A computerised debt-recovery system was designed to save the council money but coincidentally racked up losses of nearly £300,000. It was eventually scrapped last October, two years after its introduction, after being declared unfit for purpose.
Richard Laird, Inverness Councillor, described it as ‘one of the worst failings to come to my attention‘ . Richard recently took the helm of the audit and scrutiny committee.
He continued: “What a disappointing example of taxpayers’ money being wasted, this project should have saved the council money but has ended up doing the opposite. Lessons must be learned to prevent this from happening again.”
The Corporate Arrears Recovery System Project was designed to bring all the council’s debtors into one computerised system, saving staff time by allowing them to see at the touch of a button how much money an individual owed in council tax arrears, rent arrears or business rates.
The system had cost the authority £287,565 by the time it was scrapped. That is almost the same amount cut from this winter’s road gritting budget and comes as the authority faces a £46 million black hole in its budget.
The failings were discussed in private on June 18 by the audit and scrutiny committee. A source said finance director Derek Yule was “hauled over the coals” and Councillors were angered at having been kept in the dark about the problems. It is understood that the lead official working on the project has since left the local authority of their own accord. They were not dismissed.
In a report to the resources committee in Inverness tomorrow, Mr Yule admits that “project updates were not properly reported” to elected members. Mr Yule was unavailable for interview, but in a statement he said the software did not become operational and did not affect actual debt recovery.
The statement adds: “The Corporate Arrears Recovery System Project was aimed at a providing a more effective service and corporate approach to debt management. The system should have improved debt recovery and increased income to the council. As such, it was the right thing to do, but as with any large investment projects, there are risks attached.”
“The council needs to continue to be innovative to provide effective services and value for money, with appropriate governance measures. Things can go wrong and when they do, it is important to learn the lessons and be open and transparent about these.”
However, taxpayer pressure group Taxpayer Scotland believed the losses were unacceptable.
“Taxpayers will be furious” a spokesman said. “This kind of bungling simply isn’t acceptable when we’re trying to make necessary savings and get the country’s finances back on track.”