Investigation into Plymouth £72 million investment

Council leaders welcome audit

An independent investigation is to take place into Plymouth City Council’s £72 million pension transaction deal.

The council used government money to invest in a consultancy firm to reduce a pension deficit in 2019. It says it has saved more than £9 million because of the decision.

But auditors raised concerns over the move which they said was unusual and is now the subject of a  investigation by the Department of Levelling Up, Housing and Communities (DLUHC).

Council Leader Tudor Evans (Lab, Ham) and head of finance David Northey have welcomed the scrutiny.

“We are happy to work with an independent team to review the whole process and ensure everyone can learn from this, ” said Cllr Evans.

David Northey added that he would be “open and transparent”.

Questions will be asked of audit and governance committee members from 2019 and officers and financial management and practices looked into.

The Labour party was in control of the council at that time.

“I hope that everyone will take the opportunity to tell them exactly what they know and didn’t know and any issues that arise will be in their recommendations I’m sure,” said Mr Northey.

He added that he had asked the levelling up department to conduct its investigation sooner rather than later so the council could draw a line under it, and that things had moved on.

The controversial decision has held up accounts from 2019/20 being approved, but the council confirmed this week that auditors Grant Thornton were now content with the accounts and were “in the process” of signing them off.

The auditors have made recommendations about the way such matters are handled and these had been implemented.

A spokesperson from Plymouth City Council added: “We have always been transparent about the transaction and it has been discussed at various council meetings, including the audit and governance committee.

“We knew that the transaction was novel in local government, but we were doing our best to think outside the box to ensure we didn’t need to make cuts to local services as our funding [from central government] continues to reduce. ”

Former council leader Cllr Richard Bingley (Con, Southway) said a formal independent investigation was needed to “get to grips” with what had happened.