A council has said no fraud has been discovered after the publication of a damning auditors' report – but does not rule out the possibility.

‘Significant weaknesses’ were found by external auditors examining Eastleigh Borough Council’s controversial One Horton Heath project.

Fiscal controls at the debt-laden council were particular areas of concern in the 10,000-word report.

But councillors at the Liberal Democrat-led authority dispute fraud occurred.

Daily Echo:

Speaking at the audit and resources committee on Tuesday night, chair Cllr Steve Holes said: “It is important to note that there will always remain an inherent risk that fraud may not be detected, and it is essentially impossible for internal audit to prove that fraud has not occurred.

“The fraud risk assessment will continue to be carried out assessing the whole organisation and the internal audit plan.

“The implementation of the audit recommendations will continue to be monitored as part of the performance monitoring and escalated as necessary through the appropriate channels.

“A review of the policy and procedures of the fraud investigation has commenced, and it is planned that updates will be shared with audit and resources committee in June 2024.”

As previously reported by the Echo, one of the accusations centred on payments made to contractors.

Others mentioned in the report involved an alleged failure to comply with procurement law and a lack of scrutiny surrounding the council’s financial and operational plans for One Horton Heath.

Cllr Alex Bourne, who represents Eastleigh South, said at Tuesday’s meeting: “There were headlines today that gave the impression that fraud has been discovered.

“But reading these reports it looks as though no fraud has been discovered, but we can’t rule out that no fraud has taken place.

“The key thing is that no fraud has been discovered.”

The report comes after the council sunk an extra £154m into the 3,000-home project in December.

But Cllr Holes, who represents Bursledon and Hound North, reassured concerned members of the public about the council’s spending.

He said: “It is important to understand that beyond the recent cabinet approval in December 2023, the council is not committed to borrowing any additional funds for any further phases of the project.

“Each future phase will be financially modelled as part of the planning process, and the appropriate delivery model will be recommended.”