The value of good scrutiny
The value of good scrutiny made itself evident this week. I am part of a scrutiny committee working party looking at the council’s decision to invest in Icelandic banks. The working party interviewed officers and Cllr’s about their role in the decisions that led to those investments. We also looked at all the reports that have been produced to date both public and exempt.
It quickly became clear that something was wrong with the way the treasury management team had followed the treasury management strategy. Quite simply they hadn’t followed it and no-one had noticed for three years. In fact a staggering 89% of the council’s deposits were deposited against the agreed strategy including the Icelandic bank deposits. None of the departments internal audit processes had picked this up nor had the external auditors.
As you will see from the local press one officer has already resigned. As usual in these circumstances someone is the fall guy. The problem with this is that it fails to recognise the systemic failure of the department as a whole. The lack of checking, effective audit and the failure of external scrutiny are damming. This has to be acknowledged.
The somewhat hysterical press release from Mike Freer the leader of the Council was what we have come to expect from him. However he cannot escape culpability for this. He was both Leader of the Council and Chair of the Cabinet Resources Committee which is responsible for the treasury management strategy. He insists that he was misled by officers but why did he not ask them for evidence that they had followed the strategy? Portfolio holders must take responsibility when mistakes occur, especially on this scale. We saw this in Haringey with the Baby P case. The cabinet members tried to hang on but it was never going to happen. This lost money is far less tragic but the principal is the same. If you are charge then you are responsible. Ignorance of the facts may be bliss but it’s no excuse.
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89% represents a systemic failure rather than an accidental mistake. One officer has resigned but it would be stretching credulity to say that this whole crisis was caused my a middle ranking officer acting alone.
Others must have know what was going on. More heads need to roll.
Duncan
I think that everyone in Barnet owes the committee a big thank you. Also thanks for the blog. It’s a shame that the leaders official tax funded blog doesn’t tell us this.
Well done guys !
All very well and good Cllr for you to sit on your fence and criticise instead of actually bothering to offer your help and assistance and maybe a little advice.
But then thats a very typical Lib Dem response isn’t it? Never to be trusted after their own manual only a short time ago told their very own activists to act wicked and shameless to get any vote they can!
Can I ask exactly WhAT the Lib Dems have done for the residents of Barnet?
Do Call Me Dave
If you read Ducan's post or Mike Freer's press release it would be rather clear. If the leader had followed their advice in October, then we'd have had 5 months where our cash would have been safer.
Amanda,
Seems to me that Duncan & the other committee members did exactly what they were supposed to. It's a shame that the Cabinet of Barnet didn't when they had the opportunity. Strange how you two post comments within 2 mins of each other. Maybe Duncan should give your IP addresses some scrutiny
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