06 July 2001
Lothian and Borders police confirmed that they had received a complaint from SBC around three weeks ago and, as a result, the Fraud Squad was 'in the preliminary stages of an ongoing investigation into a substantial deficiency of funds'.
A council spokesman told Public Finance: 'The police are investigating transactions totalling less than 1% of the total overspend.'
In a separate development, the council dismissed John Taylor, assistant director in charge of education department finances, after it was discovered his accountancy qualification was fictitious.
The £3.9m overspend in the budget of the council's education department over the past two years has led to fears that pupils in the region will suffer as schools impose cuts to make up the deficit.
The local authority formed a working group to investigate the education budget, chaired by council convenor Drew Tulley. He said: 'This is a very serious situation and the working group will ensure that every possible avenue is explored. While there is clearly something wrong, it is not a case that money is "missing" or that it has not been spent on services for our young people.'
Tulley insisted: 'I want to try to ensure that the effects of any reductions have as little impact on pupils as possible, but clearly the recovery of such large sums of money will not be easy and may well involve unpalatable choices, but they will have to be made, sooner or later.'
Head teachers have already claimed that their budgets have been put on hold.
Neil Horne, rector of Hawick High School, told parents in a letter: 'The funding for 200 computers that were scheduled to be installed in early July has been withdrawn by SBC. Courses in computing and in business are at risk.
'Pupils at this school are therefore disadvantaged by the withdrawal of these funds.'
The authority has also announced a number of cuts in catering and cleaning services, including the introduction of a four-day week for cleaners, the cancellation of the annual 'deep clean' in summer and a rise in school meal prices.
The working group was due to report to the council as Public Finance was going to press.
PFjul2001
