Auditors slam York Council over contractor probe

Auditors have issued a critical report following complaints about how consultants were recruited during the term of the last Labour administration, which left office in May 2015..

The report will be discussed at a meeting taking place next week next week.

Officials involved in the scandal – and most of the Councillors that they reported to – are no longer with the Authority.

The audit report concerns how a consultant, who was employed in the public relations/culture activity area, was engaged.

The report concludes that there was no evidence of fraud but it says,

“Internal Audit undertook an investigation into the awarding of contracts to an external consultant. The investigation found that there was no evidence to show that written quotations had been received. A number of other breaches of the council’s Financial Regulations and Contract Procedures Rules were also identified including the absence of a signed contract, the failure to include the contract on the council’s contracts register, a payment in advance of the work being completed and inadequate contract monitoring”..

Part of the report is being withheld as it identifies the individuals involved in, what appears to amount to a case of maladministration 

Unfortunately the last Labour administration in York was mired in secrecy. Officials were given too much power and they seem to have exploited this to allocate work to their chums.

A copy of the external Auditors report can be found by clicking here

More recently there has been criticism of the present Council for allocating contracts for work on social care projects with little openness and even less regard for the rights of taxpayers 

The Council will be asked to consider what more can be done to prevent corruption in the future

Tory finance chief quits York Executive

Mystery surrounds consultants contract

The Conservative Councillor responsible for City finances has abruptly quit his post. The announcement came only days after the Council released details of a hitherto confidential consultancy contract.

In 2014 a small consultancy firm, run by a former City Council employee, had been awarded a contract to project manage the older person’s accommodation project. This is the programme which will see existing elderly person’s homes like the one at Oakhaven closed and replaced by larger privately run “mega homes”. Part of the programme would see elderly person’s accommodation built on the Lowfields school site.

The consultants contract was to have run from 1st January 2015 until 31st December 2015. The contract was extended to 31st March 2016 with a total value of £130,000.

In response to a Freedom of Information request the Council says it does not hold any information to indicate “which Directors and Councillors were involved in the letting of the contract, and any extensions thereof” nor can they ” provide copies of all appropriate decision meeting minutes or notes – including copies of any invitation to tender adverts”!

The contract had an “output” specification. This meant that payments were made to the consultancy only when agreed targets and milestones had been met.

The Council was also asked about its current policy in engaging employees, consultants and contractors who seek to be remunerated via a private company.

They replied;“There is currently no policy which specifically deals with this question.  Each assignment will be considered individually and advice is provided on the employment implications by human resources or the procurement team”.

In March 2016, the Council, now under coalition control, decided that further work was needed on the older person’s project. They decided to let a further consultancy project covering the period 31st March 2016 – 30th March 2018 using the services of NEPRO This is a local government “spin off” company run from Sunderland. It effectively procures and manages contracts let on behalf of local authorities.

behind closed doorsThe Council have admitted that “The decision to use NEPRO is an officer decision and was made by the Council Management Team on 7th May 2014.  As this is a legally compliant framework, the terms and conditions are pre-agreed.  Suppliers on the framework have already agreed to these terms and conditions, therefore no further steps were deemed necessary to ensure transparency of individual contracts agreed through the framework. 

The new contract was handed to the same consultant who had held the old contract since January 2015.

It appears that no Councillors were involved in the decision nor is there any evidence that the employment of NEPRO has been reviewed during that last 3 years. It is unclear what proportion of contract costs are retained by NEPRO or indeed what value they add, in a situation where an existing contractor is simply reappointed to a role.

The new contract had a potential value of £216,000.

£54,000 was paid out in 2016 during the first 9 months of the contract.

The contract is again based on “outputs” being achieved (see below).

While output contracts can have advantages, they are an opaque system and unsuitable for activities where taxpayers opposition to proposals must be overcome before payments are released. The temptation may be to prioritise financial gain over the views of residents.

This happened with the decision to build on the Lowfields playing fields, where lobbyists were urged to influence consultation results and a, misleading, report gave the impression that the NHS had agreed to fund a new health centre on the site (see here).

It hadn’t.

