Council apology for governance and scrutiny failures
An independent review of Guildford Borough Council's housing department raised concerns about unnecessary work being ordered and contract overspends of millions of pounds.
The review by the Society of Local Authority Chief Executives (Solace) was commissioned after potential fraud was discovered in the council's housing landlord function.
The council, which has apologised "unreservedly", said the society's findings highlight "serious issues" in the authority's governance.
A police investigation and an employment investigation carried out by an external law firm are continuing, it said.
Council leader Julia McShane said the council acknowledges the findings and accepted more than 70 recommendations.
It has published an improvement plan to address "every recommendation".
She said: "The people of Guildford deserve better from their council and for that we give a heartfelt apology and a commitment to put right the long-standing issues which we have uncovered."
A police investigation into alleged criminal offences was opened in November 2023.
In February, Surrey Police escalated its investigation to the South East Regional Organised Crime Unit (Serocu).
As part of the investigation, two employees have been suspended and five agency workers had their contracts terminated.
A Serocu spokesperson confirmed a man in his 50s, arrested in March as part of the investigation, has since been released on bail.
Duplicate invoices
In February 2022, the council agreed to invest £24.5m to bring its 5,200 council homes up to standard.
Prior to this, the Solace report shows that in October 2021 a three-year deal with Seville Developments Ltd worth £2.4m was agreed for testing and inspection.
Within three years the contract spending with that contractor had climbed to £18.9m – a £13.5m overspend.
Seville Developments Ltd has been contacted for comment.
The review also found an increase in complaints from tenants concerning works.
It cited a “lack of in-house expertise and capacity” meant the council often failed to inspect and check work and was reliant on agency staff.
Matters raised also included work that may have been ordered and paid for but not completed, or not done to a satisfactory standard and that duplicate invoices may have been submitted and paid for the same work.
The review said there were “three clear opportunities to investigate and cease trading” with the external contractor.
A separate Solace review in to governance at the council said there was a "lack of controls around contract awards and management" leading to "significant contract overspends".
Council deputy leader Tom Hunt said the review findings identified “serious issues around the council’s governance, operations, and controls” which were “unacceptable”.
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