Government Report that suggests to me bribery and bullying re ISUS

All the below  is old hat but it does show how the passage of time can be used to mitigate the impact of serious misdemeanours. The delay is caused by auditors and civil servants not by persons like myself. This report is certified to have been received by WBC in March 2015.

EXTRACTS

WIRRALBIZ Enterprise solutions(NW) ltd

.. Allegation 2( re wirralbiz) relates to a number of allegations made by an ex-employee {Nigel Hobro and James Griffiths](of a supplier) which include conflicts of interest, falsification of documentation and claiming expenditure for work not carried out as well as a number of other allegations which do not relate to ERDF.

.CORRUPTION of the Tender process

. Allegation 3 [ that the procurement process was perverted]was from a supplier to the project who has alleged that Delivery Partners had shown favouritism, towards suppliers, where they had existing contractual .interests, during the procurement processes undertaken to call off contracts from the BSU 2 Framework Agreement[Intensive Start up Scheme]. They also alleged that they had be ‘warned off’ bidding for certain contracts.

We have been liaising throughout this investigation with the three particular interested parties, the applicant (now BIS), a project partner (Wirral Council) and the whistleblower(viz Nigel Hobro). All three are likely to request details of the outcome of our investigation.

Allegation .2 (viz wirralbiz)

This proved to be the most difficult to deal with as it relates to a number allegations made by an ex-employee, most of which did not relate to the BSU2 Project. In addition to this, not all of the allegations that did relate to the BSU2 Project affected ERDF expenditure, as they .related to activity funded under the Single Pot element which was not matched against ERDF.

Fraud not possible to be proven in court of law due to backing data mislaid to invoices processed in WBC

We identified a number of anomalies with the client files held by the supplier. These ranged from signatures which did not appear authentic, dates which appear to have been altered or were not correspond to the narrative on the forms and narrative which appears to have been photocopied on to forms and some client reviews which do not appear accurate. However, due to the lack of detail on the invoices used to claim ERDF . expenditure, we were unable to identify if the above anomalies contributed to the supplier receiving expenditure from ERDF..

The majority of the anomalies appear to relate to the Post Start Support (PPS) which• is not part of the ERDF expenditure but is paid. for by Single Pot funding and therefore is .:m issue for BIS. However, the lack of detail in the inv9ices used to claim Project expenditure means it has not been possible to tie back PPS. to a particular client back to a payment made to the Supplier.

Tenuous claims for £1,400, paid, for assistance to start-up of new businesses

We also identified a number of clients where the supplier had received an ERDF payment for assisting the client as a Start-up. However, some of the evidence • provided to prove a client had started trading (needed to claim this payment) suggests that the client was trading prior to receiving support from the supplier.

Contract of 92 pages does not confirm in a litigeable fashion that £1,400 cannot be claimed for assistance to a start-up subsequent to that start-up.

We have identified a desk Instruction which suggests clients should not be trading before receiving support in order to be eligible for a payment. However, contracting documents do not provide a clear direction in relation to this issue. In.discussions with the applicant, {WBC}they are also unsure of the requirements in order for Start-up payments to be eligible. {Aren’t WBC just dandy?]

 

Tendering issues

Allegation 3

We selected 4 procurement exercises to review {including mini-tender from wirralbiz to WBC}and found a number of issues which, in our opinion, would constitute a breach . in EC Procurement Directives.
These include evaluation of bids no( in line with the set evaluation criteria, questions within the evaluation criteria which discriminate against bidders as well as questions which are not considered relevant at award stage of a contract

We identified one instance were the contract was split between 2 suppliers who finished 1st and 3rd during the process. However, the supplier who finished 2nd (the supplier making the allegations) was not awarded part of this contract. We also identified one Delivery Partner was not able to provide us with any documentation relating to their procurement exercise.{did they destroy these documents or were they like another contract for WBC just a blank piece of paper?)

Of the 3 exercises {ie the fourth Council Applicant had nothing they could review} we reviewed the final contracts were eventually awarded to
• suppliers who appear to have had a history of delivering services for the Delivery Partner responsible for conducting the exercise. One of these contracts relates to
. the supplier (viz wirralbiz)at the centre of the allegations in Allegation 2, therefore we undertook our own evaluation of this contract which has • raised considerable doubt on the original evaluation which led to the contract award. {Hang on Burgess was always adamant his council officers had done no wrong and so was the Leader of the Council)

Conclusion  {COVER-up by WBC or not?}

• 1n conclusion, we have identified a number of anomalies with the Client files reviewed in relation to Allegation 2. However, in our opinion there is not enough evidence to confirm the existence of fraud in relation to ERDF as we cannot tie back the anomalies to actual payments made to the supplier nor can we identify a definitive description of the eligibility of start-up payments. {only because the CRM database has been lost, and the backing sheets behind wirralbiz invoices have been mislaid}

As a result of our procurement testing we did not find any evidence {however given what follows it does look likely, and no mention here of my allegation re over £11,000 on suspect wirralbiz invoices that tally with WBC actually funding wirralbiz’s tender against all the rules for erdf funding!!}that confirms fraudulent activity has taken place. However, given the allegations from S2[The complainant bidding organization] and the technical breaches identified within the procurement processes tested, there is a risk that processes may have been manipulated by Delivery Partners in order to contract with their preferred suppliers.

