Tuesday 14 February 2012

Under a glass sky: unanswered questions in Broken Barnet

You may recall that at the beginning of the year, Mrs Angry wrote a letter to Councillor Lord Palmer, the Chair of Barnet's Audit Committee.

The letter was written in order to draw his attention to a very serious matter: the apparent failure by the authority correctly to implement and maintain a register of the declaration of interests by senior officers involved in the current competitive dialogue process with companies vying for an astonishing £1 billion worth of business opportunities offered by the wholescale - and highly controversial - outsourcing of our council services.

After submitting a question about the issue to the last Audit meeting, Mrs Angry had made a Freedom of Information request to see if, as informed in the assurances given at the meeting, the risk of conflict of interest was being properly managed. She asked for copies of the register entries. As she explained in the letter:

"The eventual response sent 18 attached forms of declaration of interests by senior officers, and refused to forward the details of another 67 'non senior' officers.

Despite the register supposedly being implemented in May, most of the 18 forms were signed in October, the rest in September, yet the 105 working day period for the competitive dialogue process for the DRS package ended, as I understand it, on 28th October. There are some curious omissions too: why are there no declarations from the Chief Executive, and only one from the Deputy Chief Executive? And where, one might ask, is the declaration from the employee who has gone to work for the shortlisted company?

I wonder if, as Chair of the Audit Committee, you would care to comment on the response I have had, and consider what action might be appropriate to pursue in the light of what appears to be a failure of the due process of regulation of the declaration of interests?

Last year's exposure of the MetPro scandal was instrumental in revealing not just an example of gross negligence in the specific case of the authority's security arrangements, but in the wider and frankly astonishing scale of incompetence in the management of procurement, contractual procedures and payment - in the greater context of the failures that needed to be addressed, one issue was overlooked. That was the consideration of whether or not any malpractice had taken place by any council officers. In my view, there was clearly evidence sufficient to warrant an inquiry by the Corporate Anti Fraud Team, and it is deeply regrettable, in my view, and that of many other residents, that no such investigation took place.

In the case of the declaration of interests, and I know that there was some confusion over this at the audit meeting, without suggesting any specific example of alleged fraud, I think that it is paramount that there is an urgent investigation into the broader issue of the apparent lack of transparency and accountability surrounding the interests of senior officers - and any less senior officers with direct responsibilities involving them in the dialogue process of the One Barnet outsourcing project.

I would go further, in fact, and say that the process should be suspended until it can be ascertained that the two separate dialogues - and possibly other recent contractual negotiations - have taken place with due regard to the proper regulation of such processes. Failure to do so could arguably place the authority in a difficult position should it later be challenged by any accusation of improper practices or failures in regulation that may have taken place throughout the course of the tendering process.

As I am sure you are aware, since 1st July 2011 there has been a new Bribery Act, which applies not just to senior officers of the authority, but to all employees, and I would also be interested to hear your opinion as to whether or not Barnet has made adequate provision within its processes and commercial transactions to minimise the risk of breaches of the new legislation, taking into consideration the lack of transparency and apparent laxity with regard to compliance with the register of interests in the case of the One Barnet procurement process."

Lord Palmer explained that he was abroad until 26th January and was unable to reply until then. In view of the urgency and seriousness of the issue, Mrs Angry wrote to the Deputy Chair, Councillor Schama, who referred her back to the absent Chair. In the meanwhile, the tendering processes continue, of course.

On 7th February, Mrs Angry wrote to Lord Palmer to ask if there any been any response to the issues she had raised, and referred him to a further case which has now been revealed, of another very senior officer who came to Barnet in February 2010, and left around October 2011, going to work for Serco.

"As you will know, both companies are among those shortlisted for the One Barnet outsourced service tenders. Without wishing to imply any wrongdoing on his part, this officer, who was one of the several senior and highly paid consultants working in an 'interim' capacity, as highlighted in the recent Ed Lester case, also does not appear to have signed any declarations of interest, according to the answer given to me in the FOI request."

I think it is a reasonable question to ask how many other senior officers have had close connections with tendering companies and apparently not been subject to a process of transparent declaration of interests. I have also been advised that Barnet appears not to have in place the required procedures to address the risks inherent in a retrospective conflict of interest when an employee leaves to work in the private sector, particularly relevant when the company in question is competing for business contracts with the authority."

