'The Genesis project started life as a Millennium Commission Bid in October 1996 - a bid that subsequently failed. The objective was to deliver learning, community services and e-commerce through a proposed network of IT centres across the County. Funding of£4m was secured under the Governments Capital Challenge Programme.
Unfortunately, when the project was set up by the previous council in 2000 they failed to establish effective budgetary arrangements, and there was no adequate monitoring and control system put in place. Out of the blue, we have now been advised that our officers did not withdraw from management of the project and that the spending limits authorised by the last council have been exceeded by them, unknown to councillors.
We again feel let down, not least by the fact that our officers failed to keep us informed of a developing problem. The chief executive has now launched a formal inquiry and a disciplinary investigation is underway. This information has come hard on the heels of the advice, which we received from officers, that there are some serious financial weaknesses in the council.
'When I reported this to the public a short while ago, I made the point that there may be other hidden problems, which we have instructed our Officers to identify and deal with. This is part of that process. The inquiry launched by the chief executive is another aspect of our drive to deal with the problem. Further and more detailed information will be brought to the cabinet when we have the result of the inquiries from the chief executive.
We are determined to improve the financial performance of this council and we are continuing to tackle the very serious problems that have been passed over to us. We are putting forward proposals to maintain the project in co-operation with our partners, but we are not prepared to invest any new money. We are trying to develop a solution which will enable the project to survive whilst minimising and eventually eliminating the councils' losses.'
In view of the ongoing disciplinary investigations and ongoing consideration of the financial aspects of this issue, which remain commercially sensitive, it is not possible to issue further information at this time.