A COMMUNITY council near Tenby has been criticised for failures in governance and financial management.

Penally is one of four community councils in Wales highlighted by The Auditor General for Wales.

The report was issued under Section 22 of the Public Audit (Wales) Act 2004.

The report states the 1,350 elector ward of Penally, which has nine members, failed to prepare annual accounts for the 2015-16 and 2016-17 years within the statutory timetable; failed to maintain proper payroll and PAYE arrangements, including the former clerk’s income tax; and did not prepare a budget for 2015-16 or 2016-17, and did not approve the council tax precept.

The report also highlights insufficient documentation for payments of £1,895 between April 2015 March 2017.

The report highlights the “former clerk’s tardiness” as a significant factor in the accounts delay, in both cases approved in September 2017 rather than June of the relevant years, but added: “...the council itself must take a degree of responsibility for this failure. I have found no evidence that the council took any steps in relation to the overdue accounts.”

Penally itself stated there were incorrect contact details from the audit team, which was not pro-active, and other issues delayed the response.

The report also states the council failed to make proper arrangements to publicise access to its accounts.

Penally also failed to provide the former clerk with a contract of employment, leading to ambiguity about the salary.

PAYE (Pay as You Earn) tax deductions were not passed on to HMRC.

The HMRC payment shortfalls have now been met.

Dealing with budget issues, Assistant Auditor General Anthony Barrett said: “…I was unable to find evidence the council prepared a budget for the 2015-16 or the 2016-17 financial years. The council has prepared a budget for 2017-18, however, this budget does not fully comply with the requirements of the Act.”

The report contains a long string of recommendations for Penally, including governance, financial management and reporting.

Mr Barrett said: “There are some 735 local town and community councils in Wales. The vast majority work to a very high standard. It is disappointing, therefore, that a relatively small but persistent number do not meet the standard expected of public bodies and officials.

"The four councils are already taking action to address the issues highlighted in the report.”

After a report in the public interest is issued, the council is required to consider the report at a full meeting of the council within one month of the date of issue.

At the meeting, the council must decide whether the report requires it to take any action; whether the recommendations in the report are to be accepted; and what action (if any) to take in response to the report and recommendations.

Penally council meetings are held at 6.30pm on the second Wednesday of each month at the village hall.