Thursday, 13 January 2011

Inverclyde Council suspends four officials over failed cuts plan

Our local council has suspended four of its officials after paying PricewaterhouseCoopers to deliver savings that proved non-existent.

PwC had been paid £650,000 by the council to help identify and achieve £1.9million of savings. The resulting scheme (the Future Operating Model) actually delivered a mere £250,000 of savings and its failure now leads to the very real prospect that further job losses will be required in our area - which is hardly an employment hotspot currently.

Last October the council was advised it would have to save £10million over the coming two years, which would involve an estimated 700 job losses. There are now fears that these could be higher.

Not only has the council paid out £650,000 to achieve only £250,000 of savings, it has also emerged that the suspended officials may have agreed the £300,000 contract with PwC without first putting it out to tender. If so, this is highly irregular and irresponsible conduct.

The four to have been suspended are Paul Wallace (corporate director), Arun Menon (head of IT project management) and two heads of service, Gordon McLoughlin and John Arthur. Chief Executive John Mundell, while not suspended, has been criticised for his own role in the failure of the Future Operating Model.

With further investigations pending, it would be unwise to comment further than to state that this clearly represents a poor deal for Inverclyde. Ciano Rebecchi, a Lib Dem councillor and former Provost, said: “All involved here should have been highlighting the fact that savings weren’t happening. That appears not to have happened. The impact will be on jobs in the area and morale among staff.”


Anonymous said...

I don't understand why the Head of Service have been suspended. Surely the main man in charge should be taking responsibility. Are they not forgeting that there is a reccession ending and bills due from christmas to pay? These four poor men suspended must have a family to care for and with no money coming in due to suspension then not only are the four men suffering, but so are their familys. But if the council are prepared to cause devestation then what a good council they are. PwC should be the main party in question and should be sued for there loss. . .

Andrew said...

Hi. As I said in my main post, I couldn't really comment on the suspensions as an investigation is currently taking place. I'm sure we'll find out more in the days and weeks to come.

As far as I know - and I could be wrong - the council have suspended the four officials on full pay as a "precautionary measure". You could well be right and these four have been made scapegoats for failings further up the ladder. If so, it's a shameful way to treat them.

The bottom line is that the project has been a complete disaster and people in Inverclyde deserve better. Having said that, I'm not going to be pointing fingers and playing the blame game - I'm more concerned that whatever new plans are drawn up to cut council costs are done so in more responsible way and causing as little pain to local people (and council workers) as possible.

You are absolutely correct that PwC should be coming under far more scrutiny for their role in this. Whatever the failings of council officials, it was ultimately PwC who failed to deliver, while making a tidy profit at the taxpayer's expense.

Anonymous said...

It is I from the first comment again.

yes , it would be terrible if these four men had been singled out for something there bosses have failed in, I was aware that these men's pay was on hold - I could be wrong, but it is doubtful.
It seems as if PwC are rather suspicious and have earned a sum of money that they were not intiltled to, therefore should the finger not be pointed at them ?
The council are only doing what seems right just now but in the future if the four men's names have been cleared these men are unlikely to be trusted again.I can only immagine what they and their families are going through just now and I wish them the best.

When do you think this matter will be solved and cleared ?

Andrew said...

Hello again:

If the men's pay is on hold, then in my view that is completely wrong and I think is contrary to council procedures. You could well be right though...I will contact the council tomorrow and try to get a definite answer.

PwC come out of this with little credit intact. They certainly should be asked questions about why the package they put together was so ineffective. That doesn't mean that the council shouldn't be examining its own practices and decision making, because obviously its been sold a dud investment and made the decision to buy into the PwC deal. I think the council is right to be looking at how the process was entered into because obviously a lot of money has been thrown down the drain and we don't want to see a repeat of this.

However, looking for scapegoats is not the same as a responsible investigation, and questions perhaps should also be asked about what purposes the suspensions actually serve. If it's an attempt at increasing public confidence in the council it appears not to be working!

As you say, whatever the rights and wrongs of the decision making process that led to the Future Operating Model and PwC profiting at the expense of Inverclyde taxpayers, at the centre of the matter is now the future of four council officials. As you say, the very public suspensions will aversely affect their reputations - irrespective of what any investigation might turn up.

I don't know when this matter will be resolved. Council investigations usually take some time - we're talking months rather than weeks. I don't know who's doing the "investigating" but on a matter like this I'd prefer it was done by an independent body rather than by other council officials.

Andrew said...

I have spoken with someone at Inverclyde Council who did not wish to discuss the details of this case. However, he confirmed that ordinarily council employees who are suspended pending investigation are entitled to full pay.

Anonymous said...

entiltled to full pay doesnt gaurentee it. I personally know one of the men, and i do not think he is recieving full pay.

Andrew said...

Well...firstly I must state that I'm not a councillor. Neither do I work for Inverclyde Council. I'm just an ordinary member of the public as concerned about this as many other local people.

What it clear is that the council aren't happy to be talking openly aboput this issue. Perhaps after the investigation has concluded we might get some more concrete answers.

If any of the suspended individuals are reeiving less than full pay then as far as I am aware that is highly irregular. Whatever the rights and wrongs of the deal and how it was managed, the council should be treating its employees with respect and dignity.

Anonymous said...

Hi there , what are the final outcomes of this case ? I know that at least one of the four men have lost their jobs and i would like know what has happened with the case so far? Thanks alot.
Sincerly ,

Andrew said...

I understand that Paul Wallace was sacked.

The other staff members were reinstated and allowed to return to work.