The Westminster Scandal: A driving force in the local authority watchdog: The Auditor

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The Independent Online
JOHN MAGILL, a senior partner with the accountants Touche Ross, is one of the most highly respected auditors in the country. He served as the firm's national director of accounting and auditing between 1987-93, and has been a driving force in the Audit Commission since it was set up as an independent local authority watchdog in 1983.

Mr Magill was not specially appointed to head an investigation into Westminster City Council, but was asked to launch an inquiry by a number of Westminster's residents in 1990, four years after he was originally appointed as auditor of the council's accounts.

The inquiry which Mr Magill then embarked on, with the help of three Touche Ross assistants, has taken four years and cost pounds 1m so far. It has involved 133 interviews of 50 people, and the examination of thousands of files. The resulting report runs to 235 pages, with an additional bundle of documents totalling over 10,000 pages in 14 files.

The Audit Commission was set up as an independent body to supervise local authority finances, and is funded entirely by fees from those authorities. Roughly two- thirds of its work is done by full- time Audit Commission employees, the rest by auditors from accountancy firms, like Mr Magill, who is also the auditor of Buckinghamshire County Council, Luton Borough Council and St Albans District Council.

In 1990 a group of residents or 'objectors' asked Mr Magill to launch an inquiry under section 17 (3) of the Local Government Finance Act 1982 into Westminster City Council's conduct on council house sales.

Although appointed by the Audit Commission, Mr Magill carries out his statutory functions in a personal capacity and is independent of the commission.

His status in the inquiry is 'quasi-judicial', and following the publication of yesterday's provisional findings he is now open to requests for hearings into the matter by either the objectors or those named in the report.

Requests for hearings have to be made by July, and Mr Magill will probably then hold a series of public hearings in which all sides will be able to make their case and cross-examine witnesses.

These hearings will be similar to court hearings, but only when they are over will Mr Magill be able to apply to the court for a declaration that actions taken by the council have been unlawful.

In his report Mr Magill indicates this would take the form of a surcharge on the named councillors for a total of pounds 21.25m, and a request that they be disqualified from holding council office.

(Photograph omitted)

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