Bankers’ Bonkers Bureaucracy

Governance matters – and that applies to identity management.  But question whether this bank behaviour is really fit for purpose.  The name of the bank has been omitted, because similar experiences at other banks leads to the conclusion that they are all promulgating the same inefficient processes.  In the end customers pay.

This is a letter sent to the Chairman of a bank in exasperation at trying to delete two names from a signature list, and adding three.  It used to take one working day – it is now two months and counting.

“Dear [Chairman of BBB],

I have been a loyal customer of BBB for [decades]. This is the first time I have been moved to complain about unacceptable service. My simple requirement is to change three signatures on a club account with funds of about £1000. Nothing special, you would think. We have to follow the procedures that would have to be followed by a local authority with a £billion turnover. The bureaucracy is mind-blowing. It must be costing you a fortune in time and lost customers. Where can I begin?

1. I made initial enquiries on Feb 11th. The local branch did not anticipate any problem. Just get signatures verified. The Form is a fourteen page document, unreadable by visually impaired people. I asked in the branch for a large print version and was told that it did not exist. This is probably against the law, to say nothing of the banking code.
2. Other signatories had to have their identity checked, which they duly did at other local BBB branches. I presented the Form on March 2nd. One manager had done it right and provided certified copies. The other manager did not provide certified copies; note that the Form does NOT ask for certified copies. The miscreant manager only signed it. ‘Tough’ said my local branch when I submitted it for scrutiny. They said it might be accepted – but only if the other branch photocopier was broken. This was only offered as a solution when I asked if they were accusing the other branch of incompetence.
3. The previous Treasurer, also with visual impairment, had inadvertently marked Question [x.x], which only applies to limited companies – which we are not. So we crossed it out as Not Applicable. The local branch said that this was “Not Acceptable” and that two of the original signatories would have to countersign. Given that we only meet monthly, we are spread over Hants, Berks, Surrey and Middlesex and we have lost touch with one of the signatories this posed me with a logistics problem. Tough, ‘not our problem’ says the branch – ‘we are only doing our job to prevent money laundering’. Redo the Form they suggested. So I did. This took me another hour, with occasional checks on progress.
4. The new form had to be re-signed, of course. To speed it up, I hand carried the new Form round Berks, Hants and Surrey to renew the signatures. I did not dare trust it to the post – and it would be quicker. It was presented on March 11th. The information desk asked me to wait until the original manager was available. After half an hour twiddling my thumbs and being accosted by somebody with products to sell, I could wait no longer and asked to see somebody else. This new clerk (perhaps they are managers these days) went through the same rigmarole. Without certified copies, it would not be acceptable by ‘Head Office’, for money laundering reasons. Yes, the other branch may have made an error – but that was my problem – not BBB. Your customer friendly staff training and freedom to act is unbelievable. Is the Government really worried about a £1000 account when billions are being laundered around the world? He would, however, submit it for approval, but it was my fault, not BBB. It is irrelevant that the inaccessible 14 page form did not even request certified copies.
5. It is now nearly four weeks without any response from Head Office and it is the Club Meeting tonight. And I still can’t sign cheques to pay our speaker.
6. [Lady] on the complaints line now informs me that it is probably a personal account in Staines, not Commercial. It might be the wrong form. She can’t give me a reference number but she will leave them a voice mail. She does not know the post town of an address she gave me. Amazing! Hence a letter to the top.

What on Earth is going on in BBB? If your bank ever gets round to deleting two signatories and adding three, I feel that a small contribution to club funds would not be out of place.

Yours sincerely, …”

Is there a lesson for the public sector?  I hope so.  When you get round to developing processes to identify staff and citizens, make sure that the bureaucracy is proportionate to the risk.  The country cannot afford the time-wasting that has to be endured in dealing with banks.

Bureaucracy Blocks Broadband Bonanza

Britain wants the best broadband in Europe.  But bureaucracy may beat our best endeavours is a message that could be gleaned from a recent Eurim meeting.

The keynote speaker was regulator, but now works for an equipment supplier.  Apparently the predicted demand from mobile devices with Internet features is going to fill the available capacity remarkably quickly.  Mobile data traffic is expected to increase 30-fold between 2010 and 2015, with smartphone densities of 12,800 per km2.  This needs investment in backhaul capacity and the wholesale suppliers of bandwidth do not see a clear financial case.  They do not think that £30 per month at the retail end can be sustained.

