Cambridge City Council lost almost £650,000 of public money after the company it appointed to run the online ticket sales for the 2008 Folk Festival failed to hand over any money. I have written a number of articles following the council’s attempts to understand what went wrong so that similar disasters can be avoided in the future:
- Cambridge City Council Owed 618K by Folk Festival Ticket Seller
- Asking Questions About Money Owed to Cambridge City Council from Folk Festival Online Ticket Sales
- More Questions on the Cambridge Folk Festival Ticket Money
- Damming Report on Cambridge Folk Festival Fiasco
- Looking into the Folk Festival Mistakes
- Following up the Folk Festival Losses – An Update
At Cambridge City Council’s Community Services Scrutiny Committee on the 25th of June councillors considered proposed terms of reference for a “Members’ Committee of Inquiry”, the previous meeting of the committee had already agreed to the principle of such an inquiry. The Leader of the Council, Liberal Democrat Ian Nimmo-Smith, and the Chief Executive attended the meeting for this agenda item only.
The Chief Executive presented suggested terms of reference and explained how she thought an inquiry might proceed. She explained there was no separate budget for the process, and said she had decided the council’s head of strategy and partnerships, who had not previously been involved, would be the lead officer charged with supporting the inquiry. She stressed the inquiry was not to replace the council’s HR processes and would need to be focused on learning lessons from what has happened. She said there would be a need to be tough on data protection and access to information and said it was very likely that sessions would get into discussions which would require them to go into private session. She recommended that at least the witness sessions ought not be held in public. A timetable involving five meetings, the middle three of which would be witness sessions, and the final meeting to pull together findings and recommendations was suggested.
The Chief Executive admitted there was some debate as to who the inquiry was reporting to. She said she expected it would report to “the relevant committee or executive councillor”. She finished her introduction saying it was: “important to put boundaries around the process, particularly in the form of a timetable, to make it manageable”.
Councillor Boyce welcomed the report saying he felt the terms of reference suggested were “reasonably good”. He formally proposed two amendments:
- The inquiry should follow the chain of evidence from Arts and Entertainments into other departments but not cherry pick things which do not relate directly to the subject.
- The first and last meetings shall be in public.
He gave examples of things he didn’t want the inquiry getting into – including the icelandic banks and said he wanted the inquiry to compare what happened with what should have happened and to try and work out why the two states are different.
Labour Opposition’s Reaction
Cllr Benstead spoke on behalf of the Labour opposition. He said:
“The Labour group are not supporting this recommendation; we are proposing an amendment with a counter recommendation. This issue has been in operation around the council for some five, six, seven months for some members and has been discussed at numerous council meetings including area committees, meetings of this committee and full council. It has also been informally discussed among councillors for some length of time. When we have discussed it formally we have been advised not to stray into certain areas in-case we go into the areas being dealt with by the human resources (staff disciplinary) process. We are being led down a route which the inquiry may not want to take.
Through the whole of the period the Labour group has called for an independent external inquiry. We believe that if the inquiry held by members was a court of law then the jury would be seen as tainted, as it would be felt there was some degree of pre-determination. A large amount of money has been lost by the council in anyone’s view. I don’t think this should investigated by any members of the council as there would be a degree of political and personal interest. This has been a hot issue for a considerable period of time, it needs to be looked at independently from an external point of view, this cannot be done by our own members, we are all too close to this. We already have views which may influence us. The Labour group are declining the option to take places on the inquiry. We are calling for the committee to ask the council to establish an external inquiry, which can act fairly and without predetermination. The council has to be seen to deal with issues fairly and cleanly without consideration of personal and political advantages. With an external enquiry that issue does not arise, we do not think that is possible with an internal inquiry.”
At the end of Cllr Benstead’s speech Nimmo-Smith said “I’m rather disappointed by what I’ve just heard from Cllr Herbert there”, implying Cllr Benstead was reading Cllr Herbert’s words, or at least expressing his sentiments. Cllr Herbert is the leader of the Labour Group, who had been quoted in the Cambridge-News in an article published on the day of the meeting saying his group would be effectively boycotting the inquiry, on the grounds it would not root out the problems. Cllr Nimmo-Smith then said Labour was acting in their own and not the council’s interests; saying: “they have a fox; it’s important to them that this live fox keeps running as long as possible. Cllr Herbert has said there are ‘systemic problems’ which he has seen in the folk festival, he has declared the council is infested with witches and he wants to set up a witch finding process to root them out. His views are completely unfounded.”
Other councillors briefly contributed to the discussion. Cllr McGovern said he could not see why councillors would not be able to act neutrally on this inquiry as they do on licensing and planning matters. Cllr Liddle said: “I don’t recognise Benstead’s description of councillors; they’re known for being independent – known for their bloody mindedness”. While that might be true of some councillors, I don’t think it is true of most of the backbench Liberal Democrats who generally keep quiet and put their hands up to vote when they’re told to.
