The Serious Fraud Office Chapter 2     Running costs and staffing   31   The running costs expenditure plans for 1999-2000 are 6.8% higher than the provision in Estimates for 1998-99 (Table 3). This is still a challenging position given the increased caseload. The SFO seeks to achieve a cost-effective balance between permanent and temporary staff and keeps its staffing plans (Table 4) under review so that staff numbers can be accommodated within running costs provision. During 1998-99, the SFO had 8 members of the Senior Civil Service, falling within the salary bands indicated in Table 5.   Table 3: Running Costs £million Voted in estimates 1993-94 outturn 1994-95 outturn 1995-96 outturn 1996-97 outturn 1997-98 outturn 1998-99 estimated outturn 1999-00 plans 2000-01 plans 2001-02 plans Gross Running Cost Civil Service Paybill(1) 4 4 5 5 5 5 - - - Administration and Investigation & Prosecution 7 7 6 5 5 6 - - - Total 11 11 11 10 10 11 12 12 12 Related receipts 1 1 1 1 Net Expenditure 11 11 11 10 10 11 11 11 11 Notes: (1) This covers the pay costs, including employers' earnings related national insurance, of civil servants in running costs (as given in the table on departmental staffing).   Table 4: Staffing 1993-94 outturn 1994-95 outturn 1995-96 outturn 1996-97 outturn 1997-98 outturn 1998-99 Original plans 1998-99 estimated outturn 1999-00 plans 2000-01 plans 2001-02 plans Civil service full time equivalents 138 136 138 159 160 162 150 166 166 166 Overtime 3 5 2 2 2 1 2 2 2 2 Casuals(1) 36 27 22 13 13 25 8 9 9 9 Total 177 168 162 174 175 188 160 177 177 177 Note: (1) Not all casuals in the outturn figures were paid for from running costs   Table 5: Senior Civil Service Salaries £5000 Bands Number of staff £55,000-59,999 4 £60,000-64,999 3 £65,000-69,999 - £115,000-119,999 1 Departmental Investment Strategy   32   The SFO does not have policy responsibility for any area of programme capital expenditure. The provision published in the CSR outcome details the total available to the department for administrative capital and is cash limited. All current and capital expenditure supports core operational functionality and is planned, as far as possible, to take account of changing circumstances which may affect these operations, in advance of their occurrence. The SFO will continue to seek value for money on all procurement and contracts. This is most effectively carried out through continuing partnerships with larger public sector organisations that have dedicated resources working in these areas.   33   The SFO is not asset rich. The headquarters and sole office is Elm House, in central London. This building is occupied on a full repairing lease and there is regular current maintenance expenditure to support the fabric of the property and make good the maintenance backlog inherited from Property Holdings. Other capital expenditure is mainly incurred on office equipment and furniture and on IT to ensure that the SFO's forensic IT capability continues to match the increasing demands for IT related investigative techniques.   34   Expenditure planned for the CSR period includes a phased plan to improve utilisation of space within Elm House, maintaining office equipment levels, maintaining the forensic IT capability and dealing with any residual Year 2000 related computer problems. Apart from the latter item, this trend in expenditure is likely to continue in future years due to general obsolescence and technological change. The reduction in the capital provision for the CSR years reflects the reduced need for IT capital as a result of the DOCMAN PFI project (see paragraph 42). More detail is available in the SFO departmental investment strategy document to be found on the SFO web site.   35   The SFO has sought to identify opportunities to increase the utilisation of its existing assets, including those opportunities available under the Wider Markets initiat i ve . Due to the limited scope of the asset base and the need to fully utilise this in the support of core operations, the key solutions are to rationalise and seek further efficiency and effectiveness in these and other available assets. This has not identified significant assets for disposal. Plans for future investment are not likely to have a material effect on the level of current expenditure on future maintenance or capital charges under resource accounting and budgeting.   Counsel Fees and Costs Awarded against the SFO   36   The SFO has previously provided a breakdown of counsel fees and costs awarded against the SFO as part of the Supply Estimates. This information is now given in Table 6 below.   Table 6: Counsel fees and costs awarded against the SFO £000s Outturn 1995-96 Outturn 1996-97 Outturn 1997-98 Estimated Outturn 1998-99 Plan 1999-2000 Counsel fees 3,246 3,091 2,575 3,000 3,000 Costs awarded 8 30 1 192 0 Value for money   37   The SFO has continued to build on its plans to achieve better value for money across its activities. Competitive arrangements for selecting and appointing counsel have continued. Contract procedures are being strengthened in order to gain improved value for money from competition.   38   The SFO will regularly and systematically review services and activities over a 5-year period in line with the policy set out in the handbook "Better Quality Services". A future work programme will be developed by September 1999 with the intention to review at least 60% of services and activities by March 2003.   39   Work has continued to improve the SFO's budgetary control and forecasting of expenditure. An upgraded financial accounting system is planned to become operational in April 1999, which will ensure Year 2000 compliance. It will gather and ensure the integrity of the information that will underpin resource accounting and budgeting, whilst still maintaining Vote Accounting for the production of Appropriation Accounts.   40   The SFO will introduce the use of the Government Procurement Card during 1999 and will pay invoices by BACS, where suppliers agree and this secures value for money, by December 2000.   Information Technology   41   The SFO's Forensic Computing Unit maintains an IT technical infrastructure which increasingly contributes to the efficiency and effectiveness of the work of the Office. The operation and scope has been reviewed during the year and is being developed further to match the growing trend in IT based fraud and improve the capacity to recover and analyse computer-based material seized by the Office during its investigations. Such recovery and the subsequent processing of the material are increasingly important, and are most cost-effectively carried out in-house. The SFO will continue to review its capacity for such processing in the future.   