Police to probe Lancashire County Council's finances

Lancashire County Hall, Preston Two investigations are ongoing at the authority

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Police are to investigate allegations of financial irregularity at Lancashire County Council.

The authority has referred the conduct of a senior officer who was the focus of a recent disciplinary investigation to police after taking legal advice.

It is currently probing the tendering process of a £5m fleet contract and the authorisation of a £500,000 payment to a senior officer.

Suspended chief executive Phil Halsall left the authority on 24 October.

'Concerns over irregularities'

A Lancashire County Council (LCC) spokesman said: "In the light of external legal advice, a number of issues arising from the recent disciplinary investigation into the conduct of a senior officer have now been referred to Lancashire Constabulary.

"The council will not be commenting further at this time."

Det Ch Supt Clive Tattum said: "The Constabulary has received a referral from Lancashire County Council which outlines concerns in relation to a number of financial irregularities.

Analysis

One inquiry has been exchanged for another. Lancashire County Council accepted Phil Halsall's resignation and dropped the official disciplinary inquiry being conducted by a barrister.

But the council has now passed its concerns to Lancashire Constabulary.

The allegations appear to stem from the decision to create One Connect Ltd (OCL), a joint venture between the council and BT to run some services.

In particular, concern has focused around the decision to award a contract to OCL to run the county council's fleet of vehicles, a contract cancelled by the incoming Labour administration.

Another issue is the payment of more than £500,000 in bonuses to the former chief executive of OCL, David McElhinney, who remains in charge of a similar venture between BT and Liverpool City Council.

Mr Halsall has always denied doing anything wrong and his supporters believe the complaints are politically motivated.

Geoff Driver, the Conservative Leader at the time, believes there should be an inquiry to prove nothing untoward took place.

The immediate question is whether Lancashire Constabulary decide there are enough grounds to continue with a full investigation or whether to drop it.

"We are at the very early stages of investigations into these matters and so it would be inappropriate to comment any further for the moment."

Mr Halsall left the authority by "mutual consent".

He has denied any wrongdoing and his supporters believe the complaints are politically motivated.

He had been suspended on full pay in August pending the outcome of a disciplinary investigation into the tendering of the fleet vehicle contract.

The deal to run the council's fleet services was agreed in April by the former Conservative administration which was led by Geoff Driver.

It was awarded to BT but the decision was called in by county councillors and put on hold. The council's in-house provider continued to provide the services.

The contract was revoked on 15 August with immediate effect by current LCC leader Labour councillor Jennifer Mein.

It was awarded to BT and One Connect Ltd, a partnership between BT and the council.

LCC is also conducting a separate investigation into the authorisation of the payment of more than £500,000 to David McElhinney who resigned in August.

He received two separate payments that Ms Mein and the council treasurer said they were unaware of.

Mr McElhinney ran One Connect Ltd, which was contracted to run various council services.

Jo Turton is continuing as the interim chief executive and a decision on who will take over the role permanently will be made in due course, the authority said.

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