A PUBLIC body based in Gwent paid thousands of pounds for trips abroad for its members, overpaid its most senior member of staff, and acted unlawfully on occasions, a damning report released today reveals.
The Wales Audit Office says the actions of some staff and members of the Newport-based Caldicot and Wentlooge Levels Internal Drainage Board were "likely to undermine public confidence".
Now the WAO says the board should consider asking its former clerk and engineer Dean Jackson-Johns for a payback.
The board, which has an income of around £1,000,000 a year, lost sight of the fact it was a public body that existed not to serve its own ends but those of the people who live and work on the Gwent Levels, according to the report.
The organisation manages the drainage system on the Gwent Levels and had only 22 members of staff at the start of the audit, but could not demonstrate to auditors it has always spent public money wisely.
Auditors made a raft of damning findings that stretch over a number of years, including that: * The board spent thousands of pounds of taxpayers money funding so-called inspection visits for board members and guests to Italy, Northern Ireland and the Netherlands, which included trips to tourist attractions like Venice, without proper business bases for them or ways of assessing their benefits.
* Former clerk and engineer Dean Jackson-Johns, who had been the drainage board's most senior member of staff, made his own proposals for pay to the board. Mr Jackson-Johns received overpayments to his salary, the report said.
* Three members of the board who were taking the body to court took part in meetings where the body decided how to respond to the legal action, despite having a conflict of interest.
* The board was operating contrary to law with its framework for making decisions not constituted as it should have been.
The report also details that the board spent £175,000 on the purchase of a vegetation control machine after the board accepted hospitality from the supplier, Energreen. The purchase came after three board members and the board's former engineer health and safety plant manager visited Verona on the company's invitation - despite the fact the auditor said the equipment could have been seen in the UK.
The report said the board was also unable to demonstrate it achieved value for money with a £24,349 LandRover Freelander bought for the former clerk and engineer. The report also raised concern that Mr Jackson-Johns recommended his wife Iolanda's post as officer and personnel manager should be regraded in 2004, raising her maximum salary from £22,869 to £25,326. The report says he had a "personal and pecuniary" interest and should not have been involved.
Appointed auditor Anthony Barrett said standards of governance and management at the drainage board "fell short of what the public has a right to expect".
He said the drainage board has begun an improvement programme aimed at addressing the weaknesses identified.
Since the audit began Mr Jackson-John, his wife Iolanda Jackson-Johns and other key staff have resigned and a general manager has been appointed.
The WAO recommends that the board should commission and independent review to assess the impact and effectiveness of its improvement programme, should regularly review its progress an consider whether to seek recovery of salary overpayments to Mr Jackson-Johns.
Files on the drainage board were passed to the WAO, which audits the body, by the Welsh Government in 2011 after concerns were raised by a board member and two employees.
David Rees, part of the WAO team that conducted the audit, said one of the most shocking parts of the findings was the "lack of existence of basic policies and procedures of governing the business of the board."
He said: "Without the rules and procedures and policies governing the way things are done things will always go awry."
According to the report, the board had established several committees including the establishment committee, governance committee and others despite not, prior to April 1 2009, making rules to constitute them.
Decisions made by them would have been contrary to law, unless they were confirmed by the full board. Each of the committees was constituted to give a majority to elected members over appointed members.
Of the board 18 members were elected from among the ratepayers - landowners who pay rates to the board.
The auditor wrote it was accurate that elected members had an undue influence. However he said that was also due to the fact many of the board's 19 appointed members from the three councils that funded the body did not attend.
The board is financed predominantly by levies raised from Monmouthshire, Newport and Cardiff councils which covered 72 per cent of the drainage board's costs.
Since May 2012, Newport has yet to appoint a representative to the board.
The report admits that a number of issues identified by the audit and the scale and significance of some of the issues raised questions over the effectiveness of previous audits done by the WAO. Improvements to the way small public bodies are audited are being considered.
Trips ‘did not represent value for money’
THE DRAINAGE board spent more than £9,000 of taxpayers money on sending board members and officers abroad on so-called inspection visits to Italy, the Netherlands and Northern Ireland.