In our view given the anomalies in client files and breaches identified in procurement both would result in a significant financial correction being applied to the BSU2 Project if identified during an EC audit. It is also likely that some of the procurement breaches would be considered systemic as they are borne from procurement templates provided for Delivery Partners by the Project Applicant.

Recommendations. •

In relation to Allegation 2, we have identified a number of clients which we consider to be high risk and advise. that DCLG, in conjunction with BIS, should seriously consider treating any expenditure paid, in respect of these clients, as an irregularity and claw this expenditure back from the Project. {did they? this has never been publicised?}
. In relation to Allegation 3, we advise that DCLG considers applying a flat rate correction to the BSU2 project in relation to the procurement breaches identified with the call offs from the BSU2 Framework Agreement • •

We are of the opinion that both these measures are necessary to avoid a potential future liability to the Department should the BSU2 Project be selected for audit by the EC.
4.4 Allegation 3

Procurement {INTIMIDATION}

4.4.1 During our work on the BSU2 Project we received a number of allegations from S2 in relation to the practices undertaken by Delivery Partners (DP) during the procurement processes to appoint Suppliers from the BSU2 Framework Agreement. The allegations ranged from verbal threats, from DPs or organisations linked to them, in an attempt to ‘scare them off’ from bidding for contracts called off from the Framework and ‘favouritism in the bidding process’ shown towards Suppliers where DPs had pre-existing business interests with those Suppliers. {bullying by Council employees!}
4.4.2 S2 informed us that they have no evidence to support either of the allegations as, in the case of the former allegation, these threats were made during telephone calls or during private meetings with certain DPs {COUNCILS!!!)}. In relation to the latter, this allegation is borne from frustration with, in the view of S2, a lack of fairness in the bidding processes for a number of call offs where the subsequent winner had been an organisation which had a history of sub­ contracting from the relevant DP. S2 told us that they had complained, to the relevant DPs, where this had occurred but had received unsatisfactory explanations in most cases.

4.4.3 S2 also told us that they had not reported these issues at the time because they did not know who to report to outside of the BSU2 Project. They were also concerned that they would face reprisals from DPs within the BSU2 Project should they report these issues. It should be noted that S2 reported these issues to us before they were made aware of the allegations against them (see section 4.2) therefore we do not consider these allegations to be ‘tit-for-tat’. Also, as a result of our previous work with S2, we found they cooperated fully with all of our requests and they gave us no reason to doubt their credibility.

4.4.4 The former allegation relates to verbal comments without witnesses therefore we are unable to undertake any work in relation to this. However, in relation to the latter, we have reviewed documents relating to the procurement processes undertaken by the DPs concerned. As. mentioned in Section 2 of this report, DPs were able to contract with Suppliers as long as this was done through a mini-competition (qill off) involving the Suppliers appointed to the BSU2 Framework Agreement (FA) established by NWDA. S2 have indicated the contracts called off by DP1, DP2, DP3 and DP4 as •being unfairly conducted.

4.4.5 We have already raised concerns (during the A16 Audit) around the creation of this FAs there was no minimum quality score required for bidders to be appointed. As a result of this every compliant bid that was submitted to the NWDA was appointed to the FA. In total 59 Suppliers were appointed to the FA with quality scores ranging from 22% to 88% (with S2 {the complainant bidder!!} finishing in first position). This makes it very difficult for us to understand the purpose of the FA as it appears everyone who submitted a bid was subsequently appointed to the FA without any consideration being given to the quality of their bids. This means that the FA appears to serve no purpose apart from acting as a preferred supplier list for DPs.

WIRRAL ISUS DP1 Call Off

• • 4.3.6 The reference to DP1 {delivery partner 1} was of particular interest to us considering our work on the allegations made against their Supplier (S3)(viz wirralbiz) and it is.here where we had access to more documentation. DP1 advertised the call off using the standard Request for Quotation (RFQ) (which was issued as part of the BSU2 suite of documents) to members of the FA who had expressed an interest in working in the DP1 area (the Wirral). The evaluation criteria was based on Delivery Model (50%), Staffing (25%) and Pricing (25%) with each of these criteria having sub-criterion which are weighted to ensure the maximum percentage for each criteria is not exceeded.

Wirralbiz fails the first hurdle but they CAN FIX-IT. S£ Wirralbiz moves from independent score of 36% to Wirral score of 72%

4.3.10 DP1 also required a minimum quality score of 60% to be achieved; there was no mention of an interview stage within the evaluation process. DP1 received 12 bids with 4 of these exceeding the minimum requirer)lent, finishing in the following order: S3 – 72.92%, S2 – 67.08%, S4 – 62.08% and S1 – 61.67%. As a result of these scores a decision was made to appoint 83 as the sole Supplier to DP1.

