Information on Investigations

Which Sector? > Local Authorities > Renfrewshire Council > LA/R/360

Note of Decision Web Version

Complaint no. LA/R/360 concerning an alleged contravention of the Councillors' Code of Conduct by Councillor Celia Lawson of Renfrewshire Council

1. Complaint number LA/R/360 alleged a contravention of the Councillors' Code of Conduct ("the Code") by Councillor Celia Lawson ("the respondent").

2. It was alleged that the respondent had contravened the Code, and, in particular had failed to comply with the rules for the payment to councillors of remuneration, allowances and expenses.

3. The person complaining ("the complainant") alleged that the respondent in submitting her Claim Forms for Members' Expenses and Allowances had failed to declare a vast number of expenses as taxable, claiming on occasions for the same day twice, claiming for a number of Subsistence Allowances when in fact a lunch was provided at Council Headquarters for Councillors. It was also alleged that she had claimed on a number of occasions for a Petrol Allowance for which there was no provision in the Council's Claim Scheme.

4. The respondent alleged that she had not mishandled the matter of her Claims for Members' Allowances and Expenses, and she had operated within the terms of the Scheme. She refuted any allegations of impropriety and indicated that, contrary to suggestions of over-claiming, a review of the matter had found that she had not claimed the full amount of Allowances to which she was entitled.

5. The payment of Councillor's Allowances and Rates for Travelling and Subsistence derived from the Local Government (Scotland) Act 1973 and the Local Government and Housing Act 1989. Under these two Acts, regulations had been made, periodically, to set out the framework for levels and payment of Members' expenses. In terms of the regulations each Council must have a formal Scheme setting out the details of the payments to which members of the Council are entitled ("the Scheme"). Following the last Local Government Elections, Renfrewshire Council formally adopted a Scheme in May 2003. This complaint had to be considered in the light of the specific terms of that Scheme.

6. The complainant had categorised the various areas of concern as follows:

i. Over-claims of Subsistence Allowance (incorrect hours claimed);
ii. Subsistence Allowance Claim made for Public Holidays;
iii. Subsistence Allowance Claims for attending Full Council meeting and Lunch provided;
iv. No Claims made for Subsistence for Other Full Council meetings;
v. Claims for petrol to Attend Full Council meetings;
vi. Claims for petrol to attend Special Council meeting;
vii. Subsistence and Mileage Claims for Special Council meetings.

7. I found that my powers and that of the Standards Commission were in respect of the Councillors' Code of Conduct which came into effect on 1 May 2003. It was not possible for me, or the Commission, to consider allegations predating the introduction of the Code to assess the question of possible breach thereof. What had to be considered was whether or not the respondent had pursued the course of conduct alleged by the complainant since 1 May 2003 and whether or not the actings of the respondent then amounted to a breach of the Code. (The instances alleged by the complainant I considered fell within the period commencing on 1 May 2003).

8. This complaint had to be considered within the national context. Recent consideration had been given to the remuneration of local councillors. The independent Scottish Local Authorities Remuneration Committee had recently conducted an in-depth review of the system of allowances for councillors. They in-gathered evidence and conducted research on current arrangements and made a number of recommendations for change. Several of the Committee's findings were of direct relevance to consideration of this complaint.

9. The Committee published its report entitled "Review of Remuneration Arrangements for Local Authority Councillors" in January 2006. The Committee referred to Subsistence Allowances and Meal Allowances generally being claimed for set periods of time away from a councillor's home and recommended the current system of Subsistence Allowances and Reimbursement of Costs Incurred be changed. The following paragraphs of the report were of particular relevance:

"5.13 Some councils use these figures as the maximum amounts which can be claimed, but the Committee has heard during its visits that other councils pay the flat rate regardless of what expenditure, if any, has actually been incurred.

5.14 We do not see any justification for paying flat rate allowance, especially daily meal allowances which can be claimed while attending meetings at the council headquarters or on any other council business.

Recommendation 18: We recommend that all daily subsistence allowances and overnight subsistence allowances should be abolished."

5.15 Instead of flat rate subsistence allowances, councillors should be able to claim the actual costs incurred for meals and overnight accommodation when they are carrying out council business away from their home or from council offices. We do not consider it necessary to allow reimbursement for meals where a councillor is attending meetings in the council headquarters or chambers. We do not consider it necessary to allow reimbursement of expenditure on meals when the councillors are carrying out council business in their own ward..."

