Not Just Sheep and Rugby: January 2021

Sunday, 31 January 2021

Another mystery player added to Avocet mix

by DOUG COLLIE

Shareholders in two companies - Avocet Natural Capital (ANC) and Gennfros - have been urged to resist a 'hostile' £250 million takeover bid by an unnamed major oil company, and stick instead with a group of anonymous investors said to be waiting in the wings.

The latest twist in the long and winding avocet fuel additive saga was revealed this weekend by Avocet boss and Gennfros life president Martin Frost who told some 600 ANC stakeholders of a £50 million offer for the firm's intellectual property.

According to Mr Frost that could result in a £43 million share-out for investors after he and two fellow travellers in the avocet venture - Dr Bob Jennings and US-based Glyn Short - received the £7 million they are due as creditors of ANC subsidiary Avocet IP Ltd.

Mr Frost explained in a shareholder letter that the approach from the suitor was originally perceived to be a friendly joint venture oil and gas company partnering with Gennfros Limited [ANC's successor] to develop and market the non-explosive methanol additive. Avocet was set up by Mr Frost and Dr Jennngs in 2014 but has yet to bring any product to market.

As well as the bid for Avocet IP, Mr Frost outlined a £200 million takeover offer for Gennfros, which was only incorporated in September 2020, and has yet to have four patent applications approved.

But unfortunately, wrote Mr Frost: "The directors of both Gennfros and ANC Plc along with Gennfros Limited’s new investors are hostile to this approach as it does not meet humanitarian and /or shareholder value prospects.

"It is understood that this major oil company is of the opinion that it would prefer to obtain a quasi-monopoly for the use of Avocet’s and then Gennfros’s intellectual property – it is understood that all ANC Plc and Gennfros Limited shareholders shall be shortly written to".

And shareholders were then informed: "To counter this unwanted offer, the directors of both Gennfros Limited and ANC Plc along with the new investors have commissioned a rebuttal document – in addition to the proposed rebuttal document, calls today were made to leading Gennfros Limited shareholders to ascertain if they would separately contract with the new investor to lock out the proposed hostile offer."

A business expert who studied Saturday's widely circulated correspondence from ANC and Gennfros told Not Just Sheep & Rugby: "In my opinion, a takeover offer, friendly or unfriendly, is extremely unlikely at this time."

The specialist pointed out: "All Gennfros has are four patent applications. Before a patent is granted it goes through a rigorous examination process to ensure that it is indeed “novel” and that it does not infringe on anyone else’s intellectual property. Until it is through that process there is no assurance that a patent will be granted."

By way of example, in the UK approximately 22,000 patent applications are filed each year while only some 5,000 are granted – an approval rate of roughly 23% (Source: Intellectual Property Office).

"So Mr Frost would have you believe that a major corporation is prepared to take the significant risk of investing £200 million in something that in the end, has less than a one-in-four chance of success."

And the expert claimed"Equally importantly, while Mr Frost is making much of the fact that his new additive is non-explosive, he has not addressed the fundamental drawback to it. Methanol has only half the thermal efficiency of diesel.

"In simple terms, this means that you will only go half as far on a gallon of it compared to diesel. All the economic data that he has provided to us so far shows that the price is not low enough to provide a per/mile cost advantage versus diesel, an essential element for the new fuel’s success."

However, the observer of the Avocet activities did add: "I am pleased to see that he has reduced his valuation of Avocet’s IP down to £50 million from the outrageous £100 million to £400 million that he was promising a shareholder just a week ago.

"On the downside, it does seem that he has selective amnesia as he is claiming that he, Jennings and Short are owed £7M while forgetting that he owes ANC £6.2M plus 5% interest for shares that he arranged to have issued to himself but he has never paid for.

"Lastly, isn't it time that he stops calling them "new investors"? They have been around for six months now so they are not "new", and despite many promises, they have never invested, so they are not 'investors'".

Monday, 25 January 2021

Fiscal under fire from Avocet chief

by DOUG COLLIE

Martin Frost, the "terminally ill" boss of the Avocet group of companies who also claims to suffer from memory loss has launched a bizarre written attack on a leading Scottish prosecutor, accusing him of 'rising above Crown impartiality'.

At the weekend, Mr Frost used one of his frequent shareholder letters which are circulated to hundreds of Avocet Natural Capital (ANC) PLC investors to level allegations at the Borders Procurator Fiscal (PF).

In recent months local police officers have been involved in investigating a number of disputes, complaints and counter complaints between Mr Frost, his Avocet 'disruptive technology' businesses and members of the Orrs, a Berwickshire farming family including Aileen Orr, a frequent target for Mr Frost's literary wrath.

Mr Frost's six-page communication with shareholders also suggests that police officers under the control of the PF's office, have issued a warning to Avocet company secretary and barrister Eirlys Lloyd to desist from threatening a former employee of the group. According to Mr Frost the threat allegations are unfounded.

