West Dunbartonshire Council coat of arms and their Church Street headquarters.
Audit Scotland review reveals Council contract rules were ignored by officers
Special report by Bill Heaney
Audit Scotland have called out senior officials of West Dunbartonshire Council who broke procurement rules which demand they must declare personal friendships with contractors who receive work from the local authority.
But it was just a case of all pals together when members of the Church Street management team went golfing and wining and dining with Mr Nemo, a Paisley businessman, whose company was awarded £9 million in contracts from the Council.
Mr Nemo, who has not been named or whose name has been redacted (erased) in both the Council’s own internal audit report and Audit Scotland’s review of it – was the fourth man in a party of golfers who spent a day out on an exclusive Loch Lomondside golf course at a cost of £650.
He also participated in the apres golf which involved some exotic fine dining with drinks, including champagne and Spanish wine.
And in social gatherings too with three un-named officials and their partners in exclusive city restaurants where extremely expensive items were eaten.
These included T-bone steaks at almost £80 a serving and double helpings of monkfish and sea bass were chosen to eat from the a la carte menu.
But it was all above board, according to the auditors. Nothing to see here. Now please move on, Gentlemen. A minor breach of the rules but no criminality. These men were friends beyond their Council connections and everyone picked up their share of the tab.
Audit Scotland said it was impossible to quantify how much all this “regularly” breaching of procurement policies cost the local Council taxpayer.
As did the Council’s own internal auditors who were considered not to be of sufficient seniority to be allowed to address or answer questions from councillors at a meeting to discuss the matter in the Burgh Hall.
Details were said to have been withheld from councillors over problems in Roads and Greenspace services.
All staff who did not declare connections to companies who received Council contracts were absolved of any wrongdoing.
Audit Scotland agreed they made “reasonable” conclusions and that the rules weren’t clear enough.
But there is still a whole raft of material which has been covered up or hidden from public inspection, whichever term one prefers.
The internal council report on the issue still has 80 completely redacted pages, despite the elected members unanimously telling their officers to reconsider this and submit a more penetrable version.
A special council meeting will be held on Tuesday, May 14, at 2pm in the Burgh Hall to discuss the Audit Scotland report.
Remarkably, this redacted report has been “welcomed” by the Council leader, Jonathan McColl, who has placed it on record that the SNP/Tory administration has a policy of openness and transparency in all they do.
This statement comes despite this embarrassing issue having been covered up and shuffled from pillar to post and back again over a period of three years.
That was when a whistle-blower reported it in March 2016 when Labour were still in power locally and running the Council.
In that time, and until now, no disciplinary action has been taken against the officers said to have been involved, despite the fact that it has been revealed – and repeated again now by Audit Scotland – that laid down procedures were not always followed.
Police Scotland made inquiries after taking statements from Cllr Jim Bollan and then Cllr George Black about what had been disclosed to them by the whistle-blower
The Police took no action then but were said to be back on the case two months ago when additional evidence was said to have been presented to them. No proceedings have been brought against anyone and today the police said they were still working on new information received.
Audit Scotland was called in earlier this year and pointed out that between 2013 and 2016, procurement policies had “regularly been breached,” resulting in most work being awarded without a tender process or seeking sufficient quotes.
That way, it would never be known by the public which company had submitted the lowest tender or whether the Council was receiving value for money.
This has been put down to a shortage of staff, but no reference has been made in any of the reports of any reason why the Council was unable to recruit in these areas over such a long period of time.
There were also procurement issues in fire detection and alarm services – exposed last year by the Dumbarton and Vale of Leven Reporter – and “emerging” issues with social care service contracts.
Chief Executive Joyce White, left, has said the Council has found itself in a “challenging” situation. Others have put that much stronger.
Only 72 per cent of contracts complied with regulations and the management team have set a target of 90 per cent by the end of 2020/21.
Community Party councillor Jim Bollan, who has been pushing for years to achieve transparency on the issue, said: “The Audit Scotland report is very critical and scathing of the shambolic processes used by WDC to procure services after a private contractor was ‘awarded’ work to the value of £9 million.
“Twenty-eight per cent of all council work awarded breaches the council’s own regulations, resulting in best value not being achieved.
“Whilst being critical, the report does not take us one step closer to holding these senior officers to account for their corrupt practices.
“The Chief Executive and the senior management team were aware of this practice for years and condoned the fact that, ‘Procurement financial regulations were regularly circumnavigated’.
“Key information was withheld from the audit committee of councillors in December 2018. This strikes at the heart of accountability and democracy.
“These are seriously grave matters and need to be faced up to and dealt with urgently.”
Audit Scotland was blunt that members of the senior management team “were aware that procurement practices were not being followed for some service contracts over a number of years”.
But there was no reference to “off contract” spending in breach of regulations in the annual procurement report to councillors and the public.
“We have identified that the council did not have effective controls in place to monitor revenue spend consistently against contracts across all services,” said Audit Scotland.
“This is of particular concern where contracts are being awarded outwith the procurement processes.
“Since January 2019, additional controls have been put in place to monitor spend against contracts.”
