Caerphilly council payments 'unlawful' - auditor

Campaign Series: UNLAWFUL PAYMENTS: Caerphilly council’s offices, Penallta House in Tredomen Park, Ystrad Mynach UNLAWFUL PAYMENTS: Caerphilly council’s offices, Penallta House in Tredomen Park, Ystrad Mynach

THOUSANDS of pounds in payments to Caerphilly council’s chief officers to ‘buy out’ their entitlements to essential car use and annual leave allowances – and the decisions that led to them – were unlawful, a damning report concludes today.

Inadequacies and failings throughout the process that led to the payments being agreed are laid bare in a public interest report issued by Wales Audit Office (WAO) auditor Anthony Barrett.

It reveals that the deals were approved by those who stood to gain from them, and the proposals and decisions were not made known to councillors, or published.

The council must meet next month to consider what action to take – and its Plaid Cymru group leader is calling for the money to be repaid, with resort to legal action if necessary

The report reveals that at the time the decision was made to award buy-out payments, only the council had the power to take decisions regarding such payments to the chief executive.

The latter had delegated powers to make such decisions regarding other chief officers, but there is no clear record of how the decision was made, and by whom. Mr Barrett’s report also concludes:

l It is clear the decision was not taken by a formally constituted members’ body, making the decision in respect of the chief executive, and any payments made to him, unlawful.

lEach chief officer had a pecuniary or personal interest in the decision, but due to the lack of a formally recorded decision, there are no records of declarations of interest, which again makes the decisions and payments unlawful.

lThe decision was also unauthorised and unlawful, along with the payments, because it was not publicised in line with the council’s constitution.

It was revealed during the summer that 40 senior officers received payments averaging more than £2,500 each for buying out their essential car users’ allowance. The total was more than £102,000.

The buy-out of additional annual leave cost close to £116,000, with the overall buy-out payment sum reaching £218,563.

The process was undertaken to harmonise terms and conditions for council staff, and based on paying the equivalent of three years’ worth of each allowance, where officers were entitled to it under existing terms and conditions. Payments were made in April 2012.

Mr Barrett’s report says buy-out proposals were discussed at an informal corporate management meeting in January of that year, attended by the chief executive and other senior officers. There was no agenda and no formal minutes were taken.

Two of those present subsequently told the WAO it was agreed that the chief executive would talk to the council leader about the proposals, but the report says it is evident no such consultation took place.

It concludes: “There is a lack of clarity over who made the decision to proceed with the buy-outs, although it is clear that it was not a member decision .”

Mr Barrett raises “significant concerns” over issues such as a lack of documentation recording the formal decision over buy-out offers, and lack of clarity on how the decision was made and by whom.

He also criticises failures to publish the decision, and to consider and deal appropriately with conflicts of interest.

The council must now consider the report at a full meeting in the next month, and must decide whether it is required to take action, and whether the recommendations are accepted.

lThe £218,563 in buy-outs are part of a total of £488,927 of unlawful payments given to senior officials at the council, detailed in its financial accounts for 2012/13 by Mr Barrett.

'Decisions were unlawful'

CAERPHILLY council was Plaid Cymru-led when the buy-outs were decided, and councillor Colin Mann, current party group leader in the council, said the report makes it clear the democratic process had been thwarted in an "utterly unacceptable" way.

"As the report clearly states, no reports were ever given to me or my colleagues by officers. Nothing went to cabinet, scrutiny committees or full council," he said.

"It makes it clear that any payments made to the chief executive could only be authorised by the council - they were not.

"The public will no doubt ask whether the people who were primarily responsible for this unlawful decision and breach of trust should ever again be allowed to hold public office. Anyone who holds public office has a duty to ensure public money is spent properly for the benefit of the public.

"The council now has to consider the issue of money paid unlawfully being repaid to the council. Surely, it is not acceptable for anyone to keep money that has been obtained in this manner.

"The public will expect the council to recover, by legal means if necessary, money that was unlawfully paid to officers.

"I want to make it perfectly clear that I am not saying that everyone who received these payments was aware of the true circumstances surrounding this. Quite possibly very few officers knew how this had been done. At the same time all the fall-out from this matter now has to be resolved.

"As a Cabinet member at the time, my working relationship with officers was based on one of trust. I feel councillors have been let down badly and the trust that existed has been severely strained, if not broken altogether."

