UK loosens business belt, spends 1.2bn more on expenses

Are employee expense tactics costing U.K. businesses?

Businesses in the U.K. spent £1.2 billion more on expenses in 2012 than in 2011.

Concur, a provider of integrated travel and expense management solutions, released a new survey which suggests that despite economic woes, businesses are changing their attitudes to expense claims -- spending less, but more often.

After analyzing expense claims from 200,000 U.K. employees, the researchers found that U.K. employees are far more diligent about claiming for smaller expenses -- such as lunch and travel costs -- taking on a "little and often" approach.

However, there is a "disconnect" between manager and employee behavior. Only a negligible amount of expense claims are rejected by managers, regardless of whether claims meet business policies or not. Managers query less than one percent of all employee claims. Therefore, while employees are making sure they claim for everything possible, management is not being so vigilant about keeping costs down.

On average, expense-claiming employees received 10 percent less in expenses than in 2010, despite making 7.5 percent more claims. In addition, the report estimates that on average, a U.K. employee made 36 claims during 2012 and received just over £2,054.

David Vine, Managing Director, U.K. SMB at Concur commented:

"In a tough economic environment we see a culture shift in spending on expenses. For example, the average bill for client entertainment dropped by 20 per cent, in real terms over the last two years, implying that employees are aware that they may be frowned upon if they act extravagantly. While we're not sounding the death knell for the decadent business lunch, there's clearly been a trend towards smaller but more frequent expense claim submissions in the last couple of years."

In 2012, almost £350 million was claimed in exaggerated expenses. In a recent survey conducted by YouGov, 11 percent of employees have admitted to claiming more than they should -- and 20 percent considered it acceptable behavior.

Read More: Concur

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