10. In summary, the Committee recommended a move away from an Allowance-based remuneration system for councillors to a salary-based system. The Scottish Minister for Finance and Public Service Reform responded to the recommendations:

"...There is no doubt that the system of remuneration for councillors is in need of modernisation. The current arrangements are an obscure muddle and that is exactly why the Executive is committed to modernising the whole system..."

11. It was clear that Renfrewshire Council, in common with a significant number, if not all, Local Authorities approved a Scheme for Members' Allowances and Expenses based on a "self certification" process by the individual councillors submitting claims. This relied not only on councillors acting in good faith, but also on the Local Authority, as an organisation, having the appropriate processes in place to operate the systems for checking and payment. It was self evident that the whole purpose of such systems was to check not only that appropriate claims were lodged but that attention was paid to verify arithmetical calculations on the face of the forms and that claims relate to approved duties.

12. As regards the respondent's alleged failure to declare a number of expenses as taxable, this had to be considered in the context of the manner in which the Finance Department operated this aspect of the Scheme during the relevant period. In terms of the Scheme, it was for an individual councillor to decide whether or not to submit subsistence receipts in respect of any claim. The respondent indicated that she had on occasion submitted receipts and on other occasions elected not to do so. The Director of Finance and IT confirmed that it was then for her staff to pay a gross payment for a receipted occasion and one net of tax where no receipts were provided. The Claim Forms provided two separate figures columns for these two categories of payment. As then constituted, the operation of the Scheme allowed for the respondent to act as she indicated she had done.

13. The allegation that the respondent claimed on the same day twice cannot be considered as it predates the introduction of the Code. As regards the allegation that the respondent claimed, on occasions, for Subsistence Allowance when in fact a lunch was provided at Council Headquarters for councillors, the respondent indicated that there was no obligation on Councillors to take any such meal, and a number of councillors did not always do so particularly if there was other Council business to attend to. The Director of Finance and IT, as the Proper Officer responsible for the administration of the Scheme, stated that no abatements in Subsistence Allowances were made in the situation where lunch was available at Council Headquarters. No register was kept by the Council of those Councillors taking lunch at the end of Council meetings.

14. As regards the allegation that the respondent claimed on a number of occasions for Petrol Allowance and there was no such provision in the Scheme for such a specific item, the respondent confirmed that she incorrectly used that term instead of "mileage" for which there was an entitlement to payment. In dealing with the Claim Form the finance staff clearly understood that the respondent was not seeking to claim an allowance which did not exist, but rather a key expense payable to all Councillors. The misnaming of a specific type of claim in this way could not, in my view, be reasonably assessed as a breach of the Code.

15. On the matter of "Over-claims", my investigation indicated that the respondent, when submitting Claims Forms relied on the good offices of the Council staff involved to assist her. This often, perhaps invariably, extended to the staff writing in the financial amounts on the forms, (based on the self-certificated hours put on the Claims Forms by the respondent), and then calculating the resultant totals due for payment. It was clear that the practicalities of operating the Claims System were such that it was felt to assist all concerned if assistance with calculations were provided, when required. In common with other local authorities, the manner in which the Scheme of Allowances had been interpreted and operated by Renfrewshire Council, through the Finance and IT Department, permitted councillors to claim allowances on a time related basis only. The requirement in the Scheme that expenses had been necessarily incurred was not the subject of detailed verification as staff relied, in the main, on the information given by councillors on the Claim Form. Receipts were only required when a councillor wished the corresponding allowance to be treated as non-taxable. I found that based on the manner in which the Scheme had been interpreted and operated, historically by the Council, the respondent had not deliberately over-claimed Subsistence Allowance.

16. On the matter of Claims submitted for Public Holidays, the respondent advised that on such occasions when the Council Offices were closed for a holiday, contacts to Councillors and ward inquiries from members of the public requiring attention could be just as frequent, if not more so, than when the offices are open. I had no hesitation in accepting this proposition. It should be noted the Scheme contained no prohibition on claims being submitted for Public Holidays, presumably for that very reason.

17. On the matter of no Claims being submitted for attending some Council meetings, the complainant's view of this matter seemed to be that a failure to claim was just as indicative of alleged wrongdoing on the part of the respondent as his examples of claiming for allowances. I was unable to agree with such a particular interpretation. It was a very well well-established principle that it was entirely a matter for each individual Councillor to submit Claims, or not, as they saw fit. In addition the extent of those claims which were less than their entitlement was entirely at their individual discretion.

