The Government says there is "still much to do" for Nottingham City Council to improve as the authority avoids taxpayer-funded commissioners being sent in to run it. Issues including the misspend of £40 million and the collapse of Robin Hood Energy meant an Improvement and Assurance Board (IAB) was appointed in January 2021 to closely monitor the decision-making processes and governance of Nottingham City Council.
The IAB has been sending quarterly reports to the Government on the council's progress, which the Government then uses to determine whether it needs to send commissioners in to run it. In its most recent update, the Government has confirmed it won't be taking this step for now but says the IAB will remain in place and that commissioners could still be appointed in future.
A letter has been written by Lee Rowley, the Parliamentary Under-Secretary of State for Local Government, to Sir Tony Redmond, who has been chairing the IAB. The letter from Mr Rowley reads: "I am glad to hear that there has been a step up in progress... and that the council is now adopting a more 'serious sense of purpose'.
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"I note the good progress on improving decision-making processes and constitutional reform, for example. It is clear, however, there is still much to do to deliver the level of service deserved by the residents of Nottingham."
Nottingham City Council avoided Government commissioners being sent in last year, despite Michael Gove saying he was "minded to" make the decision. His successor Greg Clark decided against commissioner intervention and instead gave more powers to the IAB.
Despite Michael Gove now being back in post as Secretary of State, the Government's latest announcement means the IAB will continue to monitor progress rather than commissioners running the council. But the letter from Lee Rowley does add: "It is paramount that Nottingham does not loosen its grip nor lose its focus on its improvement priorities over the next quarter.
"I am supportive of you using your powers of direction expediently and decisively if you are not satisfied with the progress being made. I look forward to receiving your next report from which I will assess whether the exercising of further powers, including the appointment of Commissioners, will be necessary."
As part of the IAB's work on monitoring Nottingham City Council's progress, the authority was given a list of 67 requirements last year that had to be fulfilled by the end of November. The letter from Lee Rowley suggests progress against these requirements needs to go further.
Mr Rowley says priority issues of "critical importance" for the council to tackle include addressing the remaining gap of £3.2 million in next year's budget and addressing governance and performance management issues. Lee Rowley's letter says: "It is vital that the accrued momentum is not lost over the next few months, when the council sets its budget and residents go to the polls, and that these issues are urgently addressed in the next quarter."
Nottingham City Council Leader, Councillor David Mellen, reacted to the Government's announcement by saying: "We very much welcome the Government’s decision which reflects that the current arrangements in place are working. The council has already made many of the improvements expected of us by the IAB and the Government.
"In particular, we had agreed a balanced budget and medium-term financial plan prior to the soaring inflation and energy costs that have affected the finances of households and councils up and down the country – and we are well on the way to balancing the budget for a second year. We recognise there is much more work to do to increase the pace of the changes and to put the council on a solid financial footing despite the huge budget pressures we and all councils are facing currently."
The city council says improvements made over the last two years have included the reduction of its debt levels and increasing the disposal of its property assets to fund council projects. The IAB will continue to oversee the implementation of the council's 'Together for Nottingham' plan, which seeks to address Nottingham City Council's financial challenges.
The Government's intervention at Nottingham City Council is set to last until September 2024, unless this is amended beforehand. This means that the cost of the IAB needs to be met up until that point.
The council had already budgeted for the IAB to be in place throughout the 2022/23 and 2023/24 financial years to the tune of £300,000 per annum. It was revealed last year that the running of the IAB until September 2024 will therefore cost another £125,000.
The council's Chief Executive, Mel Barrett, added: "We have previously said that our strong preference was to continue working with the IAB, with its balance of support and challenge, but that we were committed to working effectively with whatever arrangements Government put in place so that the intervention can be as successful as possible in as short a time as possible.
"We very much welcome the continued involvement of Sir Tony Redmond as Chair of the IAB. We are committed to working together to address the need to reduce the council's cost base whilst ensuring that we are providing economic, efficient and effective best value services to the people of Nottingham."
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