Cllr. Muhammed Butt and Cara Davani
(from a Brent Council photograph celebrating International Women’s Day, March 2015)
(from a Brent Council photograph celebrating International Women’s Day, March 2015)
Guest post by Philip Grant (please note as this is a long article it has been posted with a continuation page. Click at the end of the article to read all.
On 5 December 2017, three hours before the start of an Audit Advisory Committee meeting, Brent Council’s auditor issued his decision letters on the objections against its 2015/16 accounts over the payment of £157,610 to its former HR Director, Cara Davani. I will ask Martin to attach a copy of the decision letter I received, so that it is in the public domain for anyone to read if they wish to. READ IT HERE
In summary the auditor decided that the payment was not unlawful and that he would not issue a Public Interest Report over the issues the objectors had raised. He did, however, say that ‘there are a number of governance areas that we consider that the Council should strengthen’, and made several recommendations, mainly over keeping formal written records of legal advice given and of meetings (a familiar problem at Brent!).
I am sure that the auditor believes he exercised his professional judgement properly in coming to his decision. According to his “progress report” ahead of the 5 December meeting, he had also submitted his ‘statement of reasons on the objection’ to his Regulator, PSAA (Public Sector Audit Appointments Ltd, a wholly owned subsidiary of the Local Government Association) for comment.
Maybe I am a “loser” who finds it difficult to accept that he was wrong. But I can’t help feeling that I, and the four other local people who objected to the £157k payment, have been let down by a system which is meant to ensure that local electors can challenge the potential misuse of funds by their Council through a ‘fair and impartial process’. I cannot change the auditor’s decision, but I can set out why I think it was wrong.
At the heart of the objections were two decisions, both made by the then interim Chief Executive, Christine Gilbert. One, in May/June 2015, was to make the £157,610 leaving payment to Ms Davani. The other was not to take disciplinary action against Ms Davani in September 2014, and I will look at how the auditor dealt with that decision first.
Decision not to take disciplinary action against Cara Davani following the Rosemarie Clarke Employment Tribunal judgment in September 2014:
In the course of his “Findings”, the auditor says:
‘I conclude there is nothing to persuade me that this decision was not within the range of broadly reasonable decisions open to the Council.’
In fact, as all five objectors had pointed out to the auditor, the decision was not even ‘broadly reasonable’; it was so unreasonable that no reasonable person, or Council, in possession of the facts could have made it. The auditor had started his paragraph by saying:
‘Whether or not disciplinary procedures against Cara Davani should have been taken following the Employment Tribunal judgment was a decision for her line manager, Christine Gilbert, having regard to internal policies and guidance and taking account of the facts leading up to, and arising from, the hearing. We have been informed there is no documentation recording the decision on this.’
One of my fellow objectors, with experience of employment matters, had told the auditor that the evidence of Ms Davani’s actions in the judgment was ‘sufficient …to justify any reasonable employer to summarily dismiss Ms Davani for gross misconduct.’ The auditor had been given first hand evidence of Carolyn Downs, Brent’s current Chief Executive, admitting privately to the objectors in December 2016, that the Council should have taken disciplinary action against Ms Davani in September 2014, and that if she had been Chief Executive in those circumstances, it would have done.
The auditor had also been shown that Brent’s own Disciplinary Policy and Procedure documents made it clear that if an employee is found to have committed "gross misconduct", this will normally result in dismissal. The types of action by an employee 'which would result in disciplinary action for gross misconduct', as set out in those documents, included four examples of actions by Ms Davani, made as findings of fact by the Tribunal in its judgment.
Because Christine Gilbert had not kept to Brent’s own policies and guidance when deciding not to take disciplinary action, it was pointed out to the auditor that she had also shown a number of the examples of actions which could have resulted in disciplinary action against her for gross misconduct. So why had she not taken the proper action against Cara Davani, and why was there ‘no documentation recording the decision’?
