Season of Goodwill

14 Jan

Back in December the Newham Recorder reported that a number of senior managers in Newham council’s repairs and maintenance service (RMS) have been suspended and sacked for gross misconduct amid a catalogue of claims about financial malpractice.

It’s worth reading the Recorder piece in full, but some of the ‘highlights’ include:

  • Staff claiming allowances of up to £14,000 and separately for overtime which they may or may not have worked, including one claiming for up to 66 extra hours a week
  • One person caught making payments of £800 a day to an external consultant
  • Companies being issued fuel cards for Newham’s Folkestone Road depot to fill up with, leading to fuel costs soaring into the millions
  • Bonus and incentive payments dished out to plumbers and carpenters worth three times their basic salaries
  • One supplier carrying out bathroom fittings at triple the expected rate
  • Allegations of parts and equipment, including expensive pumps, being bought by RMS employees with council money and given to external contractors who would then re-charge the council to deploy them
  • An £8.7m overspend in just one part of RMS in the 2017/18 financial year
  • £423,770 paid in bonuses and incentives to 10 operatives in six months

This all happened on Sir Robin Wales’ watch and, entirely predictably, the former mayor tried to deflect the blame onto his successor, saying

“I am surprised that, seven months after taking office, and a full year after she became aware of the problem, the current Mayor has not commenced criminal prosecutions or announced that there is insufficient evidence to proceed.”

Equally predictably, Sir Robin’s supporters wasted no time in attacking his successor. Cllr Ken Clark, who was his statutory deputy mayor and held the cabinet portfolio for ‘Regeneration, Planning, Building Communities and Public Affairs’ emailed Rokhsana Fiaz, copying in all councillors:

Thank you for your email on the coverage of the RMS in the Newham Recorder.

Indeed the Recorder seems to know more about this situation than anything councillors are being told by this administration. Why do councillors find out via a third party when you should be reporting to labour members in the first instance and not as an afterthought.

Your constant blame of the previous administration – of which you were part – is noted. You blame the previous mayor for not sharing in full the historical details of this matter but in this same email you state you are unable to share full information with all of us due to ongoing investigations. Can’t you see how hypocritical this is. Don’t you realise that the same restrictions you are under now applied to the previous mayor during his tenure or are you just being deliberately obtuse.

It’s no good blaming fellow members for holding back information when you are in the same boat yourself. It seems unbelievable that your fellow cabinet member for finance, Cllr Paul, who held the housing brief in the previous administration and who would be likely to know the most about this matter did not bring you fully up to speed months ago.

As a former member of the audit board you were privy to confidential information not in the public domain or available to other councillors.

Indeed I don’t know what officers have told you since you took office but I do know that as information is finally being released by officers into the public domain there seems little reason to avoid a police enquiry. Why don’t you call for one now?

I hear you are in the market for blunt emails at the moment so why don’t you put your money where your mouth is, stop pretending that the former administration is to blame for officer fraud, stop pretending that as a previous member of the audit and scrutiny boards you didn’t have a voice on council matters, and start taking responsibility in the job you now have. It’s time to call for a police enquiry into RMS and the way officers have behaved.

Merry Christmas and a Happy New Year

His fellow Manor Park councillor, Salim Patel, also chipped in with his own seasonal message to all councillors:

Dear colleagues,

It is with deep concern for us all to learn of the massive scale of alleged corruption at Newham Council which has only been revealed as a result of the persistence of journalistic investigations by the Newham Recorder. Many of my residents have now raised this issue with me directly, so I wish to make my position on this matter very clear.

The revelation that over £9m of Newham tax-payers money was fraudulently siphoned off by some corrupt Council officers is completely unacceptable. It is also unacceptable that elected Councillors only found out about the sheer scale of this through the local press and that Council officers were investigating themselves. All these issues have been rightly highlighted by Councillor Clark and I understand that RMS has been discussed for some time at the Audit board but in private session, and with no visible outcome.

It is clear that over the past 18 months, Councillors have not been fully briefed on the scale of the allegations and the internal Council investigation. It is also clear that some Council officers have chosen to deliberately keep the full details hidden from members, even though we are the democratically elected representatives of the people of Newham. It also brings to light the question as to whether Council officers should have been allowed to investigate themselves in the first place when the crime was so huge.

