LOCAL government watchdog The Accounts Commission has heavily criticised Shetland Islands Council following its two day hearing into its affairs.
Commission chairman John Baillie has described the way the SIC is governed as “haphazard” and says it also has “serious problems” with leadership, vision, strategic direction, financial management and accountability.
Significant tensions between councillors and between councillors and officers have not helped matters, the commission said.
Urgent action to improve the running of the council is essential and the authority has been given three months to come up with an action plan to deal with the recommendations the Accounts Commission published on Monday morning.
They praised the decision to appoint Orkney Islands Council chief executive Alistair Buchan to run the council for the next two and a half years, but warned against unrealistic expectations being placed on his shoulders.
Mr Baillie said: “Every council needs to ensure it is run properly, through good governance. But that has not happened at Shetland.
“Shetland Islands Council has serious problems. Councillors and officers need to accept the need for change, to pull together and act quickly and decisively to implement our recommendations and ensure best value for people in Shetland.”
He said there were particular concerns about conflict of interest, financial management and accountability. They also want to see an end to the argument over grouping the council and the charitable trust’s accounts that has led Audit Scotland to qualify them for the past four years.
There was also criticism of the way in which former chief executive David Clark was appointed and the way he was managed after he took up his post, including his controversial departure after just nine months with a £285,000 tax free pay off.
A clear set of objectives with targets for delivery must be put in place to cover:
• the council’s approach to governance, to ensure that rigorous systems are in place to support clear and transparent decision making;
• councillors working together to ensure that they have a shared understanding of the requirements of the code of conduct for elected members;
• training and development for councillors and senior officers to help develop clear and authoritative leadership, mutual respect and a clear understanding of their respective responsibilities;
• processes to ensure that the council can put its use of resources in line with its financial strategy and demonstrate that its services provide best value;
• addressing the weaknesses in the council’s finance function and ensuring that the accounts are not qualified again in 2010/11;
• procedures for the creation and filling of all posts, and performance management and appraisal of all staff;
• procedures for consulting and communicating with the local community;
• engagement with the wider local government community and learning from good practice.
The Commission will continue to monitor the council’s circumstances through the council’s external auditors Audit Scotland, and has asked for a further report by the Controller of Audit in 12 months’ time on progress made by the council.
The Commission said they will give consideration at that point to any further measures that need to be taken.
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