An independent review of Liverpool Council requested by its own auditors will explore the extent of dodgy dealings at the authority - but the accountancy firm has also come in for criticism.
The auditors, Grant Thornton, says it cannot sign off on the local authority’s books for 2019/20 until an external investigation had taken place into practices at the council. Grant Thornton partner Mark Stocks told members of Liverpool Council’s audit committee that the investigation would consider whether issues identified that led to arrests in 2020 impacted “a particular area in the council or whether the issues are more pervasive.”
Mr Stocks clashed with opposition leader, Lib Dem Cllr Richard Kemp, who said the council found itself in this situation “owing to the failure of Grant Thornton to enquire on a range of issues raised in committee, in the press and in general over the last five years.”
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Mr Stocks said the scope of the review is expected to be completed by the end of March, with a chair also likely to be appointed by that deadline.
He told committee members that the review would look at “matters that happened” - referring to incidents that led to the arrest of council members and officers almost two years ago, as well as “what may have happened in other areas of the council.” An outline scope of the review has been agreed, according to Mr Stocks, with a view to finalising the timescale to ensure the authority’s 2019/20 audit can be signed off.
The council’s value for money conclusions are also on hold until the review is completed, he said. Stephen Gregory, independent member of the committee, said he felt there was a “lack of urgency” around getting the review dealt with quickly, while Cllr Kemp, leader of the Liberal Democrat group, said all parties needed to “shift themselves as this is becoming quite unacceptable.”
He added: “We find ourselves in the situation we’re in because of the failure of Grant Thornton to enquire on a range of issues raised in committee, in the press and in general over the last five years.” Mr Stocks said that the circumstances were “quite unusual” and work had been completed as quickly as possible amid “allegations of substantial fraud within the council committed by members and officers.”
He said the police needed time to investigate those allegations and the inquiry auditors had requested would establish whether those issues were limited to “a particular area in the council or whether the issues are more pervasive… I presume the councillor would want to know if there were other areas where issues occurred within the council.”
Mr Stocks said that any costs of the investigation “lie with the council” and would expect “in any case” for the local authority to stump up any fees. He said Grant Thornton would continue to work with the council in a “positive way” to bring the books to a close as quickly as possible.
Mel Creighton, deputy chief executive and director of finance and resources, said a procurement scheme had been set out last week, expected to take up to one month to appoint a lead for the review. Mr Stocks told members it was not possible to set out a timeline for the work to be completed once the lead has been appointed.
