Stronger management procedures and new leadership arrangements are being put in place at the county council’s development company.
It follows a highly critical report to the council’s audit committee which identified a “number of financial irregularities” around overseas trips, hospitality and sponsorship deals at Arch (a wholly owned subsidiary of Northumberland County Council).
A Northumberland County Council spokesperson said: “As an open and transparent organisation it was only right these matters were discussed publicly.
“An independent and strategic review of Arch highlighted a number of serious failings in terms of governance and financial impropriety.
“During this review, we were made aware of several further matters of concern, which we felt compelled to investigate further. This looked at activity from 1 April in 2016 to 30 June 2017.
“This work has highlighted a significant number of financial irregularities in terms of attendance at overseas events, corporate hospitality and gifts, sponsorship, as well as lack of HR and management processes and procedures.
“We are appalled at this inappropriate use of public funds.
“Any identified impropriety will be handled in accordance with standard policies and procedures.
“Interim governance and financial procedures have been in operation since July 2017, with robust management arrangements to ensure probity and transparency moving forward.
“A new development company is being created, which will have a greater focus on regeneration, place shaping and delivering for the communities of Northumberland.
“New leadership will be put in place to deliver an ambitious programme of activity that supports business growth, creates new communities and job opportunities for local people, and secures economic prosperity that everyone can benefit from.”