Another section of the shareholder letter outlines Mr Frost's state of health after "a shareholder wrote to me requesting that given I am close to death what will happen to his investments."

Mr Frost writes: "Due to the Covid-19 Pandemic, my cancer treatment is eleven months overdue and without it I shall surely die. But I am not dead yet, and I am convinced that Gennfros Limited’s [ANC's successor] new team are more than able to build upon the concepts derived from (chemists) Dr. ‘Bob’ Jennings and Dr. Glyn Short.".

Companies managed by Mr Frost and Dr Jennings have so far failed to bring a 'revolutionary' vehicle fuel additive to market after six years. The intention now is to dissolve ANC and concentrate on the value of intellectual property.

The Avocet chairman goes on to say: " At 73, I suffer from polycythaemia vera, diabetes, implant rejection, derivatives thereupon including some memory loss, and due to my physical ailments, I have clinical depression. That said, I keep taking the tablets and with support and my deep religious faith I battle through each day.

"I passionately believe ill health gives as well as it takes. My compassion and view of my fellows has radically improved especially when one sees the goodness this world has to offer."

In December 2019, explains Mr Frost, he made a complaint to the Scottish Crown Office concerning "theft and unlawful activities" involving several parties which had resulted in a £2.5 million loss for Avocet.

According to his weekend correspondence, Mr Frost claims: "What does immediately concern me, and my lawyers is the unthinking support Aileen Orr has managed to coral [sic] to her inconsistent lies. Masquerading as an SNP Scottish Government official Aileen Orr disseminates untruths and induces naïve others to her platform.

"A prominent other is Procurator Fiscal ***** who has risen above Crown impartiality and seeks to aid Aileen’s cause. Currently, even local Border based police officers are surprised by *****’s directions that all matters involving Avocet, Frost, and Orr must be passed direct to him and not sieved by the police.

"According to some police officers, **** supports Aileen Orr’s lie (endorsed by the bully girls - Mr Frost's description of the administrators of one of his insolvent firms) that Avocet & Frost stole Sunwick, Houndwood, and Harcarse Hill farms from the Orr family – so much for impartial thinking.

"Only this week, ****’s sway over Border Police was obvious when a PC... contacted Mrs. Eirlys Lloyd to warn Mrs. Lloyd off from threatening ***** [a named Avocat staff member] – although there was no truth to the threat, The PC said and inferred that (the fiscal) had issued standing instructions that Mrs. Aileen Orr must be assisted in her dispute with Frost & Avocet.

"The PC stated that **** was handling matters himself and thought Avocet’s US shareholder communications contravened the Communication Scotland Act Section 127 because such spoke ill of Mrs. Aileen Orr, her acolytes, and her bully girls. All this, notwithstanding over 25,000 hate emails against Frost & Avocet distributed by Aileen Orr - not forgetting Aileen’s social media widespread and untruthful muttering: indeed, as counsel sees it, Mr. **** appears – ‘just a touch bias’".

A spokesperson for COPFS (Crown Office & Procurator Fiscal Service) told us it would not be appropriate to comment on the conduct of a live investigation.

In conclusion, Mr Frost writes: "I passionately believe that at the end of the day, not only will all genuine creditors to all Avocet related companies shall be paid in full; but that all genuine Avocet shareholders will receive a substantial – and for many a very substantial shareholder return which shall soon be forthcoming.

"And yes: it would be nice to think that GennfrosLimited one-penny shares may sell for £20, £30 or more pounds and yes, one can dream that Gennfros’s intellectual property will fire the company to similar heights of that currently found with Facebook, Amazon, and Google – but then again truth is stranger than fiction."

Sunday, 17 January 2021

£99m contract extension could still be challenged

by DOUGLAS SHEPHERD

Scottish Borders Council received 'notes of interest' from ten separate companies after announcing its intention to controversially hand IT giants CGI a multi-million pound contract extension until 2040 without inviting competitive bids.

The information together with opinions from senior council officers on the likelihood of a legal challenge is contained in confidential documents released by the local authority in response to a Freedom of Information request.

The papers also show SBC sought advice from specialist lawyers before councillors, by a majority, rubber-stamped the massive deal last September.

However, it is revealed: "There remains a residual risk of challenge for a six month period from the date the VEAT notice was published [September 7th 2020], and the courts could consider the council's actions were unlawful were the original notice considered not to have been clear".

The so-called VEAT (Voluntary Ex Ante Transparency) notice set out the reasoning behind the proposed contract extension without opening up the IT work to CGI's competitors.

This is the SBC explanation in full: "The original City of Edinburgh contract award notice, 2014/S 024-038205, noted the scope of ICT Services to be delivered as including all ICT services presently delivered, those contemplated to be delivered by 2016 and all future ICT requirements of the City of Edinburgh Council and the contracting authorities named in the original Contract Notice.

