Accountability failures by local government highlighted in report by Research for Action and High Court Judge
By John Brace (Editor)
Leonora Brace (Co-Editor)
First publication date: 28th April 2021, 05:48 (BST).
A 40 A4 page report published today (28th April 2021) by Research for Action titled Democracy Denied: Audit and Accountability Failure in Local Government looked at the experience of those who have tried (during a 30 working day period each year) to inspect the financial records of councils, as well as the experience of those who have asked questions of auditors or made objections using rights in the Local Audit and Accountability Act 2014 (in England) or the Local Authority Accounts (Scotland) Regulations 2014 (in Scotland). The report concentrates on requests to inspect, as well as related rights to ask questions to the auditor and/or object to the auditor. The report is mainly about requests in relation to PFI (Private Finance Initiative) schemes or LOBO (Lender Option Borrower Option) loans.
The report concludes with a number of recommendations about transparency, auditor conflicts of interest, suggested changes to legislation, suggested changes to the Code of Practice, suggests scrapping the current position where auditors can prevent disclosure of communications between the auditor and an objector, response times, regulation, appeals and complaints.
Regular readers of this blog over the years will know that the author of this piece has used these inspection rights (and also in some cases associated rights to ask questions of the auditor or make objections to the auditor) over the years in relation to Wirral Council, Merseyside Fire and Rescue Authority, Merseyside Recycling and Waste Authority, Merseyside Police, the Office of the Police Commissioner for Merseyside, Liverpool City Region Combined Authority and Merseytravel. This has in many cases led to a range of interesting stories on this blog about how public money is spent.
To give one example, in 2015 I published the PFI contract involving Merseyside Fire and Rescue Authority, Cumbria County Council and Lancashire Combined Fire Authority. This PFI contract had been decided at a meeting of councillors on Merseyside Fire and Rescue Authority behind closed doors in 2010. Wirral Council, Liverpool City Council, Sefton Council, Knowsley Council and St Helens Council each appoint councillors to Merseyside Fire and Rescue Authority. The contract related to the construction and operation (maintenance, cleaning etc) of approximately 17 fire stations.
However, as detailed in this Wirral Globe article from December 2015 headlined Updated: Councillor scolds Wirral blogger over information requests about expenses, my request that year to Wirral Council to inspect financial information in 2015 (as mentioned in the article part of the request was to inspect councillors’ expense returns which are also supposed to also be open to inspection under different legislation) led to a public question to then Cabinet Member Councillor Adrian Jones who explained a refusal to be transparent on grounds of cost. However, a recently published court case  EWHC 1032 (Admin) ruled that even when around 7,000 invoices and 28 contracts were requested to be inspected using the same legislation by a Derek Moss from a London Council called the Royal Borough of Kingston Upon Thames, that the Hon Mrs Justice Thornton DBE QC ruled it was not lawful for a Council to refuse (in part) such an inspection request of that size on grounds of cost.
The Research for Action report and the decision in that court case have shone a welcome light of transparency on how councils and their auditors have not always taken their legal obligations seriously in relation to what is colloquially known as citizen audit.
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