UK: Teething Problems: The SFO's Annual Report And Leadership Review

Last month, the SFO published its Annual Report for the year ended 31 March 2019 (the Annual Report), the first since Lisa Osofsky began her tenure as Director in August 2018.1  The Annual Report was swiftly followed by the publication of a CPS Inspectorate “Review into Leadership” at the SFO, commissioned in December 2018 as a result of declining staff engagement scores (the Leadership Review).2  Together, the Annual Report and Leadership Review present a mixed picture of the SFO’s performance. Key points from both are highlighted below.

Case performance analysis 

The Annual Report begins with a “Statement from the Director”, in which Ms Osofsky highlights what she considers to be the SFO’s key successes in the past year. These include opening 11 new criminal investigations, charging 8 individuals and convicting 17 of 32 defendants (giving the SFO a conviction rate of 53% by defendant and 86% by case). Ms Oskofsky describes this as a “positive year for our casework results.”

The SFO’s conviction rate of 53% by defendant represents a significant fall from the success rate of 76.9% in the year-ending March 2018. We should be wary of jumping to performance conclusions, however: as Ms Osofsky points out in her Director’s Statement, “due to the relatively small number of cases the SFO takes on each year, our conviction rates are subject to significant fluctuation.” The conviction rate by defendant is also less of an outlier when seen in the context of an average over the last four years of 60%. Conviction rate by case, meanwhile, has improved slightly, from 80% in the year-ended March 2018 to 86%.

Another interesting statistic contained in the Annual Report is that 14 cases were dropped in the past year. Only 7 cases were dropped during the previous 3 years combined. This may indicate an attempt by Ms Osofsky to clear out the “dead-wood” in order to free resources for vigorous progression of cases with greater chances of convictions in future. A potential strategic shift to focusing on smaller numbers of cases is also supported by the fact that only 8 defendants were charged last year, compared to 28 the year before. Next year’s Annual Report may well show fewer convictions but a higher success rate as a result of this new caution with respect to charging decisions.

Budget: core funding remains high 

The period covered by this year’s Annual Report was also the first since the SFO’s major budgetary overhaul last year: in a final coup secured by departing Director David Green, the SFO’s core funding was increased from £32.9 million to £52.7 million for the year-ending March 2019.

This increase in core funding was intended to make the SFO less dependent on so-called “blockbuster” funding, available from the Treasury when a case was forecast to cost over 5% of core budget. This “blockbuster” funding would at times compose as much as 45% of the SFO’s total expenditure, and was criticised for inefficiency; in particular, for the expense of temporary staff having to be hired on cases once “blockbuster” funding was secured (and then let go on the case’s conclusion). At the time, the SFO’s COO and interim director, Mark Thompson, lauded the reform as “a welcome consolidation of the SFO’s funding position which will enable us to manage our casework and our resources more efficiently.”3  

This new security in funding has not, as yet, produced any dramatic improvement in performance, or greater numbers of investigations opened/charging decisions, as touched upon above. Core funding for next year, the year-ending March 2020, however, remains high at £49.7 million. With Ms Osofsky now settled into her new role, it will be interesting to see whether she is able to convert her more favourable funding situation into tangible results. 

The CPS review into leadership at the SFO

Finally, and arguably most damagingly for the SFO’s track record for the past year, a CPS Leadership Review published at the end of July points to concerns among staff at the SFO with respect to management practice.4  The review was performed, among other things, via interviews with 85 staff members from different grades and divisions at the SFO in February 2019, and a survey issued to SFO staff to which there was a 52.7% response rate. The review’s central finding was that “the sharp focus on delivery of casework, whilst a strength, is also a weakness. It has driven a culture of delivery which has, in many instances, led to tolerance of neglectful approaches to management or, in some cases, of unacceptable behaviours.” On a similar note, the report goes on to explain that in Ms Osofsky’s early speeches to staff setting out the priorities for her new tenure, “the messages which resonated most were those about injecting pace and thinking about other ways of dealing with casework, rather than those about encouraging personal development and esprit de corps, or having a zero-tolerance approach to bullying, for example.”

Ms Osofsky seems to be taking the concerns raised by the review seriously, stating in response: “This report doesn’t make comfortable reading, but it is necessary to understand where we are as we plan the route to where we want to be…I want everybody who works for the SFO to feel valued, to achieve their personal development goals and to be able to make their best contribution to our mission.”5  The Leadership Review is nonetheless a set-back for one of Ms Ososfky’s oft-stated goals for her tenure: speeding up delivery at the SFO. To have this goal so directly implicated in the SFO’s cultural problems may well force a change of approach.

Footnotes

https://www.sfo.gov.uk/wp-content/uploads/2019/07/SFO-Annual-Report-and-Accounts-2018-2019.pdf

2 https://www.justiceinspectorates.gov.uk/hmcpsi/wp-content/uploads/sites/3/2019/07/2019-07-11-SFO-leadership-inspection-Final.pdf 

3 https://www.sfo.gov.uk/2018/04/19/changes-to-sfo-funding-arrangements/

4 https://www.justiceinspectorates.gov.uk/hmcpsi/wp-content/uploads/sites/3/2019/07/2019-07-11-SFO-leadership-inspection-Final.pdf 

5 https://www.sfo.gov.uk/publications/corporate-information/publication-scheme/hmcpsi-report/ 

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