"It further noted a requirement for a contract which is sufficiently flexible and scalable so as to provide a long-term resolution that offers significant future-proofing. The estimated value excluding VAT was noted to be in the range: between 150 000 000 and 2 000 000 000 GBP.

"Scottish Borders Council is one of three of the named authorities currently contracted pursuant to the arrangements awarded under 2014/S024-038205 with an overall anticipated spend well within the value range notified to the market in 2014 (SBC substantive contract awarded 2016 for a period of 13 years with optional 6 year extension and a likely spend of 179m GBP) such that the additional scope and spend remains an application of the original terms within the scope of the original contract notice. This ensures the requirements of EC Directive 2004/18/C as incorporated into Scots Law by the Public Contracts (Scotland) Regulations 2015 are met."

The reports considered by Borders councillors in private warned: "Any challenge to the award is likely to emerge during the VEAT notice period. There are residual risks of challenge where the notice was not clear or the courts consider the award was in fact unlawful. Longstop date: six months from the date of the VEAT notice".

So technically an objection or challenge could be lodged before March 7th 2021.

The legal and procurement issues were set out again in a follow up report presented to councillors on September 25th, the day the final decision to finalise the deal was taken.

In a reference to the publication of the VEAT notice the report states: "This notice attracted notes of interest from ten companies over the ten-day initial test period, and three media enquiries. No challenges were raised to the proposed extension.

"This provides a basis to proceed with confidence while noting that risk of future challenge has not been removed altogether by the VEAT process."

The council had obtained external legal advice from commercial law firm MacRoberts in a bid to ensure what was being proposed was not ultra vires [beyond legal powers].

MacRoberts had also reviewed the drafting of the VEAT notice.

And the report states: "The advice from MacRoberts concluded that the proposed extension is 'not considerable' within the context of the original OJEU [Official Journal of the European Union] notice issued by City of Edinburgh Council".

The complete collection of documents released by the council can be accessed via these links:

Saturday, 16 January 2021

Financial sustainability of NHS Borders at risk, say auditors

by EWAN LAMB

There is a significant risk over NHS Borders' financial stability as it continues a struggle to balance its books while relying on millions of pounds of 'brokerage' from the Scottish Government, according to a report from its external auditors Audit Scotland.

The annual audit report for 2019/20 - before the full impact of Covid-19 hit health services - appears to have been virtually unnoticed since it was posted on the Audit Scotland website earlier this month. It outlines a list of daunting financial issues which are bound to be brought into even sharper focus by the current pandemic.

According to the report, expenditure on the Covid-19 response had reached £4.5 million by the end of August 2020.

Audit Scotland warns: "NHS Borders required brokerage [extra cash] of £8.3 million in 2019/20 from the Scottish Government in order to balance its revenue budget. The board remains at Escalation Level 4 in the NHS Scotland Performance Framework. The board must prioritise re-starting the Financial Turnaround programme and quickly assess the financial impact of Covid-19, if financial balance is to be restored."

In the NHS Scotland Performance Framework. Level 4 is described as ‘Significant risks to delivery, quality, financial performance or safety; senior level external support required’. The board therefore received tailored support in 2019/20 in the form of external expertise and scrutiny to attempt to return to financial balance.

Referring to the board's financial sustainability, the report states: "The board has developed a three-year financial plan (covering 2020/21 to 2022/23), but this reports an unbalanced position and forecasts additional brokerage of £7.9 million will be required in 2020/21. Brokerage funding will be subject to repayment if a balanced position is not achieved in this three-year period. NHS Borders will not achieve efficiency savings targets in 2020/21 based on the current assessment of its financial position".

And so far as Value for Money was concerned, Audit Scotland concludes: "Service performance continues to be variable in 2019/20. Only five out of the 13 key performance indicators were achieved, with some waiting time targets missed. Performance will continue to be challenging in 2020/21 due to the Covid-19 response and progressing remobilisation plans."

The report outlines cost pressures during the financial year covered by the audit. Those pressures continued in Integrated Joint Board (IJB) set aside budgets, particularly at its main acute site at the Borders General Hospital. This was due to the requirement to provide surge beds to support delayed discharges. An additional funding contribution of £6.3 million was provided by NHS Borders to the IJB, to allow the IJB to reach a break-even position.

In 2019/20, NHS Borders was required to make efficiency savings of £21.7 million due to deficits brought forward from previous years. This was partly achieved, with the board reporting recurring savings of £7.1 million and nonrecurring savings of £2.9 million. Due to unachieved savings and continued financial pressures, management are reporting a £13.1 million deficit was carried forward in to 2020/21.

The audit report explains: "Scottish Government have indicated that brokerage required to support financial balance in 2019/20 and thereafter will be subject to repayment, with terms to be agreed with the board as part of ongoing financial planning discussions. The financial stability of the organisation remains a cause for concern.

