2 THE AGENCY'S CASE MANAGEMENT
4. Progressing cases and recovering assets through
effective case management was crucial to the Agency's aims. The
Agency gave insufficient consideration to its business processes
resulting in basic management failures. For example:
- The Agency did not have a comprehensive database
of cases referred to it. It was unable to provide the National
Audit Office with a list of all cases under management, even though
work by the National Audit Office estimated that only 707 cases
had been received.
- The Agency decided against purchasing a staff
time recording system, which they estimated would have cost some
£300,000. As a result the Agency had no records of the time
staff spent on individual cases, making it difficult for the Agency
to estimate the cost of individual cases, to make informed decisions
on the prioritisation of cases and to make the best use of staff
resources, or to monitor the productivity of staff.
- The Agency reviewed cases under investigation
on a monthly basis but no formal and consistent case management
processes were put in place and staff were not held accountable
for the progress of their cases.[5]
5. By the end of 2006 the Agency had recovered a
total of £23 million and had cost £65 million to run
(Figure 2). The Agency's approach had been to investigate
cases and pursue them through the courts to test the new legislation.
The Agency's largest recovery accounting for half of the £23
million recovered to the end of 2006 was, however, obtained through
negotiation and settlement. The Agency had completed this case
in 15 months compared to 4 years on average for cases pursued
through the courts. Potentially negotiated settlement left the
respondent in possession of some assets identified by the Agency
as proceeds of crime, but the approach could lead to more efficient
and effective recovery overall, increasing the financial benefit
to the taxpayer. In Scotland the Civil Recovery Unit was in the
process of looking into early settlements.[6]Figure
2: The Agency's expenditure and receipts
|
| 2003-04
£m
| 2004-05
£m
| 2005-06
£m
| 2006-07
(9 months unaudited) £m
|
| Expenditure (gross)
| 11.1 |
14.1 | 23.6
| 16.1 |
| Recovered asset receipts (accruals basis)
| 0.002 |
4.3 | 6.4
| 12.0 |
Source: National Audit Office
6. The Agency had set itself a range of targets covering
the recovery of assets, the training of Financial Investigators
and the public's confidence in its powers. It had exceeded targets
for freezing assets and delivering training courses but had not
met its target to become self-financing by 2005-06. A review of
the cases in the pipeline had suggested that the Agency was unlikely
to meet the self financing target by 2009-10.[7]
7. The Agency is unable to instigate cases and is
therefore reliant on referrals from partner organisations. Only
129 of a possible 696 referral partners had submitted cases to
the Agency by the end of August 2006. Four police forces had not
referred any cases to the Agency. Of these, Hertfordshire and
Dyffed-Powys Police Forces have since referred cases and Cumbria
Constabulary and Humberside Police Force considered that they
did not have any cases suitable for civil recovery or taxation,
although they both expect to be in a position to refer cases in
the future. The other 43 forces had referred over 200 cases to
the Agency between them. Police forces are required to consider
criminal confiscation in the first instance as this must be used
in preference to civil recovery or taxation. Referral partners
were confused about the role of the Agency due in part to other
changes to assets recovery powers made as a result of the Proceeds
of Crime Act 2002, in particular the increased powers available
to the police for criminal confiscation and cash seizures. The
Agency had been trying to raise its profile and the profile of
assets recovery more generally with potential referral partners.[8]
8. Receivers are used now in cases where frozen assets
can be managed only by those with specialist skills, mainly where
entire businesses have been frozen. The Agency nominates and pays
the receivers who are appointed by the courts. Receivers' fees
were over £200,000 per case on average, and took up almost
a quarter of the Agency's budget. Receivers were required in a
lower proportion of cases now that the Agency could use Property
Freezing Orders to manage many frozen assets. They remained, however,
a costly option in the 10% of disrupted cases where receivers
were still appointed, and in the legacy cases where they continued
to act. From April 2006 the Agency had let all new receivers'
contracts on a fixed price basis.[9]
9. Cases take over four years to complete on average.
Continuity in the workforce is therefore key but the Agency had
experienced staff turnover of almost 25% in twelve months, rising
to 50% within its legal team. The Agency had located its procurement
and finance staff in Belfast and criminal confiscation staff in
regional offices, but the turnover of operational and training
staff was compounded by the location of the Agency's head office
in central London, near to the Administration Court, where there
was a particularly buoyant employment market. The Agency had relied
heavily on temporary staff, using a high proportion of secondees
from other organisations including lawyers who were part of the
Government Legal Service, which encouraged lawyers to move post
every three years. When the Agency merges with the Serious Organised
Crime Agency and the National Policing Improvement Agency from
2008 at the earliest, Agency staff would be able to transfer to
the merger organisations or to other Civil Service posts, provided
that suitable posts were available and staff were made aware of
them in good time.[10]
5 Qq 10-12, 29-30, 36, 41-45, 56-66, 125; C&AG's
Report para 3.8-3.11 Back
6
Qq 5, 11, 39; C&AG's Report, Figure 4 Back
7
Qq 5, 22-24, 125; C&AG's Report, paras 1.6-7, 1.8, 1,11 Back
8
Qq 13, 25-26, 51-5, 101-7, 109-11; C&AG's Report, para 2.1-2,
2.4, figure 9; Ev 30-32 Back
9
Qq 31, 47, 98-9; C&AG's Report, para 3.14 Back
10
Qq 27-8, 46, 100, 113-20, 121-4; C&AG's Report, para 3.12 Back
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