Allegations that housing contractor Mears has overcharged MK Council by up to £80,000 every month for tenants’ repairs are under investigation by auditors.
Also under scrutiny is a claim that around £15million of council cash is “currently unaccounted for“ by Mears .
MK Council received the allegations from a whistleblower. After the claims were examined by its officers, the council called in Ernst Young auditors to conduct a full probe into the account it holds with Mears Group plc.
The move is said to have caused red faces all round as the council is official partners with private company Mears over the city’s £1b regeneration project.
Together they set up YourMK in 2016 to deliver repairs and maintenance services for the council’s stock of 11,500 homes.
This week MK Council leader Pete Marland said: “The council received a whistleblowing allegation regarding spending on our housing repairs contract.”
He added: “We have asked our external auditors to investigate fully, as is right, to establish if the allegation has any basis and will act accordingly.”
Opposition Conservative councillors have revealed they have been concerned for some time over the council’s lack of oversight on the housing repairs and maintenance contract.
Tory group leader Councillor Alex Walker said : “These are deeply concerning allegations and huge sums of money. It is right that auditors have been called in. I hope they will have access to all the information they need.”
He added: “ Once the investigation is over, and if there has been foul play, the Labour Cabinet and officers will have big questions to answer. And I want to assure Council tenants we will be relentless in getting to the bottom of what’s gone on.
“There have long been concerns with YourMK’s capacity and a lack of oversight from Milton Keynes Council. There will also be question marks with what this means for the regeneration project, something which the Council has not covered itself in glory over.”
The Mears Group press office has denied any knowledge of the audit and said the allegations were “completely unsubstantiated”
A spokesman said: “Mears does not in any way recognise these claims and are not aware of any audit being undertaken within the council. Mears operates transparent accounting in all of our public contracts.”