Tuesday, 19 January 2016

Councils spending billions without proper scrutiny


Scotland's councillors are not being given adequate information on capital investment by paid officials which means up to £7 billion of public cash may have been spent over the last three years without proper scrutiny.

That is one of the most worrying conclusions of a newly published report from Audit Scotland (AS), the public expenditure watchdog, after a follow up study Major Capital Investment in Councils featuring analysis of 15 major projects which had been the subject of a similar exercise by AS in 2013.

One of the schemes placed under the watchdog's microscope was the ill-fated waste treatment facility planned by Scottish Borders Council (SBC) at Easter Langlee, Galashiels which was to have cost £18.2 million, according to the report.

In the 2013 assessment the Borders waste management facility was shown to be already 27 months behind schedule with an estimated completion date of January 2015 instead of the original 2012 deadline. But the entire concept had to be abandoned in February 2015 when the council's deal with their chosen contractors New Earth Solutions was torn up. Expenditure on the scheme is recorded in the latest AS report as £2.4 million.

According to the document: "Scottish Borders Council cancelled the project due to project-specific issues. In particular, the council failed to demonstrate the project's technical viability and was therefore unable to secure funding for the project."

The Borders proposal was the only one out of the fifteen to be scrapped with nothing to show for years of planning and at least two and a half million pounds of abortive spending. Nine other schemes from the 2013 study had been completed by October 2015 with five more in development.

SBC's refusal to release information about how the Easter Langlee project was radically altered mid-way through the planning process and whether councillors carried out adequate checks to ensure money was being spent wisely means it is impossible to conclude whether issues outlined in the AS report can be applied to the disastrous Borders waste management contract.

Audit Scotland says: "Elected members are not able to scrutinise the performance of capital programmes effectively because they are not receiving adequate information on capital investment.

"Councils do not routinely report to elected members project risks or non-financial information, such as the benefits realized from capital investment activity. No council has a continuing programme of training in place on capital issues".

In the Borders case the 10-year capital programme is worth £271 million which represents a significant sum being spent possibly without adequate supervision by elected members. But surely any councilor who claimed to be "on the ball" would make sure he or she asked pertinent questions of senior officers before sanctioning expenditure.

There was an adequate opportunity to ensure the waste management project received robust scrutiny when no fewer than 18 SBC members and officials travelled to south-west England at taxpayers' expense to visit a New Earth Solutions sister plant at Avonmouth.

The party stayed at the four-star Hilton Garden Inn in Bristol City Centre, some getting there by air while others preferred to travel by train. Total cost of the trip, according to a council response to a Freedom of Information request was £3,939 split between transport (£1,656) and accommodation (dinner, bed & breakfast £2,283).

Credit card transaction records of two senior officers who were part of the delegation show one purchase linked to the trip was £570.20 for two train tickets, and a single rail ticket which cost £228.70.

But although taxpayers footed the bill for the "jaunt" SBC has refused to disclose information or documents to show what took place or what was achieved on the visit, only four months before the council dropped New Earth Solutions like a ton of bricks. We are told the proceedings are "commercially confidential" which means reports and other correspondence have been heavily censored.

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