He called for a special audit of the council's affairs to find out if other payments have been made that ignored standing orders and financial regulations.

'Changes already made' - interim boss

STUART Rosser, interim chief executive of Caerphilly Council, welcomed the report and acknowledged that errors had been made by council officers.

He stressed that the finding of unlawfulness was initially reported to the council in September, with an interim internal report provided last month, and today's report will enable it to take the matter further through internal investigations.

"It should be noted that the council voluntarily referred the matter to the auditors for investigation in April 2013," said Mr Rosser.

"Residents can be assured the council has already taken steps to address the areas of concern identified.

"(It) has been working very closely with the Wales Audit Office over recent months to address concerns about its governance arrangements, and has introduced a number of improvements to ensure processes are much more robust."

The Assembly's public accounts committee will consider the auditor's report as part of its wider inquiry into senior management pay in the Welsh public sector.

Its chairman Darren Millar AM called the findings "deeply concerning."

“With front line services under threat and valuable staff facing the prospect either of losing their jobs or long term pay freezes, senior managers in the public sector should all be leading by example. Sadly it appears that, at Caerphilly county borough council, this has not been the case," he said.

Comments (13)

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10:38am Thu 19 Dec 13

Frankfurt says...

What has happened to the police investigation?
What has happened to the police investigation? Frankfurt

1:49pm Thu 19 Dec 13

Bobevans says...

I fail to see how such payment could be authorized as described above. In any normal business there would be a number of levels of authorization and with payments such as that it would require approval of the CEO & the CFO amongst others and there would be an audit trail it would be required for tax purposes as well

How an earth such large sums can be approved without anyone knowing who approved them defies logic
I fail to see how such payment could be authorized as described above. In any normal business there would be a number of levels of authorization and with payments such as that it would require approval of the CEO & the CFO amongst others and there would be an audit trail it would be required for tax purposes as well How an earth such large sums can be approved without anyone knowing who approved them defies logic Bobevans

4:04pm Thu 19 Dec 13

Aquarius says...

It's a shabby affair and I would have thought that everyone involved in this - no matter what the outcome of the police investigation -- is finished.

And are there not councillors who were involved in the nodding through of these deals? If they're still around, they should resign immediately or be removed.

And then they should all be prosecuted. It's not good enough for certain people involved to explain it away (as they did at the time in internal emails) by saying that there is a difference between 'illegal' and 'unlawful'.

They have let the public and the rest of Caerphilly Council employees down. Simple as that.
It's a shabby affair and I would have thought that everyone involved in this - no matter what the outcome of the police investigation -- is finished. And are there not councillors who were involved in the nodding through of these deals? If they're still around, they should resign immediately or be removed. And then they should all be prosecuted. It's not good enough for certain people involved to explain it away (as they did at the time in internal emails) by saying that there is a difference between 'illegal' and 'unlawful'. They have let the public and the rest of Caerphilly Council employees down. Simple as that. Aquarius

4:19pm Thu 19 Dec 13

Woodgnome says...

Aquarius is right and I would add that they have let all the people of Wales down because it's headlines like this that go national and feed a stereotypical view of Wales held by many. The scandal in all this is these greedy people appointed to public office were spending public money entrusted to the Council on themselves.
Aquarius is right and I would add that they have let all the people of Wales down because it's headlines like this that go national and feed a stereotypical view of Wales held by many. The scandal in all this is these greedy people appointed to public office were spending public money entrusted to the Council on themselves. Woodgnome

4:48pm Thu 19 Dec 13

Bobevans says...

Aquarius wrote:
It's a shabby affair and I would have thought that everyone involved in this - no matter what the outcome of the police investigation -- is finished.

And are there not councillors who were involved in the nodding through of these deals? If they're still around, they should resign immediately or be removed.

And then they should all be prosecuted. It's not good enough for certain people involved to explain it away (as they did at the time in internal emails) by saying that there is a difference between 'illegal' and 'unlawful'.

