AN independent review has provided a damning insight into the council’s handling of millions of pounds of taxpayers’ money over several years.

The mismanagement of council contracts and projects has worsened since the scandal over Waltham Forest Council’s use of regeneration funds came to light, a report has concluded.

The first independent investigation into the council’s response to revelations about how it mis-handled cash and projects for deprived areas found rules to prevent fraud continued to be broken long after pledges were made to deal with the problem.

The report is scathing in its criticism of a pervading culture within the authority, characterised by disregard for proper procedure and a “disturbing” unwillingness among managers to accept responsibility for failings.

Disciplinary action is now under way against an unspecified number of un-named officials.

The review, carried out by public sector stalwarts and led by London Development Agency chief Sir Peter Rogers, was made public yesterday (Wednesday).

It found the eagerness to instigate change since 2001 and please Government assessors led to proper processes being sacrificed in order to get things done.

And investigations by the human resources department into alleged wrongdoing were found to be so inept, staff were not punished for breaking the rules.

One example of the chaos which engulfed the authority centred on a contract with an un-named regeneration company worth £30,000.

A senior council employee was asked to produce a brief for the work although bosses knew he was soon going to work for a company which was a actually going to bid for the contract.

After completing the brief, he sent it to his new company and left the council.

He then submitted an application on behalf of his new employers, based on the inside information he had ascertained while working for the local authority.

The company in question, which did not offer the lowest bid, was later offered the contract without proper evaluation.

The authority is also criticised for a lack of transparency, with informal briefings replacing proper reports to cabinet, leading to issues remaining unresolved for years.

The review was ordered by chief executive Andrew Kilburn after previous action plans were not implemented.

He said that despite the failings, there has been a huge improvement in services delivered direct to the public.

But he made a clear commitment to put things right and change the culture within the council.

He said: “If people can’t accept facing up to mistakes then I am not sure I want them working in this organisation. I will deal with it. If people have a difficulty with that, they should consider what they are doing in the public sector.

“There were people who did things wrong, but I can’t re-write history. Disciplinary action has been taken and some people will leave the organisation, but I am not going to name those involved.

"When I joined the Council in October 2009 I became immediately concerned that we did not have the whole picture. With the full support of the cabinet, I commissioned an independent panel of experts to investigate the issues and make recommendations for improvement.

“This is a very hard hitting report. Our residents deserve better than the systemic failures which the panel has uncovered. I will be asking cabinet to accept the panel’s recommendations in full - we need to start the process of restoring our residents’ confidence in their council’s ability to procure and manage contracts.”

Leader of the council Cllr Chris Robbins said: "When I became Leader of the council in May, I promised local people that I would work hard to improve local services.

In the last five years Waltham Forest Council has improved greatly and this has been recognised by the independent panel report.

Nevertheless, the council has been aware that contract management needed to be more effective, which is why we commissioned this external and independent review.

"The report has indeed highlighted some significant failures in contract management over a number of years.

As leader of the council I will ensure that the recommendations of the review are acted on quickly and decisively.

Working with my cabinet colleagues I will make additional recommendations that are designed to add to those of the independent review.

"I want to apologise to the residents of Waltham Forest for the failure of the council in these areas. While we have made big improvements in recent years, we are not complacent.

"We are committed to work to ensure continued improvement both the management and service delivery in Waltham Forest."

Councillor John Macklin, Deputy Leader of the Council said: "This report shows that there are clearly some areas of the council which are still not fit for purpose and this is not acceptable.

"Our absolute priority is to put these matters right whilst still delivering the continued improvement in services and value for money that our residents deserve."

Chingford MP Iain Duncan Smith said: “I congratulate Andrew Kilburn for opening up the council. What we have seen here is an indictment of what has been happening for a number of years.”