The findings of an internal audit review into the use of Scottish
Government electronic purchase cards (ePC) have been
published.
The review was commissioned by the First Minister following the
public release of significant amounts of ePC spending data in
August.
The review was undertaken by auditors in the Scottish Government
Directorate for Internal Audit and Assurance, who have
recommended improvements to policy and guidance, including
enhanced monitoring and reporting, as well as a review of card
usage and limits, and of categories of exclusions and
out-of-scope expenditure.
The Permanent Secretary has also indicated that corporate
guidance should be reviewed and updated to reflect the principle
that all staff ‘away days’
should be carried out within public sector venues, with any
exceptions requiring senior (director-level or above) approval of
an appropriate business case.
An on-going review of the number of card holders has already
resulted in a reduction of just under 10% since the summer, while
mandatory training and follow-up refresher training will also be
given to everyone with ePC responsibilities.
Electronic purchase cards are routinely used by the Scottish and
UK Governments to pay for low value items such as catering,
one-off supplies and training.
The Internal Audit team reviewed 194 transactions that had been
the focus of reporting or commentary in news and social media.
The audit of this sample found that all but one were appropriate
expenditure under the current ePC policy. The transaction
that was not appropriate was not made by the cardholder and was
identified via banking system controls as fraudulent and the
expenditure was refunded.
Among the purposes of the transactions identified through the
audit were:
- Nail polish; used by Science and Advice for Scottish
Agriculture (SASA) to distinguish items of glassware to prevent
cross-contamination. Nail polish has to be used for this purpose
under chemistry standard operating procedures.
- Driving theory tests; these tests form part of the advanced
driving course provided to staff who, as part of their job, spend
a significant amount of time driving to rural and remote
locations in Scotland.
- Pregnancy tests; must be included as part of a ship’s medical
stores for Marine Scotland vessels under Merchant Shipping
legislation.
- Asda Christmas purchases; Christmas lunch for Marine Scotland
vessel crew working on Christmas Day.
Public Finance Minister said:
“The Scottish Government is focused on delivering the best value
for money for taxpayers – something that is particularly
important during a cost-of-living crisis, where both household
and public sector budgets are tight. That is why the First
Minister commissioned a review into ePC spending to ensure we
have the right procedures in place.
“It is reassuring that the review concludes that the transactions
audited were all appropriate under the current ePC policy, with
the only exception being a fraudulent transaction carried out by
a third party. I welcome the recommendations which aim to
strengthen processes, including reviewing what may or may not be
purchased through ePC, as well as improved monitoring and
mandatory training.
“The use of ePC is standard practice across governments and it is
vital that policies and guidance on usage remain as robust and
transparent as possible. This will ensure civil servants can
continue to carry out their daily duties effectively while
maintaining the best use of public funds.”
Background
The Directorate for Internal Audit and Assurance will include a
detailed review of ePC controls and compliance in its forward
2023-24 work programme scrutinising a larger testing
sample.
The findings and recommendations of both the ePC transactions
internal audit and a parallel review of ePC data-handling were
contained in a Management Report, presented to the First Minister
and now published on the Scottish
Government website.
As well as those 194 considered by auditors, one further reported
transaction, which had been made by a cardholder within the
Directorate for Internal Audit and Assurance, was reviewed
separately by the Scottish Procurement and Property Directorate
(SPPD). On review of the information provided to SPPD, it found
that the appropriate policy had been followed.
The Scottish Government uses ePC to purchase and pay for
appropriate goods and services, largely – though
not limited to – low-value, one-off or annual
expenditure such as training, catering, room hire and one-off
supplies. ePC cards are not for personal expenditure and there
are robust authorisation and regular auditing arrangements in
place to monitor their use.
As part of its wider commitment to openness and transparency the
Scottish Government has, since May 2016, proactively published
monthly reports of all ePC transactions of £500 and over.
