Opposition leader ‘disturbed’ by Nottingham City Council's reluctance to release critical finance report

A review carried out by accounting firm Ernst & Young Global concluded controls on how money is managed at the authority were “not fit for purpose”.

However, so far the council has only published its own summary of the feedback, named the Financial Controls Assessment, and said the original EY report cannot be made public.

And this has led to Coun Kevin Clarke, leader of the Nottingham Independent Party, accusing the Labour-led authority of “concealing” the report and raised concerns “due to a legacy of what’s happened in the past”.

He said: “I can’t believe the lack of transparency. This is something that should be shared with everybody, especially councillors.

“It beggars belief really. As far as I’m concerned, no councillors have seen the full report.

“Members of the public are wondering why they’re pushing it under the carpet and hiding things. Is there something to hide? This is what we want to know.

“They need to come out and show the full report.”

He said it “disturbed” him that in his view, the council had not given a clear enough reason for not sharing the report.

However, a council spokesman said: “The audit committee report goes into significant detail about the assessment the council commissioned from EY of financial controls, and is explicit and transparent about the serious concerns identified and the actions being taken to address them.

“We are not able to provide any more information on the assessment as this may impact on further activity that still needs to be undertaken.”

The report, which was originally due to be complete by February, checked historical accounting practices to check for any potential manipulation of accounts.

It follows the uncovering, in 2021, of huge misspending in the council’s Housing Revenue Account.

EY concluded that for the period 2019 to 2022, a number of ‘very serious concerns were identified’.

Ross Brown, corporate director of finance & resources, said during the meeting: “I would emphasise the findings relate to the three-year period and is not inclusive of the previous financial year, although, it is quite reasonable to say many of the challenges and concerns that existed in that period will, by default, have carried forward.

“We recognise and accept the findings and the seriousness of them.

“We are very much focused on the actions we need to take to address this as urgently as possible.”

Annabel Scholes, council interim director of finance, told councillors: “You have to accept it will take longer than 12 months to resolve this.”

“Fundamentally, an individual was able to move finances from one area to another without the oversight of a separate person. That is a basic control you ideally would’ve put in place.

“The finance improvement plan already takes you to March 2024 and I expect it to go beyond that. You are looking now at needing to invest further in IT systems.”

She said there has been ‘positive feedback’ that the financial improvement plan has already ‘turned some of these control weaknesses around’.

Coun Sam Gardiner, committee chairman and Labour member for Bulwell Forest, said there were plans to establish a working group for the audit committee to “review itself”.

He said: “We need to hold ourselves to account in addressing some of the shortcomings.”