This appalling example of maladministration, is the tip of a massive iceberg of incompetence and maladministration at Thanet Council which includes the Pleasurama development site which has blighted Ramsgate seafront for over 20 years; the live animal exports £5.1million damages scandal; the TransEurpora Ferries secret debt deal which cost taxpayers £3.4million; the White Finger safety prosecution which seriously damaged the health of more than 20 employees and which will cost the council dearly in industrial injury compensation payouts. Quite clearly Thanet Council is a basket case and its top brass are demonstrably unable to cope lurching from one crisis to another. As a lifelong socialist it pains me to admit it, but I am in full agreement with Thanet’s 2 Tory MPs, Sir Roger Gale and Craig MacKinlay when they say that TDC should be placed in special measures and top management functions taken over by commissioners appointed by the Government.As much as it would please many people in Thanet, placing TDC in special measures is not, sadly, the purpose of this post. I actually want to take a deeper look at the appointment, by TDC, of Sands Heritage Limited (SHL) as the Dreamland Park operator in 2015 and explore whether this was a wise decision which, bearing in mind SHL’s insolvency and entry into administration, it clearly wasn’t. In fact last week’s Internal Audit report strongly suggests that the appointment of SHL might have been a mistake, warning that “fledgling companies with no track record or accounts, set up for a particular purpose carry a greater risk than is being acknowledged through the due diligence checks being undertaken by these multi-disciplinary groups of officers and members”.
But it isn’t just TDCs own internal audit team who have expressed concerns about SHL’s appointment as the Dreamland park operator. In April 2015, just 2 months before Dreamland opened. The Heritage Lottery Fund who had, by this time invested almost £6million in Dreamland, wrote to Council Chief Executive Madeline Homer and the then Labour Council Leader, Iris Johnston, expressing their concerns that they had not been kept informed by TDC about the appointment of a park operator and that “despite repeated requests, we have not received any information outlining how this exercise (the appointment of a park operator) was handled and how the final selection of operator was made”.
The letter went on to say “At the recent site visit, we were surprised to find out that Sands Heritage Limited, who we understand has been selected by the Council to operate Dreamland, appeared ready to proceed with plans to relocate the learning space to a new location on the site, without fully consulting us. We also met a member of the Dreamland Trust's learning staff, who we found out was transferring to Sands Heritage Limited at the end of last month. The Trust has told us that a number of staff, including their former Director, have transferred over to this new organisation, but that this happened before the procurement of the new operator was concluded. We were also very surprised to hear that Sands Heritage Limited was in the process of creating a new charity, with the view to taking on the current role of the Dreamland Trust in this project.
I am sure you will understand our serious concerns over the current situation. As things stand, we cannot approve the procurement of Sands Heritage Limited without a clear explanation of how this process was conducted in open competition, and following the receipt of a number of expressions of interest. Sands Heritage Limited has clearly been closely connected with the project for a number of months now, as the only applicant in the first procurement exercise, and with a Chief Executive who was previously working for the Dreamland Trust. We have asked for this information a number of times, on the phone, by email and in meetings, but we have only received a scoring sheet with no back-up information, and the subsequent analysis of the chosen tender from an external company.
I remain concerned that this process may not have been conducted in an open and fair manner. Until we receive a full and acceptable report on this procurement, we cannot proceed with considering the proposed lease for the operation of the site.
Despite its careful wording, HLFs letter pulled no punches, clearly suggesting that it was concerned by the probity of TDCs operator selection process and worried about the transfer of the former Chief Executive of the Dreamland Trust, Eddie Kemsley, to the post of CEO of SHL’s Dreamland management team.
On 6th May 2015 Thanet Council provided HLF with a report outlining the processes which led to the selection of SHL as park operator. This process required 2 attempts. The first attempt took place in June 2014. It resulted in just one applicant, SHL, submitting a tender. TDC rightly decided to run a second procurement exercise in November 2014 which attracted 6 applicants including both SHL and the Dreamland Trust. I have been advised that a number of people/ organisations associated with the second round of tendering expressed serious concerns about the process, alleging that SHL may have had unfair advantages over the other bidders. Thanet Council took these concerns seriously and commissioned an external legal firm Trowers and Hamlins to review the procurement process. Trowers and Hamlins appear to have felt that there was something not quite right about the operator selection process because they took the most unusual step of recommending to TDC that SHL’s 2nd round tender submission of November 2014 should be discounted and that its previous (round 1) tender submission of June 2014 be considered as the basis of their bid instead.
Since January 2016 I have been trying, through the Freedom of Information (FOI) process to get hold of the Trowers and Hamlins legal advice to Thanet Council to find out exactly what concerns had been expressed about the Dreamland operator procurement process and what type of advantage, if any, SHL was claimed to have over its competitors and why SHL’s second tender submission to become park operator was withdrawn in favour of its first submission. I have a gut feeling that if this information is released it will be very unsavoury and likely to support and corroborate rumours and allegations of unfairness and impropriety in the Dreamland operator procurement processes.
This probably explains why Thanet Council has refused to release the information to me on the grounds that it is protected by legal privilege. I submitted an appeal against Thanet Council’s decision to the information Commissioner’s Office in April 2016 who, just last week, told me that it had rejected my appeal and supports Thanet Council’s withholding of the information. However, in arriving at its decision the Information Commissioners Office uncovered a crude effort by Thanet Council to lie to me. Apparently Thanet Council had secured a second legal opinion about the Dreamland operator procurement process, in addition to the Trowers and Hamlins advice and had failed, contrary to FOI regulations, to advise me of this fact. To have commissioned 2 expensive legal opinions on the processes used to appoint the Dreamland operator can only mean that there had been some very serious questions about the integrity and fairness of the process and Thanet residents need to know why. That’s why, in the new year, I will be submitting an appeal to the Information Tribunal in the hope that I can overturn TDCs and ICOs refusal to let me have the legal advice.
Although this advice may be privileged there is an overwhelmingly powerful public interest argument to have this exemption from public release lifted. This is a project which will, on final reckoning, have cost the public at least £30million for phase 1, with its operator entering administration owing £14million in less than a year of the park opening. There is now a charge on SHL’s Dreamland park leasehold agreement which could easily mean that a tax-avoiding, offshore, Cayman Island registered, hedge fund, which is run by mates of SHL’s directors, could take over the running of Dreamland. To add insult to a very serious injury it now appears that the failed, discredited and insolvent park operator may have been appointed by an allegedly flawed and unfair procurement process overseen by a demonstrably incompetent and totally mismanaged excuse for local authority. Sir Roger and Craig MacKinlay are right – there should be a full independent public inquiry into Dreamland and the basket case Thanet Council should be placed in special measures with its management taken over by Government appointed external commissioners.