Magic Numbers

I never cease to be amazed at how local authorities operate. They defy explanation other than to those employed as officers, it seems. Even then, it appears as if it is a select few senior officers who actually control all council matters, regardless of elected councillors who delude themselves that they are in charge. It is no different in Whitehall where ministers are often run ragged by real-life Sir Humphreys – I can personally attest to that experience!

It is one of the reasons that councillors should tread very warily when dealing with those who are technically servants of the council rather than its masters. One might believe oneself to be “in control” of a given brief without having a clue as to what is really going on. This thought occurred to me when I read of the declaration that Liverpool Council (LCC) – or rather, its mayor – would not allow schools to re-open in line with national government’s direction. At this point, I readily admit to a somewhat dated understanding of a local authority’s current remit with reference to schools. What I do know is that schools have been given a degree of autonomy which they never had in the past. Is that not what led to Mayor Anderson’s dismissal from his sinecure at a Sefton academy? Be careful, councillors, of uttering threats which you might not be able to deliver.

It is far more straightforward for councillors to maintain a diligent watching brief on what the higher echelons of their council are doing in their name. For example, in the name of the “Invest to Earn” policy, LCC have put over £1million into a small company, Briggs Automotive Company (BAC). It has a business address in Cheshire and two small buildings in Speke. By their own admission, BAC would not be in business if it was not for the financial support of LCC. So far, so good. Yet on inspection and in line with Contract Standing Orders, there are questions which ought to be asked relating to how the council operates in such cases. Who actually agreed the two payments made to BAC? Who signed off those payments? Why did those payments not go before Cabinet for approval as they ought to have done?

Getting Freedom of Information responses which are complete and meaningful from LCC is like getting the proverbial blood from a stone. Perhaps there are perfectly reasonable answers to these and many other questions which vague minutes of council meetings fail to answer. One must wonder why relatively new chief executive at LCC – Tony Reeves – has issued a contract (to Fraud Advisory Services Ltd), worth £320,000 for a forensic accountant. Is there some connection?

Back to BAC. It seems a regular company working in a niche market (high performance cars), although its accounts are not fully audited. It does have an exotic range of share holders based in Malta, Singapore and the British Virgin Islands. Others cannot be traced; LCC as a shareholder obviously can, yet it owes BAC £153,878! Payments to BAC by LCC do not show in the council’s payment list although the Local Government Transparency Code (2015) says that all payments over £500 should be so listed. I wondered whether this and similar cases explained the fact that LCC’s district auditors – Grant Thornton – failed to sign off the council’s accounts for the last four years. Who knows what to make of the magic numbers at the heart of any organisation, especially one as seemingly chaotic as LCC?

Incidentally, on April 16th last, Mayor Anderson was quoting as ordering £1.7 million worth of PPE, including 2million facemasks – “this was done through a proper process and we expect the order to arrive within a week”. Very laudable. On April 29th last, the European Journal listed three individual contracts for facemasks made by LCC:

HBS Healthcare of Preston              – £1.9million

Plaza Collection of Manchester       – £850,000

Fonebox Assets Ltd of Liverpool     – £257,000

This is a grand total slightly in excess of £3million, just for facemasks. There was also another contract with Kingsmoor Packaging of Somerset for visors. HBS is a regular company in this medical supplies field, but Plaza lists itself as a dealer in the wholesale of ladies clothing (will we get designer facemasks?) and Fonebox, a dormant telecoms company whose last accounts showed £1 cash in the bank and assets worth £34,769.

Once again, one wonders how and why these contracts were agreed, and by whom. No one would quibble with any local authority seeking to plug the gaps in dealing with the current pandemic, given the government’s catalogue of failures. Remember, however, that this PPE was to go, among others, to privately-owned, profit-making care homes. Whether these items were to be gifted or charged, we still need clarity as to the details of these transactions.

One thought on “Magic Numbers

  1. Two points. Council employees need PPE to work with the public and in crowded office space now. Many businesses have converted from clothing or plastic products to manufacturing PPE (sensible given the changes in demand). Those companies may operate outside of the NHS ordering system so not impacting on their supply chain.

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