DOUBLING THE SCORE by clever local government officers

As we stated earlier, during the creation of the FA S2 were appointed in first place with a score of 88%, with the nearest bidder scoring 64%. S1 finished in 13th place with 59%, S4 in 15th place with 54% and S3 in 43rd place with 36%. . •

4.3.11 We consider it unusual that a Supplier should manage such a significant reversal in performance, beating 3 organisations that were considered superior during creation of the FA. Based on our extensive experience of auditing EC procurement, the only scenarios where we . have experienced such a reversal in performance are, a) where the appointment was based on quality (or a combination of quality and price) whereas the call off was based only on price, or b) where the appointment covers multiple services but the call off relates to a single service.

4.3.12 Based on the documentation we have seen, none of these scenarios appear to be the case as the specification for appointment to the FA and the specification of the RFQ appear very similar. The only differences appear to be emphasis on knowledge of the area where the services will be delivered (the Wirral) and the people involved in evaluating the RFQs. Some of the questions within the RFQ were almost identical to those asked at appointment stage yet the scores were reversed. As a result of this we decided to carry out our own evaluation of the RFQs for S3 {wirralbiz) and S2.

4.3.2 O Whilst we had access to the original scoring sheets, showing the scores for each bid against each question in the sub criterion, the comments boxes were not populated so we could not see the reasons for the scores given. We undertook two separate evaluations, by different people, based on the evaluation criteria within the RFQ, comparing the original scores given with our scores. Both of these evaluations concluded that the S2 bid scored more highly than the S3 bid.

Admission of ineligible questions to assist wirralbiz

4.3.23 During the evaluation we also identified that two of the questions in the evaluation criteria would be considered ineligible during the call off stage of a procurement process and would result in a financial correction if audited by A16 or the EC. One question asks bidders to detail their experience of delivering similar contracts, within the last 12 months, in the Wirral area and the other asks bidders to provide details of other contracts being delivered which may impact on delivery of the BSU2 contract. The former is considered an ineligible question as it has the potential to favour a bidder .and the latter is not considered relevant at this stage in the procurement process.

Salford does the same as Wirral DP2 Call Off

4.3.25 We have received limited documentation in relation to the call off undertaken by DP2 ‘therefore we are unable to undertake any detailed work in this area.
We have access to a hard copy of a spreadsheet which shows the scoring of bidders against the .questions asked in the evaluation arid a copy of the bid
submitted by the winning bidder. However there is no narrative to explain why each score was awarded.

4.3.26 As we stated earlier, during the creation of the FA S2 were appointed in first
• place with a score of 88%, the eventual winner of the DP2 call off (S4) was appointed in 14th place scoring 58%. {less than the supposed qualifying score of 60%}S4 is located within the DP2 Local Authority boundary. The scoring sheet for the DP2 call off shows S4 as the winning bidder with 51% and S2 came second with 36% and, as per our comments at paragraphs 4.6.7 & 4.6.8, we consider this unusual as the only differences in the questions used during the evaluation criteria appear to be the references to the local (Salford) area.

4.3.27 We also identified that two of the questions in the evaluation criteria which we would consider ineligible during the call off stage of a procurement process and may result in a financial correction if audited by A16 or the EC. One question relates to demonstrating experience and track record in the Salford area and the other asks bidders to provide details of other contracts being delivered which may impact on delivery of the BSU2 contract. The former is considered an ineligible question as it has the potential to favour a bidder and the latter is not considered relevant at this stage in the procurement process.

KNOWSLEY DOES THE WIRRAL JIGGLE TOO DP3 Call Off

4.3.28 DP3 approached the call off slightly differently than the others as they split it into 3 Lots, Women, Social (enterprises) and Other. Organisations were allowed to submit for any combination of the above lots. S2 submitted a bid for the lot titled ‘Other’ so it is here where we have focus9ed our testing. The eventual winner of the ‘Other’ Lot was S5. As we stated earlier, during the creation of the FA S2 were appointed in first place with a score of 88%. However, S4 appear to have finished in 5th, 6m, yth, ath and 9th place with
. scores of 62%. The reason for this is that S4 appear to have submitted a number of bids as part of consortiums or for specific i;ireas only. S5 is located within theDP3 Local Authority boundary.

4.3.29 In total DP3 received 11 responses for the ‘other’ Lot and a minimum quality score of 60% was set. There was no mention of an interview process within the evaluation criteria and the criteria were scored on a similar basis to DP1 and DP2. A summary report dated 15th July 2009 shows that S2 finished in 1st place with a score of 78.87% and S4 finished in 3rd scoring 75.42%. However, a further summary report dated 5th July shows the same information but also refers to an interview process and contains.a table showing amended scores.

