Sutton Council has been accused to trying to keep quiet a “terrible scandal” that cost the public more than £1million.

It comes after Sutton Housing Partnership (SHP) failed to recoup money spent on property works on 393 leaseholder properties across the borough in 2013/14.

The revelation came during a full meeting of Sutton Council on Monday, January 30.

SHP had 18 months to send out its statutory notices to residents but in many cases either failed to do so, or dispatched them after the deadline.

It meant the £359,890 it managed to collect had to be repaid while a further £684,967 that was owed was never touched as the residents were not sent dispatches.

It has since been revealed the council was made aware of the debacle in October 2015, but this was not shared with members of its housing, economy and business committee (HEB) until December 2016.

Councillor Jayne McCoy, HEB committee chairwoman, confirmed Sutton Housing Partnership’s former chief executive and finance director had been replaced, but did not discuss any details of their severance packages, following the debacle during an exchange with opposition councillors during Monday’s meeting.

Cllr McCoy said: “Although the council has not received any formal apology from SHP. Council leadership believes that someone is held to account for these serious failings that has lead to a loss of around £1m in income.

“Through that - the chief executive and finance director have been replaced and it has been made clear to the new chief executive the expectations for the efficient management of its function as a council arm’s length management organisation.

“We made clear that the lease holders were involved from the beginning and were made aware what we were doing to find out what the issue was, what the problems were and in that time things have been addressed.

“In some ways the only reason it needed to come to the business committee was because of the money that needs to be repaid to the council.”

Cllr Neil Garratt said in response: “I understand that this had been known about for more than a year. My concern is that it seems to have been kept quiet and does that not look bad to the general public that this terrible scandal quietly disappears for a year.”

Cllr Tim Crowley, the leader of the Conservative opposition, then asked if any payments had been made to the pair.

Cllr McCoy said: “I didn’t say any one had been paid off. I just said it was unfortunate that people go and no one is being punished for it. I can’t say what the arrangements were as it was between them and the board. I was not party to it.”

Following the meeting Cllr McCoy said: "Sutton Housing Partnership manages homes for tenants and leaseholders on behalf of the council. A failure in SHP’s management systems meant some leaseholders were incorrectly charged for works to their homes. The council become aware of a potential problem in October 2015. It was only after comprehensive and independent reviews of their systems and procedures did we become fully aware of the extent of the position. 

"Following the review SHP has reimbursed leaseholders who paid for charges they were incorrectly invoiced and is paying the council for costs of works which cannot be invoiced. Since the investigation changes have been made to the management of income by SHP to ensure a failure like this cannot happen again.

"SHP's mismanagement of charging leaseholders is indeed scandalous, however there has been no cover up."