Business under threat from expenses fiddling

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Fleet Street hacks have a reputation for doing it, City bankers and some notorious company bosses (think Conrad Black and Maxwell), too. Treating expenses as a second salary isn’t exclusively the domain of MPs.

On Monday 15 June 2009 the BBC reported that over 300 Metropolitan Police detectives are under investigation on suspicion of misusing corporate credit cards. On 11 June, 2009, the well-respected head teacher of a Catholic school in London, who was acknowledged for delivering good results, was suspended on suspicion of expenses fraud. These might be the first examples outside of Westminster of a new intolerance towards previously accepted lax employee expenses behaviour.

A significant number of directors and senior managers in business as well as the public sector will have been...

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By Anonymous
24th Jun 2009 11:23

At the Top
You hit the nail right on the head when you say that behaviour at the top sets the standard for everyone else.

I am a public sector employee. Who sets standards for me? Parliament? The royal family? It's not just expenses, it's also obscene overspends on projects like the Scottish Parliament and almost anything the MoD does. The people responsible for these have mostly just carried on as if nothing has happened.

If we are really interested in controlling public spending - and I think on the whole that we should be - then someone should get a grip on this. But I honestly can't see who has the will, and let's face it the integrity, to do it.

Thanks (0)
24th Jun 2009 12:27

Expenses fidlding
"The problem is clearly widespread and the significance of this is two fold. Fiddling your expenses could be career limiting as well as potentially damaging to the reputation of your employer."

Your article appears consistent with the amoral attitude of some MP's. If a consequence of fiddling expenses is that it is "career damaging" then out of self interest the individual may refrain. The reputation of the employer is presumably of little consequence when forced to shed staff, go into administration etc. due to having illicit funds extracted by dishonest employees.

Surely the most significant consequence of fiddling expenses is that it is theft. Theft is wrong.

Some of the consequnces of theft include:

(i) The additional internal controls that the employer / society has to resource to thwart / catch/ punish the thief.
(ii) A climate of distrust and suspicion.
(iii) A loss to the public purse as Income Tax and National Insurance are evaded.
(iv) The possibility of the employer becoming damaged by the financial loss.

Please reconsider the emphasis of your article.


Douglas Collier

Thanks (0)
25th Jun 2009 12:17

What drives expenses fiddling, both for private and public sector managers, is high marginal tax rates.

Take the ( perfectly legal ) £5 per day that HMRC allows you to claim for incidental expenses while out of the office.

Too small to bother ? that's been my view hitherto. But at 51% tax + 12.8% NI, that £5 per day becomes £11.06 per day.

If I'm out of the office on business2 days a week, that becomes over £1000 per year. At this level, you can't actually afford to igneore it.

Any one who doesn't max what they can legally get on expenses is a fool.

Thanks (0)
By Anonymous
30th Jun 2009 17:44

Police action
A director at the company I work for fiddled expenses, it was blatant theft.

The Police were brought in and the person was charged and convicted.

The issue I then had, was, as the person 'selected' the instances of theft for the purpose of the court case, to admitt to and I understand is common place, and as this was considerably less than the actual theft, do you treat the balance as benefits on a P11d? Though the company would not want to compound the loss by paying Class1A!

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