My submissions to the auditor in August 2017 gave the reasons why, but his decision letter dismisses these, merely saying: ‘whilst I have noted your allegations, I have not seen any supporting evidence.’ I had provided evidence, including text from a written statement made to me in 2016 by a “Civic Centre insider” who was involved at the time, alleging that Ms Gilbert and Cllr. Muhammed Butt had considered the matter in isolation, that they were actively protecting Cara Davani, and that they communicated over it through their private email accounts so that there would be no documentary evidence in the Council’s records.
I had to keep the name of the “insider” secret, as that person did not trust their allegations would be properly investigated, and feared the possible personal / career consequences of having their identity disclosed. I accepted that this meant their evidence was only “hearsay”, but in the absence of any documentary evidence from the Council, their evidence on the matter was also “hearsay”, so why was their version preferred?
Decision to pay Cara Davani £157,610 as “compensation for loss of office” in 2015:
The auditor concludes his “Findings” on this point by saying:
‘There was nothing in the documentation I have seen to indicate that any amounts paid to Cara Davani were unlawful.’
He had seen the original documentation held by Brent Council from May and June 2015 in relation to this payment, and received representations on it from the Council, but had not allowed me or the other objectors to see it.
I have already covered the reasons why this ‘material information’ could and should have been shared with us, so that we could comment on it fully, in a previous guest blog LINK . The information included not only legal advice, but also other correspondence and documents which would have set out what information was given to the QC, and what was not, on which the advice the Council relied on justify the payment was based. It was made clear to the auditor that it was impossible for us to support our objections properly without sight of that information.
The auditor’s response to this, in the “Background” section of his decision letter, was:
‘I am satisfied that the provisional views letter sent to you on 3 August 2017 read with the Audit Committee minutes and Conrad Hall’s letter dated 14 December 2016 gave you sufficient information in order to have provided comments to me, such that there has been no unfairness in not sharing the advice.’
In effect, he is saying that the primary documents are not‘material information’, but that the interpretation of those documents given to him by a Brent Council officer is, and that it:
‘… contains the material facts on which we have relied upon when reaching our decision. For this reason and given that the Council has not waived its legal professional privilege, I have not shared the actual documents containing or recording the legal advice with you.’
In other words, the auditor has reached his decision based on what Brent Council has told him, and has not shared with the objectors any actual documents related to the payment we objected to because Brent Council did not want him to. I am sure any reasonable person will understand why I believe that the process by which the auditor reached his decision was neither fair, nor impartial.
As the auditor would not allow us to see the “material documents”, the objectors had to make their “further comments” on the best information available to them. In his “Background” section the auditor said:
‘Following the Employment Tribunal above, there was a breakdown in trust and relationships between some Members of the Council and Cara Davani. … This was considered to be an ongoing reputational risk to the Council and that it was difficult to see how Cara Davani could be effective in her role as Human Resources Director, working with Members, going forwards.’
The reputational damage had already been done in September 2014, with the facts about the appalling treatment of Rosemarie Clarke by the Council and Cara Davani receiving wide publicity after the Tribunal judgment was published, and by the failure to take disciplinary action against Ms Davani. Given the situation described, why was nothing done about it until May 2015? My comments gave the auditor evidence of why – showing that Ms Davani was being “protected” by both Christine Gilbert and Cllr. Butt – but that by May 2015 the Council was selecting a new permanent Chief Executive, so that Ms Davani would soon lose that joint protection.
The auditor’s view of the prelude to the “settlement agreement” objected to, following on from the passage quoted above, is described as follows:
‘Meetings took place between the Leader, Chief Executive and various Members to try and resolve the differences but relationships did not improve. We understand these meetings did not have minutes taken. Following discussions between the Leader and the Chief Executive, it was determined that it would be in the best interests of the Council if Cara Davani and the Council parted company and that legal advice should be sought on possible ways forwards.’
