Concerns raised about thousands being claimed in expenses

Issues have been raised about the thousands of pounds being claimed by Oldham Council staff in expenses. Inspectors said there was an ‘unexplained rise’ amid a lack of oversight but the council said ‘there is no suggestion of misuse’.

A report published ahead of an Oldham Council audit committee meeting on July 22 has revealed the outcome of a review into staff expenses by the local authority’s internal audit team which scrutinises council work. While expenses are a key way of reimbursing employees for costs related to their work, the report said there can be risks of possible fraud, incorrect claims, and non-compliance with policies.

In 2019, Oldham Council staff made 392 claims which cost over £132,000. While this dipped during the first year of the Covid-19 pandemic in 2020, this has largely risen since with the number of claims going up by 50 per cent.

In the financial year from April 2025 to March 2026, there were 612 claims made by staff costing the taxpayer more than £312,000. Compared to 2019, this is a 26pc increase when adjusted for inflation.

The report from auditors said the reasons for this increase were ‘unclear’, adding: “There is a lack of regular monitoring of staff with high mileage claims or unusual travel patterns, as mileage spending is not routinely reported and trends over time are not reviewed.

“No value-for-money review of mileage expenditure against comparable costs of public transport has been conducted, and costs are not benchmarked against comparable authorities, limiting assurance over efficiency and compliance.”

Council audit officers have requested the local authority review mileage claims in each service, particularly in light of changes in work practices such as home working and remote meeting technology.

For expenses in general, there was an increase in claims following the pandemic but numbers have since fallen largely back in line with levels seen before the pandemic. However auditors said there was ‘limited monitoring and reporting of staff expense claims’ and called for this to be done every three months.

The audit report said expense claims in children’s services suggested staff were submitting some claims for payroll re-imbursement, adding: “The authority should consider whether this client related expenditure should be accounted for elsewhere and purchased via purchase card, as opposed to being funded by, and re-imbursed to, employees.

“The staff expenses policy has not been updated to reflect post-pandemic working practices, and high-value individual claimants are not routinely reviewed.”

On business and travel expenses, auditors also raised concerns about the lack of controls in this area. While there was a sharp decrease in the last year, £854,829 was spent on hotel costs the year before.

Since 2019, the local authority has paid for over £2m in staff expenses for hotels alone.

Explaining the peak in hotel costs in 2024, the audit report said: “This growth is largely attributable to the increased use of hotel bookings via Click Travel for social care temporary accommodation costs, which rose significantly year on year.

“Temporary social care accommodation costs are now coded elsewhere, and these costs have since dropped back below pre-pandemic levels.”
While hotels have gone down, the expenses claimed each year for flights and train travel have increased and the reasons for this are also ‘unclear’.

This is highlighted as being ‘of particular interest’ by auditors because while it may sometimes be cheaper than other travel, it should only be used ‘by exception’.

Auditors said while processes exist, there are ‘authorisation weaknesses’ that need to be addressed and ‘addressing these issues will reduce exposure to financial, operation, and reputation risks’.

In their opinion, auditor officers said they said they could give ‘limited assurance’ over the ‘unexplained rise in post pandemic business travel costs’ as ‘these weaknesses increase the potential for fraud, error, and mismanagement, and may expose the organisation to reputational harm if not addressed’.

In response, management said they will set up monitoring and reporting every six months and update their expenses and car allowance policies. This in response to eight recommendations being put forward.

A council spokesperson said: “The council takes the findings of the Expenses, Travel and Subsistence Review seriously and has carefully considered the recommendations set out in the report.

“The review identified areas where processes and oversight can be strengthened, and work is already underway to act on these findings. This will help to ensure travel and mileage claims are administered consistently, transparently and in line with council policy.

“There is no suggestion of misuse, however we are committed to maintaining the highest standards of accountability for public money and will implement the actions arising from the review to further improve our arrangements.

“We will continue to monitor compliance and ensure appropriate checks are in place to provide assurance to residents that taxpayers’ money is being spent responsibly.”