Corporate governance failings at Caerphilly County Borough Council were caused by a combination of weaknesses, according to a new report from the Wales Audit Office.
A special inspection report from the Auditor General for Wales points to a number of factors that led to the governance failings at the council, although it does state improvements are being made.
The report said the council became more “action oriented” with a greater appetite for risk when Anthony O’Sullivan was appointed chief executive in September 2010.
But key governance arrangements were not reviewed or changed to reflect this, the report said, and the potential for conflicts of interest were not considered.
The report highlights a number of decisions taken by the council which did not follow appropriate governance procedures. There were also weaknesses in the way business cases were prepared to support decisions and in the transparency and comprehensiveness of reports prepared to support decisions.
Risk management arrangements were also weak.
The Internal Audit service was not used effectively. Scrutiny arrangements were not sufficiently effective and there were weaknesses in performance management arrangements. This increased the risk that governance failures would not be prevented or detected.
The report acknowledges the council is now improving its governance structures, but while the council has developed an action plan to improve, it needs to implement the plan fully and further strengthen certain key governance functions such as risk management and internal audit.
The report makes a total of eight recommendations for improvement including clarifying governance and decision-making roles.
Auditor General for Wales, Huw Vaughan Thomas, said: “Caerphilly Council is already taking steps to address fundamental weaknesses in governance. It now needs to continue this road to recovery and apply the same levels of energy to improving other aspects of its corporate services.
“Further changes are likely following the completion of the police investigation.
“The council needs to ensure that the changes it is making, and planning, are robust enough to be sustainable for the future.”
Cllr Harry Andrews, leader of Caerphilly County Borough Council, said: “We welcome the report and it is pleasing to note that the Wales Audit Office have clearly stated that improvements have been made.
“That said, we also recognise that there is still much work to do and we will act on the recommendations contained within the report and continue to build on our positive progress to date.”
Who presided over the car allowance and annual leave unlawful expenditure? Who appointed the man who excersised "risky behaviour". The answer being the former Plaid Cymru administration. Its obvious that Plaid let the officers run amock when they were in charge. Will they ever take any of the flack for this??
The governance issues Caerphilly Council is suffering from will be `Terminal`. Either, by its merger with other authorities, or, as a result of the fall out from the decisions (Yet to be taken) which WILL be taken shortly by the Crown Prosecution Service in Bristol, and as a result of the Avon Police internal investigation.
It does`nt matter if Senior Staff, currently suspended and on police bail, are,eventually charged or not, it does not matter either if, as a result of the investigation OTHER arrests are to come or not. There will be a huge public outcry if NO FURTHER ACTION is the decision, so, charged with offences or not, this will not be the end of the matter me thinks.
But is`nt it good to know that the governance of our authority is on the up????.
, its clear that the Rot set in under Plaid , who were in power but not control , Cllr Mann is the Man who knew nothing about the Icelandic millions and nothing about the car loans, says it all really, he is our very own Manuel as he know nothing !!!
see findings from the audit report.
The pace of change and a combination of a number of weaknesses inevitably led to governance failings
8. The tone at the top of the organisation changed with the appointment of a new Chief Executive in September 2010. The Council became more action oriented with a greater risk appetite and pressure for an increased pace of working. There was increased pressure to raise the profile of the Caerphilly area and to promote the achievements of the Council. The changes introduced by the new Chief Executive had an impact on the capacity of the Senior Management Team.
9. Key governance arrangements were not reviewed or changed to reflect the change in tone at the top of the organisation and the increased operating pace. The potential for conflicts of interest inherent in the new structures were not considered and key statutory officer roles did not have sufficient profile or influence.
10. A number of decisions were taken by the Council which did not follow appropriate governance procedures. There were also weaknesses in the preparation of business cases to support decisions and in the transparency and comprehensiveness of reports prepared to support decisions.
11. Weaknesses in the Council’s internal challenge functions were present throughout this time. In particular, its risk management arrangements were weak, the Internal Audit service was not used effectively, scrutiny arrangements were not sufficiently effective and there were weaknesses in performance management arrangements. This increased the risk that governance failures would not be prevented or detected.
12. There continues to be some uncertainty amongst officers as to when to consult members and when officers can make decisions. The Council’s constitution still lacks clarity over decision-making processes. Whilst training is taking place on report writing, the Council has not yet embedded a cultural shift that ensures that transparency, comprehensiveness and balance of reports is maintained over time
How can Caerphilly be improving while the corrupt senior managers are still in place?
Mr P Jones