A £3 million overspend on social services in Bury has led to a call for the committee chairman to resign.

Things got so bad that Croich Hey old folk's home at Hawkshaw was closed in an effort to balance the books.

The cash-control crisis also brought a stinging rebuke from the District Auditor, but this week defiant social services chairman John Costello told his opponents: "I won't be resigning!"

In his report the auditor claimed the department did not know what it was doing.

"Part of this overspend can be attributed to unforeseen expenditure on community care, but it was clear that budgetary control arrangements were ineffective," says the auditor.

"There was a general absence of financial acumen and financial stewardship within the social services department." The crisis was so severe that a special working group was set up last year to examine the department.

Tough financial measures, including getting rid of the Hawkshaw residential home, had to be brought in to balance the books.

They included increasing charges for community care users, and only paying for one residential place for every two vacancies. This led to bed-blocking, with old people unable to move out of hospital. The call for Coun Costello's resignation came from Lib Dem leader Vic D'Albert, his party's spokesman on social services. He said the report was damning and added that Coun Costello should go for "misleading" councillors.

"There's a crisis of management in social services which is undermining the whole delivery of services," he said. "We need a new chairman to restore confidence as soon as possible."

Coun D'Albert said he had questioned financial management before but been assured by the chairman that everything was all right.

"We have been misled, money has been spent yet no-one was keeping track of where it was going."

Coun Costello said the District Auditor's remarks were not justified, although he admitted mistakes had been made.

"There's no evidence of any mismanagement, only suggestions that management be strengthened.

"Action was taken and reports on all financial matters relating to social services were brought to every committee.

"I have not misled anyone and I am most certainly not resigning, nor are our officers."

Coun Costello said a tremendous amount of work had been put in to ensure the department had a balanced budget by the end of the 1997-98 financial year.

"The words of the District Auditor, reflecting on the accounts for 1995-96 and written last year, are unhelpful in terms of the position we have reached today."

Mr David Ashworth, director of social services, said every council in the land was struggling to manage community care budgets and most were overspending.

"We did not have adequate resources to manage the budget and we went awry in tracking expenditure."

He added: "We were trying to get community care services out to people quickly, concentrating on Indians rather than chiefs, and to some extent we've paid the price for that."

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