4.3.30 Although not mentioned in the evaluation criteria, it appears that DP3 undertook an evaluation of the bids and then invited the highest place bidders to an interview. The scores from both evaluations were added together and divided by 2 in order to get an average score. The result of this was that S4 finished 1st scoring 71.80% and S2 2nd with 71.38% a shift of 3.33% as a result of the interview.

4.3.31 We also identified that two of the questions in the evaluation criteria which we would consider ineligible during the call off stage of a procurement process and may result in a financial correction if audited by A16 or the EC. One question relates to demonstrating experience and track record in the Knowsley area and the other asks bidders to provide details of other contracts
• being delivered which may impact on delivery of the BSU2 contract. The former is considered an ineligible question as it has the potential to favour a local bidder and the latter is not considered relevant at this stage in the procurement process.

The letter of Protest in October 2009 from Supplier “S2” whose score had been reduced from 88 to70

Wirral Challenge

Wirral Challenge
I have received feedback from A4e concerning the marks awarded for our bid and believe that the scoring has not been conducted in a consistent manner and wish to make a challenge to the process undertaken for the assessment of the Wirral RFQ ISIS programme.
Under FOI, I request the following information be provided.
• Detail of the scoring methodology for all the RFQ submissions.
• A copy of the summary scoring sheets for our bid and all other bids.
• A copy of the individual scores made by each individual appraiser for each assessment criteria again for ours and all other bids.
• I note in the guidance note that contracts will be awarded on the basis of the ‘most economically advantageous,’ and I would be grateful for the unit price per business start offered by the winning bid and the score awarded for that price, and similarly a restatement from you of our unit price per business start and the score awarded for our price. For your information, we met and exceed the minimum specification requirement required of the bid.
I am aware that this information is readily available in this format having had the benefit of feedback from our other RFQs which was able to itemise scores at the individual appraiser and question level and I would not see this as being unduly burdensome nor commercial in confidence as I am not requesting a copy of any other tenderes’ bid. As this information is already at hand I do not therefore expect to see much delay in response. I am happy to accept the information electronically via ************
Once I receive the FOI responses, I will determine – using external professional advice – what further action to take. However, I do expect to request via the Local Authority Ombudsman or the procurement department of the NWDA, an independent third party re-scoring of our bid and that of the winning bidder, as I am somewhat surprised with the low scores awarded, as on all our previous RFQ submissions we have scored significantly higher than those we have been awarded here and I see the scores as a significant aberration that cannot easily be explained via assessment of local need or the natural variance of assessment opinion. I am obviously unaware as to the generosity of scoring for the winning bidder.
As an aside, I was made aware some days before the announcement, by other individuals in our market place, that we were not successful in our Wirral bid and was informed also the name of the winning bidder, who had been notified apparently some while before an official announcement had been made. I do find this a disappointment in finding such commercially sensitive information in this manner and would be grateful for your opinion on this matter and how this came about.
I take this action regrettably and after long consideration, and it is the first time that I have ever raised a challenge in the eight years of tendering to, and delivery to, a variety of public sector bodies, but feel strongly that the scoring has been inconsistent which requires explanation.
Yours sincerely

S2

Can any statement by a WBC chief Executive be trusted?

A long time ago in October 8 2014 I attended and spoke at a packed Audit and Risk committee. Scandalously this had been convened in July 2014 but broke up in disarray when the Chief Executive discovered that I was to speak of officer neglect and indolence rather than the now already established corruption of wirralbiz. This cancellation in uproar was followed by a second wrong footing for a meeting organised on the 7th October 2014, subsequently cancelled at the last moment by Graham Burgess who claimed he had discovered a diary clash. Though the meeting was organised well in advance he claimed he had to be in Wakefield on the 7th for a meeting of LGO’s- a meeting for which there is no record in the Wakefield council archives.

On the 8th October I spoke first and did indeed attack the truthfulness or otherwise of council officers using the very 700-800 pages printed by the Council itself. I pointed out that the original appointment of wirralbiz to the Working Neighbourhoods program in October 2005 was by recommendation of a letter from David Ball, printed in the pack which claimed for several years Enterprise Solutions(NW) ltd had provided start-up services in several boroughs. This was a false statement which I had blown up to the committee members by sending them details re the opening accounts of the latter company.I had already pointed out to the committee members how the statistics previously presented over the years re wirralbiz’s outputs had been massaged to present a credible business.

 

However I had not the original Beverley Edwards’ internal audit report of 13th January 2012 which the Council had been concealing and for one year further continued to conceal until compelled in september 2015 to reveal the same within 28 days by the Information Commissioner’s office. Nor did I  possess any report by the erdf auditor which I knew had been prepared before Spring 2014.. Mr Burgess proudly pointed out that the auditors had found no evidence of wrong-doing by council officers to which I could only repeat that no allegations of the same had been made re this to Grant Thornton between November and March 2013 when they actually reported. Mr Burgess ended by claiming the ISUS and BIG were largely successes and received endorsement by councillors of his officers.