Cllr Ellis-Miller said: “I feel we’re able to discuss it with people involved and come to agreement in a rational manner – if at that stage or at the end we need some help from outside we can look at costs and timings then. I feel we all need to be able to stand back and do it in a measured way; I don’t feel we need bickering and posturing.”
Cllr Walker : “I object to Ian Nimmo-Smith referring to Cllr Herbert’s request for an independent review as a witch hunt and a desire to promote a witch hunt. He’s using very emotive language which is not called for. The request for external review is made in good faith. I find Ian Nimmo-Smith’s response surprising”.
Votes were held on both Cllr Boyce’s amendment, and one from Cllr Bedstead calling for an external inquiry. Cllr Benstead’s amendment: “The committee recommends the council recommends an external independent inquiry into folk festival ticketing issues” was not passed; with the six liberal democrats voting against outnumbering the three labour members voting for it. Cllr Boyce’s ammendment was passed with the six Liberal Democrats in favour, and no votes against. The official minutes will not record who voted which way.
The meeting’s chair, Cllr Liddle tried to progress things saying “now we have a substantive motion we can move to a vote”. Cllr Blencowe said word to the effect of “oh no you don’t ” clarifying “we’re not taking part – you don’t have 2 Labour members”.
Cllr Boyce asked for an adjournment, which was granted, and he joined the Chief Executive and Leader of the Council in a huddle as they decided what to do next.
When the meeting reconvened Cllr Boyce explained that four members plus two others is permitted in terms of the council’s representation on committees rules which are designed to ensure that the ratio of members on committees reflects the make up of the council. The Chief Executive concurred confirming that if Labour don’t want to take up their seats that doesn’t stop the process. The committee was originally planning to allow a Labour member to chair the inquiry, following Labour’s boycott the meeting decided to allow the inquiry to appoint its own chair.
The meeting voted to set up the inquiry with four Lib Dems and two as yet unidentified others serving on it. Cllr Al Bander asked if the “others” have to be councillors and was told yes by Cllr Boyce and the Chief Executive. Cllr Al Bander asked for further clarification on if the inquiry would really go ahead with unfilled seats on it, he appeared to be suggesting that wasn’t such a good idea, but was told yes by his party colleagues.
Before moving on Cllr Blencowe asked questions about the timing of the inquiry in relation to the Human Resources processes. There was some discussion among councillors of the value of looking at matters arising in the HR processes, with various councillors saying that HR processes often revealed problems with management, and were a route via which the council’s procedures were improved. The Chief Executive confirmed it was her intention to allow the HR processes to complete first, so the committee of inquiry would have all the relevant information at its disposal.
There has been renewed interest in this recently, with Radio Four’s You and Yours covering the council’s losses on Friday 26th June (At 30 minutes in). A Radio Four researcher had even been in touch with Rashid Qajar, who was the director of SecureTicket UK, he blamed the recession for the failure of his business, and claimed the company had lost much more than the council. (I have come accross this blog post describing the opulence of the company.) It is likely there will be further discussion at the Council’s Strategy and Resources committee on Monday evening.
The other opposition councillors, Hipkin (Independent), Wright (Green) and Howell (Conservative) will have to consider if they wish to take up seats on, or even chair the members inquiry. I think that the presence of Hipkin or Howell would add a lot to the enquiry, with them it would be likely to achieve more; however whoever is on it, the enquiry is to be vigorously constrained by the council’s chief executive, and it will not do anything towards recovering the money. For that we need to look to the police, and PriceWaterhouseCoopers, the latter are due to visit the council and report on their progress this week.
6 responses to “Members’ Inquiry into Folk Festival Approved”
Leader of the Council, Ian Nimmo-Smith and Leader of the Labour Opposition Lewis Herbert were interviewed on the Cambridgeshire Breakfast with Jeremy Sallis show on Monday 29th June.
Transcript
Jeremy Sallis : Now – seven minutes past eight – Cambridge City Council must hold and independent inquiry into the loss of over £600,000 of online ticket sales, that’s the call from Labour councillors just a month before this year’s folk festival. They say that’s the only way the right people will be held accountable for what happened. We’ll speak to Ian Nimmo-Smith, the leader of the council in a second after first speaking to Lewis Herbert leader of the Labour group. Good Morning Lewis. Why do we need this independent inquiry to come, why do you think it should happen?
Lewis Herbert: £645,000 is 10% of the council tax each year, we think there’s still a chance the money is still around. We don’t think the council has done nearly enough to chase the money. Ian Nimmo-Smith himself promised an independent external inquiry [which hasn’t happened], it could have been done cheaply, the council has had only one quote – from PriceWaterhouseCoopers, possibly the most expensive people on the planet to do such an inquiry.
