Northamptonshire County Council is launching an investigation into the activities of its own company which paid for lavish events as it was heading towards its financial collapse.
The financially under-pressure authority is calling in an independent body to look into how NEA Properties was run.
The move comes after a joint investigation by the Local Democracy Reporting Service and the BBC revealed that the limited company used some of the £820,000 proceeds from the 2014 sale of county council -owned buildings to fund items such as £3,624 on a flypast at a Grafton Underwood memorial event in May 2015.
A sum of £80,000 was also spent with Northampton Saints and the council had use of a corporate hospitality box within the rugby club.
A spokesman for Northamptonshire County Council said: “An independent, external review into NEA Properties has been commissioned by the council. As such we are not in a position to comment any further on this matter until the outcomes and findings of this review.”
An internal audit of NEA Properties was carried out in January 2017 after the then UKIP county councillor Michael Brown blew the whistle over concerns about expenditure.
The audit found that documentation and governance within the company was minimal.
It also said: “There is no evidence of improper spend or improper management of the company but in the absence of various records only Limited Assurance can be provided.”
The limited company was set up the authority in 1983 and since then there have been a number of different councillors who held the role of directors of NEA Properties.
At the time of the 2015 spend detailed in the audit, Conservative councillors and cabinet members Andre Gonzalez de Savage and Bill Parker were directors.
The audit suggested in its findings that: “The potential conflict between a councillor of officer performing dual roles, eg the cllr/officer role and company director, should be assessed and documented for every role and overseen by the council’s monitoring officer.”
Both Cllr Parker and Cllr de Savage have said that NEA Properties was closely linked to Northamptonshire Enterprise Partnerships, an organisation set up by the county council in May 2011 to promote the council. Its predecessor organisation was Northamptonshire Enterprise Limited, which ran from 2006.
Labour councillor Gareth Eales, who sent a formal request for action to council leader Matt Golby after the NEA revelations came to light, said: “I am pleased that an investigation will take place on this issue.”
Joint story by BBC journalist Matt Precey and Sarah Ward as part of the Local Democracy Reporting Service