Council 'too busy' to cash €1m in cheques
Meath County Council admits 'internal controls' failed after withering report on the handling of planning contributions
Published 07/02/2010 | 05:00
Internal controls and processes failed at Meath County Council, its top official has admitted, after builders' cheques totalling more than €1m lodged to cover planning fees and contributions were left uncashed.
Some of the cheques went uncashed for so long that they went out of date, prompting the local authority to appoint consultants Mazars to carry out an investigation to find out what went wrong.
Almost all the money has since been recovered, except for just over €44,000 in the form of bounced cheques which is still being actively pursued. Last week, Meath County Manager Tom Dowling gave his response to the Mazars probe at a meeting of the county council.
He admitted there were shortcomings but stressed that the investigation had found no evidence of wrongdoing in the council's planning department.
Two weeks ago the Sunday Independent published details of the Mazars report findings. The report described a regime of inadequate documentation, "lax" collection systems and deficiencies in internal controls and processes.
The report also criticised the system where individual staff members were able to agree changes to existing payment schedules with developers without any other member of staff being involved, or "signing off" on these revised arrangements.
More than €50,000 worth of cheques were found lying in a drawer by a staff member in the council offices -- a month after the issue had been raised publicly.
In his review of the report, the county manager said Mazars had concluded that there were eight developments where cheques remained on hand totalling €1,040,301.
"In relation to seven developments totalling €1,037,029, the report concurs with the Planning Department's formal response and that there were adequate explanations for the cheques on file.
"In relation to the remaining development with cheques totalling €3,272, the formal response inadvertently described the cheques as post- dated," he said.
"This was clarified publicly the following day. The report says it is not practicable to determine if any party other than the developer benefited from the above," Mr Dowling said. He added: "The report says there is no evidence that cheques have systematically remained uncashed for a considerable period of time."
Mr Dowling told councillors that the report had concluded that there is a need to improve the internal controls surrounding the receipting and collection of planning contributions. This is to ensure the accurate quantification and pursuit of outstanding balances.
He said that, as a result of the report, strict controls have been implemented reconciling all payments received on a daily basis.
"Staff compliments have been strengthened to ensure structured division of responsibilities and controls, and staff have been appraised of the absolute requirement for best practice in documenting financial transactions so as to provide a clear and transparent audit trail," he said.
In a strong defence of the council's planning department, Mr Dowling added: "It is clear to me, in summary, therefore that no evidence of wrongdoing took place in the Planning Department of Meath County Council in relation to planning contributions and fees. I'm not surprised at that. Improvements in internal controls were identified and have been implemented."
He added that the shortcomings, in relation to the cheques, had to be taken in the context of the massive workload which the planning department had undertaken in the last few years, including the assessment of over 12,500 planning applications (with a total fee income of over €10m) plus appeals, additional information and enforcement.
He added the local authority had processed in excess of €120m in development levies in the last five years.
Following the county manager's report, Cllr Sirena Campbell, who first raised the issue late last year, said she welcomed the report.
She commended the manager for taking the initiative in following through on her questions about the matter in detail.
While she did have concerns, a lot of these had been addressed, she said.
Cllr Campbell said that it was wrong to state that she had ever impugned the reputation of any council staff member.
She said she had simply asked a question, adding that the report had clearly stated that there was a need for improvement.
Having cheques on file without being cashed had disturbed her, she said.
"I do think that it is a terrible indictment of what happened, but I welcome the report and welcome the fact that the manager said he will continue to review the situation. It should never have happened in the first place," Cllr Campbell said.