In a report by the Wirral Council audit commission published 8 June 2012 – “Highways and engineering services contract award and management” – district auditor Mike Thomas called for improvements in the council's internal audit procedures, which he said had placed it at increased risk.
The report relates to a multi-million pound contract awarded to transport infrastructure business Colas in a competitive tender in 2008. David Green, the council's director of technical services, met a representative from the winning bidder during the pre-tender process – and failed to declare a personal relationship with them until after the contract had been awarded. Green was suspended in March pending an independent investigation.
"The invitation to tender specifically prohibits any ‘canvassing’ on the part of tenderers," Thomas wrote. "Meeting with one potential bidder and no other during the pre-tender period to discuss contract arrangements is also likely to have placed the council in breach of the general EU treaty principles of fairness and equal treatment which are applicable to procurement."
The report identified a number of weaknesses in the council's approach to governance and criticised its internal audit team, which awarded the contract a three-star (good) level of assurance in February 2010 despite identifying a number of high-priority risks. It then confirmed this rating in August that year even though only one of its four main recommendations had been implemented. "The conclusions drawn by internal audit are not, in my view, supported by their findings," Thomas wrote, adding that concerns remained over aspects of its compliance with Chartered Institute of Public Finance and Accountancy standards.
Responding to the report, Wirral Council's leader Phil Davies said: “This is a highly critical report – with familiar themes – that identifies many of the same governance issues as other critical reports we have received. As a council we must now ensure what is wrong is put right – the people of Wirral deserve no less."
To download a copy of the report, click here