Princes Parade Update: Possible solutions to discover the lost £5m.

Updated 6 March @ 07:55am

How does Folkestone & Hythe District Council lose £5m on Princes Parade?

Cllr Jim Martin doesn’t know, nor does Cllr Lesley Whybrow.

Cllr J Martin is a qualified Chartered Surveyor, with more than  30 years of professional experience.  Cllr Lesley Whybrow is an accountant, with more than 10 years experience behind her. Both are professional people away from their Cllr role.

What can they, or any other Cllr, do about the loss of £5m, and more, on Princes Parade?

In a situation like this, it is necessary to ask the officer who is responsible for the Council’s finances. That person for now – as she is leaving the building in March – is Charlotte Spendley (pictured). She is commonly known as the s151 officer, because of Section 151 of the Local Government Act 1972 (as amended); which requires every authority in England and Wales to “… make arrangements for the proper administration of their financial affairs and shall secure that one of their officers has responsibility for the administration of those affairs“.

One of the powers the s151 officer has, is to make a s114 report under section 114 of the Local Government Finance Act 1988, “if it appears to her” that the authority, a committee of the authority, a person holding any office or employment under the authority or a joint committee on which the authority is represented

(a) has made or is about to make a decision which involves or would involve the authority incurring expenditure which is unlawful;

(b) has taken or is about to take a course of action which, if pursued to its conclusions, would be unlawful and likely to cause a loss or deficiency on the part of the authority; or

(c) is about to enter an item of account the entry of which is unlawful.

“If it appears to her” – a choice phrase; which allows for a lot of wriggle room, as it is down to her professional judgment. Given the s151 officer has announced her departure, what odds would you give that the s151 officer, would issue such a report over a lost £5m on Princes Parade?

Given a s114 report is, more likely than not, a pipe dream, what other ways are there to focus the mind of the s151 officer?

Since 1906, council chief financial officers have had a duty to act in the taxpayer’s interest.

The duty was established in law under Attorney General v De Winton 1906, when the judge determined that the treasurer (that’s what a s151 officer is) of a local authority held a fiduciary duty/relationship to the local taxpayer. It was strengthened by subsequent acts of parliament but remains at the core of the s151 officer’s role.

De Winton allows for a tax payer to bring a case, if in their honest opinion there has been a breach of the s151 officer’s fiduciary duty/relationship with the tax payer. In legalese, it is a tort of negligence

So anyone aggrieved about a £5m loss on Princes Parade, could potentially bring a case.  What one has to bear in mind, there are hurdles to straddle. Among some of the things to consider are:

1 That the harm was reasonably foreseeable.

2 That there was a relationship of proximity

3. That is fair, just and reasonable to impose a duty of care

De Winton was an individual. They brought the case. And the case was won on the grounds that De Winton had suffered an individual loss as a tax payer. This  potentially allows the Local Government Ombudsman to look at any complaint made by a resident, as one of their criteria is, you as an individual, suffered a loss.

De Winton then, opens up two potential avenues regarding the lost £5m on Princes Parade. One a tort of negligence through the courts, or two, a complaint to the local government ombudsman.

It’s not just the lost £5m, according to Cllr Jim Martin, which needs to be consider. We have highlighted many a financial irregularity, supported by bruising council reports . The evidence is publicly available, and might be sufficient grounds, to focus the mind of Folkestone & Hythe District Council’s section 151 Officer. The evidence would suggest there has been little “active” monitoring of contracts related to Princes Parade, as highlighted by Cllr Lesley Whybrow in her speech to the Overview & Scrutiny Committee on 16 Feb 2023.

Let’s not forget, back in May 2022, two QCs believed there was sufficient evidence for a s114 report regarding the Premier Roofing, and Clifford Carpentry and Interior contracts. Between them, they amounted to £2.6m. Add on the lost £5m, and the combined total is £7.6m.

Real accountability comes from the understanding that all taxpayers know the council’s resources are being properly managed. If such accountability is not forthcoming, perhaps the use of De Winton may focus minds. After all, the s151 officer, does have a fiduciary duty/relationship to the local taxpayer, doesn’t she?

We’ll leave you to ponder that

The Shepway Vox Team

Dissent is NOT a Crime