Jeremy Sallis : We’ll talk more to Ian about that in a second. Why does this need to happen – we know what went wrong, the finance department’s advice wasn’t followed, the legal department wasn’t consulted. Why dig this all up again? Is it not just electioneering on your part.
Lewis Herbert: Well there’s no election Jeremey, £650,000 is missing and Mr Nimmo-Smith promised an independent inquiry. Our judgement is that we keep having internal inquiries because they don’t want to face up to what happened. The council showed itself to be inept, both at the beginning and during all this stuff about the inquiry we really should have been chasing this money. There was a creditors meeting in January and councillors still have not had a report on what happened at that. If they want to have further inquiries then the problem is they keep pre-judging it. Cllr Nimmo-Smith started pinning the blame on several members of staff before the inquiry happened. The council really does need to give a transparent, clear report to the public explaining what happened to their £645,000.
Jeremy Sallis : Let’s have a chat with Ian Nimmo-Smith, Leader of Cambridge City Council, who joins me in the studio. I’d keep those headphones on as Lewis is no-doubt going to interrupt you. Now why has there not been an independent inquiry?
Ian Nimmo-Smith : There are two issues here, one is pursuing the money, and yes it is a serious loss, and the other is making sure we understand what went wrong and ensuring the correct moves are made following that. Now you mentioned the folk festival going forward in July 2009, very soon, a month away, it was very important that we got an understanding of what had happened last time round so that when we were going through the planning for the current folk festival we could put in hand all the right lessons so that the plan for the online ticketing, and the project as a whole was done as robustly as possible.
Jeremy Sallis : Why was this all done in-house though, an not an independent inquiry giving answers to taxpayers as Lewis says needs to happen?
Ian Nimmo-Smith : It was a matter of timescales and cost. When we looked into it the kind of time scales we would have been working to and the kind of costs – tens of thousands of pounds were not going to be value for money, and the timescales were not going to put us in a position to ensure that future folk festivals, and in particular this year’s festival were going forward on a sound footing.
Jeremy Sallis : You spoke to me and accepted it was a mistake on the council’s part; but have lessons been learnt, and is the money being chased?
Ian Nimmo-Smith : Of course the money is being chased, and I don’t think Cllr Herbert is seriously proposing he is going to put together an independent possy to pursue the money. There are specialist firms at work on this at the moment, the police are aware and they are taking their own view on the matter, and we are getting further information from the liquidator of the firm that took our money.
Jeremy Sallis : Do you think an independent inquiry would achieve anything and is necessary?
Ian Nimmo-Smith : i don’t think that Cllr Herbert has identified anything which cannot be achieved by robust independent minded councillors. We have proposed a committee which would be shared between Liberal Democrat and Labour members and they have got a quite clear remit to follow up the additional elements such as why were the messages from finance and legal not being picked up on and should we have further responsibilities to act on there.
Jeremy Sallis : Where are we as far as getting the money back?
Ian Nimmo-Smith : There are some processes going on, there will be further reports. I would not want to attach any probabilities on the chance of substantial returns.
Jeremy Sallis : Lewis, are you confident the money will come back into the hands of the tax-payer?
Lewis Herbert: We can’t see any real effort. They put some lawyers onto this case and they should have put financial sleuths onto it. There is a possibility this money is still around, and if that is the case then it should have been chased. Councillors have not had a report in nearly six months, since the creditor’s meeting. I can’t see any evidence the council has made any real effort to get its money back.
Jeremy Sallis : OK, Lewis and Ian thanks for joining me this morning. That’s Ian Nimmo-Smith who is the Leader of Cambridge City Council, and Lewis Herbert, Leader of the Labour Group on Cambridge City Council ….
When Rashid Qajar was interviewed did he explain how he has just managed to buy a new Jaguar in Cash if times are that hard?
Here is an up to date article from the Cambridge News 24/04/2012 about the owners of Secureticket (UK) Ltd, Mr Mohammad Rashid Qajar and his wife Mrs Sally Oakley..
http://www.cambridge-news.co.uk/Home/Boardroom-ban-for-pair-in-folkfest-645k-loss-24042012.htm
I have replaced a copy and paste of the entire article mentioned above with a link to it.
