19 April 2002
Public spending watchdog the National Audit Office said that the closure of the New Millennium Experience Company took more than a year because 'basic controls' had not always been applied to contracts with its suppliers, which led to police investigations into allegations of fraud.
A review by accountants PricewaterhouseCoopers found that there was no 'legally binding contractual relationship' for 129 suppliers providing around £50,000 of invoices between 1998 and 2000. Police arrested a number of individuals following the fraud allegations.
The report concluded that it was doubtful that some purchases were value for money.
Comptroller and auditor general Sir John Bourn told Parliament that the wind-up process 'was extremely challenging, particularly given the complexity and scale of the operation'.
But Bourn added that other aspects of the company's voluntary liquidation had been so well handled that part of the lottery grant given to the firm might not now be needed.
'On entering voluntary liquidation, NMEC was in better shape than when the NAO last reported. It was solvent and forecasting that £25m of the £628 lottery grant would not be required, although this cannot be guaranteed,' the auditor said.
One reason for the improvement in the company's finances was an increase in estimated profit from visitors in its final year.
PFapr2002
