They are also calling for the Leader of the Council, Cllr Richard Cornelius, and his Deputy Leader Cllr Dan Thomas to resign.
The damning report reveals major failings in financial controls within Capita that allowed the fraud to take place and have serious implications for the future of the Council.
The report outlines the failings of five financial safety nets, any one of which, had they been functioning effectively, would have prevented the fraud.
Failings identified as enabling the fraud include: the perpetrator being given inappropriate access to financial systems; insufficient control over the processing of transactions, which meant that 62 inappropriate payments were made without being challenged; a lack of robust challenge and scrutiny at an operational level; and insufficient oversight by the Council.
Shockingly, the fraud was revealed not by the Council or Capita, but by suspicions raised by the perpetrator’s bank.
These failures show insufficient oversight by the Council, despite repeated calls from the Labour Group for tighter contract management.
Leader of the Barnet Labour Group, Cllr Barry Rawlings said: “This is incompetence of scandalous proportions, and looks like a breach of contract. Barnet Council must act to terminate these two contracts and take back control of Capita-run services.
“The Council are clearly not able to manage this kind of commercial relationship, and Capita have demonstrated they are not able to run key services to a basic standard.
“Cllrs Cornelius and Thomas must also take responsibility for what is ultimately a failure of their ideology driven policy. Their misplaced faith in Capita has ensured that the Council has insufficient financial oversight of outsourced services. And as they are responsible for the council’s finances and regeneration schemes, this fraud happened directly under their noses.
“Barnet Labour Councillors repeatedly warned of the risk of outsourcing so many services to the same organisation. Time after time this has been proved right.
“The fraud case is yet another incident in a never-ending saga of financial mismanagement. Barnet residents deserve better.”
Notes: A copy of the Grant Thornton report can be found here: https://www.barnet.gov.uk/…/finance…/Financial-controls.html