Why do councils let their staff get away with fraud?

Mark Wallace of the Taxpayers Alliance monitors a lot of Town Hall waste - but has a particular sense of outrage at councils that turn a blind eye to fraud.

Working at the TPA, I see a lot of remarkable examples of ways in which taxpayers’ money can be poured down the drain. Despite the amazing variety – from the police officers’ top trumps to the council staff who got travel expenses for time spent in their office lift - they never cease to amaze me.

Indeed, I’ve always been careful to make sure I don’t get blasé about it, or allow the feeling that such waste is inevitable to creep up on me. Sadly, while my sense of outrage is still heartily intact, in some councils it seems they have turned not being bothered about protecting taxpayers’ money into an art form.

It is reprehensible to squander taxes on barmy or self-indulgent schemes, but you can at least at a stretch imagine the mindset which leads someone to think that it’s a good idea to give drunk people free flip flops or to spend £2 million on a giant concrete head. The people who do so are wrong, but I can follow their (flawed) thinking, just about.

What I simply cannot even begin to understand, though, is councillors and council officials who tolerate the outright theft of taxpayers’ money.

Take two recent examples. First up, we have Powys County Council. This week, it emerged in a council audit committee report that one of their employees had been found to have paid at least £2,700 intended for an outside organisation into his own, personal bank account . He had been paying money into that account without authorisation for several years, and when caught claimed to have passed the cash on to local “worthy organisations”, producing invoices in his defence. Following his original deceit, it later transpired that many of these invoices had been forged.

What do you think was the outcome of this initial offence, and the subsequent attempted cover-up through forgery? The audit committee concluded the matter was not even serious enough for a disciplinary hearing, and instead proposed offering the employee counselling. It fell to a member of the Welsh Assembly, Alun Davies (Labour), to report this apparent crime to the police after the audit committee documents were leaked to him.

A second example is all the more disturbing Andrew Wood, a Trafford council employee, rather foolishly boasted to his colleagues that the council was paying his rent as well as his wages, leading to his conviction for fraudulently claimed £50,000 of benefits.

Having been suspended on full pay for 16 months, he was spared jail by a judge on the understanding that he would lose his job as the result of his conviction. Trafford council did sack him – but amazingly a panel of councillors then reinstated him on appeal and agreed to award him four months’ back pay. This means that after taking part in, boasting about and then pleading guilty to a serious fraud against his employer, Wood is back on the payroll and in line to get full pension rights when he retires. Worse, the grounds for his appeal apparently included his “low intelligence” – so Trafford have taken him back despite knowing he is both a self-confessed crook and a self-confessed idiot. A worse employee is hard to imagine.

I cannot comprehend the thinking of councils like Powys and Trafford. Theft and fraud should be punished most severely by any council if it is discovered – particularly if the perpetrators are the council’s own staff. Immediate dismissal, an immediate end to any payment and an immediate crime report to the police should be the obvious steps in such a situation.

It is bad enough for a council to be running such a lax ship that it is possible for their staff to commit such crimes, but letting people get away with it after being caught red handed is an appalling betrayal of taxpayers.

It doesn’t have to be that way – for example, both Barking & Dagenham and East Ayrshire have been working hard in recent months to root out thieving staff and are apparently managing to beat even entrenched cultures of fraud and corruption within their own organisations. Bravo to them for purging the bad, and shame on those that turn a blind eye to it.