PEOPLES’ AUDIT DISCOVERS EXTENSIVE FINANCIAL MISMANAGEMENT IN LAMBETH COUNCIL
Millions of pounds of taxpayers money is being wasted by Lambeth council says a shock report published today (Friday).
The report by Lambeth Peoples Audit doesn’t just blow the proverbial doors off. It blows the monolith of a council that is Lambeth council to smithereens.
The report has found:
- Lambeth selling off council housing stock outside of ‘Right to Buy’
- Claims for works on one council estate that had clearly not been carried out
- An overspend of £11 MILLION on corporate office accommodation in the new town hall building
- Council’s own standing orders being ignored by Lambeth “on an industrial scale” when it comes to re-tendering existing contracts
- Contracts extended rather than re-tendered necessitating the issue of a waiver
- £57 MILLION of services bought without a tender because Lambeth have taken over two years to procure a replacement service
Evidence of serious failings in Lambeth’s financial management not picked up by the external auditor – with Lambeth admitting one member of the People’s Audit had asked to see more information than the auditor, despite the auditor charging £243,000 for their services
The report also found:
- possible price fixing between some contractors
- Over £8 MILLION of invoices for housing repairs which were NOT available to the council’s finance department
- “Industrial scale” ignoring of rules on competitive tendering
- Pay-outs of over £10.4 million in compensation and legal fees to tenants for housing disrepair claims in the last five years – comprising nearly 30 per cent of ALL local authority compensation claims for disrepair
- Evidence of a behind-the-scenes agreement by Greenwich Leisure to reduce its fee to Lambeth by £1 MILLION ANNUALLY if Lambeth gave the go-ahead to convert two of its libraries into Greenwich Leisure-run ‘healthy living centres’.
- Total project cost of the new town hall adding up to an “eyewatering” £104 million – more than double what the council say – because it omits to mention other costs
- £1 MILLION being taken from the supposedly ‘ring-fenced’ housing revenue account to pay towards the town hall – a move justified by Lambeth on the grounds that some of its housing staff will be based in the new town hall…
- …with a further £8.3 MILLION from the HRA (housing revenue account) apparently earmarked for the town hall rebuilding despite Lambeth claiming they have no money to repair council estates because of Government cutbacks
- Examples of Lambeth’s assets being sold off below market rate to a private property developer which receives a substantial amount of public subsidy
- Several examples of Lambeth trying to overcharge leaseholders for works – in one case by 350 per cent
- Site records of a repair sub-contractor revealing that the amount of repairs on their records were considerably less than those paid for by Lambeth
Lambeth under-declaring by nearly £8.7 MILLION the amount they paid over five years to a TfL (Transport for London) subsidiary
The ‘armchair auditors’ also found:
- Numerous examples of expenditure being under-stated on Lambeth council’s website when compared with actual invoices
- Over £8 million of invoices requested in relation to housing repairs which “simply do not exist on Lambeth’s accounting system.”
- Charges being made for works on one council estate which should have been covered by Lambeth’s insurance
- Retrospective authorisation of almost £400,000 paid over the previous two years to a tree surgery company
Other issues highlighted in the People’s Audit report include:
- Sale to a private developer of three pieces of land from Lambeth council estates at a discount of at least £1 million – without competitive tender
- Payments made without an accompanying invoice or the necessary authorisation
- Lambeth council accepting a bid from Muse for the new town hall which did not comply with the council’s requirement to achieve 40 per cent affordable housing
- Repairs showing kitchen replacement prices were around £2,000 – £3,000 per kitchen despite Lambeth saying they are paying an average of £4,000 per kitchen – with no adequate explanation as to why.
The report says: “Despite a generally obstructive attitude to the process by Lambeth council, including refusals to comply with instructions from the Information Commissioner, the team unearthed evidence of extensive financial mismanagement and failings in its financial governance that suggest millions of pounds of taxpayers’ money is being wasted.
“The results of our investigations suggest the lack of governance within Lambeth council is systemic.
“Whatever lies behind this mismanagement, it is clear that the sums involved are significant.
“Harmful cuts to public services could be avoided if Lambeth council were more rigorous in its financial management and were more open to public scrutiny and engagement with citizens living in the borough.”