THE chairman of Liverpool Council’s finance select committee has demanded to know why a damning report revealing the authority is being overcharged £10m a year by BT for its IT and call centre operation was kept secret.

Cllr Paul Clein said it was disappointing to have to read the three- month-old report in the Daily Post because his committee and a special panel set up to scrutinise the contract was not aware it was written.

He spoke out as the Daily Post today made the full damning report available on its website, www.liverpooldailypost.co.uk

On Monday, the Daily Post revealed how a secret report into the controversial Liverpool Direct Limited (LDL) concluded £23m a year could be saved if the contract was terminated.

The bleak assessment of the £70m-a-year LDL contract also stated BT has been “excessively marking up” the cost of equipment not specified in the original deal, which was signed in 2001.

The council claimed the report, written in June, is a draft and has not yet been fully evaluated.

It was the result of months of work by departed assistant chief executive Ben Dolan, assistant executive director Peter Cosgrove and a team of consultants.

Last night, Cllr Clein said: “We have had a scrutiny panel looking at this for nearly a year and we have not had sight of this report.

“In that context, I am very disappointed members of the scrutiny committee and select committee have not seen the report or were aware it was written.

“This process has not been helped by the sudden departure of Mr Dolan and Mr Cosgrove, who were lead officers for the panel.”

The council’s finance select committee set up a scrutiny panel into the LDL deal after an external report stated that bills for the LDL deal were “opaque” and “lacked transparency”, raising doubts about whether the council was getting value for money.

A council spokesman said: “The draft consultant’s report is one of a number of internal, working documents informing council officers monitoring of the LDL contract, and is also essential information for the council as it negotiates a possible “refresh” of its contract with BT.

“These documents contain commercially sensitive material and must remain confidential to protect the financial interests of the council and taxpayer.

“A full report on the contract negotiations will be presented to the city council’s cabinet and the finances and resources select committee in due course when it considers the future relationship and financing of the joint venture.

“We are arranging to give a full briefing on the progress of the negotiations to Cllr Clein in his role as chair of the select committee.

“We are working hard to ensure our partnership with LDL continues to deliver the very best front-line services which thousands of our residents rely on every day, and that they are delivered in the most cost-effective and efficient way possible.”

The latest revelations come at a time when the council is preparing to commit to continue using the LDL service until 2017, albeit in exchange for a better deal.

The report, written in June, stated its purpose was to improve the £70m- a-year contract and squeezing better value out of the contract.

But it also makes clear “significant savings” could be achieved by terminating the deal in 2012 and bringing the services back in house.

If the council finished the contract in 2012 it would save £82m over the next four years, and £23m annually thereafter.