Inspectors appointed to investigate London borough of Tower Hamlets
4 Apr 2014 04:20 PM
Secretary of State appoints inspectors to look
into allegations made against Tower Hamlets.
The
Secretary of State for Communities and Local Government, Eric Pickles,
yesterday (4 April 2014) appointed inspectors to look into allegations of
governance failure, poor financial management and fraud at the London Borough
of Tower Hamlets.
Serious concerns have been raised following the receipt
of certain documents. Using new laws that came into effect today the Secretary
of State, acting in the public interest, has exercised his legal power
yesterday toappoint PricewaterhouseCoopers LLP to carry out an
inspection of the council. A file is being passed onto the Metropolitan Police
for consideration.
The
PricewaterhouseCoopers inspection will look into evidence of the
authority’s payment of grants, the transfer of property, spending
decisions in relation to publicity, and other contractual processes from 25
October 2010 to the present day.
Eric Pickles said:
It
is a matter of public record that I have long been concerned about a worrying
pattern of divisive community politics and alleged mismanagement of public
money by the mayoral administration in Tower Hamlets.
Following the receipt of a number of documents, I am now
taking legal steps, in the public interest, to appoint inspectors to look into
the allegations in respect of Tower Hamlets.
I
hope this sends a strong signal that robust processes are in place to
investigate allegations of failures in financial management and governance in
local government, under the new regime introduced by the Local Audit and
Accountability Act which replaces the Audit Commission.
This central action is not undertaken lightly, but
localism requires local transparency, scrutiny and accountability, and these
vital checks and balances must be upheld.
Tower
Hamlets had been duly informed and PricewaterhouseCoopers is already
on site. The inspectors have a legal right to access all premises and documents
belonging to the authority which appear necessary for the purposes of
inspection.
Further information
- These steps have been taken using statutory powers under
the Local Government Act 1999, as amended by the new Local Audit and
Accountability Act 2014, which relate to a local authority’s functions in
respect of governance. The new provisions commenced , as part of the wider
abolition of the Audit Commission.
- Section 10 of the Act provides power to the Secretary of
State to appoint inspectors to carry out an inspection into a local
authority’s compliance with its best value duty.
- Section 12 of the Act provides that the authority to be
inspected must pay PricewaterhouseCoopers LLP reasonable fee for carrying out
the inspection.
- Section 15 of the Act provides powers to the Secretary
of State to intervene in the running of the council, should he consider that
necessary, in light of the inspector’s findings.
- PricewaterhouseCoopers will report its findings to the
Secretary of State by 30 June 2014.
- While the investigation is ongoing it would be
inappropriate for the government to comment any further.
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