"Scottish Government have tasked NHS Borders to produce a balanced 3-year financial plan covering 2020/21 to 2022/23. However, the plan will not be balanced. Instead, the financial plan will aim to reduce the board’s recurring deficit to an estimated £2-3 million by the end of the 3-year period. There is therefore a significant risk regarding the board being financially sustainable."

Tuesday, 12 January 2021

Grand plans revealed for "Son of Avocet"

by DOUG COLLIE

Shareholders in the controversial Avocet 'disruptive technology' businesses who were 'blackballed' and disqualified from taking a stake in the successor company Gennfros Ltd have now received a circular setting out 'grandiose' plans for the future.

The newsletter sent by Avocet chairman Martin Frost outlines proposals for a Gennfros research and development facility and the creation of joint fuel and energy ventures with major world oil and gas suppliers.

A significant number of Avocet Natural Capital (ANC) shareholders who have been vociferously critical of the company's failure to develop a single marketable product in six years have ben effectively banned by management from involvement in Gennfros.

Mr Frost and his fellow ANC executive director Dr Bob Jennings have stated they will play no part in the day to day running of Gennfros. However, a new Memorandum and Articles of Association for the company, published today, reaffirms their status as life presidents with an annual 'honorarium' of £24,000 each to be paid monthly.

Gennfros is apparently tasked with development of the so-called avocet fuel additive which various companies associated with Mr Frost and Dr Jennings have been involved with since 2014. But forecasts of vast global sales and attractive returns for investors have not been achieved.

Today's circular from Mr Frost bears the heading Avocet Natural Capital PLC and is titled 'Moving on'.

It contains another warning of legal action (injunctive proceedings) against the Orr family who are frequent targets for Mr Frost. And there is a somewhat sinister promise that certain named parties, including Mr W. Chisholm [owner of this internet blog] "shall be the focus of their own special comeuppance."

Here in full is what ANC shareholders have been told about Gennfros by Mr Frost:

"An informative circular on 10th January 2021 was sent out to Gennfros Limited shareholders and loan stockholders – as aspects might relate to ANC Plc shareholders, I repeat:

"Gennfros Limited and ANC Plc shall next week serve on Aileen Orr, Andrew Orr, and John Orr injunctive proceedings against their bizarre claims that Andrew & John Orr are the progenitors of Avocet’s & Gennfros’s intellectual property. Given the absurdity of the Orr’s claims; simultaneous contempt proceedings will run against the Orrs. It is thought unlikely that the Orrs can mount a credible argument thus full injunctions could be forthcoming by the end of January 2021 to allow Gennfros Limited’s new investors to take equity and Avocet IP Limited’s property to be sold.

"Dr. Bob Jennings and his team continue to establish new families of IP in energy and agriculture. From £8 million of funds provided by the new investors: measures are in hand to establish a Gennfros Limited research and development centre upon a site identified in Northern England. Land purchase negotiations are well in hand; additionally, a tentative agreement with Begbies [Begbies Traynor, liquidators of Omega Infinite] is reached for Gennfros to acquire Avocet / Omega plant & machinery currently housed at Sunwick (farm in Berwickshire) and in Ireland.

"Gennfros Limited’s new intellectual property shall be subject to an independent valuation in April 2021. Given the huge interest in the non-explosive methanol additive, it is hoped that such valuation shall exceed £200 million.

"Mr. ‘Archie’ Gardner is to work with a team commissioned by the new investors to create Gennfros joint fuel and energy ventures with major world oil and gas suppliers. Note: Gennfros’s new investors have introduced Gennfros to a major US oil company with whom Gennfros shortly expect to sign a joint venture ‘additive’ agreement.

"Hopefully, this January and certainly by March end, Gennfros shares shall become tradeable on Asset Match or similar platform.

".Note: if you are the holder of a Gennfros Limited share option you need only subscribe for 100 Gennfros Limited shares to become a recipient of the Gennfros Limited newsletter."

A 'blackballed' ANC shareholder told Not Just Sheep & Rugby: "These are truly grandiose ideas from the bosses at Son of Avocet. And for those of us associated with Avocet over the years they have a decidedly familiar ring. I note the unnamed investors who were going to transform ANC's fortunes are still around".

Sunday, 10 January 2021

Covid's cruel impact on theatre's finances

EXCLUSIVE by DOUGLAS SHEPHERD

The Board of a leading arts venue in the Scottish Borders have warned their theatre would have to be mothballed and all staff made redundant if the premises were forced to close for three months without further financial aid during the Covid-19 pandemic.

This potentially devastating scenario is outlined in the annual report and financial statements of the Eastgate Theatre (Peebles) Ltd. which has already been badly affected by the first lockdown from March 2020.

Although the set of accounts only covers the year up to March 31st 2020, the continuing Covid issues affecting Eastgate are discussed at length in the report which was written in October of last year.