The lack of engagement by senior Councillors in the contract letting process at the York Council is a concern. So is the lack of, publicly accessible, records of decisions taken about contract letting.

With spin off companies not subject to FOI regulations, this means that large sums of public money can be committed to controversial projects with minimal accountability.

consultants

York Council explains reasons for secret staff payoff deals.

After some delay, the York Council has explained why it has entered into 41 “Compromise Agreements” with axed staff during the last 5 years.Top-secret-stamp-006

We reported in June that the York Council had spent £82 million on redundancy costs since 2011. 546 staff (not including teachers) had left the Councils employment with an average payment of £15,000.

The Council has also confirmed that 41 “Compromise Agreements” had been signed with staff. Usually these involve some sort of compensatory pay.

A compromise agreement is a legally binding agreement made either during or following the termination of employment. It is recognised by statute and is the only way an employee can validly “contract out” of their employment law rights. It usually provides for a severance payment, in return for which former employees agree not to pursue any claim or grievance to an Employment Tribunal.

A leading law firm says that the major reasons for using the compromise agreement (other than to settle an existing claim) are to “remove an employee on the grounds of poor performance or misconduct, to avoid legal challenge in redundancy situations and to make it easier to remove senior staff without embarrassment”.

The number of secrecy deals increased markedly when Labour took office in 2011

Three months ago, the Council were unwilling to specify why compromise agreements had been reached in so many cases.

Now, following an FOI appeal, they have lifted the veil a little.

Compromise agreements at City of York Council

Compromise agreements at City of York Council

Clearly the Council has come to several agreements to avoid the costs, and adverse publicity, often associated with claims that run through industrial tribunals.

The legal nature of the agreements means that they can’t be probed further.

Taxpayers may remain a little uneasy about the process and the robustness of the decisions that led to compromises being needed in the first place.

Hello York…. Hello… Hello… anyone there?

Occasionally projects kick off in York which seem like quite a good idea until enthusiasm gradually wanes.
Campaign against secrecy started 5 years ago

Campaign against secrecy started 5 years ago

One example is/was York TV. Announced in 2014 the service was supposed to be on air in the spring of 2015.  A competition was run in June 2014 to find a name for the station which rather alarmingly seemed to result in a parody of the film title  “Good Morning Vietnam”.

Then, despite concerns about the funding sources for the initiative, everything went quiet. The TV station didn’t launch and all that is available is a web site which is very thin on content and an accommodation address and telephone number at the University’s Ron Cook centre.

The York Council – which claimed to be a “partner” in the project – has made no statement on the progress being made. Another partner was “One&Other TV” The founder of independent York publisher One&Other Stuart Goulden had left that company in early 2014 “in order to focus on launching York’s local TV station”.

The Council’s Chief Executive had appeared in a promotional video for “One and Another”Gauden

In a separate development, a Freedom of Information request has now revealed that several contracts were allocated to a public relations company in 2014 which were not subject to proper procurement procedures. Council regulations require competitive quotes to be obtained before contracts are allocated..

In total almost £200,000 appears to have been mis-spent.

It took the Council a very long time to produce the answers to what were perfectly legitimate questions posed by a concerned local resident.

It was as recently as 6th June 2016 that the Council finally provide a comprehensive response detailing the work that they had paid the PR company to undertake

On 6th July the Council admitted that procurement rules had not been followed when letting the contracts. While they rightly said that action had been taken to tighten up procedures, they remained tight lipped on how the maladministration had occurred in the first place.

The Council has now been asked to publish details of all invoices submitted in connection with the PR work in question.

It is unclear whether the Councils auditors will take formal action or whether a reference will be made to the Local Government Ombudsman on a maladministration charge.

The new information does confirm what most people already knew. By 2014 governance processes at the York Council had broken down.

All decisions on the contracts were taken at behind closed doors meetings. The Council claims that Councillors were not informed about what was being done.

York Council scrambles to make £100,000+ staff exit sweeteners

Bid to beat government cap deadline

Behind clsoed doors 2016

The York Council will hold a private meeting in a few days time to consider what exit payments to make to senior staff leaving the Authority. The move follows a decision last month to reduce the size of its management team.

One Director will lose her job. It appears that one “Chief Officer” is seeking to retire early.