Therefore and due to the severity of the matter, I am asking that the Metropolitan Police and the Serious Fraud Office (SFO) be asked to intervene immediately to properly investigate, charge and bring to justice the perpetrators of this massive fraud of local residents money.

We know that Councillor Terry Paul had direct involvement with and executive responsibility for housing which covered this service area, during the time when this huge criminal endevour is alleged to have taken place. That’s why its important that Councillor Paul immediately step aside from any current executive responsibilities, to ensure public confidence in the investigation and that it is totally free from even the perceived threat of any interference.

In the meantime, as elected Councillors we have a duty to work together to ensure the Repairs and Maintenance Service continues as a fully reliable public service, that the backlog of repairs are completed and that the service is fully protected from any threat of fraud in future.

Finally, Merry Christmas and Happy New Year

All of which overwrought and hysterical nonsense prompted the mayor to respond (link added):

Comrades – thanks for your respective emails which I have noted, alongside today’s anticipated Newham Recorder article which followed the unsurprising email sent last night.

You’ll have received my previous Members briefing sent a short while ago, so please refer to the CIPFA report and its comments about RMS (slide 24) – namely: ‘Major issue over financial control in the repairs and maintenance division, RMS; Led to an overspend of £9m in 2017/18 due to poor pricing of highways work’.

What that means is that the majority of overspend actually happened in Highways NOT housing Services. Yes, the role of all executive members at the time yes should be examined; but be clear precisely whom; alongside the role of the then Statutory Deputy Mayor who would have been privy to issues emerging with RMS (including private executive discussions) and the non-statutory Deputy Mayor who was lead finance and chair of the Audit Board at the time.

Instead of the histrionics, I’ll remind colleagues of the old adage that before jumping to conclusions get the facts right.  That has been the process that we have undertaking since May: a judicious and exacting process of interrogating information being provided by officers including independent experts, during which period a live investigation relating to the range of allegations has also been taking place. The final phase of investigations are near conclusion and any ‘jumping ahead of that’ could risk any future legal proceedings we may be able to proceed with. Rest assured we are on top of this and as I said previously a major announcement will be made about this in the New Year as well – which was always the plan because this was an area being looked into by CIPFA. This will include providing members with a full briefing and an opportunity to discuss the issues.

That aside, I will address other points in the two emails in the New Year, but large parts of what you both set out below are inaccurate. The issues relating to RMS happened before May 2018 and rightly serious questions should be raised and action should be taken to ensure that this never happens again. This is precisely what is happening now because we have and are putting measures in place in a service area that has always been part of the council  – just badly managed like a lot of things we have discovered eight months in and which we are keeping members updated on.

All – kindly note that I’ll be asking Cllr John Gray who is now leading on RMS oversight; plus Cllr Zulfiqar Ali as the cabinet lead responsible for shaping up Highways with Cllr James Asser to help me coordinate the RMS briefing session on my behalf in the New Year. So keep an eye out for details and direct any further questions about RMS to Cllr John Gray in the first instance from here on in.

Thanks.

So, despite an obviously coordinated effort to fit up Cllr Terry Paul due to his brief tenure as mayoral advisor for Housing, it turns out the biggest part of the problem was in Highways. And who had that in their portfolio, including the £100 million ‘keep Newham moving’ programme? Cllr Ken Clark. Whoops.

One person we haven’t heard from in all of this is the former cabinet member for finance and audit board chair, Cllr Lester Hudson. If anyone should be able to shed light on the massive failure of financial governance and control it would be him.

The police are now involved and an extraordinary meeting of the council has been called for 22 January, with a single agenda item: RMS. I am told councillors have already been briefed and that the report which will be discussed is due to be published tomorrow. 

The meeting will be at the Old Town Hall in Stratford, and theres’s plenty of seating for the public. I’ll be there.

 

Note: the original version of this post incorrectly said Cllr Terry Paul was briefly the cabinet member for housing; he wasn’t. He was Mayoral advisor for Housing and responsible for housing repairs. He was not a member of Sir Robin’s cabinet.

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