Did those millions drop down the pothole? Council doesn't know how much taxpayers' money has been wasted

Major weaknesses have been exposed on the performance of huge contracts awarded to private companies by West Sussex County Council.

‘Systematic failures’ were identified in the way a £60 million highways maintenance contract awarded to Balfour Beatty Living Places was managed.

Details were revealed of inappropriate gifts and hospitality and a failure to declare a conflict of interest in relation to the highways contract - though the council insisted there was no impropiety. 

Auditors were unable to say whether £20 million of work had ensured value for money or was compliant with contractual terms.

Meanwhile, the value for money of oursourcing giant Capita’s £154 million contract to provide back office services was also called into question by the report.

A number of areas of Capita’s payroll services were described as “poor”, with ineffective recovery of a large number of overpayments and weak checks.

At a meeting this week the councillor in charge of finance Michael Brown admitted he did not know how much was overpaid on inefficient contracts.

The report found there was a “complete breakdown” in financial processes with “no visibility” as to how risk was managed.

The damning revelations call into question the Conservative-run local authority’s agenda as a commissioning authority.

The council said it was “disappointed” with the findings – but denied any fraud had taken place.

Labour councillors accused the council of being “obsessed” with outsourcing and private contractors of “over-promising and under-delivering”.

The findings were contained in a summary of Internal Audit activity for 2014/15.

West Sussex County Council refused to release the full report when asked to by The Argus yesterday.

Council leader Louise Goldsmith, left, and finance chief Michael Brown Council leader Louise Goldsmith, left, and finance chief Michael Brown

Councillor Michael Jones, a member of the regulation, audit and accounts committee, said: “I have never seen as bad a report as this on the council’s internal performance. This highlights the significant shortcomings in commissioning at this council.

“It calls into question the ability of the council to provide services efficiently through its obsession with the blunt tool of outsourcing, especially to profit-driven companies such as Capita.

“How have outsource companies been allowed to win contracts, then over-promise and under-deliver to such an unacceptable extent?”

A spokesman for West Sussex County Council said: “We have well documented and tried and tested systems of internal control in place but we regularly review their effectiveness.

“We are very disappointed that this year we have found that those systems are not working as effectively as we want and need them to in some areas. None of the audits have found evidence of fraud, but doubtless we can do more to ensure that our systems work better.”