Wednesday, 24 May 2017

Auditors called in to probe alleged links between employee and contractor

Novas faces new investigation

Housing association Novas Scarman has called in auditors after allegations that one of its contractors had links to a member of its staff.

It has also emerged this week that the association, which is currently the subject of a statutory inquiry ordered by the housing regulator, spent £260,000 on creating an little-used Chinese-themed theatre in Liverpool.

The allegations emerged after a Novas source wrote to Inside Housing suggesting that there were concerns about the association’s employment of a contractor. It was alleged that a member of staff at Novas had links to the contractor. Novas confirmed it had asked its external auditors to investigate what it stressed were ‘alleged disclosures’ about the unnamed firm. It said that it was unable to comment further until the process was concluded.

In 2005/06 Novas spent £260,000 on its outdoor Dragon Theatre at the Alima Centre in Liverpool. The Novas source said the theatre saw little activity and ‘resembles a Victorian folly’. It is effectively now closed.

A Novas spokesperson said: ‘[The theatre] did end up with less use than anticipated, and in 2008 we subsequently decided to consolidate all activity.’ She said the theatre activities were transferred to Novas’ Contemporary Urban Centre, also in Liverpool.

In October the Housing Corporation announced a statutory inquiry into ‘aspects of the financial management’ of Novas Scarman.

The group has been expanding its social enterprise and arts businesses, as part of a plan to move away from hostel provision. Last summer it said it was planning to transfer its flagship hostel, Arlington House in Camden, to One Housing Group halfway through a multi-million refurbishment.

But some of its social enterprise and arts ventures have fallen on hard times - its fashion store in Camden closed in early 2008 after being open for just a year.

Novas made an operating deficit of £277,700 in 2006/07. Its 2007/08 accounts have not yet been released.

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