What did a Government Internal Audit Agency draft report reveal about Wirral Council procurement processes and how a contractor spent public money?

What did a Government Internal Audit Agency draft report reveal about Wirral Council procurement processes and how a contractor spent public money?

What did a Government Internal Audit Agency draft report reveal about Wirral Council procurement processes and how a contractor spent public money?

                                         

Chris Whittingham (Grant Thornton) 29th January 2018 Audit and Risk Management Committee (Wirral Council)
Chris Whittingham (Grant Thornton) 29th January 2018 Audit and Risk Management Committee (Wirral Council)

“The reasonable man adapts himself to the world; the unreasonable one persists in trying to adapt the world to himself. Therefore, all progress depends on the unreasonable man.” – George Bernard Shaw

Below is a GIAA (Government Internal Audit Agency) draft report. It involves a civil servant recommending clawback of a large amount of grant from Wirral Metropolitan Borough Council. It also comments on other council’s procurement processes and how the money was spent with a particular supplier. This is just the text extracted from the documents below.
Continue reading “What did a Government Internal Audit Agency draft report reveal about Wirral Council procurement processes and how a contractor spent public money?”

Auditors state Wirral Council doesn’t provide value for money for 2nd year in a row!

Auditors state Wirral Council doesn’t provide value for money for 2nd year in a row!

Auditors state Wirral Council doesn’t provide value for money for 2nd year in a row!

                                                      

Cabinet 17th December 2014 voting to close Lyndale School L to R Cllr Tony Smith (Cabinet Member for Education), Cllr George Davies, Cllr Ann McLachlan
Cabinet 17th December 2014 voting to close Lyndale School L to R Cllr Tony Smith (Cabinet Member for Education), Cllr George Davies, Cllr Ann McLachlan

Wirral Council’s auditors Grant Thornton will be telling councilors on Wirral Council’s Audit and Risk Management Committee next Monday evening (25th September 2017) that Wirral Council doesn’t provide value for money.

The auditor’s concerns are to do with the lack of improvement following the OFSTED report last year that rated Wirral Council as inadequate. In a report to be discussed by councillors next week the auditors state:

“In September 2016, Ofsted issued its report on the inspection of the Authority’s services for children in need of help and protection, children looked after and care leavers. The overall judgement was that children’s services were rated as inadequate. The inspection found widespread and serious failures in the services provided to children who need help and protection.

The Council has established an Improvement Board and developed an Improvement Plan to address the Ofsted recommendations, and provided an update on progress in its Annual Governance Statement. However, a subsequent Ofsted monitoring visit in April 2017 reported that while inspectors identified areas of strength and improvement, there are still some areas where inspectors considered that progress has not yet met expectations.

This matter is evidence of weaknesses in proper arrangements for understanding and using appropriate and reliable financial and performance information to support informed decision making and performance management, and for planning, organising and developing the workforce effectively to deliver strategic priorities.”

Since the publication of the OFSTED report, the Cabinet Member for Children and Family Services Cllr Tony Smith, the Director for Children’s Services Julia Hassall and the Chair of the Improvement Board Eleanor Brazil have all resigned (for clarity Cllr Tony Smith resigned from his Cabinet position not as a councillor).

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Why is Wirral Council’s draft 2015/16 statement of accounts to be amended following concerns by myself and their external auditor?

Why is Wirral Council’s draft 2015/16 statement of accounts to be amended following concerns by myself and their external auditor?

Why is Wirral Council’s draft 2015/16 statement of accounts to be amended following concerns by myself and their external auditor?

                              

Tom Sault (Acting Section 151 Officer) Wirral Council at the Audit and Risk Management Committee on the 13th June 2016
Tom Sault (Acting Section 151 Officer) Wirral Council at the Audit and Risk Management Committee on the 13th June 2016

I’d perhaps better start by declaring the interest that I’m the person the letter below is to, in response to a letter I wrote to Robin Baker.

In an update to Why am I objecting to Wirral Council’s draft statement of accounts for the 2015/16 financial year? published on the 11th July 2016, I have today received a further reply (that you can read below) from Wirral Council’s auditors Grant Thornton dated 19th July 2016 which I quote from below. I’ve linked to the legislation referred to and the page of the statement of accounts that’s the issue. It seems they agree with me (although curiously don’t address the issue of bonuses too in their letter). I’ve left out some of the bits of their headed notepaper which I summarise in brackets ().

