§ Mr. FraserTo ask the Secretary of State for the Environment if he has now received the audited accounts of Lambeth council's direct labour trading divisions; and 577W what conclusions he has reached as to whether each of those divisions shall continue to provide services to the local authority.
§ Mr. BaldryThe London borough of Lambeth has provided my right hon. Friend with accounts relating to the council's direct labour organisations—DLOs. These cover the financial year ending 31 March 1993 and earlier years, going back in the case of some activities to 1985–86.
The accounts have been certified by the authority's internal auditors but await certification by the district auditor. The internal auditor has qualified some of the accounts in respect of matters already made public in reports issued by the authority's former chief executive and the district auditor.
The accounts were specifically required as a result of directions given, on 23 July 1993 by my right hon. Friend, under section 19B of the Local Government, Planning and Land Act 1980 and section 14 of the Local Government Act 1988.
Subject to any changes which might be required by the district auditor the accounts show that the following defined activities met any necessary financial objectives; sports and leisure management, welfare catering, other cleaning, refuse collection and street cleaning, building cleaning, and grounds maintenance.
Losses were made in relation to general highways work. Under the terms of the relevant direction, the authority must cease carrying out the work, except for work of an emergency nature, snow clearance and gritting, as from 1 April 1994. Losses were also made on new construction work. The authority has now ceased to carry out such work.
Heavy losses have also been recorded for building maintenance work. The relevant direction already required work to be retendered by 1 April 1994 and my right hon. Friend's consent will be required before any new building maintenance work can be awarded to the authority's own DLO.
Lambeth has been notified of my right hon. Friend's views on these matters.