Opposition welcomes auditor's findings on unlawful councillor allowances

Deputy opposition leader Richard Greenhill has welcomed the official findings of the District Auditor on unlawful payments to councillors by Broxbourne Council, following a complaint submitted by the Labour councillor last September.

Responding to the auditor's findings, Councillor Greenhill (Labour, Waltham Cross) said:

"I welcome the District Auditor's findings that the council acted unlawfully in paying attendance allowances to councillors, and that the council delayed excessively in responding to opposition complaints. The disputed allowances were only stopped after we intervened.

"As a direct consequence of the objection, local taxpayers have been saved £60,000 over the past two years in stopped allowances.

"But it is a disgrace that it took nearly two years after we first complained to the council - and one month after I complained to the auditor - for the council to publish any report on the dodgy payments, and more than two years for the Tories to suspend the last of the disputed allowances.

"There are signs that the Conservatives still want to duck scrutiny of their capital spending cuts, with questions raised in committee last month about the future of the council's £2m budget to provide affordable housing for local people. We will not hesitate to intervene if the Tories fail to account fully and publicly for the funds they control.

"The council's legal and finance officers will now have to publish a formal report on the unlawful capital approvals.

"The Tories have made lots of promises, but now they need to show that they have cleaned up their act."

In a detailed response to the statutory objection to the council's annual accounts submitted by Councillor Greenhill last September, the auditor made the following observations:

• on the councillor training allowance, the auditor states: "I conclude that, at best, this is a tenuous use of this power and therefore potentially unlawful. The Council has accepted that this is the case and has withdrawn the allowance." (page 4 of the auditor's decision letter)
• on an allowance to councillors attending sub-committee meetings: "I conclude that this payment falls outside of the Members Allowance regulations and that no other powers are applicable for this expenditure, rendering it unlawful. The Council has accepted that this is the case and has withdrawn the allowance." (page 4)
• on an allowance for attending non-council meetings: "I accept that it is possible to interpret the Regulations in the way suggested by the Council and I do not propose challenging the Council's interpretation of the Regulations." (this implies that the regulations are potentially open to stricter interpretations if the question went to court)
• on two other allowances covering payments to councillors who opted not to use council laptops ("PC allowance") and a so-called broadband allowance that was suspended after Labour intervention: "No payments were made in 2009/10. Moreover the Council has recently agreed that the availability of these expenses will be reviewed in the new municipal year and will not make any further payments until that review, thus mitigating any potential uncertainty that there may be regarding the legal basis for making such payments." (this implies that the legality would have been in doubt if payments had not been suspended)

The so-called PC allowance has not yet been abolished, but was suspended two months ago following a hastily revised recommendation from officers at a meeting of the full council.

This means that all five disputed categories of allowance have now been suspended or revoked, but too late to stop a cumulative total of around £120,000 of council tax money being paid to councillors in respect of the five allowances.

The also auditor criticised the council's failure to report publicly on the matter until a month after Councillor Greenhill's objection was submitted: "I agree that it would have been helpful for the Council to have resolved this issue more quickly and in a more accessible way, so that all councillors and members of the public were aware of the issue and its proper resolution." (page 8)

The auditor upheld Councillor Greenhill's complaint that the council's capital budgets were not being properly scrutinised, in breach of legal requirements: "This [regulation] says that approval of capital plans cannot be delegated to committee. ... However I am aware that the Council's capital programme, which clearly is a capital plan, is not approved by the Council but by the Policy and Resources Committee." (page 9)

In addition, the auditor agreed that key financial reports ("Prudential Indicators") should be published in advance of meetings, so that councillors could give the figures proper consideration (page 9).

The auditor's detailed objection decision notice is now online.

Report filed 28/04/2011

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