The simple truth is that running competing fibre infrastructure (and mobile masts) is inefficient.  A single national infrastructure is the most efficient.  Some parts of the world, such as Brazil, China, Russia and Australia, have a policy to create such an infrastructure.  They are now advancing quicker than the EU countries and showing benefits to their economies.  This is a cause for concern in Europe and innovative ways of financing are being promoted.  France is doing it via local authority projects.  Most départments are creating joint ventures, partnerships, which include an element of public funding, as much as 50% in some areas.  The private sector are being given a reasonable return on a 10 year investment.  Have UK Local authorities got the energy to create such local partnerships?

Rural areas present special problems.  80% of the cost of the infrastructure is digging holes and civil works.  Farmers have tractors capable of doing the trenching at a lower cost than most contractors – in some countries as much as one third is done by local land owners.  Then you find out that, in the UK, there are arcane regulations about removal of telegraph poles.  Suffice to say, they belong to BT and there is a bureaucratic blockage.  Shared wayleave will also create much entertainment for lawyers.  The UK non-domestic rates are the biggest barrier to investment in rural areas.  In one example, <1,000  lines  >1km  from  exchange, rates are 86% of the operating costs.  Even in urban areas 30% is not untypical.  It needs some rapid legislation to amend the current rules that were developed when there was no concept of the growth in demand for broadband and how essential it is in developing the economy.  Who is going to take the lead?

Power to beat Bureaucrats

I have a friend who was a local councillor. I have great respect for his intellect. He has energy … and the ability to get things done. He even challenges anti-social behaviour on the streets. He is also ambitious – so, naturally, he became a parliamentary candidate. In the course of a conversation, I asked him, “Why do you want to become an MP?” His answer surprised me, but perhaps it shouldn’t. He just said … “Power”.

It’s only a sample of one, but it made me wonder. “How many people are in politics for the same reason? Would they admit it? Is the sensation of being “in Power” such a huge motivator?” I suggest that it is, and it may be capable of mathematical analysis.

There is a wealth of academic literature on Power – but in my brief survey, I have not seen it described as a “vector”. My scientific background taught me that a vector has both magnitude and direction. Power, in the political context, seems to have both attributes. Power promotes, or prevents action. How much happens depends on the magnitude of the push and the immovability of the object. Power operates upwards, downwards and sideways; even Left and Right.

Power seems to be a prime motivator for all our politicians and senior officials. That’s in both central and local government. There’s Power to develop policy, Power to spread ideas and Power to influence more Powerful people. Power blocks (perhaps these are political parties) can move a nation, not just a local council.

Then I identified a paradox. When I have asked serving Members of Parliament about their Power; they say they have no real power. They imply that they are powerless. They say that the Civil Servants hold “the Power”. Local authorities seem to react in a reverse manner. Almost without exception, officers and councillors were vehement about their independence as elected bodies.

• “We have the authority.”
• “We do not, … take instructions from Civil Servants.”
• “We only do, … what the Law says we must do, or can do.”

In reality, Local Government knows that Central Government does exercise Power. They control the funding. There’s nothing more effective in influencing local decisions than funding. Even though Government policy and the Treasury may not have the statutory power – for all practical purposes it makes no difference. So local government is pragmatic about the exercise of Power from the centre.

In the real world, there are always opposing political forces. There’s always compromise and a balancing act. As we have seen recently, in the Coalition, fundamental principles can be dropped and promises broken. People shift their positions under political pressure. However, a compromise is ultimately reached. What is more difficult to predict, is whether the status quo has reached a stable, or an unstable, equilibrium.

Extending the vector analogy, in a simple example, to democracy:

• People, with the capacity and energy to take decisions, are the motive force for initiating action.
• There is top-down direction. People are given authority from above. People in Power need constraints or limitations to what they can and cannot do.
• Mandates come from bottom-up. Power is supported, either passively or actively, from below by constituents, public opinion or employees. Support from below is what generates the greatest Power.

If any of these vector components are missing, then the misuse of power is a definite risk. Anarchic or totalitarian behaviours are possible results. Corruption of Power is devastating to civilised society.

Society is also constantly changing; there’s an ebb and flow of opinion. Yesterday’s solutions may be wrong today, or tomorrow. People in Power must recognise shifts in the equilibrium. They need the capacity to listen, to react to changes, and to acknowledge social pressures. In a democratic society, the people at the top of the hierarchy should respond to opinions from the bottom. Then, the majority feel more empowered. Problems arise if the minority feel disempowered and disenfranchised. In extreme cases, minorities opt out of the democratic process completely – and we have all suffered from the consequences of extremist action.

Ultimately, I have to believe that the Majority should have the Power, balancing forces from:

• The People,
• The Politicians, and
• The Bureaucrats

Does anybody know of any mathematical models that can simulate the interaction of many small forces pushing in many directions against the inertia of bureaucracies and the sensitivity of minorities?  We should be able to plot the progress of Power in Politics.