The Department for Communities and Local Government (DCLG) has served a demand notice on business network Social Enterprise North West (SENW) to recover £1.4m of public money after serious irregularities in its accounts were uncovered
The money forms part of a grant given to SENW to run a business advisory service in Liverpool called the Big Enterprise in Communities project (BEiC).
Launched in January 2012, the project, run by SENW together with 17 supporting organisations, received a total of £3.79m from the European Regional Development Fund, administered by DCLG on behalf of the British taxpayer.
However, in July 2014, an audit carried out by the Audit Authority in accordance with European Commission rules identified serious breaches in the project’s accounts.
Under the terms of European grant funding, SENW is required to show how all public money it has received for the BEiC project has been spent, but was unable to do so.
Communities Minister Lord Ahmad said: ‘I accept that European Commission rules can be very bureaucratic but in this case they are perfectly clear – failure to provide evidence of how money is spent puts the funding at risk.
‘The DCLG has a clear obligation to make sure every pound of taxpayers’ money is properly accounted for. It is totally unacceptable that SENW cannot provide proper accounts for £1.4m worth of public money.’
The DCLG said it would not be seeking to reclaim any of the money from BEiC’s 17 supporting organisations, who it said operated in good faith throughout. The department also said that with just six months of the grant funding to go, the BEiC project has already exceeded initial expectations – providing 3,128 businesses with start-up support in Liverpool and the surrounding area.