 

However time reveals all. The Beverley Edwards report was 376 pages long and covered many bases of the BIG issues eviting much of Grant Thornton’s eventual work. It contained evidence of asset stripping effectively condoned by WBC officers. Asset stripping is a criminal offence.

 

On the day after Chilcot the ultimate nail in the credibility of the defences put up by Mr Burgess was stripped away when finally I received the GIAA report into ISUS.

WBC officers had magicked wirralbiz from a score of 36 (below the eligibility threshold) to a score of 72 and frustrated the legitimate expectations of “S2” with an NWDA score of 88, down to a 70 score; the contract ironically was awarded by deceit to a company that would go on to rob the very Council that had bended rules to app0int it.In the process the poorer sections of Wirral were robbed of a decent service together with the 11 other tenderers robbed of a fair assessment.

Since I knew from the erdf auditor that his field work was finished by December 2013 his allusion to the work of checking the score sheet for the tenders does mean that WBC was aware in December 2013 of irregularities. However Mr Burgess rather brazenly stood up , never mentioned these corrupt practices by his staff, nor did Mr adderley, nor did Mr David Ball. It would be stretching the envelope to imagine that not one of these worthies were aware of the malfeasance. “S2” provided me with a letter of challenge sent to David Ball just after ISUS was awarded in October 2009..the discreet man never answered it!!

Tomorrow I will place the letter of challenge on this blog and to whet your appetite soon after the section on procurement from the GIAA audit report.

 

 

 

 

 

 

 

 

Working Wirral 3

A simple statement: the officers have lost the mother lode of contracts which was signed in November 2004. 

from this contract we have in writing in response to an FOI that the Community Enterprise programme of 2007/2008, the last tranche of Objective One money , some £800,000, was not put out to tender and that no contract was signed for the provision of any named service.

 

I strongly suspect that this mirrors what happened later with the Asset transfer program where wirralbiz was paid £66,000, An FOI response outlines that the contract was supposed to be between wirralbiz and the community groups in the Asset transfer. However no contracts were ever signed as certainly the community groups were ignorant of this important detail as the leader of the Grange Road West group told me in astonishment.

 

WBC was simply the conduit for the payments and happily paid off wirralbiz with no questions asked, none at all.In fact WBC paid them after the spending freeze £66,000 for the Asset transfer just as Grant Thornton were struggling to get into wirralbiz as had their predecessors , B Edwards and D Garry, both of Counter Fraud WBC. Strange indeed and specifically when one looks at the quality of wirralbiz’s work say on the New Brighton Community Centre. The cashflow and the projected profit and loss are combined for these advisors were blithely ignorant of the meaning of each separately.Yet the same advisors were deployed on two thirds of the Asset Transfer projects.

 

As to the Community Enterprise program I personally had to correct all 32 business plans so one wonders whether WBC paid twice; firstly for the incorrect budgets and then for my corrections? Probably as the director gloated since WBC never checked anything!

 

Working wirral 3

So I know that Working wirral 2004 to 2009 October was the Wild West.

Anything went literally. £10m to spend and how to do it?

Advisors who knew little but could earn themselves £40 and the boss another £50 if they phoned a client “Dont want to bother you but could you answer a few questions? What is your Turnover to date? Dont know? how about £10,000. Ok i’ll put it through. Thanks . Sorry to bother you at this time”

Then forge the clients signature print the invoice and bobs your uncle £40 for the advisor  and £50 for the boss. Whose wants to stop me . nobody”

Who is checking? Nobody.

WBC have an open chequebook policy. Just write it yourself. The council  monitors are on £50k per annum and they have a project management certificate called PRINCE2 {available online for max £349!) so they dont care. They dont even read the contracts!!

 

 

 

 

 

 

Working Wirral

Working Wirral operated for wirralbiz from November 2004, in a contract that WBC apparently has lost, as a precursor to Working Wirral , to be continued in 2007 as what is termed Working Wirral. 

In October 2009 Intensive Start Up Scheme {ISUS} supplemented the latter program with erdf pledging £1m, and another fund, not clear to myself, pledging £1m for a putative three year project.

Working Wirral continued with clients’s reviews for start-ups prior to October 2009.

Wirralbiz plus appears to have drawn from the DWP money and represented special projects which appear never to have clearly been specified. Some might term it a “Slush fund” and certainly it was used for accounting for businesses in deprived zones, some of whom directors in wirralbiz did have an interest within.

 

The period from November 2004 to October 2009 nearly five years was sampled by Grant Thornton in three files PISUS1 to PISUS3 which actually represents one married couple and one other .so effectively only two clients. Since over £5m had been disbursed by WBC this sample is entirely inadequate and bespeaks a reluctance by WBC to uncover the stone and see what lies beneath it.

Remember that throughout this period WBC cannot attribute responsability to any other person or organization. The monitoring of the period was entirely up to WBC officers. It was the Wild West… more tomorrow

 

 

 

Working Wirral

I have not made any entries on this blog regarding Working wirral as I was awaiting the publication of David Garry’s report from September 2012!!! and for the correcvtive Grant Thornton report , finished in March 2013, but published only on 14th July 2014 on the Audit and Risk Committees minutes for the 22nd July 2014.

