Audit Commission report highlights Kent Conservatives' failure (Canterbury & Whitstable Liberal Democrats)

Canterbury & Whitstable Liberal Democrats <info@cantlibdem.org.uk>

Audit Commission report highlights Kent Conservatives' failure

March 27, 2009 8:02 AM

The Conservative administration at Kent County Council has been branded 'negligent' by the Audit Commission for failing to take action three years ago to protect council taxpayers' money. In September 2006, the Council's own internal audit department had made a series of recommendations to improve internal financial controls. Asked to investigate the circumstances surrounding the loss of the money in the Icelandic banks in 2008, PricewaterhouseCoopers found many of these recommendations had not been implemented. Despite the fact that Butlers, KCC's treasury advisors had sent an email warning against further investment in Icelandic banks, the failure to adopt the recommended improvements to internal financial controls meant an investment was placed in October 2008. Moreover, PwC found the council's own benchmark for investment returns was more common "where the objective is to maximise return", rather than to ensure the security of the invested cash.

Guy Voizey, parliamentary spokesman for Canterbury and Whitstable Liberal Democrats, said, "The Audit Commission's criticism of Kent County Council is valid. Kent County Council was effectively gambling with council tax payers' money, seeking high interest rates when investing this cash without paying sufficient regard to the associated risk. The first responsibility of the council is to ensure the money they collect from taxpayers remains available to spend in our schools, on social services and to repair our roads and pavements. By failing to ensure adequate internal controls were in place and by failing to understand the risks associated with investments in the Icelandic banks, the Conservative administration at Kent County Council has put badly needed services at risk."