Please note the below letter I quote from was written by Robin Baker of Grant Thornton UK LLP (not myself).


Our Ref RJB/SB
Mr J Brace
Jenmaleo
134 Boundary Road
Bidston
WIRRAL
CH43 7PH

(Grant Thornton’s mailing address, telephone number, fax number and website address)

19 July 2016

Dear Mr Brace

Wirral Metropolitan Borough Council
Thank you for your letter of 10 July 2016 to me, which also includes a copy of your letter of the same date to Mr Tom Sault.

I note from your letter that you wish to raise an objection to the accounts of Wirral Metropolitan Borough Council. You identify that the draft accounts included on the Council”s website does not comply with the requirements contained within the Accounts and Audit Regulations 2015. Specifically for Category 1 authorities there is a requirements under Regulation 2(1)(a) that for employees who salary is more than £150,000 per year, that the name of the employee is included within the Senior employee remuneration table. You highlight the Council’s Chief Executive is on a salary in excess of £150,000 yet he is not named in the table at note 32 of the draft accounts. You ask us to let you know whether we will consider this objection.

As part of our audit process I have reviewed the draft financial statements prepared by the Council. My review also highlighted the omission of the name of the Chief Executive from note 32 to the draft financial statements and I asked my team to raise the matter with the Council. The Council has acknowledged that the failure to name the Chief Executive in the draft financial statements is an oversight that will be corrected in the revised financial statements that will be published before 30 September 2016.

Thank you for raising this matter with me. Given the Council acknowledges the failure to name the Chief Executive is an oversight and will be corrected, we do not consider there is a need to treat this matter as a formal objection to the accounts. The failure to comply with the regulations will be corrected and there will be no continuing breach that would require us to consider whether the accounts are contrary to law.

If you do not agree with this view, please let me know as soon as possible.

Yours sincerely,

(signature)

Robin Baker
Director
For Grant Thornton UK LLP

(bit at the bottom about how they’re Chartered Accounts, a LLP registered in England and Wales, registered office details, list of members available, regulated by the Financial Conduct Authority, member firm of Grant Thornton International (GTIL) etc)


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What happened while Cllr Denise Roberts was Chair of MFRA’s Audit Sub-Committee?

What happened while Cllr Denise Roberts was Chair of MFRA’s Audit Sub-Committee?

                                     

Cllr Denise Roberts (Chair, Standards and Constitutional Oversight Committee) (27th November 2014)
Cllr Denise Roberts (Chair, MFRA (Merseyside Fire and Rescue Authority) Audit Sub-Committee at a previous meeting of the MFRA)

The author of this is the appellant in a First-Tier Tribunal (Information Rights) case involving Merseyside Fire and Rescue Authority.

There have been serious corporate governance allegations raised about how MFRS (Merseyside Fire and Rescue Service) has been managed and led during the period when Wirral Council Councillor Denise Roberts has chaired the MFRA (Merseyside Fire and Rescue Authority) Audit Sub-Committee.

MFRS’s press office was approached to provide a press officer for today’s public meeting of its Audit Sub-Committee. However that request for a press officer was refused. A reply received from a senior manager who intervened in our request stated that a press officer is not able to attend this and indeed future public meetings due to “other responsibilities”.

Ultimately it is up to you dear reader to try and understand the reasons why such a decision would be taken.

Clearly Wirral Cllr Denise Roberts (Chair of MFRA’s Audit Sub-Committee) is not entirely to blame as reports to the Audit Sub-Committee she chairs (including to today’s meeting) have been either inaccurate or misleading (or indeed both at the same time) and indeed her time on the Merseyside Fire and Rescue Authority comes to an end in a week.

Instead, Cllr Brian Kenny and Cllr Chris Meaden will replace Cllr Denise Roberts and former Labour Cllr Steve Niblock as two of Labour’s representatives from Wirral Council on the Merseyside Fire and Rescue Authority. Both Conservative Cllr Lesley Rennie and Labour’s Cllr Jean Stapleton remain.

It remains to be seen whether a future Chair of the Audit Sub-Committee continues with Cllr Denise Roberts’ approach and what happens next.

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What links FOI, ICO decision notice FS50591795, audit, a class A drug, barristers and Liverpool City Council?

What links FOI, ICO decision notice FS50591795, audit, a class A drug, barristers and Liverpool City Council?

