Newham LBC’s mayor has launched a scathing attack on her predecessor’s administration for failing to act on “culture of system weaknesses” at the council, after evidence emerged of financial malpractice within its repairs and maintenance service (RMS).
Rokhsana Fiaz, who was elected mayor in May last year after defeating incumbent Sir Robin Wales in the contest to become Labour’s candidate, said: “What my administration inherited regarding RMS was staggering incompetency at the highest level and frankly, a shambles.”
In a statement Ms Fiaz said she was shocked when she became aware of financial mismanagement and “astonishing failures of system controls” within the RMS in March last year when, as a councillor, she was a member of the council’s audit board.
Ms Fiaz said she raised concerns that the audit board had not been made aware sooner of “revelations” about the RMS made by whistleblowers in 2017, adding the previous administration under Sir Robin had decided not to inform members.
Ms Fiaz added that “the scale of mismanagement in RMS was a clear sign that the mess could only be sorted out under a new administration”.
The information provided to the board was not made public at the time due to “ongoing investigations”, but the mayor said she was consulting legal officers on what material can be placed the public domain, pending approval from the audit board.
Measures to “enhance openness and transparency in decision-making and good governance” and improve the management of the service had since been introduced, Ms Fiaz added.
She said “serious questions about how the RMS situation was allowed to happen in the first place need to be answered” and the Chartered Institute of Public Finance & Accountancy had “identified similar concerns” after assessing the council’s finances. Cipfa had now been asked to complete a ”complete financial health check” on Newham.
Ms Fiaz added: “What is clear is this: there is a culture of system weaknesses and my administration is getting to grips with it.
“I have already started the process by calling for further inquiries to be undertaken by the council’s audit board and scrutiny committee into the council’s flawed investment into the London Stadium.
“I have already changed what is known as the ‘scheme of delegation’ which means the decision-making power in Newham that was held by the directly elected executive mayor – in other words me – is now shared with all members of my cabinet.”
Ms Fiaz said data on the council’s performance would be made available to the public and promised a “major announcement” soon on further action in response to the problems within the RMS and “other matters relating to financial good practice at the council”.
She added: “It is clear to me that a much broader review is required into the culture and practices within the council that have developed over the past two decades, because these have enabled a particular type of flawed decision-making process.
“As illustrated by the flawed investment into the London Stadium made under the previous mayor, such decision-making processes also highlight significant governance failings. Sadly, RMS is the latest example of another governance failing of the previous administration to emerge.”
Newham announced last month that Katherine Kerswell, brought in by Ms Fiaz as interim chief executive last August, would have her contract extended by an additional six months.