LevellerLive

In the May edition of The Leveller®, we ran a story titled “it’s not a cover up – honest.” This relates to the lack of disclosure by South Somerset District Council (SSDC) in relation to their corruption scandal. If you are not familiar with the story, here is a brief update. Allegations emerged in April 2021 of council property being used by staff to work at a local vineyard. A vineyard run by one of the council’s directors. In addition allegations were made that council staff also did work for others, including council executives and elected councillors. Subsequently two members of staff left the council.

We say that SSDC has been withholding important disclosures in relation to this scandal. Not so say SSDC and they pointed us to an Audit Committee meeting in May. Then apparently we would learn more (see below). This is a summary of events to date:

• Two separate reports (by auditors SWAP and Richard Penn) have been commissioned by SSDC to look into wrongdoing at the council.
• Both reports were instructed to focus on two individuals. The would be Chief Executive, Care Pestell and the former Lufton Depot manager, Chris Cooper. Both have since left the authority.
• Both reports indicated that a number of other staff and councillors may also have been involved in wrong doing.
• A Police investigation established that none of the activities at the council met the criteria to merit a criminal prosecution. That included Pestell and Cooper.

The point we have made repeatedly to SSDC, and they decline to answer, is this. The Police investigation looked at criminality. In terms of a lesser degree of wrongdoing, breaking council rules and the abuse of council assets, only two people have been investigated. Others have been implicated. Have they been investigated? If so by whom? And what was the outcome? We simply don’t know and SSDC won’t tell us.

May meeting – nothing new

The promised May Audit Committee meeting is now upon us (it will be on 26 May). So we have been reading through the papers that are to be presented. The item we have been waiting for is number 13 on the agenda and titled (without irony) “Improving Environmental Services and Corporate Governance – Achievements to date and planned further action”.

Despite the promise that we would learn more, we haven’t. Details of any investigations into other members of staff and councillors have been omitted. There is no mention of them. Did they not take place? Or are they simply not to be reported?

So what brand new disclosure do we have? Firstly the recommendations by the special investigator, Richard Penn. These are not new disclosures. We printed them in full in the January edition of The Leveller®. And SSDC know that.

The recommendations made by the SWAP have also been published. These broadly follow the recommendations by Richard Penn. There is more detail but nothing new. Both reports paint a picture of significant breakdowns in the system of internal control. What do we mean by internal controls? These are the policies put in place to ensure that council assets are protected, staff cannot abuse their position and accounting records are likely to be accurate.

New controls

The council have now indicated how they will move forward with new and stronger controls in place. These will no doubt address the issues identified. This much we can be thankful for. But the scale of failure, of control breakdown can be grasped from the following:

• Richard Penn identified 8 major areas for improvement in his report.
• SWAP identified a further 18 areas where specific control failures need to be addressed.
• SSDC have now put in place an action plan with 30 actions included. These are required to correct failed internal controls.

But questions remain. The various issues appear to have taken place between 2019 (and possibly earlier) and 2021. How was it possible for such an extensive breakdown of internal control to happen? And to go undetected. Remember, had it not been for a letter from a whistleblower, these things may well be still undetected today.

Who is responsible for this?

In most organisations the system of internal control is the responsibility of the Finance Director or equivalent. So at SSDC, that presumably means the s151 officer in post at the time and the Executive portfolio holder for Finance and Legal Services at that time. Should taxpayers not receive an apology for the failings on their watch?

We might also ask why these issues were not picked up by either the auditors or internal auditors?

And there is no longer any excuse for not publishing, in full, the SWAP report and the Richard Penn Report.