Government moves to expand intervention at Thurrock after concluding financial position result of “deeper systemic weakness"

The Government has written to Thurrock Council to say it is "minded to" expand intervention at the financially troubled local authority by handing its commissioners additional powers, including over governance and staffing functions, in light of "unprecedented" challenges.

Announcing the plan in a statement yesterday (24 January), the Minister for Local Government and Building Safety, Lee Rowley, said he and the Secretary of State for Levelling Up, Housing and Communities, Michael Gove, agreed that new evidence was "serious enough" to expand the intervention.

Essex County Council has been acting as Thurrock's Commissioner and Best Value Inspector since September 2022 after the then Secretary of State, Greg Clark, decided to intervene over financial and commercial risks and the "seriousness" of allegations made about the council's financial decisions.

Essex has since delivered a Commissioner report and update letter in December 2022, revealing a £470 million in-year funding hole in the council's finances.

In his statement yesterday, Lee Rowley said: "Taken together, the Commissioner report and update letter lay bare the profound weaknesses in this Authority's financial function, which has resulted in unmanageable budget gaps in this financial year and in future years."

He added that the Best Value Inspection update letter "posits that the Authority's financial failings are a manifestation of deeper systemic weakness in the historic and recent running of the Council".

Rowley wrote that, having considered the documents in the context of the intervention, the Secretary of State is "satisfied that the Authority is not meeting its best value duty, both in terms of its known financial issues, and in relation to its governance and staffing functions".

"Whilst we have not yet received the final Best Value Inspection, the Secretary of State and I agree that the evidence and recommendations presented in the Commissioner report and update letter are serious enough to warrant taking steps to expand the intervention now, in order to prevent further best value failure."

The proposed expansion to the intervention package would give Commissioners powers over the authority's governance and staffing functions and would instruct the authority to take further actions to support its recovery.

Specifically, the Secretary of State is "minded" to issue further Directions to permit the Commissioners to exercise powers over:

• All functions associated with the governance, scrutiny and transparency of strategic decision-making by the authority to ensure compliance with the Best Value Duty. This will include oversight of an audit of the authority's governance.
• All functions associated with the authority's operating model and redesign of council services to achieve value for money and financial sustainability.
• The appointment, suspension and dismissal of staff in the top three tiers of the organisation, including powers to determine the process for making these appointments and dismissals and to design a new officer structure.
• The development, oversight and operation of an effective performance management framework for senior officers.

Under the expanded intervention, another Commissioner may be appointed to act as Managing Director at Thurrock.

In line with procedures laid down in the Local Government Act 1999 Act, officials in the Department for Levelling Up, Housing and Communities (DLUHC) have written to Thurrock to notify them of the Secretary of State's proposals, and the council has been invited to submit representations before 7 February.

The Minister for Local Government and Building Safety has also invited representations from the public on the Commissioner's report, the Best Value Inspection update letter, and the Secretary of State's proposals.

Responding to the Minister's announcement, Thurrock’s Acting Chief Executive, Ian Wake, said: “We have been working very closely and cooperatively with the Government Commissioners and this will continue as their remit expands."

He added: “The council is in a much better place than a few months ago at the start of the intervention, thanks to the hard work of our staff, Members, and the support of the Commissioners.

“We’ve put an initial Improvement and Recovery Plan in place that reflects the Commissioner’s first report, and we are taking action to deal with our finances and changing the overall culture of the organisation.

“But we have been clear too that there are some very hard decisions to be made as we deal with our finances and agree how we can maintain our services to local people.”

Council Leader, Cllr Mark Coxshall, said he welcomed the Secretary of State’s commitment to giving the residents of Thurrock their say on the proposals.

Adam Carey