pCard and corporate credit card procurement

Today's Times included a throwaway comment that "there were signs that restrictions on corporate credit cards had started to loosen". Given that the article was generally referring to bankers, perhaps we should not draw conclusions that this is indicative of a general trend.

Of course we also need to be cautious in reading too much into what is meant by 'the restrictions' - for example, does it mean higher thresholds, wider categories of spend allowed or wider access to corporate credit cards?

Either way, organisations need to remember that corporate credit cards are not a perk or an opportunity for extravagance at the organisations expense. They should fit within the Finance and Procurement Policies and Strategies as a way of reducing transaction costs, and managing Low Value Orders. They also need to be supported by protocols, controls and guidance otherwise you may as well just hand over a wad of cash and tell the profligate to go and enjoy themselves.

pCard or not pCard, that is the question: Considering the evidience

The Government Procurement Card (pCard) was introduced in 1997. Its primary purpose was to reduce the transaction costs associated with Low Value Orders when it was assumed the cost of the transaction was more than the actual purchase price.  It was also believed that pCards would deliver better control and reduce fraud.

On 1 June 2012 the Public Accounts Committee (PAC) published its report on the use of pCard’s in central government. While the PAC report highlights the need for strengthening controls and a refreshed business case. This blog is not concerned with the key content of the report but instead considers some of the oral evidence reported verbatim in the report. The oral evidence discussed reveals some matters of relevance to all those concerned with reducing procurement transaction costs, regardless of whether or not they are based in the UK, engaged in central government or the wider public sector.  While concurring with the PAC findings and recommendations, the significance of some of the key issues debated appears to have been missed in the key body of the PAC Report.