Audit, Inspection and Safety

07.01.19

Police urged to intervene in Newham council’s ‘astonishing’ £9m repair division fraud claims after extraordinary meeting called

Newham Council has called an ‘extraordinary meeting’ into allegations of fraud surrounding the council’s £9m-overbudget repairs and maintenance service (RMS) as nine councillors have written to the Metropolitan Police asking that it launch a criminal investigation.

In December, it was revealed that Newham LBC was investigating a catalogue of allegations regarding fraud and financial mismanagement in its department responsible for social housing and road repairs.

A £8.7m overspend has been logged so far in the RMS division, and Newham’s mayor Rokhsana Fiaz recently launched an attack on the previous leadership, saying she was “shocked” by the “scale of financial mismanagement” revealed alongside “astonishing failures of system controls within the RMS.”

A spokesperson for the local authority has now confirmed that an extraordinary full council meeting has been called for 22 January to “enable Newham Council to set the record straight for the people of Newham about matters relating to the repairs and maintenance service that have been raised in the local media.”

They added that those present at the meeting, open to all residents, would be updated on progress made in “dealing with this and other similar matters” as well as plans for future action.

A whistleblower originally exposed the “major” financial issues in the RMS, and staff have now been “suspended or dismissed” with highway repair work stopped whilst an investigation is carried out.

A report found “a number of documented deals” with staff cutting work prices and then using sub-contractors at higher rates.

In a statement, mayor Fiaz said: “The scale of mismanagement in RMS was a clear sign that the mess could only be sorted out under a new administration.

“When I became mayor, what my administration inherited regarding RMS was staggering incompetency at the highest level and frankly, a shambles.

“I can say this because as a former councillor I had lots of casework relating to delayed repairs and maintenance requests by residents, including one woman in Custom House who had an agonising 12-months wait just to get some replacement cupboards for her kitchen done. It was embarrassing.”

Fiaz said that, in line with her agenda for transparency, she is asking legal officers to advise what material relating to the RMS investigation will be put into the public domain.

She added that some “serious questions” about how this situation arose needed to be answered, with experts from CIPFA coming in to give the council a financial health check after already identifying similar issues.

 

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