Report finds no evidence of fraudulent activity by councillors involved in Northamptonshire County Council's limited company

An investigation into the activities of a limited company owned by Northamptonshire County Council has found no evidence of fraud.

Wednesday, 27th March 2019, 6:16 pm
Updated Wednesday, 27th March 2019, 6:21 pm
NEA Properties was disbanded in 2017 after running for more than three decades.

The county council commissioned the report into NEA Properties in September after questions were asked about the spending of the company and auditors raised concerns about why the company had not been audited for more than two decades.

A 10-page report today (March 27) by Nick Graham, the monitoring officer at Oxfordshire County Council, has found that the company, which was founded in 1983, was run correctly and there was no evidence of impropriety.

It said: “There is certainly no evidence of any fraudulent activity on the part of officers or members in relation to the activities of NEA Properties, the NEP or Explore Communications Limited.”

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The report principally looked at the relationship between NEA Properties, the county council and Northamptonshire Enterprise Partnerships.

Mr Graham interviewed county councillors Andre Gonzalez de Savage and Bill Parker who were directors of NEA Properties for a number of years until it closed down in 2017.

A former chairman of NEP, John Markham, and NCC officers Laurie Gould, Julia Tomlinson and Quentin Baker were also interviewed.

The report concluded that there was a detailed service level agreement between the council and the limited company and that ‘ there is evidence of proper consideration of applications for grant funding to NEA Properties by various bodies and it is clear that proper monitoring and audit was undertaken in relation to that expenditure by following up with the recipients and accounting for how this money was expended.’

The issue of an £80,000 grant to Northampton Saints Rugby Club ‘accorded with the stated aims and objectives of NEA Properties.’

NEA properties had received £820,000 in September 2014 from the sale of buildings it owned to the University of Northampton and had used some of the proceeds in the form of a grant to the rugby club.

The report said: As a “reciprocal goodwill gesture” Northamptonshire Saints offered private use of a 16-person executive box in one of the stands for all home games; pitch-side advertising; hospitality, including complimentary meals and drinks, for a party of 10 for 2 of the matches. This arrangement was to include a two-year term commencing on August 1, 2015.”

The investigating officer found no evidence of declarations of gifts or hospitality received by councillors who had visited the club ‘which should have been in place’.

Mr Graham said he could find no spend in relation to a B17 Bomber flypast in Grafton Underwood in May 2015.

He said: “However, it seems to me given the historical information I read and the purposes for which that event was arranged, it seems to entirely accord with the aims and objectives of NEP and the funding that was available through NEA Properties. Again, there simply no evidence that this was an inappropriate use of funding for such an event.

“I am therefore unable to say with any certainty that there has been a breach of code of conduct in that limited area.”

The investigator was also satisfied that the money spent by Northamptonshire Enterprise Partnership’s partner company Explore Communications, whose directors were Andre Gonzalez de Savage and Rob Purdie, was used appropriately and to promote Northamptonshire’s tourism industry.

Mr Graham did say his findings were based on limited information.

“I would emphasise that I have had to base my conclusions on the limited information that is available. That may be in part because of some uncertainty regarding the record keeping, or indeed just simply given the passage of time that information is no longer available.”

A spokesman for Northamptonshire County Council said: “We have received the final report of this investigation, which has exonerated councillors and officers from any fraudulent activity in connection with the operation of NEA Properties.

“The report further concluded that councillors made the required declarations of interest and took extensive and appropriate financial and legal advice in making their decisions.

“We have already taken steps to strengthen governance processes and accept the findings in full.”

Cllr Gareth Eales, who pushed for the investigation, said: “As the original complainant I was eager to read the report, which is a bit lacking in new information. What is unquestionable is that spending public money on these lavish items like Saints hospitality when the council was on the brink of bankruptcy is wholly inappropriate.”