Sunday 15 March 2009

What did he know, and when did he know it?

As the Icelandic scandal begins to unravel, the spotlight now falls on council leader Mike Freer and his colleagues on the Cabinet Resources Committee.

After months of lies, the council finally admitted last week to knowingly breaking its own investment rules. With £27.4 million (plus interest) at risk this is not a mere technicality.

Mike Freer says that officers repeatedly told him verbally and in writing that the investments were in line with official policy. But when did he ask them for confirmation? Was it only after the Iceland banking collapse?

Did he ever ask any such questions previously? It seems not.

Cllr Freer told the Cabinet Overview & Scrutiny Committee last November that he had no recollection of discussing the council’s investments with officers until news about Iceland broke. But the Council’s Constitution (Financial Regulations, Part 1 Section 7) states:
  • Cabinet Resources Committee will create and maintain a Treasury Management Policy Statement…
  • Cabinet Resources Committee will receive reports on its treasury management policies, practices and activities…
In other words, the Cabinet Resources Committee is supposed to create the policy and then monitor the investments.

If Cllr Freer genuinely didn’t know about the council’s investments, this suggests that the Cabinet Resources Committee failed to do the job for which its Members were handsomely paid. Did they not bother reading the reports given to them? Or were they content chasing higher interest rates whilst turning a blind eye?

Mike Freer now claims that he was misled. This is a very serious accusation and, if true, then arguably the officers involved should face criminal investigation. Presumably, Cllr Freer can produce the written statements he refers to above as proof.

But Cllr Duncan Macdonald states on his blog:
"On the 28th October last year a report was produced called ‘Council deposits in Icelandic banks – Supplementary report’. The report was a report of the Leader and Cabinet member for resources who is of course Mike Freer. The report is exempt which means that I cannot tell you what is in it. However I can tell you that it was the information contained in this report that alerted the working party on Icelandic banks that the treasury team had not followed their own strategy."
So, according to Cllr Macdonald, who sits on the scrutiny committee investigating the Icelandic investments, Mike Freer had sufficient information before him last October to know that the council was not following its own rules. But for months he has been telling us something quite different.

The public are entitled to know whether they have been misled by Cllr Freer as to what he knew and when he knew it, or whether he and the Cabinet Resources Committee simply failed to bother doing their job properly.


Anonymous said...

I genuinely feel concerned and annoyed on behalf of the members of the Cabinet Resources Committee. Any investigation is sure to point fingers at this Committee and the way they monitored (or failed to monitor) the operation of the policy.

The information that has been dribbling out seems to show the Chairman took 'laissez faire' to a new height in relating to the Officers, from Nick Walkley downwards. That has surely shaken CRC members' faith in the Chairman to the core, but I expect they will show the loyalty they have done so far and 'stand by their (chair)man'.

How long this will continue and the crosshairs start to focus on each of their role is a matter for speculation.

Rog T said...

It seems that there are two byelections coming up. If I were the Lib Dem's I'd go hell for leather in these wards suggesting a protest vote against the Freer regime. As this won't affect the control of the council but would scare the life out of the Tory group, it would be a great way to actually get some sense ito Barnet politics.

I don't think that any fair minded, rational individual who has followed Barnet Politics over the last few years would say that based o the performance of the Lib Dem councillors, another couple of them before the next council elections would be a bad thing.

There are times when a protest vote is appropriate and this is one of those times.