In a section titled 'Looking Ahead' the annual report says: "There can be no certainty as to the future impact of Covid-19 on the company and its activities. If the UK and Scottish Governments were to strengthen restrictions on social gathering or instruct the venue to close there could be significant doubts about the company's ability to continue as a going concern.

"The Board has looked at a variety of scenarios, including admissions reducing to 50% of pre-Covid trade". That would involve perhaps opening for fewer days each week.

But the report continues: "The more severe scenario of forced closure for three months and assuming no further government financial assistance would result in the company making all staff redundant and mothballing the organisation in the hope that at some future date the venue could be reactivated.

"Our assessment is that a shorter forced closure period, perhaps up to six weeks, could be managed and several key staff maintained. But the impacts would still be severe and financial recovery would be slow".

Faced with these uncertainties the company says it is taking a range of mitigating action including the building of a new audience data base to allow efficient low cost marketing in preparation for activities restarting.

"The Board are committed to ensuring the Eastgate Theatre can continue as a viable cultural and community organisation and remain a vital part of the social and economic fabric of Peebles and Tweeddale as well as the Borders in general".

The financial review records that overall income in 2019/20 increased by over £138,000 from £653,381 to £791,625, mainly due to the receipt of grants towards the cost of upgrading the entrance, cafe, auditorium and heating system.

Income from admissions, hires, bar and cafe decreased by more than £61,000 to £334,681 mainly due to the closure of the theatre during the alterations as well as the closure from March 20th last year due to Covid-19. All of this resulted in a general fund deficit for the year of £56,399 compared to a surplus of £64,472 in 2019.

It is also reported that by October 2020 the company had benefitted from four emergency funding schemes linked to Covid and totalling £143,800. It included a £70,000 payment from the Scottish Government.

Eastgate chairman Ron Inglis writes in his chairman's overview: "Following the reopening in August 2019 after the renovation works attendance levels rose by nine per cent compared to the same period the previous year.

"However, the impact of Covid-19 since March on the Eastgate's business and the wider leisure industry has been substantial and there is no certainty about what impact the pandemic may have on the company in future. Since March no live performances or cinema screenings have been possible".

The report also reveals that Scottish Borders Council and LIVE Borders have confirmed their [financial] commitment to the Peebles venue but are proposing a reduction of three per cent reduction in the core grant for the financial year 2021/2022. Grant support from LIVE Borders is currently worth £18,273 per quarter.

Thursday, 7 January 2021

Those digital projects in some detail

by DOUG COLLIE

Members of Scottish Borders Council who sanctioned a £99 million IT contract extension with technology giants CGI were briefed on a collection of digital projects which, it is claimed, will improve local government services while at the same time saving taxpayers' money.

The confidential reports detailing each project have been released by SBC in response to a Freedom of Information request, and here we attempt to provide information on each of the 'transformation' themes. Some of the language used may seem obscure to the layman but was used in the briefing papers.

DIGITAL STRATEGY - Enabling citizen outcomes and efficiency. SBC challenges - ensure digital investment is aligned to key business priorities.

CGI solution - Practical actionable plan enabling key SBC outcomes through targeted roadmap and solutions; engagement across services; engagement with councillors. Benefits delivered include: future digital investment aligned to citizen outcomes and cost efficiency opportunities for the council. Cost: circa £100,000.

ENTERPRISE MOBILITY - Automated scheduling, route organisation and work anywhere. SBC challenges - Front office services under increasing stress; funding challenges across SBC; field workers hampered by admin and travel; unable to prioritise time in the field.

CGI solution - Enterprise wide scheduling and management solution; mobile app facilitating admin on the move; route optimisation factored into scheduling - the optimal route applied for the day's work.

Benefits delivered - Improved production of frontline staff; enhanced service outcomes through redeployment of frontline staff time. Cost £2 million to £3 million for 500 workers. Savings - circa £1.5 million per annum.

AUTOMATION - RBA (robotic process automation) platform

SBC challenges - Operational performance against strategic plan priorities; data accuracy and processing errors; departmental processing capacity and productivity.

CGI solution - Virtual workers deployed for the automation of processes across the business; front office automation using Chatbots and Virtual Agents.

Benefits - Full-time equivalent reduction or redeployment to value add/customer focussed activities; improved process accuracy through minimising human errors; improving productivity and reduced down time as virtual workforce can run 24 X 7 X 365; cost £350,000 to £750,000 for initial platform. Further automation costed separately. Measurable benefits - circa £80,000 per annum using virtual workforce per complex process.

COMMUNITY CARE 360

SBC challenges - To provide shielding support to citizens and patients and help people to make informed decisions during the pandemic and beyond; to communicate with shielding citizens and their wider circle of care.

CGI Solution - The CGI Community Care 360 platform is designed to support the remote monitoring of patients and citizens as part of a digital approach to delivering services using observations and assessments.

