Council admits to illegal contracts

An investigation has been launched after a district council admitted it had broken the law over the issuing of contracts worth £600,000 of taxpayers' money.

An investigation has been launched after a district council admitted it had broken the law over the issuing of contracts worth £600,000 of taxpayers' money.

A scathing internal report reveals Waveney District Council did not follow correct procedures for tendering work, and contracts were incorrectly drawn up or were not even in existence.

The council admitted the matter was being taken seriously and that a raft of measures would be introduced to prevent further breaches.

The case centres on the council's employment of private consultants to deliver efficiency savings in its benefits department and the subsequent issuing of contracts between 2003 and 2006.

The Tory-run council entered into various contracts with the supplier, a reputable consultancy firm called Kendric Ash, with a total spend of £618,546.

But in a report to be considered by the council's executive on Thursday, it is revealed that European legislation stipulates any outlay of more than £144,371 should go through the tendering process where work is advertised and awarded on the basis of strict criteria.

Most Read

The report, which admits the council is guilty of unlawful expenditure, goes on to say that only £20,250-worth of work was put out to tender, but that this procedure was also carried out incorrectly.

It has also emerged that the council is investigating why its accounts and legal teams, which would normally oversee the procurement process, did not appear to have been involved in appointing Kendric Ash.

The report says: "The contracts with this supplier have not been subject to EU procurement procedures. These contracts have therefore been entered into unlawfully. The detailed findings of this audit will be published following the outcome of negotiations with the supplier regarding the current contractual position."

Opposition councillors expressed concern at the revelations and called for the matter to be referred to the authority's scrutiny committee for a full investigation.

It is understood a council officer has been suspended in relation to the case, although a spokesman refused to confirm or deny this.

A statement by Waveney District Council said legal issues prevented it from discussing the case in greater detail, but added: "The council takes this matter very seriously. We have identified it, recognised it and are taking all appropriate measures, including referring it to scrutiny for a full, open and transparent investigation which will take place as soon as possible.

"This report does highlight the fact that Waveney District Council has a very effective internal audit service."

Measures proposed include training sessions for staff and the full implementation of an electronic purchasing system to ensure orders are authorised by the appropriate officers.

Sally Spore, leader of the opposition Labour group, said she had brought up previously raised concerns about the contract and asked for it to be investigated by the overview and scrutiny committee, which she is a member of. She said: "The reputation of the council needs to be protected at all costs. We need to dig down and find out more. It may be that we expose a culture that isn't good."

David Young, leader of the council's Liberal Democrat group, said he could not comment in detail until the investigation was completed, but added: "We are guardians of the public purse and take that responsibility seriously."

The report did not point to any wrongdoing on the part of Kendric Ash. A company spokesman said he could not comment.