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Published : 05 Apr 2014, 08:49 PM
Mayor Lutfur Rahman, who is of Bangladeshi origin, at a press conference on Friday also welcomed the probe but said the accusations were ‘scurrilous and ill founded’.
Using new laws that came into effect on Friday, the Secretary of State for Communities and Local Government (CLG), Eric Pickles, appointed PricewaterhouseCoopers to carry out an inspection of the council over allegations of governance failure, poor financial management and fraud at the London Borough of Tower Hamlets.
The staff from the accountancy firm visited Tower Hamlets on Friday. A file was also passed onto the Metropolitan Police for consideration.
Serious concerns have been raised following the receipt of certain documents, said a government statement on Friday. The enquiry follows the BBC Panorama's investigation into the east London borough run by Rahman.
Responding to the government move to send inspectors, the Tower Hamlets Labour Group on Friday said it was a sad day for its residents.
Labour Group leader, Councillor Sirajul Islam said, “Whilst there are obviously serious questions to answer, no council wants to be the subject of a scandal. We have been warning about Lutfur Rahman’s style of leadership for a long time.”
Shadow Secretary for CLG Hilary Benn said, "Given the allegations that have been made over several years, and the material submitted to the Communities and Local Government Secretary, some of which have now been passed on to the Metropolitan Police, about the running of Tower Hamlets, it is clearly in the public interest to establish the facts.
"Nobody should prejudge the outcome, and anyone who has information must present it to the inspectors. This audit must, of course, be full, open and transparent in order to command public confidence."
Labour MPs Rushanara Ali and Jim Fitzpatrick, in a joint statement said, “Whatever our political differences, a Secretary of State would not take this action without good reason.”
“Given CLG’s decision to send in inspectors and pass their files to the Metropolitan Police it is in everybody’s interest that all involved are as open as possible so the facts can be established.”
The release also quoted John Biggs, the Labour candidate for Mayor of Tower Hamlets, saying it was inevitable that something like this would happen, as the mayor has been avoiding serious questions about decision-making and use of public money.
“I am very worried about the direction the borough has been taking and that is why I am standing for Mayor. It is time the people of Tower Hamlets get the leadership they deserve,” he said.
However, the mayor said on Friday, “I welcome the Secretary of State’s decision to send independent auditors to review our grants processes.”
“This will refute the scurrilous and ill founded allegations recycled by Panorama and demonstrate that the Council acts in the best interests of all Tower Hamlets residents.”
Deputy Mayor Ohid Ahmed at the briefing also said, “This gives us the opportunity to demonstrate to independent auditors that our grant processes are appropriate and robust.”
He, however, dismissed speculation that documents had been taken away from the Mayor’s Office.
A government statement released on Friday had said that PricewaterhouseCoopers inspection would look into evidence of the authority’s payment of grants, the transfer of property, spending decisions in relation to publicity, and other contractual processes from “25 October 2010 to the present day”.
Secretary Eric Pickles was quoted as saying in the statement: “It is a matter of public record that I have long been concerned about a worrying pattern of divisive community politics and alleged mismanagement of public money by the mayoral administration in Tower Hamlets.”
