Allegations of corruption published in a whistleblowing document distributed last year against senior officers in Merton Council should not be fully investigated because of the cost, according to auditors.
Opposition councillors have reacted angrily to the revelation, made in a full council meeting on Wednesday, branding it 'unacceptable' and calling for changes in the way consultants are hired.
Just a couple of hours before the evening council meeting was due to start, party leaders in Merton Council received an email from auditors with an update on their findings.
The so-called interim report came after a whistleblowing dossier, purported to be from anonymous council officers, alleged malpractice, corruption and unlawfulness in relation to the procurement of a number of consultants.
The whistleblowers claimed the council’s chief executive Ged Curran and elected members were deliberately misled by a senior officer they accuse of unlawfully making payments of £1.29m of taxpayers’ money.
The payments were alleged to be to temporary consultants, when posts could have been filled by permanent staff.
The full independent report into the claims is not due for another few weeks, but the email from auditors Ernst & Young LLP on Wednesday, February 5, stated that the company has 'not identified evidence of corruption, malpractice or unlawful expenditure.
It stated: "Our work, however, has not involved a forensic analysis of the email accounts and electronic data held by the individuals on laptops ... or bank accounts of the named individuals."
It goes on to say that the work would be appropriate where there are concerns about illicit payments, but given that the rates paid to individuals do not appear to be materially different from the market rates for such services, any potential financial benefit derived is relatively modest.
The email said: "Unless new evidence is brought to its attention, the cost of undertaking further investigative work would be disproportionate to the risk of such payments having been made or received."
Speaking at the council meeting in Morden, Conservative Hillside ward councillor David Williams said: "People expect us to be a responsible council.
"It is not about watching the back of the Labour party because they have lost the plot."
In reply, Labour councillor Mark Allison said: "This has lead to a cloud hanging over a number of people including some very important and hard working staff.
"No doubt they will find some things that we as an organisation can do better."
Council leader Stephen Alambritis said at the meeting they would abide by and respect the whistleblowing policy, and people were innocent until proven guilty.
The final report will be discussed at the council’s general purposes committee on Wednesday, March 12.
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