Auditors said two of the trips - to Italy and Northern Ireland - did not represent value for money and were contrary to law.
Neither trip's primary purpose was to further the drainage board's objectives, the WAO said, but both appear to have been organised to mark events or benefit board members.
Members went to Italy in October 2005 for a three day trip. A total of 13 members and three officers attended with 21 guests, mainly spouses or parents of the board members. Although contributions were taken, the trip cost the board £4,333.
While the first day was spent visiting local drainage works, the second was spent on a guided sightseeing tour of Venice. Event organiser and office and personnel manager Iolanda Jackson-Johns wrote the visit was an "interesting inspection for the board members... to mark the end of our chairman's term of office."
A further two-day visit to Northern Ireland, made up of 11 board members, three members of staff and other guests who were mainly spouses of the attendees, took place in September 2008.
Again contributions were taken, but the trip still cost the board £4,732.65.
The second day of the trip consisted of a tour of the Old Bushmills Distillery, a trip to the Giants Causeway, Dunlace Castle and Carrick-a-Rede.
Minutes to a meeting said the event was "really organised for the benefit of board members" while Mrs Jackson-Johns wrote that it seemed timely to organise the trip as the current board's term of office ended in October that year.
Detailed records of one inspection trip, to the Netherlands in 2000 and intended to "mark the Millennium", could not be obtained but the auditor wrote he was concerned the visit may not have represented value for money.
Clerk paid ‘thousands more than terms of contract’
THE drainage board's former clerk and engineer Dean Jackson-Johns submitted his own proposals for his pay resulting in him being paid thousands more than terms agreed in his contract, the report said.
The auditor said the officer had a personal and pecuniary interest in the matter and should not have taken part in the decision-making process.
In 2006 the former clerk and engineer submitted proposals on his pay in 2006 that resulted in him being paid more than dictated by what are known as the Lincolnshire terms.
The terms include national pay scales and terms of overtime and expenses, and Mr Jackson-John's contract had stated he would be subject to them. In May 2006 of that year his pay rose from £55,228 to £65,553, £8,268 more than the terms allowed.
By 2010 Mr Jackson-John's pay had risen to £83,122 a year after he had proposed to the board's establishment committee in November 2007 that he should receive an annual pay award of five per cent per annum each year for five years.
No formal minutes of the meeting were kept but the committee agreed to pay him a five per cent increase each year from April 1 2008, to be reviewed in three years.
Mr Jackson-John's pay was, by 2010, in excess of the £63,660 maximum he could be paid under the Lincolnshire terms.
Members ‘failed to declare their interests’
THREE members of the board took part in meetings where a legal claim they were backing against the body was discussed, despite their personal interest in the court action.
In April 2010 Leonard Attewell, an elected member and then vice-chairman of the board and a landowner on the Levels brought a High Court claim against the Environment Agency to seek a declaration the body was responsible for repairing and maintaining the sea wall.
But the action, which was also funded by elected board members and Levels landowners Neville Waters and David James, named the drainage board as a co-defendant after the Environment Agency argued it was the board had the legal responsibility. If the case had been successful, the board could have found itself liable to the tune of £35m to £40m.
Mr Attewell had told the auditor that he had recognised the difficulty of pursuing legal action against the board when he was vice-chairman, and had offered to resign but said it had not been accepted.
From July 9, when the board was joined to the claim, each of the members with an interest should have declared it and withdrawn from the meeting, the report reads.
But the three members failed to declare their interests on one or more occasions and remained in meetings when the case was discussed. The auditor said each of the three had a "personal and pecuniary interest" in the case.
In December 2010 Mr Attewell attended, and Mr Waters chaired, a meeting where the board resolved by vote to accept liability. The report said the decisions taken were significant and their determined the board's legal stance. Mr James was not present at the meeting.
Mr Waters later expressed regret over the oversight, and both told the WAO they did not take part in any discussions or vote on the resolutions.
But the auditor said the three members failed to differentiate their roles as members of the board from their roles and interests as private individuals. He accepted they did not act with ill intent.
Mr Attewell has since resigned from the board. Mr Waters and Mr James remain members.
The resolution to accept liability was later rescinded.