One thing that seems to be absent in Swindon’s free wi-fi fiasco is due diligence. Mr Bluh would have us believe that due diligence occurred before Swindon Borough Council loaned a start-up company £450,000 of our money to provide ‘free’ wireless internet across the borough.
As for whether due diligence was followed, of course we looked at the risks and exposure of the investment. There is absolutely no requirement for us to seek third party independent advice. We have successfully concluded many multi-million deals and transactions and, as a result, have built up a high level of legal, commercial and technical expertise.
Others disagree. Evidence of due diligence is certainly hard to find. The published advice given to Mr Bluh and Mr Edwards is limited. The advice stated that the company was more likely to pay the council’s loan back late than to completely default. It also stated that the likelihood of the council getting a return on its shareholding was strongly dependent on the company’s marketing campaign, yet at the time the company did not have a formal marketing plan. Just how weak would a business proposition have to be for these two councillors not to squander our money on it? This is also the council’s first public/private venture, according to an article in the council’s own newspaper. So the expertise available in the council is more limited than than is being suggested.
Mr Bluh would also have us believe that this £450,000 could not be used for other purposes.
The money invested in Digital City cannot be used to plug a gap in our budget or operating services, it forms part of a sum we would normally invest in order to get a better return for the council.
Just how naïve does he think we are? Transferring money from reserves is commonplace amongst councils when times are tough, as shown in Swindon Borough Council’s own accounts.
Theres also the matter of whether this boroughwide wifi service should have been put out to tender, as a procurement exercise. The Swindon branch of the Federation of Small Businesses believe so, and that the council is disadvantaging local businesses. Once again, Mr Bluh would have us believe differently.
We have been looking at providing free Wi-Fi for the last three years as part of ‘Swindon’s Digital Challenge Proposal’ and it is only recently we have been approached by Digital City UK who had a technical partnership with aQovia. They came to us because they wanted to set up services to sell in Swindon and we invested in them, so we have not disadvantaged any other businesses in Swindon.
But if it was part of the council’s policy to provide such services would they not have eventually offered a contract to supply these services if this offer hadn’t been made? And isn’t Mr Hunt — as chair of one of the council’s bureaucracies, the Swindon Strategic Economic Partnership, and a board member of several others (SSP, TNSC & SCS) — someone with rather better access to the council cabinet than most? This is not some unconnected company coming along with a commercial proposition: Mr Hunt and the council have been closely connected for many years. And as a consequence of that we, the Swindon taxpayers, seem to have been landed with a deal with far less financial security than a properly procured service would provided.
It’s not enough for the process to be, as Mr Bluh regards it, not only above board but robust. It also needs to be seen to be above board. At the moment, all that can be seen is a fog of secrecy and spin, mixed with smoke from taxpayer’s money burning.