Lack of IT project governance causes qualification of accounts at Department for Local Government…
Last year, improper authorisations were made for £55m capital spending on IT projects at two ‘arms length bodies’ controlled by the UK Department for Communities and Local Government (DCLG).The boss of the National Audit Office has castigated the DCLG for allowing spending beyond limits set by Parliament.
Poor governance of project management was the root cause in both cases.
At the Valuation Tribunal Service (VTS) IT systems enhancements were approved by the Department’s sponsorship team despite there being no capital budget approved.
The incoming management team at the Commission of Local Administration in England (CLAE) discovered that the previous management had authorised an IT system upgrade and hidden the cost in revenue budgets rather than having to seek approval for a capital spend.
The Association for Project Management guide to Directing Change makes clear that special consideration needs to be given to ensuring that corporate financial controls are applied just as rigorously to projects as to business as usual operations:
Specifically, the guide recommends that the board should ask themselves the following question:
“Are the organisation’s financial controls, financial planning and expenditure
review processes applied to both individual projects, and to the portfolio as a
whole?” p.12, Directing Change, APM 2011