Mayor 'misleading public' over report on City Hall scandal

The London Development Agency inquiry was launched following the Evening Standard's revelations that 12 projects linked to Mr Jasper, his friends or business associates have received at least £2.8million from City Hall, yet appear to have done little or nothing with the money.

The inquiry's findings will be presented to the LDA board tomorrow.

At his press conference this week the Mayor described tomorrow's document as a "report of the outside auditors, not internal LDA employed auditors". He said: "Without giving anything away, I look forward to an apology."

But LDA spokesman Rob Beasley confirmed today that the report was an "internal review" led by one of the agency's officials and conducted by its staff. The agency also refused to describe it as an "audit", and said the inquiry's main work had been examining project files to determine whether "LDA procedures prevailing at the time [were] followed effectively".

The agency refused to say whether the suspect projects had been audited as part of the review, or whether anyone from the review visited the projects, or whether any suspect grant recipients had been interviewed. It also refused to say how many staff had worked on the review. It said its "contracted internal auditor," accountancy firm Deloitte, had "assisted" by "helping to review the project files," but did not say what the "assistance" was.

Richard Barnes, Conservative leader on the London Assembly, said: "The Mayor has been misleading the public. He is trying to claim it is an independent audit when it is neither independent nor an audit. He will no doubt use it to declare that all is well. But the LDA investigating itself and finding itself innocent is simply a whitewash."

The Standard has also learned that at least four of the 12 projects it investigated will not be covered in the review, either because they were funded directly by the Mayor's office or have been reported to police.

The four excluded projects are the Black Londoners' Forum, 1990 Trust, National Assembly Against Racism, and South London Green Badge Taxi School, which together received at least £944,000 of City Hall funding.

LDA board members will not see the report until 8am tomorrow, an hour before they meet. The meeting will be the first for more than two years to be held entirely in secret. One board member said: "I fear they want to bounce us and not give us enough time to decide whether the report is a proper job or not."

The Mayor and Mr Jasper, his policy director for equalities and policing, deny any wrongdoing.