EFFICIENT GOVERNMENT FUND

Transcription

1 Part 1: Summary Table EFFICIENT GOVERNMENT FUND Stage 1 application expression of interest Bid number (for EG use) Lead bidder Tom Wilson Scottish Executive T Tom.wilson@scotland.gsi.gov.uk Martin Gibney Scottish Executive T Martin.gibney@scotland.gsi.gov.uk Brief description of the aims of the project The aims of the project are to reduce the administrative costs of manually processing paper invoices through eliminating duplicate data entry and manual keying across the Scottish Executive, Executive Agencies, Non Departmental Public Bodies and associated bodies which use Oracle 11i (Scottish Executive Accounting System - SEAS). To make a step change to move to automated consolidated electronic invoice uploading onto SEAS with major transactional suppliers and the p-card provider (VISA GPC Barclaycard). Plus introduce Evaluated Receipt Settlement where appropriate which eliminates the need for a supplier to generate a paper invoice. To Introduce e-invoicing as the norm whereby suppliers and the p-card provider present electronic invoices which are uploaded onto the finance system for payment eliminating manual intervention. Clear description of what the EGF money would be used to buy The EGF money would be used to purchase external consultancy services, change management services, training provision and communications materials. Partners to the project likely to commit resources Scottish Executive (9 core Departments) Scottish Courts Service Scottish Drug Enforcement Agency Scottish Criminal Records Office Scottish Criminal Cases Review Commission Scottish Fisheries Protection Agency Communities Scotland

2 General Registers Office National Archives Scotland Care Commission Scottish Agricultural Science Agency Her Majesties Inspectorate of Education Student Awards Agency Scotland Scottish Public Pensions Agency Scottish Fire Service Training College Scottish Police College Accountant in Bankruptcy Accountant of Court Scottish Land Court Land Tribunals for Scotland Scottish Law Commission Office of the Social Security Commissioners Pension Appeals Tribunal VAT and Duties Tribunal Red Deer Commission Mental Welfare Commission Royal Commission on Ancient and Historical Monuments Names of other organisations with whom the project has been discussed (to assist the introductions process) The project has been discussed with : Tayside NHS Trust, Forth Valley NHS Trust, Argyll and Clyde NHS Trust, SNHS Shared Services and the Scottish Executive Health Department. The Scottish National Health Service have decided through HD and their shared services agenda to fund two projects independently from their own Programme funding. Two projects are being taken forward at Tayside NHS Trust and Forth Valley NHS Trust. SNHS s decision was made due to the period of time it would take to secure EG funding and the proposed funding models. Evidence that suggested approach has been deployed successfully elsewhere A Multi-Functional Team (MFT) was established within the core Scottish Executive including : SEAS Operations staff, Scottish Executive Audit Unit, Scottish Procurement Directorate and Education Department. The MFT was set up on 4 July The MFT worked for a 12 month period reviewing, re-engineering and rationalising purchase to pay (p2p) processes. Significant investment has been put forward by the Scottish Executive over an 18 month period. The administrative costs of processing paper invoices in a manual manner has been analysed and cost breakdowns are available. The proposed e-invoicing solutions were applied to 4 Divisions in Education Department and proven to be efficient and effective securing administrative cost reductions across the 4 Divisions. A Project Initiation Document was drafted in mid July Unfortunately Programme funding was not

3 available within the Scottish Executive. Papers were submitted to EG on 4 October 2004 on the proposed e- Invoicing and e-payables Programme. Change and Corporate Services (CCS) a Department within the Scottish Executive decided in early November 2004 to independently fund the roll-out of e-invoicing due to the reduction in administrative costs. 35,000 was put forward by CCS to fund external Project Support which is required (plus SPD and SEAS Ops are providing internal support). The processing of manual paper invoices is expensive in allocation of time and effort. E-Invoicing replaces the paper invoice. Work has now been completed in educating a number of major transactional suppliers to format their invoices in an electronic manner for upload onto the finance system (SEAS). Work has also been completed with Barclaycard (p-card provider) which enables e-invoicing and settlement for the physical and embedded p-cards. VISA have recognised the work which the Scottish Executive have undertaken as the best example of B2B E- Commerce in North America and Europe. Automated electronic consolidated invoicing has been introduced for several major transactional suppliers (Carlson Wagonlit and Pertemps). Reducing the number of paper invoices received per month from 3,500 to 36 electronic files. The VISA Government Procurement Card has been rolled out across Education Department within the Scottish Executive. Plus the virtual / embedded p-card is being used within EASEbuy on an exception basis for low value / high volume commodities. Barclaycard have formatted an electronic file which uploads data seamlessly into Oracle 11i (SEAS). VISA have commended the virtual p-card solution as the best p-card e-commerce solution within the Public Sector in Europe and North America. Total Transaction Costs have been calculated for the cost of processing paper invoices as against e-invoicing solutions. The comparative Total Transaction Costs are attached. Are there any restrictions to potential for enlargement of the project (i.e. technology, number of partners etc) Benefits projected from the No. e-invoicing Benefits

4 project The benefits projected from the project are as follows: 70,000 low value non-recurring paper invoices (less than 1,000) are received by the Scottish Executive on a recurring annual basis. The administrative cost of setting up a new supplier and processing the invoice manually is approximately 12. The cost of processing a paper invoice manually on SEAS where a supplier has been set up is approximately 10. The administrative costs associated with invoice payment through the VISA GPC for the partners is 2. The reduction in administrative transaction costs is 500,000 per annum on a recurring basis (15,000 of the invoices cannot be paid through VISA GPC due to the small suppliers and professionals who cannot accept VISA GPC payment0. 200,000 invoices per annum are received from major high volume transactional suppliers on a regular basis (low value and mid-value). These invoices will be moved to an automated electronic consolidated invoice which is received from the supplier. Administrative cost reductions across all partners is in the region of 1 million per annum. 30,000 invoices per annum are received from infrastructure suppliers for services where demand cannot be forecast eg utilities, photo-copying and facilities services. Evaluated Receipt Settlement (ERS) has now been proven as the cost effective payment solution for such services eliminating the need for a paper invoice from the supplier(s). Estimated cost reductions in the region of 200,000 per annum. Estimated financial projections Total 2005/6 2006/7 2007/8 2008/9 Overall project cost 400, ,000 Estimated projected benefits 700,000 1,300,000 1,700,000 1,700,000 Is a pilot required see No. guidance notes Additionally: why is EG funding required Does this project EG funding is required to roll out e-invoicing across the partner organisations. To provide the external consultancy services which are required to act as a change management catalyst for the transformation of manual invoice processing. Training and education are required to embed the best practice which has been developed to business as usual. External Project Managers and external training support is required to provide change management, communication, education and training on our cohesive approach to invoice management. The project is complementary to eprocurement providing

5 complementary in anyway to other EG work Is stage 2 development funding requested? automated back-office reconciliation of invoices. No.