Why Eric Pickles will allow councils to fiddle your cash – MPs’ damning verdict

Eric Pickles:will he make it easier for councils to fiddle your cash?

Eric Pickles:will he make it easier for councils to fiddle your cash?

Do you believe your council spends your money wisely? Are you sure none of your council tax is wasted through incompetence or fraud? Do you trust all your local politicians to be honest? Probably the answer to all three is no!

Communities Secretary, Eric Pickles, has a flagship policy of scrapping the body that  tries to protect you from all of this – the Audit Commission. His passionate belief is that this body of highly skilled auditors and officials  is a load of bureaucratic nonsense – and has produced figures to claim that the public will save  over £1bn in a decade by scrapping it.

Now an all party committee of MPs led by the indefatigable Margaret Hodge, scourge of  tax avoiding Amazon and Starbucks and chair of the Commons Public Accounts Committee, has come to some damning conclusions on what the government is about to do. There is a full report by me on the Exaro News website (http://www.exaronews.com).

Basically Pickles wants to leave it to local councils, health trusts and the new NHS commissioning bodies to police themselves by appointing their own auditors,taking away a whistleblower hot line to the Audit Commission, and allowing big accountancy firms  free rein to up their charges by picking off individual councils. It also allows  even more cosy relationships to be built between the auditor and the local council and leaves whistleblowers nowhere to go.

Given the present background of mass privatisation of services this plain daft. The most extreme example is Tory controlled Barnet’s plan to hand almost everything over to the private sector – see the Broken Barnet website for detailed coverage (http://wwwbrokenbarnet.blogspot.co.uk). Are locally appointed auditors going to be up to doing a tough job – already Grant Thornton missed the MetPro private securityscandal in the borough. How will they keep up with all the services being privatised?

Some amazing facts are comments in  the report. The government claim it will save £137m a year. The MPs say the figure is more likely to be £2.4m. They warn of a fragmented and more complex audit regime.

And on the appointment of local auditors they say: “The proposals for self-appointment of auditors risk compromising the independence of audit. The Government must intervene to ensure that existing governance structures within local bodies are not duplicated; existing contracts are managed proficiently; economies of scale in audit fees are not lost; quality of audit does not diminish; value for money can be measured comprehensively and consistently; fees, especially for smaller bodies, do not increase as a result of increased tendering costs and potential limitations to the market in audit and; processes for auditor removal, whistleblowing and public interest reporting are rigorous enough so that the regime is sufficiently robust in difficult circumstances.”

The link to the full report is: http://www.publications.parliament.uk/pa/cm201213/cmselect/cmdraftlocaudit/696/696vw01.htm.

Pretty damning stuff. And they call on the auditor general, Amyas Morse, to  offer to take calls from whistleblowers as well as local auditors who could have a vested interest in not upsetting the council.

Otherwise they warn that whistleblowers will contact the media, and in Barnet’s case,it will be  the local bloggers. Too right if Pickles gets his way on this dodgy piece of legislation, your money is at stake.

Something rotten in Ruritannia

Fillingham,Lincolnshire – the most unaccountable parish in England

Picture Credit: Ian Sykes
By David Hencke and Anne Hassan ( my daughter who has been training to be a journalist)

Updated: Since this blog appeared BBC Radio Lincolnshire have followed up the situation in Lincolnshire where some of the councils – who spend up to £140,000 a year – have said that they have prepared accounts but not submitted them to the Audit Commission. The effect of the local broadcast has been to highlight the councils’ behaviour in the county which had until then gone completely unnoticed.

Would you ever pay a bill without the slightest idea of where the money has gone? If you happen to live in 14 parishes across England you would have been doing this for up to the last ten years.

This extraordinary fact is buried in a  report by the Audit Commission on parish council spending (see http://bit.ly/yLaEhD ). It reveals that these parishes have levied a tax on all the householders in their area but have never produced any accounts of how they spent it for the last three years.

The worst place in England is the tiny parish meeting of Fillingham, near Gainsborough, where people have paid taxes- a precept with their council tax- for the last TEN  years and the meeting hasn’t bothered to produce an audited account of how they spent it since 2001.

Despite repeated warnings and rude letters from auditors the councillors there have obdurately refused to publish anything. They are not alone.