Benefits - Reduce costs through systems standardisation and consolidation; increase in time dedicated to patients; average increase in visits per worker; minimisation of unnecessary care visits; reduction in the number of readmissions after hospital stays. Cost - £250,000 to £400,000; ongoing cost per citizen per month £5. Potential saving per month is £50,000 or £60,000 per year or could be taken as an increase in capacity of 1.6 visits per day per care worker.

CARE HOMES - INSPIRE PILOT (Waverley Care Home)

SBC challenges - No coverage for any technology to residents; limited ability to contact out of hours GPs/services restricted to certain areas of the building.

CGI solution - Additional WIFI and network capacity. IOT devices integrated with care solutions - Amazon Alexa, Facebook Portal, fall and flood alarms, medication dispensers. Adoption of Solution - UK Smart Retirement Village; staff and residents technology training.

Benefits - Improved care home resident experience through better communications, browsing, entertainment; improved safety, well being and security of residents. Costs: to be confirmed.

FLEET MANAGEMENT - phase one refuse route management

SBC challenges - Delivering service optimisation and cost reduction; optimised refuse collection routes and services that minimise risk of missed bins; missed bins lead to poor customer satisfaction.

CGI solution - Ruggedised in-cab device for high density route navigation and problem reporting; potential to integrate with digital citizen; potential to deploy on other cleansing services and gritting (winter services).

Benefits - Improved bin collection efficiency (based on vehicles' working hours, depot and landfill locations and the road network); reduced cost due to reduced fleet size required to operate route; fuel, crew and vehicle fixed cost savings as a result of driving fewer miles. Cost £500,000 to £1 million. Savings - two to three less bin lorries and indirect savings in customer contact.

STUDENT WELLBEING - monitoring and tracking

SBC challenges - Manage students and staff in relation to academic, non-academic outcomes; improve data accuracy and constancy of tracking pupil performance.

CGI solition - The CGI Monitoring & Tracking Solution is aligned to Curriculum for Excellence and supports the tracking of wider holistic attainment alongside the factual tracking of progress in SEEMIS.

Benefits - Improved pupil performance due to earlier interventions; reduced teacher admin time. Cost - circa £100,000 to £250,000 for base monitoring and tracking solution.

Wednesday, 6 January 2021

Future is digital for Borders local government

by DOUGLAS SHEPHERD

The delivery of local government services in the Scottish Borders will change markedly in the next few years with sectors ranging from community care to refuse collection undergoing a so-called digital transformation.

There will be admin apps for frontline staff, care home residents will have access to modern technology, and bin lorry crews will be equipped with in-cab devices for "high density route navigation and problem reporting".

A total of eight different digital projects forming part of a £99 million contract extension between Scottish Borders Council and IT giants CGI were outlined in private to councillors in August and September last year before the majority decision was taken to proceed with a deal which will now last until the year 2040.

The various initiatives are available for public scrutiny for the first time after reports linked to council decision making were released in response to a Freedom of Information request. But some of the jargon may be difficult to comprehend.

In general terms it is claimed the programme which was launched last October and will cost the council £5.7 million in the current financial year will bring improved support for SBC's 4,200 FTE (full time equivalent) council employees while providing enhanced services for 115,000 Borders residents.

There will also be "a major contribution to reducing the carbon footprint to net zero by 2045 (estimated at least a 2,000 tonnes reduction in CO2 annually".

And the transformation will enable 1,000 Borders teachers to "have a more automated and wholesome view of a pupil's wellbeing, leading the way with Inspire [education programme] for all generations".

Apparently the overall tie-up with CGI holds out the prospect of annual cost savings of 'up to £3 million (subject to verification) on projects identified to date'.

The Digital Borders Fit For 2024 three year plan will be delivered in four phases, according to the documentation now declassified by SBC.

Phase One includes a digital strategy and road map, Covid support for vulnerable citizens, fleet management and student wellbeing.

In Phase Two there are references to smart street lights, bin sensors, elected members' surgeries, digital care homes and paperless offices.

The third phase is intended to cover enterprise workforce scheduling, automated social care payments, Inspire academy and kit out new schools.

Phase four will see the creation of digital health and social care hubs, classroom of the future, SBC energy efficiencies, payment services and legal services.

A presentation made in private to the council's Finance & Risk Committee last September said: "Our Fit For 2024 programme sets out to ensure that in a constantly changing digital world SBC can meet future challenges, embrace new opportunities and deliver best outcomes".

The proposed vision - "The Scottish Borders will become the UK's first smart connected rural region".

NEXT: THOSE PROJECTS IN MORE DETAIL

Tuesday, 5 January 2021

Public kept in dark over council's biggest ever deal

by EWAN LAMB

The global IT and business consultancy CGI is set to play an extremely influential role in the delivery of local government services for 115,000 Scottish Borders residents over the next 20 years by leading a multi-million pound digital transformation programme.

