On Thursday 25th June 2020, exactly a year after the seed was sown for CIPFA to do a full review of Governance at RBWM, the final CIPFA report will be presented at Cabinet.
The full report is a catalogue of gaping holes and is highly embarrassing for RBWM. I do hope “lessons are learned” as will obviously be the common thread of the cabinet discussion as it always is! No heads will roll, no falling on swords, simply, “We are sorry. We promise to implement the recommendations, lessons will be learned and we’ll not do it again.”
With due credit & acknowledgement to fellow Cllr Wisdom Da Costa and Cllr Lynne Jones. They had shouted about financial irregularities for years but to no avail…their appeals for common sense to prevail simply brushed aside by an arrogant Tory administration.
The catalogue of errors goes on for page after page in the report, far too many to list but please, please, please do go and read it for yourself.
All changed in May 2019 with new Councillors being elected bringing much more political balance to the RBWM. On the 25th June 2019, the newly appointed Managing Director of RBWM heard a question asked by a new Councillor…
25th June 2019 Council Meeting
MEMBER’S QUESTION 17 e) Councillor Davey will ask the following question of Councillor Hilton, Lead Member for Finance and Ascot:
In last year’s budget there was a line “CC52 Clewer & Dedworth Neighbourhood Improvements £350,000”. On enquiring how this money was invested officers tell me that £386,943 was spent so there appears to have been a £36,943 or 11% overspend. How was this overspend allowed to happen and can you ensure us that you will not overspend again this year?
“Councillor Hilton responded that this was the first time in his long experience that a Councillor has raised, as an issue, the spending of more money in their ward rather than less.” Which brought a chortle from the Tory benches…
This was a genuine question by myself, I had no idea of the fall out it would have. I am encouraged to not only hear but see CIPFA actually propose a catalogue of improvements to governance at RBWM.
One of the CIPFA recommendations is for improvements in training… I called a motion to this effect in September 2019
24th September 2019 Council Meeting
i) Should enhance its project management steps, ensuring a more efficient use of council time, officers and Councillors alike.
ii) Ensure appropriate training for all parties.
iii) Agrees that the key decision makers should make their thoughts known within the first few weeks of a project’s planning so that answers can be found to address their concerns before energy is wasted on bringing a plan together.
It wasn’t voted through but did get support from the opposition.
To encourage further reading, I’ll just bring your attention to a few observations made in the report:
- Officers appeared overly sensitive in providing bad news about RBWM’s financial position and the poor publicity that it would bring to RBWM.
- The poor governance, culture and any issues, including those between Officers and Members were not set out in the Annual Governance Statements.
- Not all spending is accompanied by an official Purchase Order, a significant financial control weakness.
- Members were able to circumvent RBWM’s approved policy framework to include additional schemes in the capital programme without appropriate challenge from officers
- Approval by Council as an item in the capital programme in many cases was taken as adequate, despite there only being a line of detail in the report to Council and no published officer reports.
- The Capital Strategy failed to assess the affordability and deliverability of capital investment plans.
The initial estimate for gross business rate income in 2019/20 was £93.995m. This was reduced to £92.687m in October 2019, to £89.840m in January 2020 and the outturn was only £86.638m.
- The level of outstanding debt from this source at 31 March 2019 was £5.109m but the provision for bad debts was just £0.794m, despite more than 50% of the debt being older than three years and with some debt going back to 2001/02.
- Variances were reported against 85 completed schemes in the capital outturn but the table does not show the variance to the approved budget. No outturn information is given for 184 schemes that are in progress or are part of ongoing programmes.
One of the areas of particular concern to me, as ward Councillor, is around the Clewer and Dedworth Capital Scheme:
- Members were able to circumvent RBWM’s approved policy framework to include additional schemes in the capital programme without appropriate challenge from Officers;
- This indicates a lack of clarity and clear division between member and officer roles;
- Schemes appeared in the Capital Programme with no business case;
- Officers lack of awareness of basic governance procedures and not raising concerns with RBWM’s Monitoring Officer or asking for advice led to procedures being by-passed;
- There was a lack of action by the s151 Officer when it became apparent that non-approved expenditure in Parks was being charged to the scheme. The failure to consider that officers could be acting beyond the authority set out in RBWM’s constitution is also an area of great concern and raises questions regarding potential Ultra Vires expenditure;
- Overall there was a lack of transparency around the financial implementation of capital schemes
The report concludes…
The report highlights a lack of clarity between member and officer roles. It is essential that this clarity exists to enable RBWM to operate effectively. Accordingly it is recommended that the current Protocol Governing member and officer relationships is reviewed in the light of this report and additional training is provided to all officers and members once this protocol has been revised.
The audit committee was merged with the Corporate Overview and Scrutiny panel. Given the number of financial governance issues and the different roles of Scrutiny and Audit it is recommended that an independent Audit Committee is established, potentially with an independent chair.
Does that mean that Cllr Lynne Jones could be nominated to chair this committee?
In my new role as Vice Chairman of the Infrastructure Overview & Scrutiny Panel I will be encouraging the committee to look closely at how decisions are being made by asking appropriate questions to ensure the best use of public resources over the next 12 months.