In Lincolnshire  there are five other parishes which have not produced accounts for between six and three years running. They are Wycliffe cum Hungarton Parish Meeting (six years);Little Ponton and Stroxton Parish Council (four years) and Fenton, Greatford, and Saxilby with Ingeby parish councils ( all three years).

Outside Lincolnshire there are eight parishes which have not produced accounts for three years or more, two in Leicestershire (Barleythorpe and  Burton Overy), and one each in Shropshire (Bromfield), Dorset (Church Knowle), Lancashire(Carrington), Suffolk (Ilketshall St Laurence),Warwickshire (Luddington)  and Cumbria (Newbiggin).

In addition 133 parish councils  which had submitted accounts have had them qualified for three years running and 567 have received qualifications this last year. This means their basic accounts are at best incorrect, at worst, a work of fiction.

Why should we care? The general opinion that these councils are so miniscule  that  the unreported cash is meaningless (Private Eye does  not even consider them for Rotten Boroughs).

Not so, these bodies – there are 9600 in England – raised a staggering £500m from householders last year.

As the Audit Commission says in its report: “Local electors are entitled to see how their parish council has spent taxpayers’ money. Those parish councils that fail to publish an audited annual return are not providing this most basic level of accountability.”

And it adds: “It is unacceptable that parish councils should fail persistently to produce an annual return, yet still be able to raise a precept.”

My daughter tried to contact three of the parish councils without  any success. Fillingham Parish Meeting’s chairman Mr Andrew Carter at Lake Farm was never available for comment. Mrs Mel Brown, the clerk at Wyeville cum Hungerton slammed the phone down with shock when asked why they had hot submitted accounts for six years . Ms Natalie Bowes, clerk of Little Ponton and Stroxton parish council numbers were unobtainable, despite being on a public website.

I began to  have sympathy with the Audit Commission in trying to chase up our money and whether it had been spent wisely. This is not a good advertisement for localism.

Council Fraud up £50m Eric Pickles- so let’s relax auditing nearly 100 authorities

Eric Pickles: Slashing audit checks as council fraud booms

Detected fraud in local councils has jumped £50m in one year – with the biggest scams involving cheating on council tax benefits, unlawfully subletting council homes and false benefit claims.

 You would think Eric Pickles, the communities secretary, and Grant Shapps. the local government minister, would only be too delighted that someone is collecting this, advising councils how to tackle the problem, and saving the taxpayer up to £185m.

But soon you won’t know because the Audit Commission, the body that collects  all this information,  is to be abolished. And to save more money the government is raising the ceiling on councils that needed to be fully audited from £1m to £6.5m next year.

 Perhaps you might think these councils – mainly town and city councils, museums and drainage boards, are paragons of virtue and nobody working so close to the parish pump would dream of defrauding them.

But read the Audit Commission report,Protecting the Public Purse 2011, (summary and download here http://bit.ly/sSfVJG ) and you will find that one parish clerk managed to defraud four councils  out of £63,000 and get an 18 month prison sentence. As the report reveals: “The clerk forged signatures, altered cheques, and made unauthorised payments to herself and her family. ”

The chair of one of the parish councils said, “We have had to take out a £30,000 loan as a result of her leaving us practically bankrupt.”

In another reported case a parish council clerk set up an internet banking account for the council without its knowledge. He used this account to pay himself. The clerk told councillors the council did not require an audit. Councillors believed him and failed to ensure their responsibilities for protecting public money were undertaken properly.

So perhaps it is a bit stupid of ministers to decide that 96 authorities each spending between £1m and £6.5m a year WILL no longer require a full audit – the perfect excuse for the fraudster who conned his local councillors.

Not only is  this an opportunity for fraud but incompetence as well. An investigation I did for Exaro News revealed that among the 96 – a number had recently had their accounts qualified because they were full of mistakes or just plain wrong. One authority, Swanage Town Council, was  qualified twice in successive years. Another council, Tavistock, was told by its auditors to  resubmit its accounts to the council because they had approved completely inaccurate documents.

 You will find the full story and the  list of authorities on the Exaro News website ( http://bit.ly/vWuRFK ). In the meantime you could always ask Mr Pickles to justify what he is doing – his work e-mail is eric.pickles@communities.gsi.gov.uk . Bet you he won’t want to know.