Liverpool Council texts and emails could be scrutinized as listeners call for new inquiry
The investigating commissioners are “dissatisfied” with some of the council’s responses to an explosive report.
Auditors have called for a full independent review of Liverpool City Council – which could involve reviewing text messages from senior officers.
Commissioners were appointed last year to oversee the council’s planning, regeneration, property management and highways departments which were highlighted in a damning report.
Auditors Grant Thornton say they are ‘dissatisfied’ with the answers given to them by the board about whether there is evidence of other problems outside of the areas examined in the appellant’s explosive report.
At a meeting of the board’s audit committee, Grant Thornton director Andy Smith said further investigations could include reviewing senior officers’ emails and text messages.
Why is the board under review?
Government commissioners were installed on the council last year after the shocking revelations of the Max Caller report.
They currently oversee work in the problematic departments of regeneration, highways, property management and planning. But the auditors suggested that more scrutiny is needed for other departments in the council.
Mr Smith told a meeting of the council’s Audit and Governance Committee on Tuesday that the arrest of former Mayor Joe Anderson in December 2020 was a game-changer in terms of the level of risk that needs to be assessed before that Grant Thornton can sign the council books.
Auditors sent a series of questions to the council in September after the release of the caller’s report, including questions about the work the council has done to assess areas outside these problem departments – explaining that they needed more proof before signing the 2019/2020 accounts.
The council gave a written response to the auditors on December 2, which Mr Smith said had left them unsatisfied that there was “sufficient” evidence to show the problems did not extend beyond the areas already reviewed during the Best Value inspection.
what was said
Grant Thornton director Andy Smith said: “I believe the inspection only covered regeneration, highways, planning and PAMS (real estate asset management service).
“We know the review went a bit further, what it didn’t do was proactively confirm that there were no issues elsewhere and we believe there are always has a shortcoming.
“It is likely in our view that an independent investigation is likely to be required.”
Mr Smith said that in order to meet audit requirements, this investigation would involve a “full” review of communications as well as a review of “material” delegated authorities and key procurement decisions to be made by someone with expertise in forensic investigations.
Chief executive Tony Reeves said the board “does not automatically agree” to what Grant Thornton has asked for and discussions are ongoing, including with the commissioners, on how best to proceed.
He added: “I’m concerned about how you prove a negative result.”
Mr Smith said the scope of the review would be critical, adding: “If it is too limited and cannot give us what we need in terms of audit evidence, we will be clear from the start.
“We see no point in an ongoing review that is not of sufficient scope.”
Liberal Democrat cllr Kris Brown questioned whether the review was due to specific Grant Thornton concerns or because listeners were taking a “defensive stance” in light of allegations of bribery and corruption.
He also said he shared some of the chief executive’s concerns adding: ‘The only way to prove a negative result is to go through every bottle of milk purchased.’
Responding to a question from Labor adviser Nick Crofts, Mr Smith said that since the arrest of Joe Anderson it had changed the auditor’s approach to understanding risk within the council.
Mr Smith said: ‘Once the mayor was arrested, it dramatically changed the requirements of what we have to do from an audit point of view.
“The approach we take is simply to meet the audit requirements, the auditing standards that we have to comply with, it’s not a defensive approach, it’s us who take our responsibilities under that requirement. , we absolutely believe this is necessary to do our job properly .
Independent Cllr Peter Mitchell said he found the request for review “puzzling”.
Cllr Mitchell said: “You kindly responded that the mayor’s arrest was a game changer and I understand that but correct me if I’m wrong, you have no evidence to back up why you are doing this? “
He added: “We have been shaken financially, the cost involved here could be huge for a city that already has to pay commissioners, face levels of cuts.
“I want assurances that before any decision to go into a wider investigation, to bring it back to this committee with a full cost base to do so.
“Unless you have something to tell me, you don’t have a shred of evidence.”
In response, Mr Smith said: ‘With all due respect, we’re asking this because we don’t have proof, we need proof that it doesn’t go any further.
“We are required by auditing standards to seek and ensure sufficient audit evidence.”
“Empty the decks and start again”
Greens leader Cllr Tom Crone questioned why there was such resistance to the review, adding: “The last year has been about acknowledging past mistakes, trying to clean up bridges and starting over.
“Looking at these things, sunlight being the best disinfectant and all that, what’s the reason for not wanting an independent investigation to get to the bottom of issues that might be hidden?”
Chief executive Tony Reeves said the allegations that led to the best value inspection stemmed from robust internal processes that found no evidence of problems elsewhere, adding that the cost of a review could turn out to be “very important”.
He said: ‘:It’s an ongoing discussion, we haven’t argued with our listeners and in also discussing with the commissioners about this we are questioning value for money and proportionality.’
If the review is not carried out and Grant Thornton refuses to sign the accounts, finance director Mel Creighton said there could be consequences for the council’s finances in the future.
She said: “It may have an impact on cash management and we will have to look at the extent of it.
“If we have [accounts] as far as authority-to-authority lending is concerned, it may cost us more.
Following further discussions between Grant Thornton, council leaders and commissioners, the matter will be brought back to the committee in the coming months.