Council regulations require that any pay off deals, costing over £100,000, are authorised by Councillors.

No details of the individual payments have been published – to preserve individual privacy – but the payments are expected to be amongst the highest ever authorised by the York Council.

The Council report includes the following statement on national policy,

The Government is currently consulting upon options to introduce a cap on the total cost of exit payments for staff working in the public sector. The total figure which has been proposed is £95k. The specific details of the scheme are still subject to consultation and have not been published but there is likely to be some form of ‘capping’ of exit payments introduced at some point in the coming months. On the 24th February, the Minister of State responsible for the introduction of these provisions confirmed that the earliest implementation date would be 1st October 2016″.

The Council has not yet fully responded to a FOI request for information on why it has imposed confidentiality (compromise) agreements in  respect of 41 redundancy decisions made over the last 5 years.

While individuals do have a right to privacy, taxpayers also need to be convinced that their money is being spent wisely.

No justification is offered for the proposal to offer enhanced terms on “early retirement” to one officer and it appears that one of the posts will subsequently be filled by recruitment.

Sadly some will see this as another case of lack of transparency at the City of York Council made worse by an indecent haste to evade central government restrictions?

Strange case of the missing £18,000 report

Occasionally Freedom of Information (FOI) requests throw up some interesting answers.

That’s one of the reasons why we believe that the increasing numbers of QUANGOS in York should voluntarily accept and respond to FOI requests. After all, most depend heavily – some exclusively – on funding from taxpayers. The Council’s Executive had an opportunity, when discussing governance of these bodies yesterday, to increase transparency. Unfortunately it failed to take the necessary action.

The York Council should itself set an example in providing information in a candid and comprehensive way.TOR for Council central services report 2

One resident asked recently for a copy of a report commissioned by the Councils Chief Executive from PWC (Consultants). The objective of the exercise was  to improve the Council’s efficiency.

The consultancy cost taxpayers £18,000.

The Council claims that it has not kept a copy of the report (received just 12 months ago!)  and goes on to say that,

This work was commissioned by the then Chief Executive of the Council, who left the authority in July 2015. The interim Chief Executive who was in post from July 2015 determined that this particular work would not be taken forward and therefore no further discussion or action has taken place on this matter.

The Council says that it doesn’t know whether any Councillors saw the report.

This seems, on the face of it, to be a very cavalier approach to the use of taxpayers money.  

The Council’s Leadership, and incoming Chief Executive, should make sure that the report – even if unsuitable for implementation – is made publicly available.

 

 

 

York Council still in a muddle over local QUANGOs

The York Council’s Executive is to consider its relationship with agent bodies and companies tomorrow.Quango list

The move comes in the wake of criticism of several bodies not least York City Trading where audits revealed that inappropriate payments had been made.  Other problems arose in relations with the York Museums Trust over charging arrangements and Make it York where apparently unilateral decisions angered residents

The organisations concerned depend on Council taxpayers for a lot of their income

One common criticism was a lack of transparency shown by the organisations (they are not subject to Freedom of Information legislation).

Concerns were also expressed that performance indicators – where published – were inappropriate or “soft”.

Campaign against secrecy started 5 years ago

Campaign against secrecy started 5 years ago

The expectation was the new Council would shake up the bodies and inject more democratic accountability.

Instead a disappointing report concentrates only on governance issues. Steps are being taken to separate executive and customer functions but little else. We will still have a bureaucratic muddle with little consistency and no new commitment to openness.

If approved without change, the Council will stand accused of ignoring many of the concerns expressed by taxpayers over the last five of years.

Important decisions affecting the City will continue to be taken “Behind Closed Doors”

York Council has paid out £8.2 million in redundancy costs since 2011

546 staff made redundant – 41 sign “compromise agreements”

A Freedom of Information response has revealed the costs of cutting staffing levels at the York Council.

FOI response Redundancies table 2

The figures don’t include teaching staff.

In total 546 have left the Council with average pay-outs of around £15,000 each. Over 80% of the redundancies were voluntary.

The figures reveal that the largest number of redundancies occurred in 2011/12 when 212 left the Council. This has fallen gradually each year to a figure of 66 during the last financial year.

