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Management at Northumberland CC subsidiary shaken up after scathing reports of ‘financial irregularities’

Stronger management procedures and new leadership arrangements are being put in place at Northumberland County Council’s development company, it has been revealed.

The move follows a highly critical report to the council’s audit committee, which identified “a number of financial irregularities” at Arch, a wholly owned subsidiary of the council.

Following the independent strategic review last year, the council confirmed that it would dissolve Arch in its existing format.

The decision was made by the board after the review found “failings in relation to the operating principles and fundamental purpose of Arch,” and that “probity has not been at the level required.”

A spokesperson for Northumberland County Council confirmed that during the review it was made aware of several matters of concern between 1 April 2016 and 30 June 2017, including financial irregularities with overseas events, corporate hospitality and gifts, sponsorship, and lack of HR and management procedures.

“We are appalled at this inappropriate use of public funds,” they said.

“Any identified impropriety will be handled in accordance with standard policies and procedures.”

“Interim governance and financial procedures have been in operation since July 2017, with robust management arrangements to ensure probity and transparency moving forward.”

A new development company with a greater focus on regeneration and place shaping is currently being created.

“New leadership will be put in place to deliver an ambitious programme of activity that supports business growth, creates new communities and job opportunities for local people, and secures economic prosperity that everyone can benefit from,” Northumberland CC’s spokesperson concluded.

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