Way back in 2007 WBC received £30m from the Department of Work and Pensions qualifying because of the Borough’s levels of unemployment and low levels of self employment. A study was commissioned from “Regeneris Consulting” which explored the ways of disbursing this money. Ultimately some £10m passed either as fees or in grants via the conduit of Wirralbiz Enterprise Solutions(NW) ltd.

 

Any person who has read the Grant Thornton reports will understand that this pipe was the rustiest and dirtiest possibly that they could have found.Whereas the financially vulnerable wanted clear fresh water what they received was murky, cloudy, with bits in it and rather noisome.

The fascinating element of this is Wirral Borough Council’s studious avoiding of reference to Working Wirral in connexion with Wirralbiz (Enterprise Solutions (NW) limited) as if they were ashamed that the two might be linked. If one was to view the press release of March 2013 when once WBC had Grant Thornton’s report one might be puzzled as to why no mention is made of Working Wirral aka Working Neighbourhoods, whereas the release goes so far as to provide definitions of ISUS and indeed of BIG fund .

 

Motre tomorrow of how only three files were examined for the period November 2004 to October 2009 when Working Wirral was the only funding

 

 

 

 

Address aborted to Audit and Risk committee for 22nd July 2014

Address to ARMC on 22 July 2014 12 minutes

I am Nigel Hobro, former accountant to wirralbiz and referred to as A1 in D, Garry’s report and WB2 in Grant Thornton’s reports. Having referred my concerns to Michael Raworth, director , in April 2011, I was astonished to learn from him that Invest Wirral had “investigated” and had cleared all and sundry, way before I gave my evidence to Counter Fraud.

Thanks for the opportunity to address committee.

Had we not spoken out few in this Borough would be aware of these fiascos, wirralbiz would have a sterling reputation and might easily have been sold on as the chicken that lays the golden eggs, to any one of the business advisors whose practices are damned in Grant Thornton’s reports. Then the abnormal would be transmuted by alchemy to the normal. Had the Chair of this scrutiny committee been a Councillor of the opposition I am sure we would have been assembled here one year ago, instead of three years after James Griffiths first blew his whistle.

I have to thank Grant Thornton for much, not least for not using the notation WBA, WBB, for had there been 3 whistleblowers the third could not be WBCee, but the non phonetic WBD! And wirralbiz becomes WBZee. Grant Thornton becomes GTee. Ridiculous? Perhaps but no more so than “the grotesque chaos of a Labour council- a Labour council” despatching 526 pages to Councillors on Friday evening by couriers scuttling over the borough, 526 sheets of paper to read by Tuesday and that when the Golf Open is running! Thirty years ago the Mr Burgess was on the receiving end of P45s sent out by Liverpool council, but now he is the one dishing out the punishment.

It is an important point though that the rebel of 30 years ago becomes the Establishment. It underlines the importance of dissent, of pushing the view diametrically opposite to the Establishment. When Cllr Kelly highlights issues it is not as Cllr Davies has publicly said “irresponsible”, nor is it any reason to exclude him or any Conservative from the Chairs of these scrutiny committees.

Predominant in the first 55 pages of the Public Information Pack, and this order quite perverse, is the Report that Mr D Garry, retired Chief Internal Auditor, took 13 months to concoct. He paints the affair exclusively with whitewash and no colours.

Speculate what would have happened had Mr Wilkie not retired in early 2012. Without a new Chief Executive and Finance Director, who were untrammelled by long association with officer colleagues, without the threat of the Government Commissioners,

I wager that the Garry report would have become official damning WB1 and WB2 both. The latter report captures in a still picture what will happen to claims by informed whistleblowers , their evidence will simply be painted over with whitewash.

What rosy conclusions does Mr Burgess draw from the last tortuous three years?

He seeks to defend WBC’s Regeneration record in the teeth of the negative yet forensic comments within the GT {Grant Thornton}full reports. From 526 pages he draws but few conclusions and these conclusions are perverse.

How can this committee agree that the regeneration projects run by WBZ were largely successful in stimulating enterprise and the economy of Wirral? Our allegations passed through the eye of GT’s forensic needle but the Chief Executive’s rosy assertions have not, and never could.

He lifts a sentence from GT reports where they write they found no evidence to suggest council employees were dishonest or lacked integrity. However the preceding four lines in the GT report are redacted out. Perhaps they refer to the severe time constraints that GT were under given the scrambling of the evidence, the inordinate efforts to obtain proper contractual documentation from officers, or even the database (CRM) schedules that could link the fraudulent files unearthed to the payments made at the time. GT were hampered and stone-walled and ultimately were reliant on the self-same officers for evidence.