A total of £8.2 million has been paid out of which £4,554,000 was the cost of statutory payments, £3,339,000 early retirement costs and £352,000 pay in lieu of notice.

Only three former staff were subsequently re-employed directly by the Council.

The authority says, though, that they don’t record whether any of their agency or contract staff have previously been employed by the Council.

Individual redundancy proposals are reported to a small group of Councillors who meet each week in a “behind closed doors” decision session.

The Council has specifically said in its response that it “has made no enhanced redundancy or pension payments”.

Compromise agreements

The Council has also confirmed that 41 “compromise” agreements have been signed with staff. Usually these involve some sort of compensatory pay.

A compromise agreement is a legally binding agreement made either during or following the termination of employment. It is recognised by statute and is the only way an employee can validly “contract out” of their employment law rights. It usually provides for a severance payment, in return for which former employees agree not to pursue any claim or grievance to an Employment Tribunal.

A leading law firm says that the major reasons for using the compromise agreement (other than to settle an existing claim) are to “remove an employee on the grounds of poor performance or misconduct, to avoid legal challenge in redundancy situations and to make it easier to remove senior staff without embarrassment”.

The Council has so far failed to explain what the reasons were for the compromise agreements that it has been party too.

While such agreements usually involve a confidentiality clause, there is no reason why the main reasons for the high level of use of the system in York cannot be made public.

We’ll press the Council to provide taxpayers with more information about this policy.

York Council moves to legitimise Local Plan decision date

Big City smallThe latest Forward Plan -which indicates when key decisions are scheduled to be taken by the York Council – has been amended to include consideration of a new Draft Local Plan.

The Council has said that it will consider which sites will be allocated for new housing when its Executive meets on 30th June.

Residents were mystified when, last week, Councillors said discussion of the changes was imminent. No item had been placed on the Forward Plan and the Executive’s own agenda – which outlines the issues that will be considered at its subsequent two meetings – was also silent on the issue.

The Council has still not said when its Local Plan Working Group will meet. The all party group has not met since 30th November 2015.  It would normally meet to discuss any draft proposals before forwarding them to the Executive for approval.

We understand that Council officials are briefing the owners of major sites in the City this month. They are being told what to expect when the Draft Plan is released next month.secret decisions

Eyes will be on major sites like Clifton Gate (between Clifton Moor and Skelton) and Whinthorpe (Between Elvington and the A64) both of which have traditionally formed part of York’s Green Belt. If either (or both) were to be slated for development then huge amounts would need to be spend on infrastructure improvements. The former would require a dualled A1237, while the later would require a new access corridor because of  existing transport congestion in the area. The source and scale of the funding required must be made clear in any Council decision.

It is little short of outrageous that vested interests will find out the fate of projects worth tens of millions of pounds before ordinary residents and taxpayers are even told when they will be able to first see the proposals.

 

 

York Council responds to vested interest criticism

The Council has published details of an interim scheme which it believes will prevent a repetition of the recent scandal over unlawful payments to officials.Top-secret-stamp-006

Ironically the proposal was agreed in another “behind closed doors” decision session earlier today. The background papers were only made public after the decision had been made.

It has published a new code which can be read by clicking here

click to read

click to read

The form that senior officials will have to keep up to date – and publish publicly – can be found by clicking here .

The Code list sevral areas where a potential conflict of interest may occur

The following is a list of situations that may result in a conflict of interests for a member of staff:

  • A planning application or appeal in which the address concerned is the employee’s residence or a neighbouring address;
  • Ownership of land that is subject to a Council decision;
  • School admissions appeals involving a friend or relative;
  • A contract between the Council and another organisation in which the employee has a personal or financial interest(including council-owned or other related parties to the council). Any pay received from related parties must be declared;
  • Processing of Council Tax payments/refunds where the employee is the landlord of the properties concerned;
  • Benefits applications/appeals in which the claimant is a friend/relative or neighbour;
  • Processing of home or residential care cases where the customer is a friend or relative;
  • An audit of an establishment in which the employee has a personal interest (e.g. Elderly Persons’ Home where a relative is a member of staff).
Further refinements to the rules are promised at a later date.