Single council overpaid staff by more than £800,000, watchdog discovers

One local authority worker received £15,500 more than they should have

Delays notifying payroll meant former employees still got paid after leaving (iStock)

A council overpaid staff and former workers by more than £800,000 in less than three years, a spending watchdog has revealed.

A report from the Accounts Commission disclosed that a single local authority in Scotland – which has not been identified – made more than 800 salary over-payments between April 2015 and February 2018.

These amounted to about £812,000, the report said, with six over-payments exceeding £10,000 and one person receiving £15,500 more than they should have.

The local government spending watchdog also found that “an eighth of former employees were still paid after leaving the council, usually due to a delay in a department notifying payroll services staff that someone had left”.

The council has since recovered 58 per cent of the money overpaid to current staff and 27 per cent of that overpaid to former employees, but the commission noted it has written off £21,000.

Details of the financial errors were revealed in a new report from the Accounts Commission, which warned that systems aimed at preventing money being lost through mistakes and fraud may be becoming “strained”.

It said: “Some recurring weaknesses are becoming apparent among councils and the consequences could be serious, including the loss of significant amounts of public money, impacts on services and reputational damage.”

Graham Sharp, chair of the Accounts Commission, said tighter budgets and Brexit uncertainty meant it was more important than ever for councils to scrutinise their outgoings.

“Robust management and scrutiny of the finances at Scotland’s councils is more important now than ever before,” he said. “Councils face complex and challenging financial pressures, and rising demand for services. At the same time, budgets are tightening and there is significant uncertainty from factors such as the UK’s withdrawal from the EU.”

He added: “Councillors are ultimately responsible for scrutinising a council’s use of public money, and they should seek assurances from council officers that rigorous systems and processes are in place to safeguard finances.”

Alison Evison, the president of Scotland’s local government body Cosla, said the report is a “timely reminder of the many and varied pressures on local government”.

She added: “Scotland’s councillors appreciate their role and duty in safeguarding public money and take it seriously. Our colleagues at the Improvement Service support councils with this through the continuous professional development framework for elected members and bespoke support to develop councillors’ scrutiny skills.

“Cosla and our colleagues in the Improvement Service will continue to support our member councils look at ways to strengthen our joint work in this vital area even further.”

Additional reporting by PA