Birmingham, which claims to be Europe’s largest local authority, is suffering from what the Council’s spokesperson describes as teething troubles and local MP John Hemming suggests is something trivial.
The council’s joint venture IT system with Capita is a SAP-based Voyager installation. The Council uses the system to pay GB£1 billion a year for goods and services, representing some 700,000 invoices.
So far, 216,000 invoices from 20,000 suppliers have been paid and the Council claims that these are successful payments, suggesting that no paid invoice payment has been contested by a supplier. The Council admits to approximately 18,000 invoices in backlog but has not disclosed how long they have been in backlog.
For bailiffs to have been sent to Council premises to enforce orders for debt payments suggests that at least some invoices have remained unpaid for a significant period.
There is no indication yet whether the system problems are being successfully addressed, or how long it is expected to take before the Council is able to pay invoices within payment terms.
In addition to bailiffs calling on the Council, many suppliers are reported to have withdrawn services or refused to supply goods to the Council. In one reported case, Council staff have had to buy food using their own money to feed children in a Council care home.
The council ran into problems in October 2007 when the system went live. That suggests that some unpaid bills may have been outstanding for as long as eight months which would explain why suppliers have been forced to go to the courts to obtain payment of bills. There is no available information on the companies that are still owed money, but it is believed that many of them will be small to medium sized enterprises, SMEs, who would be seriously affected by late payments from what might be a major customer.
Amongst the problems encountered was the failure of the automatic installation system, affecting 5,000 PCs, each of which had to be visited by by a software specialist. Users were unable to obtain assistance from the helpdesk for 48 hours.