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Investigation into Plas Madoc Communities First uncovers serious failings
17/03/2010
Joint Wales Audit Office and Assembly Government audit review published
The Auditor General has today reported on the results of an audit investigation, which found a fundamental lack of financial control and governance at Plas Madoc Communities First, near Wrexham. The report also considers the remedial action taken to safeguard the assets within Plas Madoc, and the actions being taken by the Assembly Government to ensure that the failings at Plas Madoc do not happen again.
The Auditor General's report, along with the Welsh Assembly Government's Internal Audit Services report, can be found on the WAO website www.wao.gov.uk. The matters raised in the internal audit report have now been referred to North Wales Police.
The report concludes that fundamental failings permeated the whole of the operations of the partnership and suggests that those charged with responsibility for governance had little regard to recognised standards in public life or the need to achieve value for money from public funds.
Plas Madoc Communities First receives over £500,000 per year, most of its £735,000 annual funding, from the Assembly Government via its Communities First Programme. It also receives grant funding from other sources, including The Big Lottery Fund, the Arts Council of Wales and Wrexham County Borough Council.
A third party raised concerns about the governance of Plas Madoc to the (then) Auditor General for Wales in May 2009. Given the nature and severity of the allegations made, a joint investigation was launched between the Wales Audit Office and the Internal Audit Service of the Assembly Government. An interim audit report was produced in November 2009, which identified fundamental failures in financial control and governance. The Assembly Government then took swift action to address the issues raised. Subsequently, two members of staff at Plas Madoc Communities First were suspended.
Today's report by the Auditor General sets out the findings from the internal audit report and examines how the Welsh Assembly Government responded to the concerns raised. It details the steps now being taking to minimise the risk of serious problems at Plas Madoc, which had not been addressed for a number of years, being repeated, and remaining undetected, at other Communities First Partnerships.
Auditor General for Wales, Gillian Body, said today:
"While this report highlights serious failings at Plas Madoc, it is encouraging to see that the Assembly Government is learning the lessons and is taking measures to tighten up the monitoring of Communities First partnerships across Wales. The Assembly Government should implement these measures swiftly to ensure that the events we have witnessed at Plas Madoc are not repeated."
Notes to editors:
- Plas Madoc is a housing estate located seven miles south west of Wrexham that is home to approximately 1,800 people.
- The estate is served by Plas Madoc Communities First, a company limited by guarantee and a registered charity. It was created in 2003 and took over responsibility for delivering Communities First from a partnership that had been estabilished and led by Wrexham Maelor County Borough Council.
- It employs 21 members of staff, but it also receives support from volunteers and from voluntary and not for profit organisations.
- The Wales Audit Office is independent of government and is responsible for the annual audit of some £20 billion of annual public expenditure. Its mission is to promote improvement, so that people in Wales benefit from accountable, well-managed public services that offer the best possible value for money. It is also committed to identify and spreading good practice across the Welsh public sector.