02 May 2008
One of Scotland's biggest local authorities sold off properties for a sum that could be more than £5m below market value, a report by the controller of audit has disclosed.
The potential sales loss, currently the subject of a police investigation, was uncovered at Aberdeen City Council after auditors had been called in to examine property transactions.
Caroline Gardner's report highlights procedural and administration deficiencies, poor record-keeping and cases where accurate and relevant information was not reported to elected members. It also points to a lack of evidence to support the valuation at which properties were sold. 'Overall, it appears that there is a potential loss of capital receipts which may be more than £5m,' Gardner states.
The controller has submitted her report to the Accounts Commission in Scotland. The commission is due to start a public hearing in Aberdeen on May 13 following a separate Best Value audit report, which described the council's financial position as 'precarious'.
Chief executive Douglas Paterson said the report acknowledged that the city council took decisive action as soon as the concerns emerged two years ago. He added that property valuation was now provided by a private company.
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