Proceeds of Crime Act (POCA)

Report: 06
Date: 24 January 2008
By: Assistant Commissioner Specialist Crime for the Commissioner

Summary

This report is additional to the fifth quarterly report of the Payback Programme Board (PPB) discussed at Finance Committee on 11 December 2007. At that meeting clarification was sought concerning a proposal to supply regular funding to the Safer London Foundation (SLF) from the MPS Asset Recovery Incentivisation Scheme (ARIS) funding.

A. Recommendations

That members:

• Approve a proposed ‘payback’ scheme for communities:
• To use the SLF as the conduit for community funding from ARIS.
• To provide £500,000 yearly from ARIS funding to the SLF to fund community based projects aimed at reducing acquisitive crime and sending the message across London that crime does not pay
• To maximize the publicity opportunities that this recycling of criminals assets provides.
• Where ARIS income is above that forecast to satisfy the 5-year plan. An additional 20% of that extra income to be provided to SLF at year-end to a maximum of £500,000 (which would be £1 million including the yearly amount).
• The remaining 80% of income above forecast to be used to continue to build the MPS infrastructure and to fund MPS led community initiatives.
• To publicise the bidding process and outcomes

B. Supporting information

Proposals for a Payback Scheme for communities

1. The primary function of the POCA legislation is to reduce crime. It provides the side benefit of ARIS funding. This provides an opportunity to increase our infrastructure to maximise the use of POCA as a crime reduction tool. There is also an opportunity to put something back into London communities using this funding. The use of the money to fund community projects presents difficulties in relation to administration. It is necessary to have a fair bidding process, governance, audit and transparency as to how the money has been used. It is not appropriate for the MPS to be involved in this. The Safer London Foundation offers an auditable process with recognised governance structure. This is the preferred method of providing ARIS funding for community projects.

2. The SLF is the charitable arm of the Metropolitan Police Service. It was an idea conceived by Sir Ian Blair when Deputy Commissioner and he is still President of the SLF. The set up costs and initial core funding was provided by the MPA, via the MPA Finance Committee, and the MPA remains the biggest single sponsor. The Trustees’ Report sets out the governance of the SLF and is attached as Appendix 1.

3. The disbursement of funds by the SLF is decided by the SLF Grants Committee, chaired by Lord Toby Harris and composed of members of the Trustees of the SLF. A list of Trustees is included in Appendix 1. Trustees are expected to declare an interest in any applications for funds.

4. Applications for funds are invited through the SLF website at www.saferlondonfoundation.org.uk and other publicity. The applications are received direct to the SLF and the process of evaluation is delegated to the Chief Executive and his Operations Managers to ensure they fit the published criteria for funding. In the case of successful bids, this team also monitor expenditure and evaluate the results. SLF support is given to projects through a legally binding contract; evaluations of supported projects can be made available to the MPA if required. The system of bidding, acceptance and evaluation is transparent and the accounts are independently audited by MacIntyre Hudson & Co. The SLF funding criteria is at Appendix 4.

5. The fact that one of the sources of funding comes from Proceeds of Crime monies is advertised in SLF literature, an example is shown at Appendix 2. The Trustees’ Report states that the POCA monies have been used to ‘fund community based projects addressing the issue of guns, gangs and weapons crime in London’. This worthy cause is slightly restrictive and it would be helpful if the purpose of POCA funding was amended to ‘fund community based projects aimed at reducing acquisitive crime and violence and sending the message across London that crime does not pay’.

6. In 2006/7 £500,000 from the Payback budget was given to the Safer London Foundation. The SLF has disbursed £225,000 to eleven projects designed to reduce gun and gang crime in London (see Appendix 5). The remaining funds will be allocated in 2008/9. The PPB is content that the SLF is a properly accountable, independent custodian of Payback money. There is an opportunity for the SLF and Proceeds of Crime Incentivisation Team (POCIT) to send the message that money removed from criminals is funding community projects under the Payback banner. The key advantage of using the SLF is that it will conduct an auditable bidding process, manage the disbursement of funds and capture outcomes.

7. Subject to the Finance Committee being satisfied with the above described auditable and accountable processes it is proposed:

• To use the SLF as the conduit for community funding from ARIS.
• To provide £500,000 yearly from ARIS funding to the SLF to fund community based projects aimed at reducing acquisitive crime and sending the message across London that crime does not pay
• To maximize the publicity opportunities that this recycling of criminals assets provides.
• Where ARIS income is above that forecast to satisfy the 5-year plan. An additional 20% of that extra income to be provided to SLF at year-end to a maximum of £500,000 (which would be £1 million including the yearly amount).
• The remaining 80% of income above forecast to be used to continue to build the MPS infrastructure and to fund MPS led community initiatives.
• To publicise the bidding process and outcomes

The additional funding is dependent on the MPS income exceeding the current estimates. The proposal guarantees the SLF £500,000 each year for the duration of the ARIS funding. This enables the Foundation to plan ahead. The SLF decisions on disbursement will be transparent and can be periodically reviewed. BOCUs in receipt of reward funding from ARIS through PPB, can already use this funding for local community projects. Any such use will be captured so that a comprehensive report of how ARIS has been used to fund community projects can be reported at year-end. The current projection against the 5-year plan is shown in the spreadsheet at Appendix 4.

Abbreviations and acronyms:

PPB

Payback Programme Board

POCA

Proceeds of Crime Act

TP

Territorial Policing

FI

Financial Investigators

OCU

Operational Command Unit

SLF

Safer London Foundation

C. Race and equality impact

It is believed that there will be a positive benefit from the proposal because, among the stated ‘Objectives and activities’ of the SLF (see Appendix 1), is the phrase ‘to provide facilities for people who are by reason of their age or mental or physical disability in need of care or support and/or by reason of the place where they live or work, their ethnic origin or other social and economic factors particularly likely to be victims of criminal activity’.

D. Financial implications

1. The disbursement of funding to the SLF will be the subject of three-monthly review by Investment Board.

2. The income from incentivisation will be monitored by the Programme Board and, if it falls below projection, remedial action can and will be taken to reduce the expenditure. A plan to descale the project is being prepared to identify what will cease first. The SLF funding will be considered as part of this descaling. The Home Office Funding under ARIS is agreed until 2010.

3. The current position against the five-year plan is at Appendix 3. The proposed expenditure will still keep the accounts in credit with an end of programme surplus. This has been helped by the Home Office decision to fund the London Regional Asset Recovery Team (RART) until 2010, which has removed the projected three-year expenditure of £1,572,000 per year from April 2008.

4. It should be noted that receipts from the Home Office are falling below the projection. This is being carefully monitored and a significant piece of work has been commissioned to understand the pipeline. This will help to project future income. This work should be completed in time to be incorporated in the next review due in February 2008.

5. The suggestion of boosting the £500,000 to a figure of up to £1m depending on resources being available will need careful consideration of the governance involved. Members may want to assess the alternative options available for the use of any flexibility on an annual basis. The opportunity to do this could be assessed at the end of the financial year when the refresh of the 5-year POCA plan is brought to Committee. Members can then look at MPS proposals in the round. It may be helpful to invite a representative from the SLF to answer potential questions regarding the governance of any additional funding.

6. Members to note that the allocation of £225,000 of the POCA money fell outside the accounting period for 2006/7 and this is specifically mentioned in the Trustees report for the year ending 31 May 2007.

E. Background papers

None

F. Contact details

Report author: A/Commander Nigel Mawer, MPS

For more information contact:

MPA general: 020 7202 0202
Media enquiries: 020 7202 0217/18

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