Letter to the Second Clerk of the Committee
from the Head, Parliamentary Relations Team, Foreign and Commonwealth
Office
FOREIGN AFFAIRS
COMMITTEE VISIT
TO HANSLOPE
PARK, 24 JUNE
2008
In reply to a question about Bad Debts, it was
stated that the Foreign and Commonwealth Office had problems with
the Ministry of Defence which was regarded as not one of the best
payers. Discussions have taken place with the MoD over a long
period and, since June 2007, a better process is in place to resolve
disputes.
The background to this is as follows.
The FCO has many transactions with the MoD.
Over the last four years, the amounts invoiced to MoD have amounted
to approximately £111 million. The MoD debt is approx £4.6
million. The debt for MoD relates to old invoices that have been
chased by the FCO over a period of time. The FCO Recoveries Section
found that MoD were using different numbers on their system to
those recognised when entering invoices and making payments and
thus causing problems. There was a mismatch between what we recognised
as due and what the MoD recognised as due and this was leading
to delays in settlement.
In June 2007, the MoD changed the system and
process they used for entering invoices and making payments. This
has helped greatly to reduce the mismatch and has allowed the
debt to be chased more effectively. Although we do still have
some issues we are resolving them and have moved forwards from
invoices sent before June 2007. For invoices sent since June 2007,
the position is much clearer.
18 July 2008
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