6.5 to 1, with three full time redactors and a team leader in post. It was therefore estimated that a team of at least 20.5 people would be needed to handle and redact the number of receipts IPSA was receiving.

It was estimated that this would add up to £616,757 per annum in staffing and IT costs alone to the previous estimate of up to £240,000. This estimate, however, did not take the following into account:

  • the additional costs of providing office accommodation and office running costs;
  • the additional cost of providing quality assurance of the redaction work from outside the publication team to minimise the risks of accidentally publishing sensitive personal data; and
  • the cost of the maintenance of the publication website.

Although no formal estimate was made of these additional costs, it was clear that they would add well in excess of £200,000 to the total taking the cost of publishing all receipts to over £1 million per annum.