It does not appear that any documentary record exists of those discussions, but the next step is set out in the auditor’s “Findings” as follows:
‘Legal advice was sought in May 2015, which concluded the Council did not have a case to conduct a fair dismissal, noting that Cara Davani had informed the Council that she would take the Council to an Employment Tribunal for unfair dismissal if her employment was terminated. Given no disciplinary procedures had previously been taken in respect of the findings from the Employment Tribunal, in these circumstances and given the legal advice obtained, it does not appear unreasonable for the Council to decide to proceed with a settlement.’
The ‘legal advice’ referred to was contained in an undated note, made by the Council’s Chief Finance Officer (why was the Council’s Chief Legal Officer, a solicitor, not involved?) about a discussion between Christine Gilbert and a QC, which he had been the only other party to. It was apparently not checked for accuracy by the QC who gave the advice, given the auditor’s recommendation that such advice ‘should be recorded formally immediately after the call and key issues confirmed with the legal adviser.’
Another of the documents not shown to the objectors was a ‘statement of loss’, first mentioned to the objectors by Carolyn Downs, in December 2016. I have no reason to doubt the information which she gave us about it. It stated that Ms Davani intended to resign, and that if she were not given a satisfactory financial settlement, she would make an Employment Tribunal claim for “constructive dismissal”, together with a claim for alleged “sexual discrimination”. The objectors’ initial reaction was to ask Ms Downs whether she was joking! Ms Davani’s “sexual discrimination” claim was apparently based on a comparison with the Council’s treatment of Clive Heaphy, a senior male officer suspended for alleged gross misconduct in September 2012, who was then allowed to resign under a confidential agreement, with a payment of £140,508 as “compensation for loss of office”.
I had pointed out to the auditor that the Council’s version of the legal advice received made no mention of “constructive dismissal” having been considered, and put forward an alternative “scenario”. This alleged that the seeking of “legal advice” was a smokescreen to cover-up the real reason why the £157,610 was paid to Cara Davani, and that there was never any possibility of an Employment Tribunal hearing over Ms Davani’s departure because neither Cllr. Butt nor Ms Gilbert could allow the alleged truth about Clive Heaphy to be made public. I provided several strands of “hearsay” evidence to support the allegation that Ms Davani and Mr Heaphy had worked together with Cllr. Butt in 2012 to get rid of the former Chief Executive, Gareth Daniel, and bring in their former colleague at Ofsted to replace him, and that the Council held email evidence to show that Ms Davani and Mr Heaphy considered: ‘Mo owes us one’.
The auditor’s response in his decision letter was: ‘The barrister was also made aware that Cara Davani had prepared a schedule of loss.’ This does not answer the points I had raised.
Other Matters:
There is a short section at the end of the “Findings” in the decision letter headed ‘Other Matters’. It refers to detailed comments which I and other objectors had made ‘about various friendships and relationships at the Council which it is alleged may have influenced the decision making or outcomes in relation to the matters subject to objection.’ The auditor says that he will not comment on these ‘except to note that no evidence has come to our attention that supports those comments ….’
Some of those comments, and the evidence provided in support of them, had first been sent by me to the Head of Brent’s Audit and Investigations team on 17 June 2015, when rumours of a possible pay-off to Cara Davani first came to light. One of the points raised in my original objection letter in August 2016 was why no action had been taken by Brent Council to investigate those allegations, which could have prevented the payment of £157,610, which was not actually made until 15 July 2015. There is no mention of this point in the decision letter.
