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LDA staff competed to spend taxpayers' money, Mayor's audit reveals
Katharine Barney, Evening Standard27.06.08
Staff at the London Development Agency competed with each other to spend taxpayers' money, it was revealed today.
The leader of the Mayor's forensic audit panel, set up to investigate financial irregularities at the agency, told of a catalogue of bad practices.
Former Sunday Telegraph editor Patience Wheatcroft praised the Evening Standard for "lifting the lid" on allegations of misspending at the agency involving projects linked to Ken Livingstone's race adviser, Lee Jasper.
She said that until recently no project to which less than £6 million was granted came before board members.
The panel also found that some of the former mayor's advisers told staff at the agency about projects they wanted funded in an "enthusiastic manner".
Ms Wheatcroft told the London Assembly's budget committee: "I don't believe that governance at the LDA was of the highest quality. The culture of spending was endemic there.
"There is an impetus to get the money spent by the end of the year. At the LDA they took it to extremes.
"I am told teams competed to be the ones that did not underspend and in order to do that there seems to have been a determination to actually find projects to back and the monitoring was not as regular as one might have expected. It doesn't seem to have been measured until all the money had been handed over. Very little actually came to the attention of the board.
"The board was not concerned with the plethora of the relatively small and when I say small I mean under £6million. I was very surprised when I heard that."
When asked whether mayoral advisers had used bullying or arm-twisting to push funding through, she said that messages had been expressed " enthusiastically", according to emails the panel had seen.
Ms Wheatcroft said: "The mayoral advisers were very keen for certain projects to get the money they wanted them to get and left those at the LDA in no doubt about that."
She said the panel also found there had been overspending at the Greater London Authority on consultancy work as well as on the Caribbean Showcase festival, which she said was founded on "a whim". Ms Wheatcroft, a former financial journalist, dismissed an Audit Commission report last year which gave the LDA a clean bill of health, saying it had merely been a paper exercise.
But her panel came under fire over its make-up - it includes two Conservative council leaders and Boris Johnson's business adviser.
John Biggs, deputy leader of the Labour group, said: "Far from being authoritative, independent or objective, Patience Wheatcroft's 'audit panel' is merely a hand-picked group of Conservative politicians and supporters."
Ms Wheatcroft said all the panel members were working to establish a way of providing better value for money for Londoners.
The panel, which has already produced an interim report, is due to publish its findings by 16 July.
Five projects funded by the LDA are being investigated by police. Mr Jasper, who resigned in March, has denied any impropriety.
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Reader views (6)
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IT looks like this inquiry will make the original "gerrymandering" trials in New York seem quite mild. Perhaps we will have a new term, "Kennymandering"?
- Jonathan Montmorency, Cooden, UK
Why should John Biggs mention the misuse of public funds? It was his party that perpetuated it. The old adage, it never hurts when you are spending someone else's money.
- V Tan, London
This search and destroy mission should be extend to the national government and MEP's, with suspension without pay and benefits for all over the last 7 years, at least.
- Peter Renton, UK
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