Borough to “tighten governance” around temporary accommodation procurement after monitoring officer and s.151 officer issue joint report

In the report, members were advised that, whilst the council had been fulfilling its statutory duty to provide emergency accommodation to homeless households in qualifying circumstances, it had done so in a manner that had “not complied with certain statutory requirements, legal provisions and the council’s constitution”.

The report added: “As a consequence, expenditure has been incurred without the necessary compliance with the applicable legal and procedural framework and is therefore considered to have been incurred unlawfully.”

The review identified that between financial year 2019/2020 and 7 July 2026, the council had engaged multiple different providers in relation to temporary accommodation services.

However, the review did not identify documentation evidencing compliant procurement of contracts with the providers throughout the review period, or compliance with the council's Contract Procedure Rules.

The report said that to date, the review of council records had identified payments to providers totalling approximately £16.6 million during the review period. Payments from 2022/23 onwards totalled approximately £13.6 million. The highest amount paid in a single financial year was approximately £3.8 million during 2024/25.

The monitoring officer and the s.151 officer noted that s.188(1) of the Housing Act 1996 places a statutory duty on the council to provide emergency accommodation to homeless individuals in certain circumstances, and s.206(2) permits accommodation to be secured through third parties.

“However, those provisions do not override other statutory and constitutional requirements, including procurement legislation, the council's constitution, Financial Procedure Rules and Contract Procedure Rules, nor do they remove the requirement for obtaining and recording appropriate authority to incur expenditure or enter into contractual commitments," they said.

In relation to procurement legislation, the report said that the Public Contracts Regulations 2015 and, from 24 February 2025, the Procurement Act 2023 governed the procurement of the services during the period in which the payments were made.

The services in question were considered “light touch” services. The review identified that expenditure with four providers exceeded the applicable threshold, and so the council was required to comply with the procedures set out in the procurement legislation unless a lawful exemption applied.

The report said: “No evidence has been found to demonstrate that the required procurement procedures were followed in relation to these arrangements or that a lawful exemption applied or was considered and recorded. The Statutory Officers are therefore concerned about the Council's compliance with the applicable procurement legislation.

“Where the estimated value of a procurement is below the relevant threshold but exceeds £30,000, the Procurement Legislation also imposes procedural requirements the Council must meet. The Review identified that arrangements with at least ten providers fell within this value range. Officers have been unable to identify evidence that the applicable below-threshold requirements were complied with in relation to those arrangements.”

The monitoring officer and s.151 officer meanwhile expressed concern that, in the absence of evidence of written contracts or other contractual documentation, expenditure on the services was incurred “other than in accordance with the Council's contractual and governance requirements”.

The report added: “This constitutes a direct failure to comply with the Council’s Contract Procedure Rules made pursuant to section 135 of the Local Government Act 1972. The failure to enter into written contracts where they were expressly required meant that expenditure was incurred otherwise than in accordance with the Council’s statutory and constitutional requirements.”

Upon discovering the issues, the council said it sought independent, external legal advice from King's Counsel to examine the review’s findings and work with the authority to put in place a “remedial action plan”.

Havant stressed that the review did not identify any dishonesty or misconduct by council staff.

Yesterday (23 September), Havant’s Cabinet received the report and accepted the remedial action plan prepared by officers.

Leader of Havant Borough Council, Cllr Gillian Harris, said: “As a council, we have a statutory duty to provide emergency accommodation for homeless people in our borough, often at short notice and in difficult circumstances.

“I believe we’ve sought to do this to the best of our ability and to meet the needs of vulnerable, homeless people, all within a very challenging budgetary environment.

“The reality though, is that we need to be able to evidence that we’ve done this properly and that we’ve also worked to use our resources efficiently and to achieve the best value accommodation. The lack of a clear procurement framework for the period during which this service was outsourced means that we can’t provide that evidence, and we need to ensure that we put that right.”

Cllr Harris added: “As a Cabinet, we accept the review and acknowledge that significant improvement must happen to ensure we have a compliant procurement system going forward so residents can be confident that value for money is being achieved, expenditure is fully documented and monitored, and our processes are transparent and fair.”

Lottie Winson