AWEMA - someone in Cardiff needs to own up

More on this at Jac OThe North, Inside Out, National Left, The Western Mail, Betsan Powys, Gareth Hughes and Wales Home.

It's been a point made elsewhere but Martin Shipton and his team at The Western Mail (as well as BBC Wales and the South Wales Evening Post) need to be congratulated for this excellent piece of investigative journalism. It's shows the true value a solid national press has for Wales and the vital role it plays in holding TPTB to account.

The latest report from the Welsh Government and Big Lottery Fund was published last week into the goings-on at All Wales Ethnic Minority Association (AWEMA). We've had things called "scandals" in the past (Nick Bourne's Ipod, The Lib Dem 2, second homes in Penarth and Rosie Butler's table), but I'd agree with Daran Hill that this is "perhaps the biggest scandal around the use of public money since devolution began". However, we have to put this in perspective. It's still small fry compared to some of Westminster's shenanigans.

You probably already know about what happened but here's a summary of the allegations from the latest report:

• AWEMA didn't submit any accounts to Companies House or the Charity Commission for the year 2010-11 and no management accounts exist having "not been produced for some time".
• There's an "absence of key policies and procedures within AWEMA", for example an expenses policy, conflict of interests register or register of hospitality's given/taken – this was taken advantage of (mobile phone bills paid, greetings cards, parking charges) although the sums were small and backed with receipts.
• Creditor information was not available - said to be vital to give assurance of solvency.
• Naz Malik (the CEO) hadn't been subject to a performance appraisal since 2006.
• ABOMA (the board of management) held no regular meetings or were done so on an "ad hoc" basis with big gaps between them – sometimes as long as 11 months.
• Naz Malik's decisions were only given retrospective approval by ABOMA.
• Expenditure from AWEMA's funds included £2,100 on gym membership, £800 on rugby and cricket tickets and one of Naz Malik's parking tickets worth £110. None of these were disclosed to HMRC and it's unclear if these were funded from public money.
• Naz Malik relied on the Financial Director for details of financial processes, when as CEO he should have "a key duty in overseeing these processes".
• The AWEMA payroll system was "seriously inadequate". The three directors salaries were "high in comparison to other members of AWEMA" though action has now been taken by ABOMA.
• Naz Malik's daughter reported to him as a director, a "clear conflict of interest" and her salary increased from £20,498 in 2008 to £50,052 in 2012 with Naz Malik present at meetings of ABOMA (when approving salary increases) both as CEO and an ABOMA member.

The most damning statement of all is that there can be "no assurances" that there were "appropriate arrangements in place to safeguard and make proper use of Welsh Government (£105k), Wales European Funding Office (£5m) or Big Lottery Funds (£523k) entrusted to AWEMA". That's a potential (and I have to stress potential) misuse of some £6million in public funds.

But it gets worse.

As you probably know, the Welsh Government were warned about AWEMA in a 2004 report (found by a Lib Dem researcher – more on that at Gareth Hughes's blog) that suggested all public funding was stopped there and then.

So it's taken the Welsh Government 8 years to act, after they commissioned their own report into AWEMA, after the resignation of their acting chairman in 2007 and after that report rung whacking great big alarm bells that AWEMA had issues.

We needn't dwell on the fact that the Malik family are prominent Labour members and supporters. I don't buy that this was a conspiracy - just a toxic mix of negligence, arrogance and old fashioned cronyism. In fairness Labour were quick to suspend them and appear content to stall things for now while distancing themselves from the Malik's and AWEMA. No doubt they'll want to "move on to the important issues that matter to the people of Wales blah blah blah"  - and they'd have a point.

However this going to be hard for them to shake off for the following reason.

Somebody, somewhere, signed off public money to AWEMA back in 2004 (probably with the best of intentions) while ignoring independent advice wilfully or accidentally. Presumably a social justice, European affairs or equalities minister, a deputy minister or a senior civil servant.

Only the anoraks who follow Welsh politics closely are really interested in this and we're comfortably out-numbered by those who aren't. However I think we'll all be more forgiving if that person (or persons) owned up instead of hunkering down hoping this will blow over. If it turns out public money they signed off has been abused in any significant way, a dent in their pride by taking ownership of their mistake should be the least of their concerns.

At the very least that person(s) has to come out with an apology, explain the reasons why they ignored the original report and cooperate with any new investigations. The sooner the better. We don't know what any possible criminal investigation could reveal though I suspect the worst of it is already public knowledge.

I'm not going to speculate on who that could be.

Of course that's small comfort to those losing their jobs or having their schemes/funding/programme under threat by AWEMA's demise. I hope that all those who had nothing to do with this can move on to better things.

I also hope someone in Cardiff Bay or Cathays Park is having their conscience tugged before someone else tugs it for them.