A REPORT produced by Northumberland County Council has laid out 'significant concerns' about the 'behaviour, ethics and conduct' in relation to a controversial planning application to create a new village.

Daljit Lally, the authority's current chief executive, has produced the document which claims there is 'significant evidence that appears to suggest that attempts were made to subvert’ the authority’s planning function in relation to the Dissington Garden Village scheme, near Ponteland, which sparked a £10m High Court claim against the local authority, which was later dropped.

In echoes of the scandal surrounding the council’s former company Arch, it raises concerns about ‘excessive hospitality’ provided to an ex-planning boss which went undeclared, as well as evidence of a ‘highly irregular’ loan to fund the development and collusion to secure ‘inappropriate advantages’ for the developer.

In March 2017, Newcastle-based developer Lugano’s proposals for up to 2,000 new homes and other facilities were handed a 'minded-to-approve resolution' by the council.

However, after the Conservatives formed the new administration following the elections in May that year, the council withdrew the previous core strategy before starting to develop a new version of the Local Plan, which required the reassessment of the DGV bid.

In May 2018, Lugano made serious allegations against the local authority as well as council leader Peter Jackson, chief executive Daljit Lally and cabinet member for planning John Riddle, with writs then issued in the High Court in August.

In January 2019, the Dissington application was withdrawn just days before going in front of the council’s strategic planning committee again, where it was to be recommended for refusal.

At the time, Lugano said it was continuing with its High Court action and that it would resubmit the plans in the future, but two months later the legal claim was discontinued as it was revealed that the estate had transferred into the ownership of Matterhorn Capital, one of those to provide a loan for the Dissington project.

Lugano Dissington Estate Ltd has since gone into administration.

A report to Wednesday’s meeting of Northumberland County Council’s audit committee now informs members of ‘significant matters of concern which have been identified in relation to the discharge of specific aspects of the county council’s planning function’.

The issues initially came to light following an investigation into a whistle-blowing disclosure in 2017-18, with more matters coming to light during ‘further subsequent relevant investigations’.

The report reveals that:

  • ‘Significant concerns’ had been raised with Northumbria Police and the relevant professional body after the conduct of a number of senior former council employees ‘fell short of expected standards of behaviour, conduct and ethics’;
  • ‘Significant efforts were made by several persons in positions of authority and control within the county council to collude with and secure a number of inappropriate advantages for the planning applicant/developer’;
  • There is also evidence that ‘a former very senior planning officer’ accepted substantial hospitality, including first-class rail travel, hotel accommodation and fine dining in a private room of a London restaurant owned by a Michelin-starred chef, from the applicant/agents and did not declare or record this;
  • Staff were instructed to use personal email accounts in relation to this application, so correspondence would be hidden from the council’s system, although junior planning officers brought this matter to senior management’s attention;
  • The applicant/advisers were invited/allowed by a very senior officer in the planning department to write and alter parts of the report to the strategic planning committee which recommended approval of the scheme, while council officers sought to obtain legal advice to support the applicant’s stance;
  • A total of £273,389 of legal costs were racked up by the council to fight the High Court claim before it was dropped and given the administration of Lugano Dissington Estate Ltd, ‘it is highly unlikely that the county council will be able to recoup any of the funds’;
  • The administrators have investigated the company directors and a report regarding their conduct had been formally submitted to the Department for Business, Energy and Industrial Strategy.