Cornwall Councillors have questioned why the council’s own companies have opted out of using a new IT system which has overspent by more than £3 million.

Councillors have also expressed surprise after discovering that Corserv said that it is not paying any rent to Cornwall Council for its buildings.

The authority has taken on a new system based on Oracle software which brings together IT services for a number of different departments.

When it was originally agreed the council stated that it would also enable the authority to bid to provide back office functions for other organisations.

However the council’s latest budget papers revealed that the Oracle Cloud programme had overspent, creating a budget pressure of £3.2m.

A meeting of the council’s customer and support services overview and scrutiny committee this week took the opportunity when quizzing staff from its Corserv group of companies to ask why it had not signed up to the system.

Corserv was presenting its latest business plan to the committee which sets out its proposals for the next four years.

The company, which is wholly owned by Cornwall Council, also includes a number of other council-related companies including Cormac, Cornwall Housing and Cornwall Airport Newquay.

Conservative councillor David Biggs asked Corserv managing director Cath Robinson why the company was not signed up to Oracle.

He said: “We have talked about back office functions and we have looked at the situation around our own Oracle contract. There are companies on this but Corserv isn’t one of them.

“You have been talking about strategic partnerships, Corserv should be joined at the hip with Cornwall Council on back office functions.

“You are almost independently doing the same things we are, I think that is extraordinary.”

Mrs Robinson said: “We worked with the council for several months to use the Oracle system and our aim was to use the system and be part of that implementation.”

But she claimed that the management board at Corserv was not happy about the level of access the company would have to its data under the Oracle system.

She said: “We could not make it work in terms of our access that we were going to be given to our own data with how it was going to be set up here.

“That is just the way that it turned out. We actively tried to work together and both parties want to make it work.

“We went out and purchased our own Oracle system and we put that in under our budget.”

Cllr Biggs said that he felt it was an issue that the council and Corserv should have been able to solve. He said it was an issue of waste and suggested that the chief executive “should have got everybody in the room and said ‘sort it out'”.

Councillor Philip Desmonde asked Corserv about the arrangements for the buildings that it uses owned by the council and asked whether properties had been transferred to the company.

Corserv finance officer Phil Mawston said that no properties had been transferred to the company and added: “We don’t pay any rates at the moment.”

A surprised Cllr Desmonde asked for clarification stating: “You don’t pay any rental for the properties that you occupy from Cornwall Council?”

Mr Mawston replied: “That is correct.”

Committee vice chairman Neil Burden referenced the issue later on in the meeting and suggested that members of the council sitting on the Corserv board should “put their foot down”.

He added: “They pay no rent. There is something wrong here.”