Thursday 21 December 2017

Committee hears Common Good mismanagement allegations

DOUG COLLIE reports on disturbing claims in Hawick submissions

A SET of written submissions to the Scottish Parliament's Local Government & Communities Committee contains evidence of alleged mismanagement of the country's network of Common Good funds including poor record keeping, and valuable assets having disappeared or been misappropriated by councils.

Members of the committee are currently investigating the status of scores of Common Good funds which have been in existence for centuries, and should now be worth hundreds of millions of pounds.

The MSPs will determine whether changes in ancient statutes are necessary to protect the funds from further decline and to ensure they achieve their full financial potential.

Not Just Sheep & Rugby has reported in the past on the poor investment returns being chalked up by funds in the Scottish Borders compared to a neighbouring common entity in Berwick-on-Tweed.

The Borders funds have been combined into a single organisation with investment managers appointed to look after each town's interests. But complaints persist that the funds continue to under perform.

As part of its investigation, the Holyrood committee issued a call for written submissions which have been published. And this week members started taking evidence from experienced Common Good witnesses, including Dr Lindsay Neil, of Selkirk, a regular critic of how his town's fund has been run by Scottish Borders Council.

A number of the most critical and hard-hitting submissions have come from Hawick which has a Common Good fund worth in excess of £3 million. The fund includes farmland, woods, buildings and movable assets which have recently been comprehensively listed for the first time in ages.

In their written contribution members of Hawick Callants Club have told the committee: "Many of the common goods have been merged by these larger councils and the loss of local knowledge has generally resulted in inadequate control over the goods. The Scottish Government’s instruction to Local Government to compile lists of common good assets has exposed the failure to maintain accurate records.

"Hawick Callants Club have recently been instrumental in raising the issues of omission of Moveable Assets in the Hawick Common Good Fund. This was directly as a result of the Hawick Councillors insisting that Scottish Borders Council inform Hawick civic groups, including this Club, of items they had recorded on the Moveable Assets list."

The Club says it immediately identified a significant number of assets missing from the list and after further investigation noted numerous further omissions although there were conflicting views of what was common good and what was not. Numerous townsfolk had donated to the ‘town’ thinking they were going to the common good, but the council had argued that they were donated to a museum and therefore were‘council’ property.

"These donations need to be assessed to ensure the correct recipient is identified", add the club. A club member who held a senior position in the previous organisation, Roxburgh District Council, maintained that a full list of all fixed and movable assets of Hawick Common Good Fund had been prepared at the end of the District Council in 1996, but SBC were unable to find this list and others that had been mentioned to them.

"This is a prime example of a remote organisation failing to keep accurate records of local assets. Very recently another club member identified an area in Hawick where potential movable common good assets are stored and these are now being checked. At the moment, unfortunately, due to the way SBC is structured, any actions taken by the sub-committee can be overturned by councillors from other wards. This arrangement totally defeats the whole purpose of common good being managed locally and leaves the funds at the mercy of someone who is not interested in the local community."

Local man Derick Tait - a former chairman of Future Hawick -  had some equally strong and sensible things to say in his submission.

Mr Tait writes: "Common Goods were once an important specific part of local community culture, managed by Town Councils and the like, which because of their dedicated specialist knowledge, were able to manage and disburse their obligations in that respect conscientiously, expediently, and appropriately.

"Sadly, as local government has become bigger (but not better), management of individual common goods has merged and passed into the trusteeship of those who neither appreciate their significance and importance to local communities, nor care particularly about their management. In recent years, I personally have been aware of instances of failure to manage common goods properly in three towns, principally because of lack of local knowledge.

"There is no doubt that the edict from the Scottish Government to Local Authorities to compile lists of common good assets opened several cans of worms, with delay upon delay in reporting entirely due to the failure to maintain proper records. In Hawick, that list has only now been completed, completion only being achieved thanks to the assistance of several civic groups in the town.

"Part of the problem with incomplete records is that the intentions of the original donors may not have been properly interpreted. Financial assets present their own problem in that these are very often swallowed up, often without trace, into Council coffers. Indeed, I suspect that if all common goods asked for their monies back simultaneously it would spell financial disaster for many local authorities. The merging and management of “joint” common good funds into single investment portfolios clouds the issues of management fees charged and apportionment of dividends (and losses).

"On one occasion I even heard local council talk of a proposal to allow borrowing in excess of investment from such joint portfolios. Fortunately, those with an interest and knowledge prevailed. Common goods are a diverse subject and have been the subject of diverse management over the years. Many have been frittered away or spent to suit council budgets with little reaction from the communities involved. 

"However in towns with a strong sense of community and appreciation of custom and tradition, common goods are a precious commodity to be jealously guarded not by sentiment, but by structure. Politicians ignorant of such structure are neither qualified, nor able, to analyse the present or shape the future. 

"As local government becomes less local, and the pen grows ever mightier than the sword, the intensity of the community fight to protect its rights and common should not diminish. Management should be devolved to appropriate civic bodies whose trustees are town dedicated councillors, community councillors, and representatives of appropriate local organisations."

TO BE CONTINUED....

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