                                           

There is a form of direct accountability during the audit of local councils when for a short period each year local government electors can inspect information about that financial year such as invoices and contracts.

Here is a legal reference to that right (Audit Commission Act 1998, s.15) which has been a direct form of democratic accountability that in one form or another has been around since Victorian times.

It’s tied in to rights of local government electors to ask questions of the external auditor (which for Wirral Council is Grant Thornton), to make objections to the accounts, to request public interest reports. After all how can you do all that without seeing the information in the first place?

It’s a form of direct democratic accountability.

Unlike making a freedom of information request (time limit of 18.5 hours) there is strictly very little legal limits on what can be requested (well apart from on the insular peninsula at Wirral Council where they have a habit of deliberately shifting the goalposts and coming up with bizarre interpretations of legislation to suit themselves). Last year I made requests under this audit legislation to Wirral Council, Liverpool City Council, Merseyside Waste Disposal Authority, Merseytravel and the Merseyside Fire and Rescue Authority.

The Liverpool City Council request was connected to an earlier FOI request and there’s been a recent decision notice issued in that matter on the 1st February 2016 which hasn’t been published yet by ICO.

Ironically ICO seemed to have met a stumbling block with Liverpool City Council on that one as they asked me for the information that I’d been refused under FOI (happy to oblige). This implies Liverpool City Council weren’t being entirely cooperative with ICO.

I’ve been sent a paper copy of the decision notice through the post, but it’s not published on ICO’s website yet. The reference is FS50591795. It’s a mercifully short eight pages and requires both Liverpool City Council to issue a fresh response with 35 days of 1st February 2016 (or appeal to the Tribunal) and states that Liverpool City Council breached s.10(1) of the Freedom of Information Act 2000. If anybody wants me to I can scan a copy in and publish it here.

Basically LCC’s arguments are that I’m being unfair to barristers by requesting invoices they’ve submitted to LCC. Because as we all know, the purpose of a self proclaimed "socialist" Council like Liverpool City Council is to stick up for downtrodden, oppressed groups on the margins of society like barristers!

Cllr Paul Brant (left) speaking at a recent public meeting of Liverpool City Council (11th November 2015)
Cllr Paul Brant (left) speaking at a recent public meeting of Liverpool City Council (11th November 2015)

Let’s take the example of one barrister (pictured above on the left), a barrister I might point out who is not the subject of the invoices I requested, but who is in addition to being a barrister, a Labour Liverpool City Council councillor called Cllr Paul Brant. He resigned as a councillor in 2013 (although has since been re-elected) after receiving a police caution for possession of a class A drug. He was also the subject of a The Bar Tribunals & Adjudication Service disciplinary tribunal.

Below are the details.

Defendant Paul Brant (Lincoln’s Inn)

Type of hearing 3 Person Disciplinary Tribunal

Panel members
Mr William Rhodri Davies QC (Chair)
Ms Pamela Mansell
Mr Mark West

Finding and sentence Reprimand.

Section of the code 301(a)(i)/901.7

Status Final
Date Friday 12 September 2014

This Tribunal was held in Private.

Here is a link to the outcome of the Paul Brant disciplinary hearing from which I quote,

"Details of Offence

Paul Brant engaged in conduct which was discreditable to a barrister contrary to paragraph 301(a)(i) of the Code of Conduct in that on a day between the 1st January 2013 and the 21st September 2013 he committed the criminal offence of being in possession of a controlled drug of class A contrary to The Misuse of Drugs Act 1971, for which offence on the 20th September 2013 he receive a simple caution."

It would be a conflict of interest for Cllr Paul Brant to do work for Liverpool City Council but according to his Chamber’s website he has been instructed to represent Wirral Council in the past (yes Wirral Leaks I can get trees into a story too!):

Jayne Spencer v Wirral Metropolitan Borough Council (2008); LTL 1/10/2008 (Highway liability claim, tree root in Port Sunlight conservation area causing personal injury – whether breach of duty. Mr Brant appeared successfully at first instance and on appeal).

This is an aside but I do remember one year during the audit, Wirral Council weren’t happy with me requesting the invoices for their legal invoices for these sorts of liability claims. “

However there should be some transparency as to who Liverpool City Council are paying! All Liverpool City Council councillors are responsible for budget matters including Cllr Paul Brant.

One of my arguments rejected by ICO was that there are laws regulating who can give legal advice. You can check whether a barrister has a current practising certificate here.

