Saturday 28 September 2013

'Unlawful' expenditure - more thoughts

I have, of course been keeping a very close eye on the developments this week with regards to the Appointed Auditor and Carmarthenshire County Council. The two 'unlawful' payments were the main subject of yesterday's Audit Committee meeting and the South Wales Guardian has again showed its mettle with a good report.

Over in Pembrokeshire, the Chief Executive is also under fire over the same pension arrangements which have been revealed in Carmarthenshire. He, on the other hand is not facing the revelation of an unlawful indemnity payment as well.

The significance of yesterday's meeting was that, for the first time, and despite attempts to bar and limit discussion, the facade is beginning to crumble and the findings of the auditor even persuaded the Members to refuse to sign off the report and to pass that responsibility to the Executive Board which so readily approved the payments.

This sort of action is unheard of in Carmarthenshire Council circles.

The auditor has refused to sign off the accounts until these issues are resolved. He also adds, in the report that there are other issues, including complaints made by members of the public which need to be addressed before completion.
"The audit cannot be formally concluded and an audit certificate issued until further enquiries regarding the lawfulness of transactions mentioned above and enquiries arising from matters raised by members of the public have been formally completed" (Anthony Barrett, Appointed Auditor, Wales Audit Office)

The circumstances surrounding the meeting where the indemnity was granted is also the subject of complaints, and that has yet to be determined by the Wales Audit Office itself. To put it simply, the question whether the officer concerned should have declared an interest, been present at the meeting and have contributed to the report is under consideration.

The exposure of the pension scandal and the 'unlawful' libel indemnity have opened up channels which will enable questions over other decisions to be brought to the forefront, the Towy Community Church and the Parc y Scarlet's stadium to name but two.

Concerns over the former were raised with the auditors some time ago. As for the latter, the auditors are, as I understand, unimpressed that the council has failed to secure it's asset, the stadium, should the club go bust. There is currently nothing stopping receivers seizing it should that happen - it would not automatically revert back to the council.

I am, as you may imagine, personally and primarily concerned at the moment with the decision over the libel indemnity. The possible consequences; the fact that it relates to an ongoing legal action as well as being the subject of legal discussions between lawyers acting on behalf of the council and the auditors, makes it difficult for me to comment very much at the moment. It is however, very significant.

On a more general point I first raised my concerns over the lawfulness of the 'libel cost amendment' to the council's constitution, which enabled such an indemnity, with the local auditors back in 2008. Regular, and long term followers of this blog will be aware of that. This week's decision that the payment itself was unlawful may have much wider implications concerning other councils who may have been considering similar actions as well as raising important legal questions.

However, I will wait for further developments, including the long awaited decision over the 'indemnity' meeting itself.

Jonathan Edwards, Plaid Cymru MP for Carmarthenshire East and Dinefwr, issued this comment on Friday;

“In the case of Carmarthenshire council the opinion of the Appointed Auditor is very clear – he considers two expenditures relating to the Chief Executive to be unlawful.

“Carmarthenshire residents need answers.  What advice was sought about the legality of these two expenditures?  How much did that advice cost county taxpayers?  Who took the decision to approve the Chief Executive’s new pension arrangements?  Who is accountable for these decisions?

“As the teams of lawyers from both the Audit Office and the council go back and forth debating the legality of the actions, how much more will this cost county taxpayers?

“It seems as if it’s another day and yet another question mark hanging over county hall. 

“Carmarthenshire needs a political reboot and an end to what I consider to be too cosy a relationship between the ruling Labour and Independent Executive and the council’s senior management. 

“The residents of Carmarthenshire deserve nothing less than a full investigation into how almost £40,000 of public money has been spent unlawfully.”


South Wales Guardian; County Hall showdown ends in legal stand-off over 'unlawful' claims against Carmarthenshire county council

Previous post here; Libel indemnity 'unlawful' 

BBC report here; Carmarthenshire blogger row: Council libel costs pledge 'unlawful

For a detailed report on the situation in Pembrokeshire, I strongly recommend Jacob Williams' blogpost; Pension Potty

...and if you haven't already, please go and read Cneifiwr's recent reports.

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