They have let the public and the rest of Caerphilly Council employees down. Simple as that.
Illegal & unlawful amount to the same thing
[quote][p][bold]Aquarius[/bold] wrote: It's a shabby affair and I would have thought that everyone involved in this - no matter what the outcome of the police investigation -- is finished. And are there not councillors who were involved in the nodding through of these deals? If they're still around, they should resign immediately or be removed. And then they should all be prosecuted. It's not good enough for certain people involved to explain it away (as they did at the time in internal emails) by saying that there is a difference between 'illegal' and 'unlawful'. They have let the public and the rest of Caerphilly Council employees down. Simple as that.[/p][/quote]Illegal & unlawful amount to the same thing Bobevans

4:51pm Thu 19 Dec 13

spartucus says...

Bobevans wrote:
I fail to see how such payment could be authorized as described above. In any normal business there would be a number of levels of authorization and with payments such as that it would require approval of the CEO & the CFO amongst others and there would be an audit trail it would be required for tax purposes as well

How an earth such large sums can be approved without anyone knowing who approved them defies logic
Err ? Mr Evans, it WAS the suspended CEO AND CFO, among other "senior officers" who were giving themselves the "unlawful payrises, and of course this latest offering of "unlawful" handouts, all at the expense of the honest hardworkers, and tax payers of Caerphilly.
It shows the calibre of the officers, that when ordinary workers on minimum wages had their pay frozen and hours cut, the very people who caused the misery on the workforce were busy feathering their own nests.
[quote][p][bold]Bobevans[/bold] wrote: I fail to see how such payment could be authorized as described above. In any normal business there would be a number of levels of authorization and with payments such as that it would require approval of the CEO & the CFO amongst others and there would be an audit trail it would be required for tax purposes as well How an earth such large sums can be approved without anyone knowing who approved them defies logic[/p][/quote]Err ? Mr Evans, it WAS the suspended CEO AND CFO, among other "senior officers" who were giving themselves the "unlawful payrises, and of course this latest offering of "unlawful" handouts, all at the expense of the honest hardworkers, and tax payers of Caerphilly. It shows the calibre of the officers, that when ordinary workers on minimum wages had their pay frozen and hours cut, the very people who caused the misery on the workforce were busy feathering their own nests. spartucus

5:10pm Thu 19 Dec 13

Frankfurt says...

Bobevans wrote:
Aquarius wrote:
It's a shabby affair and I would have thought that everyone involved in this - no matter what the outcome of the police investigation -- is finished.

And are there not councillors who were involved in the nodding through of these deals? If they're still around, they should resign immediately or be removed.

And then they should all be prosecuted. It's not good enough for certain people involved to explain it away (as they did at the time in internal emails) by saying that there is a difference between 'illegal' and 'unlawful'.

They have let the public and the rest of Caerphilly Council employees down. Simple as that.
Illegal & unlawful amount to the same thing
Yes, something which is unlawful is illegal. What you can say though is that something which in unlawful may not be criminal.
[quote][p][bold]Bobevans[/bold] wrote: [quote][p][bold]Aquarius[/bold] wrote: It's a shabby affair and I would have thought that everyone involved in this - no matter what the outcome of the police investigation -- is finished. And are there not councillors who were involved in the nodding through of these deals? If they're still around, they should resign immediately or be removed. And then they should all be prosecuted. It's not good enough for certain people involved to explain it away (as they did at the time in internal emails) by saying that there is a difference between 'illegal' and 'unlawful'. They have let the public and the rest of Caerphilly Council employees down. Simple as that.[/p][/quote]Illegal & unlawful amount to the same thing[/p][/quote]Yes, something which is unlawful is illegal. What you can say though is that something which in unlawful may not be criminal. Frankfurt

5:20pm Thu 19 Dec 13

Aquarius says...

Frankfurt wrote:
Bobevans wrote:
Aquarius wrote:
It's a shabby affair and I would have thought that everyone involved in this - no matter what the outcome of the police investigation -- is finished.

And are there not councillors who were involved in the nodding through of these deals? If they're still around, they should resign immediately or be removed.

And then they should all be prosecuted. It's not good enough for certain people involved to explain it away (as they did at the time in internal emails) by saying that there is a difference between 'illegal' and 'unlawful'.

They have let the public and the rest of Caerphilly Council employees down. Simple as that.
Illegal & unlawful amount to the same thing
Yes, something which is unlawful is illegal. What you can say though is that something which in unlawful may not be criminal.
Yes, and as the suspended Chief Exec allegedly pointed out in his email to staff ages ago that there was a difference between 'unlawful' and 'illegal', we can assume that this will be a central plank of the defence in any legal proceedings.

