PEOPLE’S AUDIT: OTHER POINTS FROM LAMBETH’S RESPONSE:
“Lambeth council have been asked to respond to claims made by the ‘People’s Audit’ review of the council’s 2015/16 accounts” say the council on its Love Lambeth website.
Who made this request is not yet clear.
The statement continues:
The 2014 Local Audit and Accountability Act gave citizens the authority to scrutinise councils’ expenditure. During the inspection of the accounts for 2015-16, Lambeth council received an unprecedented number of applications to inspect the accounts. The requests asked for significant volumes of information (one query asked for over 2,000 invoices with contracts) and officers worked with the individuals who requested items to provide responses.
The council welcomes transparency and the right of members of the public to audit local authority accounts, and furthermore believe that this right should be in addition to the powers that the Audit Commission had before it was abolished by the Government.
While the report does raise issues which the council will examine (and in some cases has already done so) we have not seen any evidence to support the allegation of “extensive financial mismanagement”. The final document contains suggestions, assertions and straightforward errors which, taken together, give a sensational but inaccurate account of Lambeth’s finances.
We have produced a comprehensive response to the points raised in the People’s Audit report.”
The comprehensive response states:
It is untrue to assert that Lambeth officers were obstructive. The ‘People’s Audit’ exercised their right to inspect the accounts in person; over 230 hours of officer time was spent supporting queries and a senior finance officer met members of the group last August.
Some of them then exercised their right to object by contacting Lambeth’s external and independent auditor KPMG, who went through the complaints in detail. Letters were sent to this group from Lambeth’s independent auditors, rejecting some claims and asking for evidence for others. No such evidence was provided.
That correspondence is between the auditor and the ‘People’s Audit’ so Lambeth is not able to release them into the public domain. The ‘People’s Audit’ has chosen not to publish them.
(Last week Lambeth council refused a Freedom of Information request for the auditor’s report. The request said: “On July 16th this year Lambeth Labour Party, on their Twitter account, stated: “People Audit’s claims were rejected by auditors”. Please send a full copy of auditors reports rejecting People’s Audit claims in relation to the 2015 – 2016 accounts (of Lambeth council).”
Lambeth council responded: “The audit was undertaken by KPMG. “The auditor’s letters are confidential between the individual and the auditor and therefore the council does not hold this information.” The council did not state who ‘the individual’ is. – Ed.)
The Lambeth council statement continues: To offer reassurance that the council’s finances continue to be effectively managed there are answers to the main points below. In addition, it is important to note that the annual accounts were signed off, without qualifications, by KPMG.
The following are the main issues that have been put to the council by this group:
1. What has the council done to investigate the appearance of price fixing by contractors? This refers to an instance where two tenders for a contract contained identical prices and was due to the fact that one sub-contractor had priced for both the companies tendering for a specific area of work. This was explained to the People’s Audit.
2. On Wyvil estate in Vauxhall, where documents show that in three blocks of flats Lambeth paid invoices for twice the amount of brickwork and concrete repairs than that carried out by the subcontractor, what has the council done to check the other 13 blocks? The council did not pay its contractors more than was due for concrete repairs or brickwork repairs on Wyvil estate. All works and costs were scrutinised in detail prior to the settlement of the final account and all works that were paid for had been completed.
3. Why is Lambeth’s finance department unable to access invoices worth £8m paid by the housing department? The invoices are stored on the council’s housing database which is separate to the finance database, and finance officers have access to this. This was explained to the People’s Audit.
4. What steps is Lambeth taking to reduce its poor record on housing repairs, given the £10.4m it has paid out in housing disrepair compensation over five years (30% of all those made by local authorities in the UK)? The decision to bring Lambeth Living back in-house in 2016 was in large part due to a need to improve housing repairs. Since we have done so and asserted greater control over repairs, they have improved and are proving better value for money. This process began in 2015.
5. Why is Lambeth not getting a better deal in its dealings with developers – for example in its relationship with Pocket Living, which has received discounts worth £1m on three plots sold by the council? Sale of the sites to Pocket Living resulted in 100pc affordable housing which Pocket had received grant funding from the GLA in order to progress. This means there are 102 new affordable units built on the sites which we would not have achieved with other developers.
7. Lambeth paying an average £4,000 for kitchen replacements, priced under its Decent Homes contracts at £2-3,000. The claims of cost per kitchen were derived from calculating the overall contract cost from the number of properties, ignoring the other associated costs (the replacement of the distribution network, as well as individual kitchens) and other work relating to gas servicing, water storage and heating. Therefore, the cost quoted by them is not accurate. The People’s Audit were informed about this.
8. Contractors for repairs at Cressingham Gardens estate charging for works that have not been carried out; repeat instances of the same repair; and instances of overcharging. The People’s Audit has been asked for evidence to support this but none has been forthcoming. Any evidence would of course be taken extremely seriously and acted on immediately, but this remains an unsubstantiated allegation.
9. Numerous examples of expenditure being under-stated on Lambeth council’s website, when compared with actual invoices, including £3.2m paid to Transport Trading Ltd (a wholly owned subsidiary of TfL). As part of transparency the council publishes a list of transactions over £500 on the website in line with government guidelines.
This is a snapshot extract of the data on the finance system and is not used by the council to produce its accounts. BOLD The error in the download that the People’s Audit identified has been reported to the finance system provider and officers have been working with them to get this corrected.* (Note: What this error is not stated in Lambeth’s response – Ed.)
*Bold type by News From Crystal Palace