OIC claims £186k credit card bill ‘legitimate spending’

A £186,000 credit card spend by Orkney Islands Council (OIC) will not be the subject of further investigation, The Orcadian understands.

The hefty bill for the past year emerged following a Freedom of Information (FOI) request by the Local Democracy Reporting Service.

It has been reported that the bill, spread between 23 credit cards held by the authority, include a more than £800 spend on fashion store Shein, over £19,000 at Tesco, and over £8,000 with luxury boutique hotel chain Malmaison.

OIC maintains that all spending on its credit cards have been legitimate.

It is understood that, alongside standard business carried out by the local authority, the council also has charge of the personal finances for a number of vulnerable children and adults in its care.

On a departmental level, it has been reported that the highest total card bill was racked up by the roads and transportation department (£48,559.75).

Other high spending departments included the accountancy section (£35,005.23) and the piers and harbours team (£32,0009.65).

The lowest total charges came from the Orkney and Shetland Valuation Joint Board, at just £43.49, with the chief executive’s service coming in at second-lowest with £1,294.67.

The council has maintained that “spend on purchase cards is necessary for the day-to-day running of Orkney Islands Council”.

One example of this, according to the authority, is over £46,000 of payments made by credit card to the Driver and Vehicle Licensing Authority (DVLA) in the past year. According to OIC, these payments can only be made by credit card.

The authority has also cited “necessary” spending on travel and accommodation bookings for its staff attending business outwith Orkney; visa arrangements for staff joining OIC from outside the UK; and providing essential goods and supplies “for some of the most vulnerable people in our community”.

An OIC spokeswoman said: “There are a limited number of cards in use across the council and their use is tightly monitored through checks and balances.

“Guidance on the use of purchasing cards are issued to all card holders across the organisation, and it is also covered in the financial regulations. 

“In line with guidance from our banking partners, card activity and card limits are reviewed regularly.

“To be clear, council purchase cards are being used appropriately and within policy.”

The council has put a reported quadrupled spend on credit cards since 2020 down to a variety of causes — including changes in suppliers and more online purchasing.

The spokeswoman added: “In terms of the supply of foodstuffs for example, previously the council primarily purchased goods through a local on-street retailer for which invoicing arrangements were in place.

“That retailer is unfortunately no longer operating an invoicing arrangement, so the council had to move to buying goods with card payments.

“In the case of travel, the comparator figure being used is for financial year 2020/2021 — when travel was restricted due to the pandemic.

“More goods are also bought online — requiring card payments.

“There has also been a general increase in the costs of goods and service, including a significant increase in the cost of visas.”