To give the example of Paul Brant above, it shows he works at Oriel Chambers and was subject to a disciplinary tribunal in September 2014 (the outcome of which is detailed above).

One of my other arguments to the regulator was that Liverpool City Council is under a legal obligation to publish the names of its suppliers for invoices over £500. In fact the guidance they’re required by law to follow specifically states that being self-employed (which is their argument surrounding barristers) doesn’t mean they can keep the suppliers’ name out of the public domain (but Liverpool City Council do).

The page on his Chambers’ website states he is "in a senior position in a large local authority" (meaning Liverpool City Council).

However the above legislation (surrounding rights of inspection, objection etc) during the audit was scrapped by the government. You can’t use it any more to do this after the 2014/15 financial year.

Instead for 2015/16 financial year onwards it’s been completely watered down.

Previously (apart from information about its own staff) local councils during the audit had to get permission from their external auditor if they wanted to withhold from inspection in the category of "personal information" (which was very narrowly defined). This was a safeguard to prevent public bodies abusing their powers.

Bear in mind however that each time the public body contacts their external auditor it increases what they’re charged.

This was a check and balance introduced by the last Labour government.

However this check and balance on misuses of power in local government was repealed (scrapped) by the last Coalition government (Conservative/Lib Dem).

Oh but there’s more!

There’s a rather infamous recent case (well infamous in those familiar with "citizen audit") where a local government elector called Shlomo Dowen requested (during this period each year during the audit) a waste management contract between Nottinghamshire County Council and Veolia ES Nottinghamshire Ltd.

The case reference is [2009] EWHC 2382 (Admin), [2010] PTSR 797, [2010] Env LR 12. Anyway interestingly at that stage a High Court Judge said Mr. Shlomo Dowen should be allowed to inspect and receive a copy of the contract (despite Veolia bringing a judicial review about it).

However Veolia weren’t happy at all by this (in fact if you read through the judgements in both cases you’ll find that even if Mr. Dowen was given the contract they wanted restrictions on him sharing it with other people) and brought an appeal in the Court of Appeal ([2010] EWCA Civ 1214, [2012] PTSR 185, [2010] UKHRR 1317, [2011] Eu LR 172). Veolia claimed that allowing Mr. Dowen to inspect/receive a copy of the contract would infringe that companies’ human rights.

I quote from part of that judgement, “I am not entirely convinced that English common law has always regarded the preservation of confidential information as a fundamental human right”.

Rix LJ, Etherton LJ, Jackson LJ upheld the appeal however.

The irony of all that was that Shlomo Dowen already had access to the information as Veolia’s lawyers did not seek a stay following the earlier judgment.

However the above is why an extra category of "commercial confidentiality" has now been added to s. 26(5) of the Local Audit and Accountability Act 2014.

Interestingly withholding information on grounds of commercial confidentiality, this is a quote from the legislation,

“(5) Information is protected on the grounds of commercial confidentiality if—

(a) its disclosure would prejudice commercial confidentiality, and

(b) there is no overriding public interest in favour of its disclosure.”

is subject to a public interest test.

However there are other changes on the horizon too. Previously the inspection period was 15 days (3 weeks assuming there are no holidays).

When that inspection period was published in a public notice in at least one newspaper in the area and on the public body’s website.

I only have until the end of the 2015/16 local government financial year to get up to speed on these changes as being the Editor here I’ll have to schedule time for responding to the public notices, arranging appointments to inspect, as well as spare capacity for dealing with the moaning of the public sector (example moan last year being, it’s been 7/8 years since someone did this!).

As Wirral Council was somewhat uncooperative last year over the size of my request (only responding to the 10% of it they didn’t deem to be particularly sensitive), I will be having internal discussions here on avenues that can be explored to either embarrass Wirral Council into legal compliance (by censure (not to say that always works) or take more formal action.

Weirdly some of the politician’s expenses that they refused me under the audit legislation and Cllr Adrian Jones refused to make an appointment for me to see, they released in response to a later FOI request.

Which just goes to show that if you ask for the same information three times from Wirral Council (audit rights, a politician, then FOI), you might finally get it! Obviously by the third time, it starts to get embarrassing and seems like they have something to hide. I really don’t like having to ask three times when once should be enough though!

Anyway what was going to be only a short article about local government, barristers, ICO, FOI and audit is now rather on the long side so I’ll draw this to a close and give you an opportunity to comment.

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