CASH chaos was so bad at Congleton Borough Council that £1m in debts was not collected and only one person knew how to use an expensive computer system, an inquiry has revealed.

A row has erupted amid revelations of poor financial management at the council, which has its headquarters at Westfields in Sandbach.

The Conservative administration at the authority shelled out £20,000 on an independent investigation to root out the cause of financial difficulties.

It brought in accountant KPMG. The firm's report revealed the council has failed to collect almost £1m in debt, staff are unable to use financial systems properly and that this year's budget was rushed through at the last minute.

Council leader Roland Domleo said he was 'horrified' at the report's findings.

He added: 'The report identifies problems, most have been in place for many years, and some deteriorated in the last 12 months.

'The situation turned out to be far worse than we ever imagined. This report will be of great concern to residents, but I would ask them to look at it in a positive way.

'This administration will identify long-standing problems and failure to adapt to modern times, and will do something about it.'

But Cllr Rod Fletcher, leader of the Liberal Democrat group which ran the council before the Tories took over two years ago, said his party is a scapegoat for errors for which they are not to blame.

He claimed: 'I am very angry at the way this has been dealt with. It is clear from the report the problems mainly occurred during the last two years, especially when the financial computer system was brought in.

'It was done poorly and not over-seen correctly.'

KPMG was called in when the figures for this year's budget did not appear on time. Even when they did, councillors did not trust them and they were rejected.

The report says a lack of effective project management was in place when the system was introduced last year.

KPMG has made 35 recommendations for improvement and an action plan is being drawn up to make future project management and performance better.

They include reviewing its contract with its computer system provider, strengthening sundry debt collection arrangements, having adequate project management in place for future projects, and changing the budget-setting process.