I had sent the auditor very detailed allegations, with a number of supporting documents, showing a pattern of behaviour involving Ms Gilbert, Cllr. Butt and Ms Davani from September 2012 onwards, which I summarised as ‘a triangle of interdependence’. It included allegations about the way in which Ms Gilbert was appointed and kept in an “interim” post for nearly three years, through alleged failures to advertise for a permanent Chief Executive, the alleged possibility that Full Council was misled into delaying the a permanent appointment in June 2013, and the allegation that Cllr. Butt exceeded his powers when extending Ms Gilbert’s time in post in September 2014. It was also alleged that there were irregularities over Ms Davani’s employment by Brent Council (following the end of her interim self-employed contract in March 2013), as well as her involvement in the alleged actions to keep Ms Gilbert in post, as Cllr. Butt’s alleged preferred personal choice of Chief Executive. This was an important part of the evidence which explained why the two key decisions by Ms Gilbert had really been made.
Final Thoughts:
In my final comments to the auditor on 31 August 2017 I had said: ‘I believe that I have set out a strong case for saying, on the balance of probabilities, that the payment to Cara Davani of £157,610 was unlawful.’ He had already said, in his provisional view, that even if he considered this to be the case, he would not exercise his discretion to seek an order from the court, as he was ‘mindful of the significant cost to local taxpayers of doing so.’ I accepted his right to exercise that discretion.
I will conclude my views on the auditor’s decision by quoting from what I suggested to him last August that he should do, and why:
‘I believe that there is a strong case that you should decide to issue a Public Interest Report on the basis of this objection, and on the information provided in support of my other three objections, which together show [alleged] very serious failures in governance at Brent Council. Those [alleged] failures have never been properly brought to public attention. At first they were covered up, then the payment of £157,610 was finally admitted, a year after it was made. The carefully worded admissions that something had not been dealt with properly, with a mild apology for this and promise that things had improved since, did not disclose the facts or seriousness of what [allegedly] had actually occurred, which Carolyn Downs and Conrad Hall were probably still ignorant of at that time.The [alleged] failures involve the former interim Chief Executive, and the Council Leader who is still in post (so that there is an ongoing governance problem, although he is now kept more “in line” by Ms Downs, who took over as Chief Executive in September 2015). Both Christine Gilbert and Cllr. Muhammed Butt have [allegedly] shown a level of misconduct (possibly amounting to the crime of “misconduct in public office”) which needs to be brought to the attention of the Council and to the Council Tax-payers of the borough. Brent’s people have shown a strong interest in, and outrage at, matters involving Cara Davani, and have suffered a financial loss which may, in total, amount to several million pounds, when taking into account the cost of the Rosemarie Clarke and other Employment Tribunal cases resulting from the [alleged] misconduct of Cara Davani, who those top Council Officials [allegedly] “protected” for several years.I realise that if you do consider a Public Interest Report, you will need to alert Ms Gilbert and Cllr. Butt (and any others who may be criticised) to the allegations against them, and give them the opportunity to respond. I confirm that, should you need it, you have my full consent to sharing this document, and any other relevant documents which I have sent to you or your predecessor as auditor from August 2016 onwards, with those individuals.’
As the auditor has decided not to issue a Public Interest Report, Christine Gilbert and Cllr. Muhammed Butt have not been given the opportunity to respond to these allegations, which in various forms were already in the public domain before I brought them together in support of my objection to payments in Brent’s 2015/16 accounts. As a matter of openness and transparency, I sent copies of my August 2016 objection letter, and all further comments and documents in support of it up to 31 August 2017, to the Council’s Chief Executive and Chief Finance Officer. I would have no objection to that material being shared with Ms Gilbert and Cllr. Butt, so that they can respond if they wish to, although I would ask that any responses are issued publicly.
Wasn’t the lesson we were meant to learn from the examples of Hillsborough and Rotherham that public bodies should not cover things up?
I have had my say, and this is the last thing I intend to write about these matters.
Any other business?
As well as dealing with the normal audit functions, and with any objections to the accounts, a Council’s auditor can also be asked to advise it on “value for money” matters. Brent’s Audit Advisory Committee might like to ask the auditor: ‘How much should Brent Council expect to pay for a bucket of whitewash?’
Philip Grant
(old-fashioned public servant, retired)
31 December 2017