DOCMAN   42   The SFO has been in the forefront of using information technology in the investigation and presentation in court of fraud cases. It had identified the need for an IT based investigation and prosecution system and embarked upon a major project to identify the competitive benefits and route to achieve this. The preferred route was to seek a public/private partnership under the Private Finance Initiative. Called "DOCMAN" the contract was signed between the SFO and IBM in January 1998 for the full service provision and development of an image based document investigation and prosecution system together with an IT infrastructure refresh. This significant private sector investment will contribute to the achievement of SFO aims and objectives and will be paid for on a demand basis from current expenditure. The contract provides options for other related services and the SFO has already arranged for IBM to provide office automation services. All the existing SFO office automation equipment was transferred to IBM in April 1998. The development phase of DOCMAN has involved all parties in significant effort during the year. Full implementation is planned to take place during the next year and includes further work on integration and development of systems to take account of technological change in IT communications e.g. Government Secure Intranet (GSI) and telephone services.   Millennium Threat   43   Plans have been brought forward to deal by summer 1999 with potential Year 2000 risk and any disruption to Office systems. All non-compliant IT equipment is being replaced, and software being replaced or up-graded. The SFO has a relatively small computing base and the cost of ensuring compliance is estimated to be within £400,000. Specialists have checked all non-IT office equipment and systems and none have been found to be at risk.   Payment performance   44   The SFO fully complies with the CBI prompt payment code and already adheres to the guidance contained in BS7890 "Achieving good payment performance in commercial transactions". Current payment policy is to pay bills in accordance with agreed contractual conditions,or where no such conditions exist, within 30 days of receipt of goods and services or the presentation of a valid invoice, which ever is the later.   45   For all invoices paid (6,400 in total) during the sample period from 1 April 1997 to 31 March 1998, over 96% were paid within this payment policy. This is, in real terms, an improvement on figures published in previous departmental reports and continues the trend in improved performance to meet agreed targets.   Environmental issues   46   The SFO is involved, along with the rest of the Law Officers' Departments, in a continuing review of environmental issues, reporting to the Solicitor General as Green Minister. The SFO successfully met the Departments' target of a 10 % reduction in energy consumption in 1995-96 against a baseline of 1992-93 and is now aiming for a 15% reduction by the year 2000.   47   The level of paper recycling within the department remains high. It is anticipated that the implementation of the DOCMAN project will result in a significant reduction in the volume of paper consumed by the department. Recycling of newspapers, fluorescent tubes and other items will continue. Energy efficiency and the economical use of water remain important elements in the maintenance programme for Elm House. Environmental considerations also continue to feature in the SFO's procurement decisions.   Equal Opportunities   48   The SFO continues to promote equality of opportunity throughout its management and personnel policies and staff development. It supports the Investors in People standard as a means of improving development opportunities for all staff as well as harnessing their effort more effectively to the business aims of the Office, and intends to achieve accreditation by the end of 1999.   49   Some 48% of the Office's total staff are women. Of total staff at junior management levels (salary bands 3 - 5) 44% are women and at middle management levels (salary bands 6 and 7) 29% are women. Some 22% of the Office's total staff are from minority ethnic ori gi n s. During the year 13 % of available promotions were gained by ethnic minority staff. Staff with a known disability make up 1.9% of the SFO work force.   50   The SFO continues to offer training in equal opportunities by video to all staff. Staff from the Office participated in positive action training programmes for women designed to ensure that women fully contribute to the organisation's role at management level. The SFO is a member of Opportunity 2000, and subscribed to Familylife Solutions (which provides information on childcare and eldercare to working people). The Office also offered assistance to staff who incurred additional childcare costs when on training courses or detached duty.   Recruitment   51   There have been a number of external recruitment competitions, which were held on the basis of fair and open competition in accordance with the Civil Service Commissioners' Recruitment Code. During the course of the year there have been no occasions where a permitted exception to fair and open competition has been used and there have been no re-appointments of former civil servants.   52   A Recruitment Guide has been distributed to all staff who are eligible to participate as assessors on recruitment boards. The Guide is provided in addition to their mandatory attendance on formal selection interviewing training courses.   Sickness Absence   53   The SFO is reviewing management of sickness absence and will be making proposals to the Cabinet Office for a target of reduction, which relates to existing rates, to be set by June 1999. As part of its strategy to achieve reductions, the SFO intends to offer health screening checks to staff.   Further Information   Further information on the work of the SFO may be obtained from:   Serious Fraud Office Elm House 10-16 Elm Street London WC1X 0BJ Telephone number: 0171 239 7272 Web Site: http://www.sfo.gov.uk Fax number: 0171 837 1689   Bibliography   Serious Fraud Office Annual Report 1997-98, published by HMSO July 1998 (ISBN 0105518565).   Supply Estimates 1998-99 Class VIII Lord Chancellor's and Law Officers' Departments, published by HMSO March 1997 (ISBN 0105539368).   We welcome your comments on this site. Prepared 23 March 1999