Repairs scandal: Audit firm wants extra £150k

Deloitte LLP is seeking another �150,000 to finish the job of billing homeowners for unpaid statutory notices work. Picture: Callum Bennetts
Deloitte LLP is seeking another �150,000 to finish the job of billing homeowners for unpaid statutory notices work. Picture: Callum Bennetts
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THE auditing firm hired to bill homeowners for unpaid statutory notices work is seeking another £150,000 to finish the job – having already being paid around £3 million to investigate the scandal.

Deloitte LLP was drafted in last March to recoup some of the outstanding £20m on 430 projects, now subject to third-party verification before being charged out to property owners.

The auditors were expected to complete the work by October 2013 for a fee of £792.965 but have now asked for more money as many of the projects “were more complex than anticipated”. A new completion date has now been set for March.

The city previously appointed Deloitte to carry out an internal investigation into the property care scandal at a cost of £2m.

Today, critics said they were “uncomfortable” spending even more money on the work which, they say, could have been completed in-house.

Gordon Murdie, of Quantus quantity surveyors, who has more than 200 clients ­affected by the property ­repairs ­controversy, said there had been “no transparency” in Deloitte’s work.

He said: “It seems an enormous expense on something which appears to be the alternative to cost-effective quantity surveying. It ought to be able to have been done in-house. How much is the council is prepared to spend to get the answer they are looking for?

“What they were required to do is say it’s gone dreadfully wrong and we are going to fix it. Instead it’s been an investigation by the council for the council into the council. There’s been no transparency.”

Green finance spokesman Cllr Gavin Corbett said the additional £150,000 payment should be a line in the sand.

He said: “Two years ago Deloitte was paid £2.2m to get to the bottom of the property repair scandal. Last year another £792,000 was committed to the company to help the council sort out the backlog of repair bills, amounting to over £20m.

“Now it seems that Deloitte is coming back asking for more funding to complete that work. If the £150,000 extra is agreed it needs to be with a firm line drawn under it and with ­redoubled resolve never again to let such a shambles develop with such high costs.”

Finance chiefs insist costs have escalated due to the complexity of the projects, the need for extra legal advice on key issues and retaining the Deloitte staff team on site for a longer period than anticipated.

Cllr Alasdair Rankin, finance convener, said: “We have ­developed a comprehensive and rigorous approach to the assessment of these projects. It is vital that these high-quality reviews by Deloitte continue so we are recommending the cost of the contract be increased to cover the additional and more detailed work.”

System is unique to the capital

THE statutory notices system is unique to Edinburgh and requires homeowners to carry out repairs using council-approved builders to protect ageing buildings.

Repairs could be ordered by the council who would commission builders to stop buildings deteriorating and then charge owners for the work. The system became mired in controversy when it emerged many residents had been overcharged for the work which led to an independent investigation into the affair and saw several staff from the property conservation department suspended.

By January 2012, it emerged that at least 650 complaints about the scheme had been received by the council.