Hitting the plastic

AS credit card bills go it is a whopper. Over the last three years Highland Council has spent £2.84 million on its plastic, snapping up everything from building supplies to electric guitars and foreign hotel rooms.

That puts it third in the list of British local authorities for credit card use, albeit a long way behind Cornwall, the biggest spender, which racked a whopping £8.9 million bill.

But is that necessarily a bad thing? The implication that all credit card spending is somehow frivolous and possibly underhand is simply not true. Buying on a card provides insurance against any failure by the company involved to deliver the product and also offers an interest free period. It may also enable the authority to shop around and buy items off the internet at the most competitive rate - those electric guitars for example, flights or even furniture.

In some instances it is simply the most practical method of payment. Teachers organising a school trip may have no other way of paying for flights and a foreign hotel. That explanation accounts for the appearance in the pages of material seen by The Inverness Courier of the Flanders Lodge in Belgium (close to the First World War battlefields) and the Africa Centre Lodge hotel near Johannesburg airport (a number of schools, including Fortrose Academy, have visited Africa in recent years).

More puzzling is the heavy use of credit cards to pay local suppliers. Howden Joinery, William Wilson, Edmundson Electrical and the Plumb Center are amongst the companies receiving card payments on a sometimes daily basis and amounting to tens of thousands of pounds a year. On the 12th July 2010, for instance, six separate credit card payments, all for £1,492.53, were made to the Plumb Center. On 5th April this year Edmundson Electric received 13 separate payments of £427.07. And these are not unusual.

There is no suggestion any of the transactions are suspect, but they seem, on the face of it, to be extremely bureaucratic. It is surely more labour intensive to process each individual transaction in this way than to simply have an account which is settled at the end of the month.

There is also a question of accountability. The council has 251 authorised card holders across a range of departments and it must be sure that each is monitored closely.

It is not clear how aware elected members are of this widespread use of publicly funded credit cards and, now that its full extent has been revealed, they must satisfy themselves that it provides the best possible deal for the Council Tax payers.

JUST as one business opportunity appears to hit the buffers, another emerges. IT firm Alchemy admits it is unlikely to press ahead with plans for a major computer data centre at Inverness Harbour as advances in technology have reduced the need for such large developments. A scaled down version is still possible, but nothing is yet in the pipeline.

More positively, the company has launched a cloud computing network which executive chairman Peter Swanson predicts will spark a rise in annual turnover from £1 million to £20 million over the next five years. It is an ambitious target in such a fickle and fast moving sector, but we wish the business well and applaud its ambition.