'Broken system' and 'toxic environment' blamed after probe into Northumberland County Council's international business

Councillors heard how the controversial Northumbria International Alliance (NIA) was not subject to proper scrutiny within Northumberland County Council.

The authority’s participation in the business, which was set up in 2017 in partnership with Northumbria Healthcare NHS Foundation Trust and delivered healthcare consultancy in places including China, has been put under the microscope over the past year.

An independent investigation was commissioned after ‘unlawful’ council spending was identified in relation to the NIA between 2017 and 2021, because it was not set up with the correct company structure.

Sharing the findings of his investigation at an audit committee, external adviser John Gilbert said the business was “never set on solid foundations”.

He told councillors there were no proper scrutiny or accounting processes for the NIA, which was run as an ‘unincorporated partnership’, and that decisions over it were wrongly taken at ‘informal’ meetings of the council’s cabinet.

Mr Gilbert said the fault was not down to one individual but to a ‘broken system’, a ‘complete breakdown in trust’ between council officers and politicians, and an ‘increasingly toxic environment’ for local authority staff.

He added: “Those are not my words, they are the words of a number of individuals and officers who I spoke to. If there was one thing that was uniform about this, it is that the environment they were working in at times was impossible.”

Despite the ‘hurt’ caused by the NIA episode, Mr Gilbert said the council had to move on and to ‘understand the lessons learned’.

A council report identifies 14 key learning points from his investigation, as well as 23 recommendations – six of which have already been completed.

Liberal Democrat Jeff Reid questioned why the council ever wanted to be involved in an international business.

Coun Reid said: “Way back when, who among us thought it was going to be a good idea touting for business that we don’t know anything about. I can’t remember when we decided to do it and why we decided to do it.

“Councils should be concentrating on delivering services in their area, then maybe next door to that doing work to fix traffic lights or streets lights together and have companies doing that.”

Several councillors also raised concerns about the use of informal cabinet meetings to make decisions.

Former Tory council leader Peter Jackson insisted that political leaders had asked questions about NIA.

Coun Jackson, who was dramatically deposed in 2020, added: “One of the major reasons that no formal decisions were made, and I understand that informal cabinet was not a decision-making body, is that when you are making a formal decision you need the information to base it on. We asked time after time after time for proper budgets and accounts for those “

Mr Gilbert’s report noted that it was “impossible to quantify with any degree of certainty” whether NIA made a profit or a loss – but that it “does not appear that the council suffered any financial loss, and may in fact have made some net gain”.

Coun Sanderson later revealed the council would “absolutely not” pursue another international venture similar to NIA.