Select Committee on Public Administration Minutes of Evidence

Third supplementary memorandum by the Parliamentary Ombudsman


  1.  In October 1997 the Office introduced a time recording system for investigation staff and their managers, in order to enhance the range and quality of management information. We have been seeking to develop that system with financial data to produce costs for the various activities that the investigating divisions undertake. The task is a complex one and continually developing as the organisation develops. We do not yet have reliably accurate unit costs for the Office's investigative activities. More work is required in several areas, for example: defining further the range of our activities and outputs and their costs, and in particular achieving a more accurate allocation of overheads and thus total costs.

  2.  The most meaningful information we can provide is set out immediately below. It focuses on cases concluded as the best representative measure that we have at present. But it does not capture the total work of the Office, and some important types of additional output are mentioned later in the paper.

  3.  The figures cover the two years 1997-98 and 1998-99. 1997-98 was the first year that OPCA started operating on a financial year, not calendar year, basis; and this aids comparison.

  4.  Total Voted Expenditure for the years 1997-98 and 1998-99 was as follows:

Table 1
PCA direct costs3,531,534 3,180,581
HSC direct costs2,763,487 2,583,055
Central services and accommodation costs 6,946,9796,926,364
Total Voted Expenditure13,242,000 12,690,000

  Numbers of cases concluded (but see paragraph 10 below) were:

Table 2
(including 402 full investigations) (including 388 full investigations)
(including 120 full investigations) (including 119 full investigations)
(including 522 full investigations) (including 507 full investigations)

  Note: HSC cases exclude those that fall into the categories of "Enquiry answered" and "No action required". PCA cases exclude advice and response to direct written contacts from members of the public in connection with PCA matters.

  5.  This gives the following figures of cost per case concluded for the Office as a whole.

Table 3
Office costs per case concluded2,575 2,982

  6.  It is when one attempts to break the above figures down, for example into separate figures for PCA cases and HSC cases that a degree of arbitrariness sets in. That is because while direct PCA and HSC costs are separately recorded, the way in which central service and accommodation costs are apportioned between the two sides of the Office markedly affects the figures. For example, if those costs were to be allocated to PCA and HSC pro rata to average staff in post then the respective central service charges for PCA cases and HSC cases would become:

Table 4
Central services allocated on the
basis of average staff in post
per cent1997-98
per cent1998-99
PCA Central Service Charge57 3,959,778553,809,500
HSC Central Service Charge43 2,987,201453,116,864
Total6,946,979 6,926,364

  7.  That in turn would produce the following figures for cost per concluded case:

Table 5

  8.  Conceptually, it is difficult to break the above figures down still further by costing separately cases which go through to a full investigation and those which do not. For example, if on the PCA-side the direct costs of all staff in the investigation directorates are wholly attributed to cases going through to a full investigation and the direct costs of staff in the screening directorate are wholly attributed to the remaining cases which do not, and if the central services and accommodation charges attributed to the PCA-side in paragraph 6 above are themselves allocated between the PCA directorates on the basis of average staff in post, then that would yield the following figures:

Table 6
Cost per full PCA investigation12,376 11,660
Cost per other PCA case disposed of1,480 2,135

  However, the work we have done shows that to be a gross oversimplification, and so inaccurate. Staff in the screening directorate do some work on cases which go through to full investigations; and staff in the investigation directorates often do work on cases which do not. Put simply, the figures in this paragraph cannot be taken as reliable.

  9.  There would be even more difficulty in adopting such an approach for OHSC as it does not split screening and investigations work. Instead the HSC directorates operate with an integrated approach.

  10.  But even the limited figures presented in paragraph 5 (Table 3) hide considerable uncertainties that make comparison or analysis problematic. Difficulties arise from:

    (a)  The data are affected by the efforts made throughout 1997-98 and 1998-99 to eliminate the backlogs in screening and investigations from earlier years, particularly in OPCA. Whenever the handling of a case extends over more than one financial year costing problems arise: those are made worse when (as in 1997-98 and to a lesser extent in 1998-99) there are significant backlogs overhanging the normal in-year workload;

    (b)  The figures for cases concluded in paragraph 4 (Table 2) above do not include the Office's advice and response to direct written contracts from members of the public in connection with PCA matters. Only a minority of these come back as cases subsequently referred by Members of Parliament. There were some 1,087 such approaches in 1997-98 and 822 in 1998-99. They are not included in the figures for numbers of cases concluded in paragraph 4 (Table 2) above to avoid any risk of double counting. Nevertheless, they are a tangible output of the Office which consumes resources: most other Ombudsmen would count them as cases. (If they were to be included the cost per case figures in paragraph 5 would fall to £2,046 (1997-98) and £1,838 (1998-99);

    (c)  Apart from screening and investigation cases and dealing with enquiries the Office has other significant activities and outputs. They include those in support of the Ombudsman's strategic aim to promote improvements in services and increase awareness of the Office. This covers, for example, the representational duties that the Ombudsman and his senior staff undertake, and the work of the Office in working with organisations to improve their practices, the production of volumes of selected investigations, and the spreading of advice and good practice through a range of initiatives.

  11.  As noted above we are working to develop our systems to provide better information to measure and increase our efficiency. We shall take this forward in the coming year with the aim of being able to produce reliable cost information that is relevant to and meets the needs of internal and external users.

26 January 2000

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