Thursday, May 18, 2006
Plumbing New Depths
"One of the worst cases of conflict of interest and impropriety that this Committee has seen... plumbed new depths... the taxpayer let down by almost everyone in the chain of responsibility... a culture which seems to have had no respect for the proper conduct of public business... every one of Lord Nolan’s seven principles of public life have been breached."
So which department is the Public Accounts Committee describing? The Home Office? Department for Work and Pensions? Department of Health? Tricky isn't it. Could apply to virtually any of them.
But it's actually Northern Ireland's Department of Enterprise, Trade and Investment: the PAC are reporting their enquiry into an outrageous catalogue of complacency and ineptitude that has squandered millions and may yet result in criminal prosecutions.
Briefly, the Department of Enterprise set up a quango, LEDU (the Local Enterprise Development Unit) to dish out our hard-earned money to whatever hi-tech/lo-tech/start-up mumble happened to take its fancy.
Now the Deputy Chair of LEDU was one Mrs Teresa Townsley. She's one of those Greatandthegoods who sit on the boards of so many quangos- in her case, the Health and Safety Executive, LEDU, Invest Northern Ireland, the Department’s Audit Committee, Chair of the LEDU Audit Committee and the Health and Safety Executive Audit Committee and Member of the Senate and Honorary Treasurer of Queen’s University Belfast. Get the picture?
But she was also on the board of the Emerging Business Trust, another conduit for disbursing all those lovely public funds, and which depended for its own funding on LEDU.
Pause right there. Does that sound right to you? Wouldn't your average five year old have thought there could be the teensiest potential conflict of interest where the giver is also the taker?
But it gets much worse. She was also joint partner with her husband in an accountacy firm, MTF, which was then appointed by EBT- without a proper tendering process- as managers of EBT itself. They received £1.4m in fees for that- a quarter of EBT's entire public funding.
And there's even more. She and her husband had fingers in all kinds of pies and were closely involved with several of the small companies funded by EBT. In one case, Arcom, her husband joined the board and purchased 10% of the shares just three weeks before EBT invested in the company. The price shot up. In a virtually unprecedented statement, the PAC says: "In our view Mr Townsley’s actions amount to ‘insider trading’. Which of course is a criminal offence, and which must surely be followed up by PC O'Plod.
Oh, and EBT has now gone into liquidation and a whole load of files have somehow been shredded.
It all absolutely stinks.
But the really appalling thing is that nobody in the Department of Enterprise thought any of this was in any way questionable. Oh no. They just nodded, smiled inanely and signed the cheques.
What about all those codes of practice and Lord Nolan's Seven Pillars of Public Service? Where were they?
The answer is- as we've seen over and over again in recent years- little of what's promised at the top actually gets translated into effective action down below. More and more of the public sector seems to exist in a dreamworld where the common sense tests have disappeared.
At best our money is wasted. At worst, it goes walkabout.
PS As we know, Northern Ireland is awash with public spending, as is Scotland. According to the latest official stats per capita spending in N Ireland is 35% higher than in England, and it's 22% higher in Scotland. Both countries have experienced more than their fair share of jaw-dropping financial scandals. Is there by any chance a connection?
Posted by Mike D at 5:33 pm