We are currently seeking business’s and individuals who have past dealings with Mr Mohammed Rashid Qajar commonly known as Rashid Qajar or Mrs Sally Oakley of 34 Sutton Park Road, Winchester, SO21 3GZ, past directors and secretaries of SECURETICKET (UK) LIMITED and other companies including:
ROVERCO CAPITAL LIMITED Dissolved
SECURETICKET LIVE LIMITED Dissolved
PARAGON RESEARCH & DEVELOPMENT LIMITED Dissolved
TELSECURE CONSULTING SERVICES LIMITED Dissolved
TELSECURE GROUP LIMITED In Liquidation
BAR PROPERTIES LIMITED Active (Director Resigned 16/09/2005)
SECUREBET LIMITED Active (Director Resigned 25/04/2010)
MORAL PROPERTIES LIMITED Active (Director Resigned 02/09/2005)
BOTLEIGH GRANGE PROPERTIES LTD Active (Director Resigned 15/07/2010)
DAYFIELD TECHNOLOGY PLC Active (Director Resigned 19/02/2002)
ALTAIR TRADING LIMITED Active (Director Resigned 19/02/2002)
V.I.P. ISLANDS (GREECE) PLC Dissolved
ROVERCO CAPITAL LIMITED Dissolved (Company Secretary Resigned 18/04/2010)
OLIVE CARD LIMITED Dissolved (Director Resigned 20/04/2010)
PURPLE DRAGON PRODUCTIONS LTD Dissolved (Company Secretary Resigned 11/07/2003)
PURPLE DRAGON PRODUCTIONS LTD Dissolved (Director Resigned 01/02/2009)
ENTERTAINMENT CAPITAL GROUP PLC Dissolved (Director Resigned 24/07/2003)
CMAX CORPORATE FINANCE LIMITED Dissolved (Director Resigned 29/04/2010)
C MAX CORPORATION PLC Dissolved (Director Resigned 21/02/2002)
INSPIRITED
ST.DENYS MARINA LIMITED
SECUREMEDIA LIMITED Dissolved
PARAGON SYSTEMS LIMITED Dissolved
SECURECARD LTD Dissolved
SECUREPAY GLOBAL LIMITED Dissolved
UDOO MUSIC LIMITED Dissolved
SECUREACCOUNT.NET LIMITED Dissolved (Director Resigned 19/03/2009)
ACTIVE CONSULTING
EPAY GLOBAL LTD
OLIVEPAY LTD
If you have previous dealings with Mr Mohammed Rashid Qajar, Mrs Sally Oakley or any of the companies mentioned above, we would like to hear from you.. Please email you name, telephone / contact details and past dealings to [Hotmail address redacted – RT on the grounds it looks dodgy)
On Monday the 15th of October 2012 I observed Cambridge City Council’s Strategy and Resources Committee recommend that the council write off the money owed in relation to the Folk Festival tickets. The committee were split with Liberal Democrat members wanting to write it off, and Labour arguing this sent out the wrong message. Liberal Democrat Cllr Sarah Brown held the casting vote which she used in favour of writing the money off, when challenged by Labour to explain her reasons she refused to do so and stayed silent.
Following the committee’s recommendation council leader Liberal Democrat Tim Bick decided to write off the debt.
The council has been using solicitors Wilkin Chapman Grange to advise them on recovering the money – council officers say they specialise in this kind of thing. They expressed a view, echoed by the council’s own head of legal, that:
Wilkin Chapman Grange state the funds due to the council were “in the region of £500,000” where as the amount written off by the council is £618,801 and that’s a figure which doesn’t include the fee which the council was intending to pay for the online ticket service provided. Labour councillors suggested the broad approximation and underestimation from Wilkin Chapman Grange indicated they were not the right people for the job. Labour leader Cllr Herbert said they’d been like the Dad’s Army character who always says “We’re doomed” right from the start and had always taken the view that there was no hope of recovering the money.
A letter from Wilkin Chapman Grange was circulated at the meeting. It is not currently on the council’s website but I have made a copy available (17MB PDF).
The letter, and the council’s head of legal, say that Mr Qajar is currently renting the property he appears to live in and this, they suggest indicates he has few assets.
The council’s head of legal said that once SecureTicket UK was put into liquidation the council ceased to be able to take action against the company and had to rely on the liquidator. Cllr Herbert said he didn’t have much faith in liquidators to work on behalf of those owed money saying they were just in it for their cut.
Labour’s Cllr Herbert said ex Cllr Howell had been right and the council should have put forensic accountants, not a firm of solicitors, on the case.
Cllr Herbert said that my website (http://www.rtaylor.co.uk) had done more than the council in trying to get the money back.
The council’s head of legal told the councillors that Mr Qajar the ex director of SecureTicket UK is to face a civil trial in Bournemouth County Court in November 2012. The council’s head of legal has prepared a witness statement and is on a “call list” and may appear in person at the trial.
The councillors were told by their head of legal that Sally Oakley one of the other directors is contesting attempts by central government’s business department to disqualify her as a director.
The head of legal also told councillors there is an report by the Insolvency Service into SecureTicket UK Ltd. This report is currently not being released to Cambridge City Council despite them asking for it. I’ve made a FOI request for the report, in public, using mySociety’s Freedom of Information service WhatDoTheyKnow.com.
The writing off of the debt was described as an “accounting transaction”, a technicality, which will not prevent the council from taking further action if things change.
Meeting paper: Debts for write off report.