The delay in resolving financial issues with schools resulting from Liverpool Council’s energy contract debacle lay with the government, a council cabinet member has claimed.
Liverpool Council has signed off on plans to reimburse schools more than £2.3m after its costly electricity contract error last year. A report earlier this month confirmed schools across Liverpool were left with an additional bill worth millions of pounds as a result of errors around its energy contract in the spring of 2022.
Council leaders were not informed by officers that the electricity provider it was dealing with had withdrawn from the commercial market, leading to the council - and other city institutions including schools and the fire service - being placed on a far more expensive contract. This morning, members of the city council cabinet have confirmed the funding for more than 130 sites across the city impacted by the fallout.
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A report to executive members revealed during a 10 week period between April and June 2022, Gateacre School was left with a bill of more than a quarter of a million pounds - £156,000 more than expected. West Derby School was handed an electricity bill of almost £140,000 for the same period, £84,000 more than it should have been.
Cllr Tom Logan, cabinet member for education and skills, said the time taken to sort the problem lay at the door of Whitehall, not the Cunard Building. He said: “As soon as I was made aware of this, I was keen schools knew we wouldn’t leave them to deal with this themselves.
“It is regrettable that it has taken this long.” Cllr Logan added how holds up were the result of the government, not the council. The local authority had to negotiate a legal route with the Department for Education and Department for Levelling Up, Housing and Communities to get the funding to schools.
He added: “Hopefully, we can move on.” Deputy Mayor Cllr Frazer Lake said the “political will to try and resolve this situation” had been there “from the beginning” and the council “could not have foreseen” the move by Scottish Power to close its trade desk last year.
Reacting to the move, Cllr Richard Kemp, leader of the opposition Liberal Democrat group said the “major blunder has been a very costly exercise for the council and for its taxpayers.”
He said: “While welcoming that fact that schools, already hard pressed by a range of increased costs and charges, will be compensated for our appalling lack of procurement skills, we must accept that this comes at a price. The £2.3m has had to come from our reserves.
This has had to be replenished by this amount which we can see within the Council’s budget for the next financial year. At the same we must also recognise that there has been a cost to the council’s main activities of an unquantified sum which has also had to come from reserves and that the Fire Authority has also agreed to pay its own share of the council’s error.
“We are not confident the council has yet got to grips with an incompetent procurement programme.”
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