He brings forward the GT recommendation to establish a central repository of contracts with suppliers which meaning I will translate for my listeners. The significance of this recommendation, which WBC, had it more humility, would explain, is that the public are expected to be naive enough to believe that honest officers with integrity can:-

1. Misplace the mother-lode of contracts with WBZ, signed or unsigned probably, which governed some £10 m fees to WBZ from 2004 onwards

2. Forget to get WBZ to sign a contract for BIG delivery where over £500k of grants and up to £60k of fees were spent

3. Disregard the NWDA contract and negligently misplace the digital and the paper documentation that would indicate for which client and for which exact service over £2m was spent

I invite the Members and the audience to imagine how all three such disasters can have happened simultaneously. The effect is that the two tailors who spun the invisible cloth for the Emperor of Regeneration can scuttle off rather conveniently with our Regeneration gold and never explain themselves in court.

May I then introduce the word “Negligence” to these discussions?
The costs of this negligence are enormous. The discredited Garry report has brought on additional costs to the rate payers of £50,000 to GT added to a likely bill of £30k to the government auditor from DCLG, and, I could guess ,some £50k of Counter Fraud time.

Consider that GT were able to look at only 20 files costing £50k of fees because WBZ felt empowered to refuse access crowing that no valid contracts existed. The period pre-ISUS (PISUS) can only be covered by three files PISUS1 to PISUS3. which period covered 1,800 files, 2,969 advisor sessions at at least £90 an hour, at least 3,615 reviews sometimes effectively charged at £1,500 per hour! 32 grants to Community organizations of up to £40k apiece and 66% of all asset transfer cases! Further after one year and more the government auditor still has not rendered his report!

The CEO proudly repeats the conventionally polite phrases of GT, who are also WBC’s auditors, thanking the WBC staff for their co-operation, the same staff their colleagues will need to work with in future audits.

Mr Garry was most courteous on the three days that I met with him but nevertheless he did, in his reports, stab me in the back! Where informations did matter GT were stonewalled by council staff.

GT reports the recommendation that Ms Paula Basnett , Head of Invest Wirral gave to Surjit Tour in early summer 2011, that the Working Wirral and ISUS contracts be suspended forthwith.

Despite repeated requests to Legal Services for the minutes of these meetings, or confirmation that they happened, GT record that no reply was ever received. GT refer to the lack of the full documentation for ISUS ,the one contract we still possess., GT were told by council officers that day-to-day management of the projects was the responsibility of A4E.

I have provided committee members with extracts and definitions from the ISUS contract that charge the LA Partner-i.e. this Council with this responsibility.

Tellingly all officers asked regarding “cross-selling” by WBZ to ISUS/WW clients responded virtuously that it should lead to suspension of contracts. All denied knowing of such “cross-selling” despite these activities being notorious, even comprehensively used by WBC itself. I have read a letter to M Blasczyk, complainant ,where David Ball , a Regeneration director, acknowledges WBZ cross –selling and writes that it is of no concern to the council. Moreover the operations of “Thinklocal”, an advertising brochure, and the individual leafleting operation, were run for two years from the office adjacent to Invest Wirral at Egerton house. Wirral Borough council advertised in it for some £10k plus, must have proof read the brochures, and indeed paid the two salesmen’s handsome salaries through the back-door of wirralbiz plus “development”?!!

Mr Burgess might more humbly have “averred” that the failure of officers to suspend the contract permitted WBZ to pass itself off as a successful training organization in summer/autumn of 2011 with Alt Community College for Making Business Work and to Social Enterprise North west for Business enterprise in Communities.
The council might be said to have assisted driving out good training firms in favour of the bad for WBZ enjoyed these contracts until the late summer of 2013.

Mr Burgess does not report in his summary of any officers, or contractors who are to be disciplined or sued in a civil court.

The notes on redaction refer to not naming wirralbiz subcontractors though all are named save one. Accidentally a copy time sheet from Mr Paul Davies regarding a BIG file for M. Lamb is left without redaction Paul Davies managed to call me a “Twat, Twat , Twat” within yards of the wirralbiz directors for pointing out an overclaim of his on wirralbiz+; managed to sulk for 2 months eating his lunch in his car in the car-park; treat a wirralbiz director with contempt and still choose the timing of his defection to Invest Wirral. Did Paul Davies wear a cloak of inviolability or did he have friends in high places?

It is notable that Mr Burgess refers to the BIG reports being referred to Police out of openness and transparency and because wirralbiz was common to both contracts. However GT did recommend that BIG6, a file prepared by Mr Davies, be referred to the Police.

The latter contractor continued to be employed by Invest Wirral during and after the BIG allegations were made and up to the date of the freezing of Council expenditure in late summer 2012. Given the evident deficiencies in the 6 BIG files all prepared by Mr P Davies I find it contumacious that Invest Wirral continued in employing him on BIG projects.

We will continue to search for a telephone recording that will sweep away these perverse conclusions. I know what I witnessed was the negligence and arrogance on the part of several officers allied with a smug certainty on the part of WBZ that the council would never act. I resent that as a private individual I have had to spend so much time and effort over four years simply to set the record straight.

