Family affairs and chocolate teapots

This week's meeting of Carmarthenshire County Council was notable for several interesting revelations. We learned, for example, about the extent of political cooperation between Labour and the Independents as they stitched up a deal to ensure that control of the council would remain in the same hands whatever the outcome of the elections in May. We learned a little more about the financial arrangements between the Council and Scarlets, and we learned that the Council does not normally carry out due diligence on the financial affairs of the organisations to which it gives large amounts of money.

The last point came up in a discussion about social care, a discussion which highlighted once again the Tweedle Dee-Tweedle Dum relationship between the Independents and the Labour leadership. The Independents believe strongly in outsourcing social care, and make no bones about it. Politically this is tricky territory for Labour, so although some backbench Labour councillors are clearly worried about it, the leadership sits quietly while Meryl Gravell, Pam Palmer, Mair Stephens, Jane Tremlett et al make all the noise in the knowledge that if any of this came to a vote, the whips would ensure that Labour and the Independents stand shoulder to shoulder.

In that way, Labour can support Big Society outsourcing without antagonising the unions and its grassroots supporters.

During the course of this discussion allegations were made about the management of one "third sector" organisation in Llanelli, where the charity's chief executive is apparently being paid £57,500 a year and, it is alleged, various family members make up part of the rest of the payroll.

No names were mentioned, but typically "third sector" organisations like this receive funding from three main sources: the Welsh Government, the Lottery and the County Council. Over the years, this funding amounts to very large sums of money.

The Chief Executive told councillors that the Council was interested principally in the quality of service being delivered by such organisations, and that it "normally" left due diligence to the government, and presumably the Lottery (although he did not say that).

As we know now after the scandals involving, for example, Awema and Plas Madoc Communities First in Wrexham, doling out public money with your eyes closed in the assumption that somebody else is doing the checks is not necessarily fool-proof.

One of the things which both Plas Madoc and Awema had in common was the involvement of families in their operations, and in the case of Awema at least there were clear warnings that all was not well long before the brown stuff hit the fan.

So why do public bodies ignore warning signs in cases like these? Incompetence probably has a role to play, but councils and governments often invest more than money in these ventures. We are talking about political capital. 

If you have a close relationship with an organisation, have championed and defended it and been photographed and filmed shaking hands and cutting ribbons, admitting that you were wrong can be very difficult.

And here we come to one of the weaknesses of the cabinet system in local government, where political bigwigs tend to stay around for a very long time. They appoint the senior officers, ensure that they are paid very handsomely and nominate them for CBEs, OBEs and all the rest of the fairytale nonsense. Over time, the senior political and professional upper echelons of councils can become joined at the hip with a single agenda where failure and admitting mistakes are not an option, and the politicians and senior officers look out for each other.

The organisation referred to in Wednesday's debate is not the only third sector organisation in Carmarthenshire to have been given the enthusiastic backing of the council's top brass and lots and lots of public money. It is also not the only organisation involving families and husband and wife teams.

As with Awema, there have also been plenty of warning signs, including major discrepancies between what the the council says on the one hand, and the third sector organisations say on the other.

So if the Council is unwilling or unable to lift up the stone, who will?

Step forward the Wales Audit Office, but then they don't seem very keen to peer under stones either.

When a member of the public raised concerns about one of the council's schemes and pointed out the discrepancies between what was being said by the council and the recipient of large amounts of public money, the WAO did what it always seems to do. It nipped down the road and asked the council officers if everything was OK. You can guess what the answer was.

As for the discrepancies, the WAO's position seems to be that the council's version is the only one which counts. Others simply don't exist, so there is no discrepancy. 

The WAO has also repeatedly made it clear that it is not interested in what councils spend their money on. The only thing which matters, it says, is whether all of the right boxes were ticked along the way and the most efficient path was taken, even if the destination involved jumping off a cliff.

So if the council decided to replace metal teapots in its canteens with chocolate ones, the WAO would only be interested in making sure that the tendering process was correctly followed and the decision had been taken with the correct authorisation.

Having said that, the only course of action for any councillors worried about council funding of third sector organisations is to go to the WAO and try to insist that, rather than the usual cosy chat with officers in County Hall, the auditors go and take a long, hard look at the recipients of the money.

In one case that springs to mind, that may not be easy because the organisation has successfully ensured that its finances are completely and legally closed to all public scrutiny.