The “Big Bang” Theory

New Forest District Council introduces the active expenses management solution to over 90% of its workforce in record time to realise savings.

Confident

An online expenses management system was introduced at New Forest District Council in an efficiency drive designed to help make the council as cost-effective as possible as the payroll department handles an average of 500 expense claim forms each month.

The decision to avoid a protracted rollout and get all employees claiming business expenses on-line immediately was bourne out of confidence in the system's capabilities to control policy from the implementation's acceptance testing stage.
“I had to ask a few of my colleagues to do some testing - it was just too easy, I felt I had to be missing something - but I wasn’t!”, commented Becky Cornell, Payroll Manager, New Forest District Council.

“We knew the new system would be a success very quickly when attendance at the series of workshops we had planned to train employees on how to use the technology dropped significantly.  When we investigated, we discovered the reason for this was that people were so enthusiastic about the system, they had started showing their colleagues how to use it and were finding it so simple to get the hang of that the training workshops were no longer needed.

Efficient

“As far as boosting the efficiency of the payroll function goes, this is the best thing we’ve ever done.

"Previously, every claim had to be processed manually with driving licences and insurance documents relating to each claim scrutinised.   These measures were taken to ensure that the relevant documentation was in place, up to date and that each claim was therefore legally valid, in order to safeguard the safety of employees and the reputation of the organisation as a responsible employer.  

"Employees are now able to submit their own claims and are prompted to submit details of their driving licences and insurance documents at the relevant review date.  Claims are automatically checked alongside details of New Forest DC’s expense policy rules to determine their legitimacy.

“One of the most startling efficiencies we’ve seen lies in the system’s ability to measure distances to one tenth of a mile.  

"Where employees had historically claimed nine miles for journeys between two of the council’s most commonly visited buildings, the system calculated this distance as just 8.2 miles.  This meant the council was immediately making measurable savings by paying out less in mileage.

"The council’s planning department, employees of which are some of its heaviest travellers, have been particularly welcoming of the new technology.  Whereas before they submitted all claims for the previous month by the 7th day of the current month, now they have until the 11th and they are able to submit claims for journeys made right up to that date, meaning they are waiting less time to be reimbursed for their travel expenses.  The tracking facility means they can also monitor the progress of their claim and check that it has been approved.  

"Another significant financial benefit which has arisen from implementing the system is that it has enabled the council to begin reclaiming VAT on the fuel its workforce uses to carry out its business.  Prior to the system’s introduction, the council had stopped claiming VAT on fuel because it had become impossible to collect all VAT receipts from employees.  These were essential after it became compulsory to be able to show a valid VAT receipt for all VAT reimbursements.  As a result, the council was losing £14,000 worth of VAT each year.  Now everyone enters the details of their own VAT receipt as they make their claim and the system effectively polices the council’s entitlement to claim back VAT by recording and storing details of all its receipts for inspection by HMRC.

“We’re quickly clawing back the cost of implementing the system by saving time processing claims, cutting the number of miles employees are claiming reimbursement for, and fulfilling the legal requirements that are enabling us to claim back thousands of pounds of VAT on our travel expenses."
Freedom

The solution offers complete flexibility when claiming. Ms Cornell continued “I was pleased that it is not an ‘all or nothing’ decision – people who are ‘computer phobic’ or do not naturally have access, can continue to claim on paper forms until the time is right for them to move over.


Unexpected Benefits

“We took the opportunity to review and change some of our existing practices, and this resulted in a reduction of claims we need to process and reduced the practice of people saving up their expenses and submitting them in one go.”

These efficiencies allow the payments team to redeploy effort into other important areas and improve the management of cash flow.

Ms Cornell concluded, “It is interesting to see the response of managers - they now see business mileage submitted by their staff more starkly in cash terms rather than purely as a distance. It is now transparent how these expense claims affect their budgets.”

What Next?

To introduce the system to people who are not employees of the council, but for whom they have a responsibility to manage reimbursement of expenses, including the council’s Members and other organisations to which the council offers its services.