Government commissioners at Sandwell Metropolitan Borough Council have reported “considerable progress”, but the authority still needs to “develop capacity and capability” to demonstrate it is financially resilient.
The commissioners will now begin to ‘step back’ from the council, spending fewer days there. Intervention is planned to end in March 2024.
The Department for Levelling Up, Housing and Communities (DLUHC) acknowledged the findings in a letter to the commissioners published today (27 July). But Lee Rowley, parliamentary under secretary of state for local government and building safety, said more work was still needed, particularly around “coherently tying the transformation programme to the [council’s] medium term financial strategy (MTFS)”.
Kim Bromley-Derry and Jim Taylor were appointed as commissioners in March 2022 to address “serious mismanagement” at the authority. A Value for Money Governance Review by Grant Thornton had revealed a “deeply troubling picture of mismanagement and of ineffective scrutiny and accountability arrangements” at the council.
In their third six-monthly progress report, the commissioners said they had seen significant progress on the single improvement plan and areas highlighted as priorities in their previous report. This includes the “crucial handover and settling in process” of Sandwell Metropolitan Borough Council’s new chief executive Shokat Lal since February 2023.
“Significant” progress is also being made on recommended actions from previous Local Government Association (LGA), Chartered Institute of Public Finance and Accountancy (CIPFA) and Grant Thornton reviews, the commissioners said.
However, Bromley-Derry and Taylor noted that more needed to be done to link the council’s the transformation programmes to its MTFS, and in the resolution of closing accounts for 2020/21. These will be priorities over the next six months, they said.
While the council’s CIPFA rating has improved from 2* in January 2022 to 3* in January 2023, the commissioners said there was “still work [needed] to develop capacity and capability in this area”. They wrote: “There is a focus on developing financial acumen and skills through up-skilling budget holders and embedding a finance business partnering approach. There is an agreed budget in place that supports the corporate plan priorities and an agreed MTFS. The approach to transformation is developing and with the additional planned work, outcomes from this process will better support year three of the MTFS.”
The commissioners also noted that governance structures in place to monitor progress have been further strengthened by the introduction of a comprehensive monitoring tool, which enables a “more dynamic approach to highlighting and responding to work areas that require remedial action or additional levels of assurance”. Robust oversight is provided by monthly delivery progress reporting to senior officers and on a quarterly basis to cabinet.
In other areas of improvement, the council has enhanced its “previously weak” customer service with the development of a customer journey plan, while it is working on an organisational culture that enables and empowers staff “to constructively challenge and improve ways of working”.
The council has also continued to “positively contribute” to a range of partnership arrangements, including the West Midlands Combined Authority.
15th Annual LATIF & FDs’ Summit – 19 September 2023
250+ Delegates from Local Government & Investment
The commissioners concluded: “We have continued to challenge the council to satisfy our proxies for success and to have the right processes, governance and behaviours in place to ensure that change is sustainable. This is to ensure that continuous improvement and delivering best value are to be cornerstones of the council’s future, beyond the intervention. We are pleased that the council has adopted a more robust approach to evidence-based decision making to help achieve this effectively.
“Sandwell has both established sound foundations for its improvements and built on them a robust set of structures to withstand change and adversity: what remains is to test this resilience, to demonstrate the ability to learn from any oversights and to grow in confidence on handling this without commissioner support.”
In his response to the commissioners’ report, Rowley said it was “encouraging to see the progress made” and thanked the commissioners for their “continued hard work”.
But he warned that there was still work to do, “particularly to show that the improvements of the past fifteen months are both embedded and sustainable”. But DLUHC is “seeing a council better placed to demonstrate this”, he noted.
Rowley said he expected to “see evidence of the impact on residents from the new council processes and systemic changes put in place since the improvement began” over the next six months.
He added: “I have noted your key priorities for the council to address in the coming months, particularly securing more strategic capacity and coherently tying the transformation programme to the MTFS. I fully support your decision that now is the right point for you to reduce the amount of time you spend in Sandwell and look forward to your assessment of the council’s response to this next challenge.
“Clear evidence that demonstrates Sandwell’s resilience and capacity to take forward its improvement independently will be crucial if the intervention is to end as planned in March 2024.”
Lee Rowley will speak at the Local Authority Treasurers Investment Forum (LATIF) and Finance Directors’ Summit 2023, which takes place in London on 19 September. Click here for more information.
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