18. The complainant's interpretation and expectation of the Scheme of Members' Allowances, included a perceived individual responsibility on each councillor to provide detailed justification (e.g. diaries, travel logs, receipts etc) in vouching for claims submitted. The Scheme did not set out such requirements to justify Claim Form details. I was unable to uphold his particular interpretation. The Scheme placed no such specific responsibilities or obligations on Elected Members of the type he wanted.

19. The question to be considered was whether or not the actions of the respondent amounted to a breach of the Code in relation to her specific obligations for making Claims under the Scheme. The exact obligation on the respondent in terms of the Code of Conduct was:

"You must comply with the rules for the payment to councillors of remuneration, allowances and expenses."

Having considered all the information provided, within the context of the how the Scheme was interpreted and administered during the relevant period, I did not consider that, in all the circumstances, there had been non-compliance on the part of the respondent. I made the particular point that it was not unknown for miscalculations of the correct amount of members' expenses to occur, even in the best administered Schemes. These could be overpayments or underpayments. When noted, a corrective adjustment was made by the Scheme administrators in adjusting subsequent payments made.

20. To her credit, when the complaint was intimated to her, the respondent met with finance staff to review the Claim Forms and indicated that several individual items appeared to be for the wrong amount. I do find, on the balance of probabilities, that these resulted from financial miscalculations as part of the support given to the respondent by Council staff rather than any wilful attempt by the respondent to obtain payments to which she was not entitled. She also indicated that it was discovered there were items she had not claimed for. I considered that the respondent operated within the boundaries of the Scheme for Members' Allowances and rates for Travelling and Subsistence as administered by Renfrewshire Council at the relevant time of the complaint. I recommended that a final check be made of the respondent's Claim Forms, with any necessary adjustment being made so that a calculation could be made of the amounts due to the respondent in terms of the Scheme, and the appropriate deduction for any miscalculated sums which were found to have arisen. It was ultimately for the respondent to decide whether or not she submitted a full retrospective claim for any or all sums to which she was entitled and a matter for the Council as to whether or not those sums were paid in view of the time which had elapsed since any entitlement arose.

21. Renfrewshire Council as a Local Authority had a fundamental obligation of "good stewardship" in relation to expenditure of public monies under its control. This included the operation, administration and audit of an appropriate Scheme of Members' Allowances and Rates for Travelling and Subsistence. It was clear from the recent investigation by the Scottish Local Authorities Remuneration Committee that the Council's provisions for the system of Members' Allowances were not unique. The Renfrewshire Scheme was the subject of investigation by the Council's independent external auditors, Audit Scotland, for the financial year 2003/04 and recommendations were made for changes to be made with a number of suggestions being made by them for enhancing existing controls which were implemented. This included a redesigned Claim Form, effective from May 2005 with more space to include details of the specific Approved Duty being claimed. The clear aim was to support and verify an effective system of paying allowances. The Council then obtained further specialist advice on the matter and made further improvements to assist the proper administration of the Scheme. This advice was accepted by the Council at its meeting on 16 March 2006.This involved an additional responsibility on members to provide further information to support claims made, which I considered would prove a reassurance to the Council Tax-payers of Renfrewshire that the Council placed a very particular priority on good stewardship. As part of that process, which should be a continuing one, I recommended, mindful that the current statutory provisions on allowances were likely to be changed in the near future:

(i) The Council implement a training scheme for all Members on the Claims System to assist the understanding of all concerned, with, in particular, further practical advice and guidance on the level of detail expected in Claims Forms;
(ii) Once the training process was complete, the Council consider what sanctions should be placed on any Councillor who was not complying fully with the Claims process;
(iii) The Council should allocate appropriate Internal Audit resources to support the operation of the current Scheme;
(iv) The Council should consider, consulting as necessary with Audit Scotland, what further steps, if any, should be taken in relation to my findings and the recommendations.

22. Having considered the information that arose from my investigation, I concluded that Councillor Celia Lawson had not contravened the Councillors' Code of Conduct.

D Stuart Allan,
Chief Investigating Officer.
Forsyth House
Innova Campus
Rosyth Europarc
Rosyth
Fife
KY11 2UU
28 April 2006