Nice way to use your legal knowledge eh? Not for the benefit of the public and the council it would seem, but for personal gain.

I used the word 'shabby' before, but that doesn't really begin to cover this behaviour does it?
[quote][p][bold]Frankfurt[/bold] wrote: [quote][p][bold]Bobevans[/bold] wrote: [quote][p][bold]Aquarius[/bold] wrote: It's a shabby affair and I would have thought that everyone involved in this - no matter what the outcome of the police investigation -- is finished. And are there not councillors who were involved in the nodding through of these deals? If they're still around, they should resign immediately or be removed. And then they should all be prosecuted. It's not good enough for certain people involved to explain it away (as they did at the time in internal emails) by saying that there is a difference between 'illegal' and 'unlawful'. They have let the public and the rest of Caerphilly Council employees down. Simple as that.[/p][/quote]Illegal & unlawful amount to the same thing[/p][/quote]Yes, something which is unlawful is illegal. What you can say though is that something which in unlawful may not be criminal.[/p][/quote]Yes, and as the suspended Chief Exec allegedly pointed out in his email to staff ages ago that there was a difference between 'unlawful' and 'illegal', we can assume that this will be a central plank of the defence in any legal proceedings. Nice way to use your legal knowledge eh? Not for the benefit of the public and the council it would seem, but for personal gain. I used the word 'shabby' before, but that doesn't really begin to cover this behaviour does it? Aquarius

6:25pm Thu 19 Dec 13

scraptheWAG says...

Bobevans wrote:
Aquarius wrote:
It's a shabby affair and I would have thought that everyone involved in this - no matter what the outcome of the police investigation -- is finished.

And are there not councillors who were involved in the nodding through of these deals? If they're still around, they should resign immediately or be removed.

And then they should all be prosecuted. It's not good enough for certain people involved to explain it away (as they did at the time in internal emails) by saying that there is a difference between 'illegal' and 'unlawful'.

They have let the public and the rest of Caerphilly Council employees down. Simple as that.
Illegal & unlawful amount to the same thing
what ever its a vast waste of taxpapyers money and these are the organisations saying services need to be cut due to NASTY TORY CUTS how on earth these daft little councils need all these layer upon layers of management is beyond me.
[quote][p][bold]Bobevans[/bold] wrote: [quote][p][bold]Aquarius[/bold] wrote: It's a shabby affair and I would have thought that everyone involved in this - no matter what the outcome of the police investigation -- is finished. And are there not councillors who were involved in the nodding through of these deals? If they're still around, they should resign immediately or be removed. And then they should all be prosecuted. It's not good enough for certain people involved to explain it away (as they did at the time in internal emails) by saying that there is a difference between 'illegal' and 'unlawful'. They have let the public and the rest of Caerphilly Council employees down. Simple as that.[/p][/quote]Illegal & unlawful amount to the same thing[/p][/quote]what ever its a vast waste of taxpapyers money and these are the organisations saying services need to be cut due to NASTY TORY CUTS how on earth these daft little councils need all these layer upon layers of management is beyond me. scraptheWAG

7:29am Fri 20 Dec 13

snafu1 says...

Animal farm springs to mind,all animals are equal ,but some are more equal than others !!!!!!!!!!!!!!!!!!!!
!!!!!!!!!!!!!!!!!!!!
!!!
Animal farm springs to mind,all animals are equal ,but some are more equal than others !!!!!!!!!!!!!!!!!!!! !!!!!!!!!!!!!!!!!!!! !!! snafu1

3:26pm Fri 20 Dec 13

Bobevans says...

Frankfurt wrote:
Bobevans wrote:
Aquarius wrote:
It's a shabby affair and I would have thought that everyone involved in this - no matter what the outcome of the police investigation -- is finished.

And are there not councillors who were involved in the nodding through of these deals? If they're still around, they should resign immediately or be removed.

And then they should all be prosecuted. It's not good enough for certain people involved to explain it away (as they did at the time in internal emails) by saying that there is a difference between 'illegal' and 'unlawful'.