Oh, and speaking of declarations of interest - two weeks ago, in an operation attended by more security than the visit of an American president, Mrs Angry and Mr Mustard paid a visit to North London Business Park to inspect the register of councillors' interests. Our researches led us to submit some evidence to the Director of Corporate Governance suggesting that not all the declarations in the register have been made in the full spirit of openness and transparency, or indeed as required by the local code of conduct. We have received no formal acknowledgement or response to this submission.

Returning to the subject of our lucky interim consultant senior officers, here in Broken Barnet: it was reported yesterday that Mr Ed Lester, the CEO of the Students Loan Company, will now be paying tax and NI contributions like any other employee, and, well: it would seem reasonable to assume that the half or dozen or so 'interim consultants' working for Barnet's senior management team might be forced to make an urgent review of their own generous arrangements.

It might also be an interesting question, as posed to Mrs Angry recently, to ask whether or not the long term employment of these 'interim' consultants is not in itself a breach of the council's own constitution, which states in Part 5, 'Codes of conduct and protocols':

2. Recruitment of head of paid service and chief officers

Where the council proposes to appoint a chief officer and it is not proposed
that the appointment be made exclusively from among their existing officers,
the council will:

(a) draw up a statement specifying:
(i) the duties of the officer concerned; and
(ii) any qualifications or qualities to be sought in the person to be

(b) make arrangements for the post to be advertised in such a way as is
likely to bring it to the attention of persons who are qualified to apply for
it; and

(c) make arrangements for a copy of the statement mentioned in
paragraphs (1) and 2(a) to be sent to any person on request.
Officer Employment Procedure Rules - 2

3. Appointment of head of paid service

(a) The full council will approve the appointment of the head of paid
service following the recommendation of such an appointment by a
committee or sub-committee of the council. That committee or subcommittee
must include at least one member of the executive.

(b) The full council may only make or approve the appointment of the head
of paid service where no well-founded objection has been made by any
member of the executive.

4. Appointment of chief officers
(a) A committee or sub-committee of the council will appoint chief officers.
That committee or sub-committee must include at least one member of
the executive.
(b) An offer of employment as a chief officer shall only be made where no
well-founded objection from any member of the executive has been

Clearly section 4(b) refers to 'an offer of employment', not a contractual interim arrangement. Should the Chief Finance officer's post really be filled by a temp, rather than an employee of the authority? And is the One Barnet 'relentless drive for efficiency' and 'value for money' best served by paying a consultant £1,000 a day, rather than a council officer subject to standard rates of employment?

Mrs Angry suspects the answer to these questions is no, and: no. But then the budget restrictions which we are told must be followed in our 'relentless drive for efficiency', and the demand for value for money, applies only to council employees who are in the way of profits for outsourcing companies.

In other words, if you are employed to answer the phone for the council, you are going to lose your job: if you are employed to arrange for a private company to come in and answer the phone instead of council employees, your job is safe, and your career looks set to grow and prosper in the unnaturally protective micro climate that is One Barnet.

As to Mrs Angry's letter to the Audit committee, and her attempt to throw a brick through the glasshouse roof: Palmer could only say that he had no immediate answer he could give, and that he would 'pursue with Barnet officers'.

Palmer is an honourable man, and in a difficult position. As a Libdem opposition party chair of a committee, his influence is limited. And the senior management team of Broken Barnet is hardly going to investigate and find itself guilty of any wrongdoing, you may be forgiven for thinking.

Just as in the MetPro debacle, and the culture of gross incompetence which that revealed, those responsible for upholding the proper procedures look set to escape what would appear to be a blatant defiance of the council's own regulations, and carry on with no censure. Worse still, the outsourcing process that has been compromised by a lack of the appropriate assurances of transparency and proper regulation will continue to the end so fondly wished for by the parties most likely to prosper as a result.

Except that this is not quite the end of the story, is it? Look: Mrs Angry can see a fan, and a cartload of One Barnet excrement flying towards it with a pleasing and increasing rate of volition.

Stand well back, open up an umbrella, and hold your nose.


Mr Mustard said...

AS you know Mrs Angry the Cabinet meet on Monday and I have out in a question about the PAYE of officers; let us see if the question is allowed to stand as it has to relate to the business of the meeting. The business of the budget is finance but doubtless that will somehow magically exclude any question of PAYE. If it does get answered, don't expect the answer to have any semblance of a proper answer therein.

Mrs Angry said...

Greetings to our oursourcing friends in Bangalore, who have developed a keen interest in this post, for some reason. Can't imagine why.