Government launches intervention at Thurrock over financial concerns and “seriousness” of recent allegations

The Secretary of State for Local Government, Greg Clark, has drafted in Essex County Council to lead intervention and a best-value inspection of Thurrock Council in response to urgent concerns about the unitary's level of financial risk and debt.

The Secretary of State said the decision was made in response to the scale of financial and commercial risks facing Thurrock and due to the seriousness of allegations made about its financial decisions.

Essex has been appointed as Commissioner and Best Value Inspector in order to conduct the intervention, meaning it must now exercise Thurrock’s strategic financial functions and assess whether there are failures in other functions to mitigate any further risk to services.

According to a letter sent by the Government to Thurrock on Friday (2 September), the Secretary of State believes the financial circumstances at Thurrock are “sufficiently urgent” to impose the direction under the Local Government Act 1999 without allowing the council to make representations.

The letter stated that the decision was made due to the scale of the financial and commercial risks potentially facing the council, “which are compounded by the Authority’s approach to financial management and the seriousness of the allegations that have been made by third parties about the processes that have been applied to the operation of the Authority’s commercial strategy”.

It added that Thurrock’s “failure” to provide assurance to the Government on the adequacy of the actions that it is taking to address the issues also contributed to the decision.

Essex’s best value inspection will look into the governance, audit (internal and external), risk management, overview and scrutiny functions at Thurrock and consider their impact on service delivery.

A best value report is expected to be handed to the Secretary of State within the first three months of the intervention alongside an improvement plan.

The Secretary of State said that, given the “serious financial” situation at Thurrock and its potential impact on local services, he believes it is necessary for the Government to intervene.

Clark continued: “I strongly believe that when a council gets into difficulties its local government neighbours should be the preferred source of help in turning it around.

“I know that Essex County Council possesses the expertise and ability to help its local government neighbour. Working together, I believe the councils can deliver the improvements local people expect and deserve.”

The Leader of Thurrock Council, Cllr Rob Gledhill, stepped down from his position on Friday in response to the intervention.

Cllr Gledhill said: “Whilst I welcome this news and the support from Her Majesty’s Government it has become clear over the past few months that the situation regarding council investments, and subsequently its finances, has not been as reported.

“As Leader of the Council the political buck stops with me and as such it would only be right, and expected, that I resign as Leader of the Council. However, I will be remaining as an elected member to support the new Leader and the Commissioner as required.”

Deputy Leader of Thurrock Council, Cllr Mark Coxshall, will take over the duties of Leader until permanent arrangements are confirmed.

Thurrock said it was treating this situation “extremely seriously” and confirmed it would co-operate fully with the appointed Commissioners.

Leader of Essex County Council, Cllr Kevin Bentley, said: “Through partnership working with the Association of South Essex Local Authorities, we have a good understanding of the local context. Working alongside Thurrock colleagues and utilising ECC’s strong financial expertise and performance, I hope that we can soon begin to see Thurrock Council take positive steps forward.”

The intervention comes a month after The Good Law Project launched a judicial review over Thurrock Council’s finances in relation to a decision to invest £138 million in a solar farm.

The Good Law Project’s letter before claim requested further information on the decision and alleged that the council could have breached its fiduciary duty to taxpayers, failed to take account of relevant considerations in making its investment decisions, and failed to comply with principles of transparency around decision-making.

Adam Carey