They have let the public and the rest of Caerphilly Council employees down. Simple as that.
Illegal & unlawful amount to the same thing
Yes, something which is unlawful is illegal. What you can say though is that something which in unlawful may not be criminal.
tI is still an offence it could possibly be a civil offence rather than a criminal one
[quote][p][bold]Frankfurt[/bold] wrote: [quote][p][bold]Bobevans[/bold] wrote: [quote][p][bold]Aquarius[/bold] wrote: It's a shabby affair and I would have thought that everyone involved in this - no matter what the outcome of the police investigation -- is finished. And are there not councillors who were involved in the nodding through of these deals? If they're still around, they should resign immediately or be removed. And then they should all be prosecuted. It's not good enough for certain people involved to explain it away (as they did at the time in internal emails) by saying that there is a difference between 'illegal' and 'unlawful'. They have let the public and the rest of Caerphilly Council employees down. Simple as that.[/p][/quote]Illegal & unlawful amount to the same thing[/p][/quote]Yes, something which is unlawful is illegal. What you can say though is that something which in unlawful may not be criminal.[/p][/quote]tI is still an offence it could possibly be a civil offence rather than a criminal one Bobevans

9:12pm Fri 20 Dec 13

varteg1 says...

Bobevans wrote:
Frankfurt wrote:
Bobevans wrote:
Aquarius wrote:
It's a shabby affair and I would have thought that everyone involved in this - no matter what the outcome of the police investigation -- is finished.

And are there not councillors who were involved in the nodding through of these deals? If they're still around, they should resign immediately or be removed.

And then they should all be prosecuted. It's not good enough for certain people involved to explain it away (as they did at the time in internal emails) by saying that there is a difference between 'illegal' and 'unlawful'.

They have let the public and the rest of Caerphilly Council employees down. Simple as that.
Illegal & unlawful amount to the same thing
Yes, something which is unlawful is illegal. What you can say though is that something which in unlawful may not be criminal.
tI is still an offence it could possibly be a civil offence rather than a criminal one
A civil 'offence' could not be used as the matter concerns persons in public office. Anyone in public office who is proven to be acting or have acted in a unlawful manner. especially where money is involved, is certainly not subject to common or civil legal action.

The two does, civil/common, and penal (criminal) have utterly different legal parameters.
I think you mean, whatever actions have been taken could fall under the term, CRIME ,either misdemeanor or malfeasance, the first carries financial penalties, the second custodial, (or fines or prison) potentially suspended.

Under penal(criminal) legal terms, the STATE takes action in prosecuting the offender.
Under civil/common law, one party takes action by suing another.
Civil/common law does not have sentencing powers, all that can occur is a judicial outcome finding for either the plaintiff or the appellant.
[quote][p][bold]Bobevans[/bold] wrote: [quote][p][bold]Frankfurt[/bold] wrote: [quote][p][bold]Bobevans[/bold] wrote: [quote][p][bold]Aquarius[/bold] wrote: It's a shabby affair and I would have thought that everyone involved in this - no matter what the outcome of the police investigation -- is finished. And are there not councillors who were involved in the nodding through of these deals? If they're still around, they should resign immediately or be removed. And then they should all be prosecuted. It's not good enough for certain people involved to explain it away (as they did at the time in internal emails) by saying that there is a difference between 'illegal' and 'unlawful'. They have let the public and the rest of Caerphilly Council employees down. Simple as that.[/p][/quote]Illegal & unlawful amount to the same thing[/p][/quote]Yes, something which is unlawful is illegal. What you can say though is that something which in unlawful may not be criminal.[/p][/quote]tI is still an offence it could possibly be a civil offence rather than a criminal one[/p][/quote]A civil 'offence' could not be used as the matter concerns persons in public office. Anyone in public office who is proven to be acting or have acted in a unlawful manner. especially where money is involved, is certainly not subject to common or civil legal action. The two does, civil/common, and penal (criminal) have utterly different legal parameters. I think you mean, whatever actions have been taken could fall under the term, CRIME ,either misdemeanor or malfeasance, the first carries financial penalties, the second custodial, (or fines or prison) potentially suspended. Under penal(criminal) legal terms, the STATE takes action in prosecuting the offender. Under civil/common law, one party takes action by suing another. Civil/common law does not have sentencing powers, all that can occur is a judicial outcome finding for either the plaintiff or the appellant. varteg1

9:15pm Fri 20 Dec 13

varteg1 says...

The whole thing seems designed by that expert geek in chief.....

, Mr Creative Accounting.
The whole thing seems designed by that expert geek in chief..... , Mr Creative Accounting. varteg1

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