COUNTY bosses have warned they are working at pace to address ‘fundamental errors’ in South Yorkshire Police’s accounts after an ‘unlawful’ £65m black hole was found - but warned savings will have to be made immediately to protect frontline services.
The Office of the Police and Crime Commissioner (OPCC) - which was transferred to the South Yorkshire Mayoral Combined Authority in May - resulted in Mayor Oliver Coppard taking on a dual role.
Due diligence has been undertaken by Mr Coppard’s finance team who found a ‘significant’ error in the OPCC’s accounts and future year budgets.
It was revealed that in recent years £65m has been spent on equipment such as kit for officers, vehicles and IT gear and services.
Investments in this kind of kit, called capital spending, are often financed through borrowing and repaid over a longer period to help make the costs more affordable.
The work undertaken by the SYMCA finance team has identified that £16m of charges that should have been made to allow for the repayment of this debt so far have been missed and that future payments of £49m have not been included in spending plans going forward.
These problems ‘would appear to represent a fundamental error in accounting practices’ in Dr Billings’ former office, they revealed, and the errors were not identified by annual audit checks from 2020 onwards.
In response, Mr Coppard has asked them to commission an immediate independent review of the accounts of the former OPCC to understand how this issue arose and to ensure that no other errors have occurred.
Mr Coppard said: “I am deeply frustrated by the problems uncovered by my team following the transfer of OPCC powers into my office earlier this year.
“We are working at pace with the government, external auditors and South Yorkshire Police to mitigate the impact the required charges will have on budgets going forward.
“Those conversations have been positive and we will continue to work together to find solutions.
“These problems would appear to represent a fundamental error in accounting practices in the office of the former PCC.
“Those mistakes were missed by external and internal checks.
“I have now instructed my office to bring in an external team to independently look at the processes that allowed those mistakes to go undetected for five years.
“I am grateful to South Yorkshire Police and the government for the constructive conversations we have already had about finding a sustainable solution to both these new challenges and the ongoing pressures caused by tightened police budgets over the last 14 years.
“Protecting the communities of South Yorkshire will always remain my first and most vital priority.”
A report, compiled by SYMCA chief finance officer Gareth Sutton and monitoring officer Rebecca Brookes, said ‘consideration will now be given to how the issues can be resolved in a sustainable way’.
“Any immediate resolution is likely to require reactionary measures including the cessation of planned activity and the re-allocation of resources currently deployed to priority work, risks and priorities,” it added.
“A deferment of costs onto a more sustainable basis would afford the SYMCA and the force the chance to readjust its planning in a more considered fashion but would likely lead to greater financing costs overall.
“We believe that the failure was an inadvertent omission on the part of the office of the former PCC, however the consequences of the omission are that the accounting practices of the former PCC failed to comply with the requirements.
“This failure is likely to cause loss or deficiency to the police fund revenue budget for the reasons set out in this report.
“We take the view that it appears that since the PCC failed to have regard to the statutory guidance in respect of capital expenditure between 2019/2020 and 2022/2023, they acted unlawfully.”
Chief Constable Lauren Poultney said she had ‘great disappointment and concern’.
She said: “I have learnt of a significant error in the accounts formerly held by the Office of the Police and Crime Commissioner and the impact this will have on the financial stability of South Yorkshire Police.
“The mayor informed me of this error two weeks ago and since then we have worked together at pace to understand how this happened, the impact of this and the options available to us.
“We have a well-established savings and efficiency programme and healthy reserves which will mean we can come at this from a relatively healthy and robust position but this is not how we would seek to manage our finances and it will, of course, have impacts on the service we deliver.
“As you would expect, my priority now is to safeguard the services we provide to the public and so I have sought reassurance from the mayor the accounts, now in his care, are properly governed.
“I have that assurance and feel confident through working together and with the support of the Home Office we will be able to stabilise the budget and protect the services we offer - that said, there will of course be challenges ahead as we work through this.
“I have informed the workforce of this error this morning and will do all I can to offer them appropriate reassurance so they can continue to focus on the task ahead.”
