NI civil servants criticised in report
Northern Ireland civil servants were lambasted today over major fraud by employees in the province’s government-funded small business agency and a failure to recover the money.
The Stormont Department of Enterprise, Trade and Investment and the Local Enterprise Development Unit were condemned in a report by the Public Accounts Committee of the power-sharing Assembly over the fraud by two members of staff at the agency involving £220,000 (€343,689) of public funds.
Committee chairman Billy Bell said their actions smacked of ‘‘incompetence and complacency’’.
There had been a complete breakdown in the application of even the most elementary principles of financial control and it was ‘‘astonishing’’ a body which advised small firms on financial control systems had been incapable of keeping its own house in order, he said.
The first fraud, by employee Ms Barbara Atwell, involved her diverting £118,000 (€184,000) of public money into her personal bank account.
It was discovered by Tom Gribben, the organisation’s assistant accountant in 1996.
Two years later it was uncovered that Mr Gribben was involved in fraud, actual and attempted, to the value of £101,000 (€160,000) after he used funds to purchase private travel for himself and his associates.
Ms Atwell was later jailed for two years and Mr Gribben for 12 months.
The Committee said it was disappointed to learn the police had been unable to trace any of the money stolen by Ms Atwell and that neither they or Ledu were pursuing restitution.
The report highlighted a number of ‘‘serious shortcomings’’ in Ledu’s ability to handle fraud and in the department’s ability to keep control of the non-departmental public body.
Mr Bell added: ‘‘To have one of the largest frauds in the Northern Ireland public sector is unfortunate, but to have it followed within months by another major fraud in the same unit smacks of incompetence and complacency.’’
He said he firmly believed ‘‘the department was too lenient in dealing with Ledu’s inability to address adequately the weakness in the control environment after the first fraud, its handling of the second fraud and also in its failure to hold those responsible to account.
‘‘We are dealing with a complete breakdown in the application of even the most elementary principles of financial controls.
‘‘I find it astonishing that a Government agency, whose remit included advising small firms on financial control systems, was incapable of keeping its own house in order.’’
The report said that in the cases of both Atwell and Gribben there had been inadequate control of staff, a lack of separation of duties, controls were being bypassed and there was inadequate
management information.
Despite all of that no-one in a supervisory or management position had any action taken against them ‘‘not even the mildest reprimand’’.
The Committee understood that some may even have moved on to positions of greater responsibility.
‘‘That does not send the right signal to the system and wider public and is symptomatic of an organisation where there is a culture of weak management. Clearly the department has a lot to do to turn this around,’’ said the report.
Ledu was in April absorbed into a new super agency, Invest Northern Ireland, and the report said it was essential the new public bodies such as it ‘‘establish robust financial controls at the outset.’’
Officials from the department, Ledu and other government departments who gave evidence to the committee were accused of attempting to ‘‘stonewall’’, failing to give information requested and being ‘‘evasive’’
Among them was the Permanent Secretary at the Department of Enterprise, Trade and Investment, Bruce Robinson, who came in for sharp criticism for his evidence to the committee when it was probing the affair.
The Report said the committee was ‘‘astonished’’ Mr Robinson, the department’s accounting officer, had not supported a recommendation from his own internal audit for early police involvement in the case.
‘‘In our view the accounting officer should have been much more proactive’’ when the frauds were discovered, it said.
‘‘He should have ensured that the police were notified and that a proper fraud investigation was under way. In our view this was an abrogation of the responsibilities set out for the accounting officer in his letter of appointment.’’
The report went on: ‘‘Let us be quite clear about notification. We regard the failure to report fraud promptly as a very serious breach of procedure and one that we will not tolerate.’’
