Wilful, reckless, guilty

Six face pounds 32m bill in the worst local government scandal

John Major yesterday resolutely refused to condemn Dame Shirley Porter, the former Tory leader of Westminster City Council, after she was found "guilty of wilful misconduct" in the biggest local government scandal for a generation.

Dame Shirley and five of her former colleagues on the council are to be surcharged for their part in the "homes-for-votes" scandal and ordered to pay back pounds 31.6m of public money, spent on gerrymandering, which the district auditor, John Magill, said he had found to be a "disgraceful and improper purpose".

The "homes-for-votes" scandal began in 1986, shortly after the local elections which saw Dame Shirley retain power by a narrow majority. Soon after that victory, eight key marginal wards were identified as being crucial to her chances of shoring up her power base in time for the 1990 elections.

At a series of secret strategy meetings, Dame Shirley and her closest colleagues devised a formula which they hoped would guarantee them a bigger margin in 1990. Central to their plans were "designated sales" - selling council homes to likely Tory voters. This, said Mr Magill, was "unlawful, unauthorised and to the detriment of the interest of local taxpayers". The Tory leader, he said, had been "recklessly indifferent" as to whether the policy had been right or wrong.

While his 2,000-page report marked the end of a seven- year investigation, it signalled the beginning of what is bound to be a long, drawn-out legal battle, with Dame Shirley vowing to clear her name through the courts.

Her decision to appeal was immediately used by Mr Major and his Cabinet colleagues to resist repeated calls by the Opposition to condemn them.

The only relief for the Tories on what was an otherwise grim day - made worse by Westminster's position as one of the party's much trumpeted flagship councils - came when Mr Magill announced that Barry Legg, the MP for Milton Keynes South West, and a Westminster councillor at the time of the controversial "designated sales" policy, would not be surcharged.

Last night, Labour sources were claiming the Tories' unwillingness to condemn the councillors arose from the fact that documents and interviews collected by Mr Magill had revealed "substantial involvement" by "past and present" government ministers and Tory MPs. These included two Westminster MPs - Peter Brooke, the former Northern Ireland and Heritage Secretary and John Wheeler, a serving Northern Ireland minister - and Paul Beresford, now an environment minister, but then leader of Wandsworth council, a neighbouring Tory flagship.

The total loss from keeping homes empty, often for long periods until purchasers could be found, and the consequent denial of rental income and capital grants, was pounds 31.6m, said Mr Magill. This sum will now have to be found by Dame Shirley and five former colleagues: Graham England, Peter Hartley, Paul Hayler, Bill Phillips and David Weeks.

Dame Shirley was typically unbowed yesterday. She accused Mr Magill's investigation of being "blatantly unfair. One man has been prosecutor, judge and jury".