Mayor of Newham Rokhsana Fiaz and her Cabinet members are intending to set-up an Internal Control Commission.
The Internal Control Commission will advise Newham Council on how to become a beacon of good practice in terms of financial management and internal control.
Councillors will discuss the matter at an Extraordinary Meeting of the Council on Tuesday 22 January at the Old Town Hall in Stratford. The meeting has been called following reports in local media in connection with allegations relating to the Council’s Repairs and Maintenance Service (RMS).
The Mayor and Cabinet will discuss establishing the Internal Control Commission when they meet on 5 February. The proposed Commission will be led by an independent chair and will review two key lines of enquiry:
- How does the Council make itself a model of best practice for internal control and governance?
- How did the Council not prevent issues in RMS from arising in the first place?
The Commission will produce a report on their findings which will allow the Council to review best practice and what can be adopted from other high performing authorities.
The report being considered at the Extraordinary meeting raises several key points, including:
- Concerns being raised by a whistle-blower within Newham Council.
- Four members of staff have been dismissed including two senior managers; five members of staff have been given final written warnings.
- The £8.78million overspend took place during the 2017/18 financial year, under the previous administration of the Council.
- The £8.78million overspend was caused by the loss of control of the Keep Newham Moving highways repair programme, which was agreed in 2016.
- Insufficient due diligence and risk assessment was undertaken when RMS undertook the Keep Newham Moving programme to assess its capacity to deliver the programme.
- While whistleblowing allegations were made alleging fraud in RMS, after a number of thorough investigations insufficient evidence of criminal activity was discovered by external auditors to bring legal proceedings; any new evidence that is presented to the Council will be thoroughly investigated. The bad practice that was uncovered was the subject of disciplinary hearings.
Mayor Fiaz made a pledge to make Newham Council transparent and open when she was elected in 2018. The Commission is seen as the latest step in that process. She has already called in experts from the Chartered Institute of Public Finance & Accountancy to carry out a financial health check across the organisation. Following the publication of their initial findings, which said financial planning could be better, improvements have already been made to procurement processes.
The Mayor has also had discussions with Newham Police Borough Commander, Detective Chief Superintendent Richard Tucker, regarding RMS and whether there are grounds to take the matter further.
She said: “I am committed to making Newham Council more open and transparent than ever before. In the spirit of that promise, I welcome the consideration to establish an Internal Control Commission.
“This proposal aligns with my administration’s commitment to transparency, and improving the governance of the Council in the interests of all Newham residents. We are putting things right. We have been proactive in resolving the financial mismanagement in RMS and taking clear action.
“I have instructed the new management team at RMS to implement a whole series of measures designed to offer reassurance on the effectiveness, governance, and efficiency of management, performance and compliance.”