Where in 526 pages does Mr Burgess thank me, Mr Griffiths, ISUS1 or any of the witnesses. Are we “sour-faced bean –counters who have interrupted the Regeneration emperor’s magnificent procession wearing his invisible robes of Regeneration with hems sewn with thousands of outputs, and his offices arrayed in suits of sustainability

“The Emperor has no clothes”! we have cried.

Jostled by his courtiers for our impudence and given short shrift when we are proven correct we carry a dunce’s hat overwritten with “Whistle-Blowers not welcome in this Burgh”. After this huge dump of evidence we may, without being jostled, legitimately cry

“The Emperor has no contracts!”

In the absence of acknowledgement I ask Members and the public to applaud all those involved in the battle to expose these serious failures of local government officers.

I have given the text of this speech to Mark Delap to publish in the minutes of this meeting,

I am willing to answer questions from Members of the Committee.

Not in speech as time constrained but for publication:

Mr James Griffiths who sacrificed his employment and risked his sanity to protect vulnerable start-ups and prevent the pillaging of rate-payers money.

I applaud, Cllr Adrian Jones, though not as a Cabinet Member, but as an individual who risked his reputation with his colleagues to get at the truth,

I applaud Cllr Phil Gilchrist who necessarily lent his shoulder to pushing this boulder the last yards to the hill’s summit and sent it freewheeling down the other side.

A few good men…. ISUS1 I thank you for your unstinting support and advice even before you realised that you yourself were among the greatest victims of these schemes. ISUS1 was just one of many victims that Mr Burgess does not spare even one line for, but I refrain from listing them for their losses are too bitter to re-enact in this forum.

I applaud the help from John Brace, Paul Cardin and Julian Justice of wirralleaks who like an alchemist turns dreary negligence into entertaining satire.

Lastly Mr Garym Lambert, who leaves the authority on Friday, thanks for your good humour and friendliness.

Internal audit answers under pressure

Faced with deus ex machina Mr Garry defended himself pointing out that per himself that I had never mentioned any scandal pre October 2009 the advent of ISUS. I had retained the transcripts of interviews and faced with his email cc’d to all influential council members and officers I responded to all the same circulation. I read back to him from the transcript programs I had criticised which had hew read the interview notes he would have checked backwards and discovered they went far back to 2006. He was an auditor after all and they were WBC projects farmed out to the Service Provider!

He changed his tune and recommenced correspondence with myself and taking-not refusing as before- new evidence. A very humbling experience which two months later would result in his retirement when Mr Timmins, Acting finance chief examined his work describing it  in contemptuous terms and outlining that the papers were spread to the four winds and that it would cost £10,000 just to reassemble them and to be in a position to recommence the investigation which looked as if it had never started even though it was supposed to have begun 13 months before.

Was D Garry like Marshal Ney , the rearguard of the Grande Armee in headlong flight from Russia 1812. was he covering the bridges over the Beresina as the tattered fragments of the army were bought time to retreat to safety?

 

A blanket over the truth

We left the matter with my receiving an admonitory email from the then Chief Executive Mr Wilkie. It must be borne oin mind that Mr Wilkie was a great advocate of the Regeneration Deparment and of Invest Wirral  who were being criticised by my witness. Indeed at the height of the BIG/Grant Thornton investigation he was seen to come back from “retirement” to spend time closeted with Invest Wirral at Egerton house, and note to exchange well wishes!

 

My answer to the admonitory letter received from Mr Wilkie was as follows

This won’t work mr Wilkie
 
Political correctness does not answer the questions I have raised.
 
The matter is the questions I have raised the rest is a sideshow

Sent from my iPhone

On 2 Mar 2012, at 18:14, “Wilkie, Jim D.” <jimwilkie@wirral.gov.uk> wrote:

 
On 5th March I attended a final interview with D Garry and with J Molyneux taking notes. The administration changed until May elections 2012 when Labour received an outright majority. In April 2012 faced with no visible actions from the Counter Fraud department the Daily Post published its first story. The journalist had been warned from the highest quarters that there was nothing in the story but he persisted. Meantime I was sending further data-I mean exact data not hearsay- to counter Fraud in WBC but receiving no response. My suspicions were aroused as were Cllr A Jones’ who went so far as to be quoted in the Daily Post reporting his anxiety regarding the silence and lack of movement on this affair.
 
A story broke in the national newspapers about A4e and its former head internal auditor who had barged into a parliamentary committtee to gainsay the whitewashing of that firm. Inspired by the latter I emailed Margaret Hodge MP and chair of Public expenditure Committee regarding this issue. She responded and suddenly I had a labour councillor ringing me up- there had been uproar within the council. Things were moving. Deus ex machina, it had taken someone from outside the Borough, someone influential , to put a rocket under the council.
 
Tomorrow – the rather foolish response of Mr D Garry chief internal auditor….