Crucial, however, they concluded: “In our opinion, the council’s controls to ensure personal relationships between officers and suppliers do not influence the awarding of contracts were not effective. It is not possible to identify whether this influenced the awarding of council contracts.”
The relationship between those staff and contractors “should have been declared”. But because the employee code of conduct was “not explicit”, it was right for WDC not to pursue disciplinary action against staff.
A spokeswoman for WDC, who do not speak to The Democrat, told the Reporter, whom they do speak to: “The council welcomes the findings of this independent review and will take the necessary action in response.
“It is reassuring that a number of the required improvements are already being addressed and we look forward to updating elected members on progress on the action plan on May 14.”
What she didn’t disclose was what the “necessary action in response” will be, despite the fact that the “required improvements” which are part of an “action plan,” are already being addressed.
And if elected members were involved in drawing up this action plan even before the full Council had an opportunity to discuss the Audit Scotland report and the latest information from Police Scotland next Tuesday.
How Council was made to fess up to failings after blowing own trumpet about how good they were
There must be questions now for Audit Scotland who produced a Best Value report for the Council over a five-year period to 2017.
West Dunbartonshire Council posted that report on its own website, boasting how wonderful they were and emphasising that they had been praised by AS for the way they handled their financial affairs during that period.
Everything changes, however, and voters must now be thoroughly confused in light of recent events, which must leave the Council and those responsible for its finances utterly ashamed.
Unashamedly, the Council said then that “Scotland’s public spending watchdog has highlighted the strong performance and significant progress made by West Dunbartonshire Council.”
And that Audit Director Fiona Mitchell-Knight echoed the comments made in the report “which found that effective and improved leadership from councillors and officers had been critical to the progress made in West Dunbartonshire.”
If anyone knew what the real situation was in West Dunbartonshire, it must have been the Council’s own officials.
Ms Mitchell-Knight also highlighted “the clear and steady improvement in service performance and other areas of responsibility”.
There is no evidence for this in the most recent AS review.
She talked about “key strengths” which she identified as:
- The vision, leadership and strategic direction of the Council
- A steady improvement in performance and use of resources, including finances and staffing
- Effective financial management
- Partnership working including with community planning partners and other local authorities
- Future plans which reflects the needs of the communities in West Dunbartonshire
Council leader Councillor Jonathan McColl said at the time: “This is an excellent report for West Dunbartonshire and evidences the significant efforts to transform this Council over the past decade. It is an endorsement of the commitment of all of our staff from our Chief Executive to frontline workers.
“We are not complacent and there are areas where we can continue to develop. There is now a strong platform in place on which we can build, we are clear on our vision for the future and both elected members and officers will do everything they can to ensure we deliver for every resident in West Dunbartonshire.”
He must believe the electorate have their heads buttoned up the back.
Also at that time, Councillor Martin Rooney, Leader of the Labour opposition, added: “This report confirms the significant improvements made by the Council since 2007. All Councillors are committed to ensuring progress continues over the coming years and services for residents are maintained and enhanced.”
The Commission published its findings in June following a significant review of the Council conducted over several months in 2017/18. The latest Best Value publication marks a significant turnaround for West Dunbartonshire since audit reports in the mid-2000s.
Work is already underway on the areas identified by the Accounts Commission for continued improvements:
- Review project management processes for capital projects
- Further develop workforce plans to include forecasts of numbers and costs
- Continue efforts to address employee absence and support employees through change
- Continue to support the development of the Community Alliance and help it reach its full potential
- Consideration be given by councillors to establishing a cross-party groups to address the financial challenges which exist and the important decisions required in the future
Audit Scotland undertook the review on behalf of the Accounts Commission. They must now be considering going back to review their own review of the Internal Audit report which was so badly put together and revealed so many failings on the part of West Dunbartonshire Council.
The seven areas where the Council fell down on its remit
SNP’s McColl, Labour MSP Baillie and Bollan, of the Community Party
Audit Scotland said there were no less than seven areas of its responsibilities which West Dunbartonshire Council had fallen down on.
- No effective controls in place to monitor spend against contracts across all services
- Just 44 per cent of contracts awarded in compliance with regulations since 1912 and has been steadily increasing over the years
- Controls to ensure personal relationships between Council officials and suppliers did not influence the awarding of contracts were not effective
- The time taken by the Internal Auditors to investigate and report on the matter was excessive
- The format of the report, which had page after page redacted, was not appropriate and could not easily be shared with elected members
- The findings issued to members of the Audit Committee in December lacked the level of detail required for proper scrutiny
- The internal audit inquiry should have been more extensive and included whether contractors were properly vetted and whether senior officers were aware that procurement practices were not being followed.
Incredibly, SNP/Tory administration leader Cllr Jonathan McColl said the review was “very welcome”.
And that he was “pleased” with it because “the conclusions of the internal audit investigations were correct”.
He omitted to mention to the Lennox Herald – he is part of the boycott of the SNP Party and Council boycott of The Democrat – any regrets or excuses for the above shambles having taken place on his watch.
And Labour’s too, of course, over such a long period.
Labour MSP Jackie Baillie’s comment amounted to no more than a mild rebuke for the Council.
She is reported to have described the Audit Scotland review as “a wake-up call” for the Council to get its financial affairs in order without delay.