Page last updated at 17:28 GMT, Wednesday, 17 March 2010

'Financial mismanagement' at Wrexham community scheme

Council housing Plas Madoc
A report says money was diverted from Communities First in Plas Madoc

An audit investigation into the Plas Madoc regeneration partnership in Wrexham has found evidence of alleged financial mismanagement.

The Communities First scheme had "fundamental weaknesses of management", the Wales Audit Office report said.

It found a car had been bought from petty cash, and more than £3,000 was spent on driving lessons for staff.

Social Justice Minister Carl Sargeant said the matter has been referred to North Wales Police for investigation.

The chair of the assembly's Public Accounts Committee, Jonathan Morgan, described the findings as "scandalous".

Mr Morgan said: "The reports by the Wales Audit Office and the Assembly Government's internal audit service both make worrying reading.

All efforts have been made to ensure projects continue and services within the community have been maintained throughout
Plas Madoc trustees

"Plas Madoc Communities First has clearly been misusing public funds for a number of years and urgent action is needed to ensure this doesn't happen again.

"This situation is even more regrettable at a time when public services are facing severe financial pressures, as described earlier this week in the Auditor General's report 'A Picture of Public Services."

In a statement, the Plas Madoc Communities trustees chairman Mark Leather, said: "Plas Madoc Communities First has been the subject of an investigation by the Welsh Assembly Government and the Wales Audit Office.

'Co-operated fully'

"It has co-operated fully with the audit team during this time. Plas Madoc Communities First took the step of suspending two members of staff at the outset of the investigation.

"All efforts have been made to ensure projects continue and services within the community have been maintained throughout."

The trustees statement said it would not comment further until it had reviewed the report's finding.

Social Justice Minister Carl Sargeant said he deplored actions which led to public funds being diverted from their intended purpose.

He said: "As I said yesterday, the audit concerns relate to the financial mismanagement of a small proportion of the funding routed through the Plas Madoc partnership and there is no suggestion that the majority of funding has not been used for its intended purpose.

Regain trust

"I hope that the services that the Communities First programme in Plas Madoc provides to the local community can be sustained.

"Arrangements will be made to channel the funding through other agencies so that the programme of activities can be maintained with minimum disruption. "

Mr Sargeant said for Plas Madoc partnership to continue to play a role in delivering services, it would need to overhaul its working practices and regain the trust of the local community.

To assist in this and to rebuild the programme on stronger foundations, he said "tailored support" would be made available from the Communities First Advice Service delivered through the Wales Council for Voluntary Action.



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