But discussions and decision making by Scottish Borders Council leading up to a £99 million contract extension with CGI were conducted exclusively behind closed doors before the extremely lengthy publicly funded deal was finalised last September.

The secrecy was maintained by use of the 1973 Local Government (Scotland) Act which allows local authorities to exclude members of the press and general public and classify all reports and minutes 'Not for Publication'. It also meant none of the Borders' elected councillors could discuss the subject or raise their concerns publicly.

The sheer scale of the massive deal which lasts until 2040 has only come to light following a Freedom of Information request which resulted in SBC making available a collection of confidential papers, including presentations made by senior officers before the arrangements were sanctioned by a majority of councillors.

After negotiations were completed and at least one elected member complained of the lack of transparency, SBC told the Border Telegraph 'we have no secrets'. But the released documents confirm most of the details have remained hidden from public view. The impact on the council's limited funds did not rate a mention in a joint statement issued in October..

Audit Scotland's external audit report on SBC covering the financial year 2018/19 stated: "There is an increasing focus on how public money is used and what is achieved. In that regard, openness and transparency supports understanding and scrutiny. There are increasing public expectations for more openness and transparency as citizens want to understand how public money is used and, to support their participation in local service design and delivery.

"A transparent organisation shows the basis for its decisions and shares information about performance and outcomes, including when targets have and have not been achieved as well as how it is using its resources such as money, people and assets.

"There is evidence from several sources which demonstrate the council's [SBC] commitment to transparency. Members of the public can attend meetings of the full council, executive and other committees. Minutes of these committee meetings and supporting papers are readily available on the council’s website. The council and committees do meet and consider business in private where there is a need to consider commercially sensitive information. The need to consider business in private should be subject to regular review."

The 'confidential' minute of a full council meeting in August includes the following passage: "Members needed to be sure that the deal offered good value for money and that the opportunities and risks of the proposal were fully understood and that officers had undertaken all necessary due diligence before a final decision was made" A final report would be submitted in September.

Councillor Robin Tatler (Conservative), seconded by Councillor Shona Haslam (Conservative) [SBC's Leader], moved approval of the recommendations as set out in the report to agree in principle to extend the contract with CGI until 2040.

Councillor Stuart Bell (Leader of the Opposition SNP group), seconded by Councillor Heather Anderson (SNP), moved as an amendment that discussions continue with CGI with a short term sub-committee to be formed to clarify a number of issues.

The motion was carried by 20 votes to nine.

There was a further attempt to block the deal in September, as the private minute of that meeting shows.

This time Councillor Haslam, seconded by Councillor Mark Rowley (Con), moved approval of the recommendations in the report and spoke in support of the proposals which Mrs Haslam believed would bring benefits to the area.

But Councillor Bell, seconded again by Councillor Anderson, moved as an amendment that council should note the report and take no action at this time. He advised that he had not been reassured by the Members’ Sounding Board sessions and that he could not agree to this without more information on the costs/benefits and details in relation to the various projects.

The administration's motion won the day by 20 votes to seven.

Today Councillor Bell congratulated Not Just Sheep and Rugby on their successful Freedom of Information request which, he said, "opens the door to public scrutiny on the detail behind SBC's decision to sign an astonishing 20 year contract with the IT Supplier CGI."

He told us:"I am very supportive of our Council's partnership with CGI as this gives our rural local authority really good access to the fast-changing world of information and communications technology, and opens the possibility for improvements in services to Borderers, over and above those that can be provided by the Council's own in-house capability. But I don't think that signing up - at relatively short notice - to a 20 year contract extension is either necessary or wise.

"Not Just Sheep and Rugby's blog extensively quotes Audit Scotland's recommendations to our Council to play close attention to the need for openness and transparency; and as Chair of the Council's Audit & Scrutiny Committee I am always mindful of the importance of reviewing and learning, as Audit Scotland says, from "..information about performance and outcomes, including when targets have and have not been achieved..."; as well as the Council being open about why, as well as on what, it decides to spend public money. The Council should be open about all these issues which overlap with the three concerns I articulated when the proposal to sign up to a 20 year IT deal was debated in September last year. To summarise; I was concerned that:-

"1 Evidence we reviewed in August & September indicated that not only had the original contract with CGI, dating from 2016, failed to deliver all the promised financial improvements, but there have been significant gaps in the officer and elected member oversight of this contract. As this original contract still has nine years to run; and as it has not been fully effective - why rush to extend it now?

"2 It is not clear where the £34 million funding for a new contractual commitment to CGI over the next three years will come from. This is not a small amount of money - it is more than the cost of the new Grammar School in Jedburgh.

"3 It was - and still is - not clear exactly what benefits in improved services and/or reduced costs will be seen by Borderers as a result of a new commitment of £34 million of investment.

