What can you do if you suspect your local council of financial misconduct?
One solution is to take a good hard look at their books; and thanks to the Local Audit and Accountability Act we all have the right to do just that for a set 30-day period each year.
The People’s Audit is a volunteer-run network of people who are keen to raise awareness of these little-known rights, in the belief that local government spending should be open and accountable to local people.
At the same time, they’re using the Act to good effect themselves, as they probe into spending anomalies in their own borough of Lambeth. They’ve found that the Freedom of Information Act has proved a useful complement to their auditing activity.
Investigating financial misconduct
We spoke to Ben Rymer from The People’s Audit to find out more. What exactly have they uncovered to date?
“Perhaps the most worrying finding was around the Fenwick Estate regeneration project in Clapham. The chosen supplier was almost £6 million more expensive than others who tendered. This is a massive red flag as the likelihood of this sum being accounted for by quality of work alone is slim.”
There’s plenty more: Ben says they’ve made concerning findings around public housing, procurement and contract management and how major works are overseen, from possible price fixing between contractors to payments for work that was never done.
For example, the group say that a sampling of some of the housing blocks on the Wyvil Estate in Vauxhall indicates that the council paid its contractors for more than twice the number of repairs that were actually carried out.
They also claim to have found evidence of land in Kenningham and Streatham being sold to a private developer at a discount of at least £1m, without any competitive tender.
And another major finding was that costs for Lambeth’s new town hall — originally flagged as a money-saver for residents — have overrun by more than £50 million.
Two Acts working together
So, some substantial discoveries. Where does Freedom of Information come into the picture?
Ben says that the two Acts can be used together, to good effect. “The Local Audit Act requires access to be given to documents relating to costs incurred by the council in the preceding financial year. Once these have been obtained, FOI requests can then be targeted more precisely using the insights gained from such documents.”
But there is a slight snag: with the Local Audit Act offering access only within a specific period of 30 days each year, the FOI Act’s prescription that a response must arrive within ‘up to 20 working days’ does not allow for much wiggle room, especially if the FOI response generates more questions that might be answered through scrutiny of the accounts.
Ben says that unfortunately, responses to both Acts are often delayed, refused on the grounds that they would take too long (despite similar requests to other councils being processed without an issue) or just ignored. “An extreme example is our attempt to obtain the original budget for Lambeth’s new town hall, which we have now been trying to get hold of for 18 months!”.
But all of this notwithstanding, WhatDoTheyKnow has been a useful tool for the FOI side of the People’s Audit’s investigations: “It is an easy way to organise FOI requests, and the fact that it’s all in public means that other people can use the information in the responses — though we do also submit requests directly to the council.”
“One notable success was when one of the team received some emails via WhatDoTheyKnow following the audit inspection period in 2015 which showed that the council had agreed to install gyms in libraries months before any public consultation on the idea.”
So, the group have uncovered plenty of concerning information — but have they actually made a difference?
Ben says that they’ve achieved a good amount of local and national press attention. More importantly, they’ve seen an increased focus on financial issues among the people of Lambeth, especially in the run-up to the local elections in the spring. “Given that we are all volunteers with day jobs and families we think this is a pretty good result!”
And they believe that there’s been some effect within their local authority too, although not as wholehearted as they would have liked. “They have published their responses to citizen audit requests and are making more positive noises about the importance of transparency.
“However, they are also imposing arbitrary limits on the amount of information which citizens can request and have put in place ‘guidance’ around requests which we think may be intended to discourage further requests.”
If the Local Audit and Accountability Act is new to you, you may be wondering whether you should be using it yourself. The People’s Audit think you should consider it:
“Local Government financial scrutiny is really important and these powers need to be used to their fullest to prevent wasteful spending or corruption. Many people don’t realise that councils are often £1bn+ organisations, or that UK councils spend a total of over £92bn a year. Yet since the Audit Commission was abolished there is very little scrutiny of this spend.
“Many local newspapers have closed in recent years so citizen audits and hyperlocal publications have become more important.
“The powers are hugely underused currently. However what we’ve hopefully shown is that a group of committed individuals can use them to good effect.”
If you’d like to do the same, find out more on the People’s Audit website.