External auditors call on council mired in employment tribunal claims to commission report by independent monitoring officer

The external auditors to Thanet Council have urged the local authority in a report issued under Section 24 of the Local Audit and Accountability Act 2014 and identifying "key deficiencies" in governance processes to bring in an independent monitoring officer to carry out a risk assessment of the employment tribunal claims it faces and draw up an action plan.

The section 24 report from Grant Thornton followed a request from the council for a review of governance to be undertaken and a private letter that the auditing firm wrote to the authority’s Governance and Audit Committee in July 2021.

The external auditors’ first recommendation is that the council commission "an experienced, independent monitoring officer from a large local authority" to report to Thanet’s General Purposes Committee on:

  • a risk assessment of the current employment tribunal claims and propose actions which safeguard the council’s best interests including a detailed financial analysis of the options available to the council;
  • an assessment of the status of all outstanding grievances, alleged whistleblowing complaints and any continuing suspensions and propose a plan of action to address them;
  • a lessons learnt collating themes and recommendations from all externally commission reports and any other appropriate evidence.

The due date for this work is November 2021.

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Grant Thornton has also recommended that the council:

  • bring the current General Purposes Investigations and Disciplinary Sub-Committee (IDSC) process to a conclusion with clear actions that are reported and action monitored;
  • revisit the financial plans and identify additional savings plans to address the further cost pressures created in resolving the grievances and whistleblowing complaints;
  • agree an approach where the council demonstrates that it is responding to the substance of concerns raised including a clear agreement on where officer and member responsibilities lie.

The recommendations and subsequent actions will be discussed at an extraordinary Council meeting which must be held in public within the next month.

Grant Thornton said they had concluded that it was appropriate for them to use their powers to make written recommendations under section 24 of the 2014 Act, “due to inadequate arrangements in governance in responding to whistleblowing, grievances and disciplinary procedures with the direct financial costs adding further pressure to a fragile financial position”.

The background is that throughout 2019 and 2020, a series of interlinked complaints and grievances were raised which included a number of officers and the four Senior Officers of the Corporate Management Team (the three senior statutory officers and the Corporate Director – Communities).

Grant Thornton said its findings to date included that there had been a serious breakdown in relationships between the four senior officers from 2019 to the present. There were a number of interlinked instances of whistleblowing, lodging of formal grievances and disciplinary action “including examples of serious allegations made by Senior Officers without adequate, or in some cases any, supporting evidence”, it said, while there were also missed opportunities to de-escalate, mediate or moderate the situation.

The key deficiencies in the council’s governance processes are said to include:

  • Failure to adopt promptly the governance principles by the Joint Negotiating Committee for Chief Officers of Local Authorities (issued in 2015 and adopted in 2020);
  • Failure to manage whistleblowing cases, grievances and disciplinary cases and their outcomes promptly and systematically;
  • Failure to follow through with agreed outcomes or to deliver definitive resolution by the General Purposes Committee;
  • Failure to identify and mitigate perceived and actual conflicts of interest in the choice of senior manager responsible for investigating and deciding the outcome which has allowed the subject of complaints to influence the governance process;
  • Failure to involve elected members at an appropriate stage;
  • Failure to establish clarity and recognise statutory responsibilities in relation to whistleblowing.

Grant Thornton said that in compiling its report it had considered eight separate reports by six external independent reviewers over the past two and a half years.

These reports – and their use and handling by the council – showed themes in common including independent reviewers identifying at least two separate cases where they considered there to be clear evidence of bullying, but the council only taking disciplinary action on appeal following a third independent review.

Individuals who raised grievances and whistleblowing complaints that Grant Thornton considered to have merit, were subject to disciplinary action prior to the substance of their complaints being formally considered.

Senior officers’ behaviour was found to have fallen below the standard expected on a number of occasions, Grant Thornton also found.

The professional advice that Thanet commissioned – including legal advice – had in some instances been “interpreted selectively, ignored, discredited or restricted in its circulation to members”.

In a number of instances senior officers had failed to adhere to the council’s policies and procedures for dealing with grievances and staff performance issues.

Grant Thornton identified a number of consequences for the council including:

  • A direct financial cost of external legal advisers of £700,000 had been accounted for in the council’s draft 2020/21 financial statements “together with the need for retrospective budget approval for a significant unbudgeted cost”.
  • Significant time and effort from the senior officers, other members of the Corporate Management Team and elected members had been diverted to deal with the matters.
  • The council’s duty of care to officers had been compromised due to the length of time individuals had had to suffer significant reputation damage without resolution.

Responding to Grant Thornton's report, the Leader of Thanet District Council, Cllr Ash Ashbee said: “I have been clear that a key ambition of my leadership and administration is to improve governance, so I welcome the recommendations shared with the council.

“Good governance is the cornerstone of good local government and it is essential that we do everything we can to improve the way we work. It is absolutely right that members will have the chance to discuss the recommendations, to participate in the process and ensure we commit to a robust plan of action.”

Last month Cllr Ashbee took the rare step of asking the Government to intervene to resolve its governance problems.

However, the council’s senior management team said they had not seen her letter to the since-renamed Ministry of Housing, Communities and Local Government (MHCLG).

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