"I thought there were some interesting prospects in the proposals which Councillors reviewed in September. Prospects which could have justified further analysis, clarification and costing; and prospects which could, perhaps, then have justified further contractual commitments with CGI. But there was nothing with sufficient clarity to justify signing up to a 20year contract worth £99m; and also little that needed to be kept to purely private Council discussions - as your FoI documents now show."

NEXT: WHAT THE DEAL MIGHT MEAN FOR BORDERS RESIDENTS

Monday, 4 January 2021

Revealed: Borders Council's secret £34 million splurge

EXCLUSIVE by DOUG COLLIE

Scottish Borders Council which has deemed it necessary to make financial 'savings' totalling £55 million since 2013 has embarked on a short-term £34 million spending spree after signing up to a controversial contract extension with IT specialists CGI until 2040.

Now spending on capital projects over the next three financial years will have to be "reprioritised" and cut back, and budgets will be juggled to allow SBC to find £5.7 million in 2020/2021 alone, and a further £28.3 million by 2024 to pay for the local authority's side of the bargain.

There was no mention of costs or financial implications for council taxpayers when the massive deal was announced in October. And details of the various projects to be undertaken via the £34 million 'transformation funding' were not revealed either.

The joint statement from SBC and CGI said: "Together we will lead the way in creating a smart, connected rural region, which will digitally connect all Borders communities, supporting innovation, empowering a flexible workforce, advancing truly integrated partnership working, and providing solutions to allow greener, low carbon ways for a sustainable future.

"We will do so by advancing cutting-edge digital systems and processes for all the Borders’ citizens and employees in key areas such as social care, health, its world-class education IT programmes, employment, the environment and sustainability."

But confidential documents and private minutes released by SBC following a Freedom of Information request reveal the huge financial input by the supposedly cash-strapped council - and the strong opposition to the contract extension by some councillors.

The Conservative-led authority's elected members were warned in presentations leading up to a final decision in September of the issues the deal might produce.

In reports submitted in August and September David Robertson, executive director finance and regulatory wrote: "There are some potentially negative aspects to extending the contract with CGI: The pace and scale of investment required at £34m is challenging, although officers believe necessary. The increased transformation programme is extensive and therefore there are risks around the capacity of Council and CGI to deliver."

And he added: "The 20 year, long-term commitment proposed may reduce future flexibility." In fact the arrangements sanctioned by councillors is scheduled to last throughout the next three elected administrations.

The ability of the council to identify some £16 million from its capital budgets to help fund the digital transformation seems remarkable given that SBC's leader Councillor Shona Haslam told the Southern Reporter in March 2020 they were 'having to cope' with a 25% cut in the capital allocation from the Scottish Government.

The documents released by SBC contain a financial summary of the offer from CGI to secure the 'unprecedented' extension to its contract, originally signed in 2016 and meant to expire in 2029. Now a six year option plus a further five year extension stretches out the lucrative deal until 2040.

The extension has a gross contract value of £76 million with CGI offering a £11 million discount, £8 million of it between 2021 and 2023. In its calculations the council includes that £8 million as part of the £34 million expenditure on transformation investment.

According to the figures the £11 million reduction brings the service charges payable to CGI down to £65 million, and with the council's £34 million contribution the total contract extension value is £99 million.

When the original deal was signed it was valued at £110 million, £91 million of it in service charges so the revised overall contract value now stands at £209 million.

The itemised figures showing how this year's £5.7 million will be earmarked before being taken from council coffers break down like this: IT transformation reserve £265,667; energy efficiency reserve £300,000; balance sheet review £1.5 million; existing IT capital budget £270,000; delays in 2020/21 capital plan £3.331 million.

And a table setting out the allocation of a further £28,333,333 to be identified and spent by SBC between 2021 and 2024 shows the following: service discount £8 million; existing capital IT projects £840,000; CGI digitally enable new buildings £4.5 million; re-prioritise capital plan £1.8 million; NHS contribution to digital health to be confirmed; external funding opportunities other councils have achieved £2 million; re-prioritise capital plan to a maximum of £11,193,333.

However, it appears that those councillors who voted for the deal did so without being told or deciding which of the planned projects in the capital expenditure programme would have to be axed or at least delayed for several years.

Apparently the £34 million 'transformation' investment is to be divided between council departments like this: Assets & Infrastructure £7.890 million; Health & Social Care £11.070 million; Customer & Communities £6.250 million; Finance IT & Procurement £1.135 million; Children & Young People £3.875 million; Contracted Services (Live Borders, Sport, Heritage & Culture) £280,000; and Business Change Support £3.5 million.

One of the newly disclosed documents - a report to councillors in August - also explains the advantages of a deal to the council's IT providers: "CGI is a major employer, keen to further invest in the Borders and demonstrate to its shareholders and members that they are continuing to win new business and importantly retain existing clients. Extension of the SBC contract will enable CGI to book this as new business providing stability to members living and working in the Borders and investing in its economy."

NEXT: SO MUCH FOR TRANSPARENCY