Report Details “Significant Mistakes” and Poor Practices at Bankrupt Woking Council

A recent report examining Woking Borough Council, which is currently bankrupt, has identified deficiencies in its accounting practices and systems, stating that “significant mistakes were made” within the authority during its “long and atypical history of borrowing.” The auditors, Grant Thornton, released a public interest report detailing the council’s financial state, which culminated in debts totaling £2bn. Ray Morgan, an individual who served the council for over three decades, was identified in the report as the “principal architect of the council’s investment decisions.” Mr. Morgan acknowledged his awareness of the report’s release, stating that it would be improper for him to provide comments before the council’s review of the document on 20 November. The report explicitly stated: “Both documentary evidence and the information provided by stakeholders make it clear that the former CEO, Ray Morgan, was the principal architect of the council’s investment decisions.” Douglas Spinks and Peter Bryant, two additional former senior officers who retired in the same year as Mr. Morgan, were also mentioned in the report, described as “a close-knit group who were not exposed to challenge and new ideas.” The document examines the oversight of the council’s investment decisions starting from 2008 and assesses their financial repercussions on Woking’s long-term financial viability. The council effectively declared bankruptcy in June 2023, and government commissioners have since been appointed to stabilize its financial situation. Woking’s accumulated debt resulted from an investment strategy that involved borrowing hundreds of millions of pounds for various regeneration initiatives, such as the Victoria Square development in the town. Grant Thornton’s report stated: “There was a lack of commercial knowledge and specialist legal knowledge within the council. Accounting practice and systems were poor and significant mistakes were made which led to the lack of an accurate picture of the council’s true financial position.” Furthermore, the report indicated that stakeholders associated with the council during Mr. Morgan’s tenure “provided a consistent narrative that he was the driving force behind the investment decisions and significantly influenced the members’ approach to risk.” The report also noted: “His drive, vision and commitment to Woking, and to the council, were regularly commented on in a positive light.” Additionally, it mentioned that the former CEO “did not welcome challenge of his decisions by other stakeholders.” Ann-Marie Barker, the council’s leader, commented that the authority has been “focused on tackling the severe financial challenges” since her Liberal Democrat group assumed leadership of the council in 2022. She expressed her approval of the report’s release, characterizing it as “a pivotal moment in understanding the decisions and actions of the past” that led to the council’s present circumstances. Councillors are scheduled to discuss the report during a specially convened meeting on 20 November.