Belfast Telegraph

Thursday 30 October 2014

Councils slammed over bill payments

Councils have come under fire for failing to pay bills in a timely manner

Councils in Northern Ireland are the worst public bodies for paying bills on time, auditors have found.

Even though the 26 local authorities spent more than £800 million last year, they settled just 37% of their bills within 10 days.

A new Audit Office report, which also raised questions about the management of capital projects and poor procurement practices, said last year Newry and Mourne, Ballymoney and Craigavon Councils paid the fewest number of of invoices promptly.

Louise Mason, the chief local government auditor, said: "Whilst prompt payment performance has improved significantly, performance still falls well behind other sectors."

In 2012-13 councils processed over 295,000 invoices to suppliers - 81% of which were paid within 30 days. This failed to meet targets set by the Stormont Finance Minister; does not compare well with central government bodies where almost all, 97%, of bills were paid within 10 days, and lags well behind the health and social care trusts and education and library boards.

Ms Mason added: "Better performance in this area has the potential to significantly improve cash flow for local firms providing services to councils."

Councils employ 9,700 staff and utilise assets worth more than £2,000 million. They have a key role to play in providing public leisure, recreation and environmental services to local communities and also have responsibility for regulatory activities such as building control and environmental health.

Their total capital expenditure during the 2011-12 financial year amounted to more than £91 million but some councils failed to manage projects properly resulting in soaring costs.

Auditors raised a £9.2 million refurbishment of Greenvale Leisure Centre in Magherafelt as causing significant concern.

L ast-minute changes including the provision of a 50 metre swimming pool, alterations to changing facilities and the addition of two biomass boilers saw the original contract price of £4.1 million jump by 125%, which did not represent value for money for ratepayers.

Ms Mason said: " Such changes would suggest that there were weaknesses in the original scoping and business case of the project.

"I found a lack of evidence that the procurement exercise was undertaken competitively and with independence. I also found that whilst two boilers were purchased and installed, it is economically advantageous for the council to operate only one boiler."

The report also noted several instances of poor procurement practises and drew attention to one unidentified council which spent £600,000 procuring leisure equipment even though it did not have a contract with a private company to provide the gear.

Ms Mason added: "In several instances, councils have identified that a lack of procurement expertise or weaknesses within their procurement processes represent significant risks that will have to be addressed."

Councils are independent of central government and are accountable to their local electorate and ratepayers. All have the same basic legislative powers although each council has the discretion to place a different emphasis on the services delivered.

The auditor said it was important to ensure anti-fraud and corruption policies were embedded as part of a council's culture and said staff should receive additional training to raise awareness.

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