Carmarthenshire blogger row: Council libel costs pledge 'unlawful'

Mark James won a libel action against blogger Jacqui Thompson earlier this year

A pledge by Carmarthenshire council to cover the court costs of its chief executive fighting a libel case against a blogger was unlawful, auditors say.

The Wales Audit Office said the authority was wrong to provide indemnity in Mark James's libel action against Jacqui Thompson.

He won the case and Mrs Thompson was ordered to pay costs of £23,217.

The row began when the blogger was arrested after filming a council meeting on her mobile phone.

Her own attempt to sue Mr James for libel during the course of the dispute was rejected.

Carmarthenshire council said it had taken external legal advice and had consulted the Wales Audit Office prior to deciding to cover Mr James's court costs. It said concerns had not been raised until now.

But there was criticism from some politicians, including Plaid Cymru AM Rhodri Glyn Thomas, that the council had agreed to provide indemnity related to Mr James's legal fees in relation to the action.

The council's appointed auditor from the Wales Audit Office, Anthony Barrett, has now told the council he views that arrangement as unlawful.

In a separate issue, his report also found that a council payment of £16,353 in lieu of pension contributions to Mr James was also unlawful.

The council insisted this was done on the advice of independent experts and did not result in any extra cost to the council.

However the MP has urged Local Government Minister Lesley Griffiths to take up the auditor's report with the Wales Audit Office.

Mr Thomas asked her: "Will you undertake to investigate this matter as they are very serious allegations?"

Mrs Griffiths replied: "The allegations you make are serious if that is the case. I will certainly read it and raise it with the auditor general in due course."

'Different view'

Carmarthenshire council insisted that it still believes the decision about the libel case indemnity and the payment in lieu of pension contributions are both lawful.

"Regarding the issue of the indemnity to an officer of the council to take action for libel, we would like to make it clear that we consulted the Wales Audit Office prior to the decision being taken in January 2012 and that it has taken almost two years for these concerns to have been expressed," a spokesman said.

"We have discussed the matter with them on several occasions and in August of 2012 they indicated, in response to questions from a third party, that they agreed that the council had the legal powers to grant the indemnity.

"It is disappointing that they have now expressed a different view so late in the day, and too late for the council to act upon it."

The spokesman said its own independent legal advice, along with the outcome of the libel court case and the comments of the judge in that case "further reinforce our opinion that we acted properly".

Tax changes

"So far as the payment in lieu of employer's pension contributions is concerned, this has not incurred any additional cost to the council or the local taxpayer," he said.

"Instead of paying into the employee's pension scheme we have agreed simply to make a payment directly to them of an equivalent amount and it is then for them to make their own arrangements as they see fit.

"This situation has been brought about by changes in tax rules which make it difficult for people earning above a certain level to remain in the occupational pension scheme.

"We believe there are numerous other employers including local authorities, universities and housing associations who have adopted the same practice.

"The decision was made having obtained expert advice from independent consultants."