Damning report on culture at insolvent Tory council

Anyone interested in how a council can go bad should read this relatively brief and easy-to-read report on the shenanigans which went on at Northamptonshire County Council prior to its technical insolvency. It was SO bad the Inspector recommends doing away with it entirely and creating two separate unitary authorities for a fresh start.

Full report here:

Owl particularly “enjoyed”:

Section 3.46 – 3.52 – the behaviour of the Chief Executive and senior officers)

Section 3.78 – 3.84 – scrutiny (lack of)

Section 3.90 – 3.100 (role and function of the Audit Committee)

and Section 4.5

“The council did not respond well, or in many cases even react, to external and internal criticism. Individual councillors appear to have been denied answers to questions that were entirely legitimate to ask and scrutiny arrangements were constrained by what was felt the executive would allow. When external agencies reported adverse findings these were not reported with an analysis of the issues and either a justification or an action led response to a relevant decision taking body. At its most extreme, the two KPMG ISA 260 reports, stating an adverse opinion on Value For Money matters were just reported to the Audit Committee without comment and the unprecedented KPMG Advisory Notice issued under the 2014 Act was reported to full council without any officer covering report giving advice on what the response was recommended to be.

and 4.11:

“It is not possible to establish what action the corporate management team took in the face of all these issues as those meetings that took place were not minuted.”

As reported in the area’s local paper:

“Max Caller, an independent inspector, was called in by local government secretary Sajid Javid after allegations of financial mismanagement. He was also tasked with seeing if the local authority was being run properly by bosses and the cabinet’s Conservative councillors. …

His report, published this morning, says the origins of the crisis was the Ofsted inspection into Children’s Services in 2013 that caused emergency money to be pumped in, which meant the local authority ‘lost tight budgetary control’.

What came next was a poor response to the financial pressures, Mr Caller says, in effect chasing a heavily flawed model championed by departed CEO Paul Blantern.

He said: “Instead of taking steps to regain control, the council was persuaded to adopt a ‘Next Generation’ model structure as the solution.

“There was not then, and has never been, any hard-edged business plan or justification to support these proposals. Yet councillors, who might well have dismissed these proposals for lack of content and justification in their professional lives, adopted them and authorised scarce resources in terms of people, time and money to develop them.

“This did not and could not address the regular budget overspends which were covered by one off non-recurring funding sources.”

When the use of capital receipts to fund transformation was introduced by central government, Mr Caller says this was seized on as a way of supporting revenue spend – by classing some expenditure as ‘transformative’.

However until this week, there had been no report to full council – or anywhere else – that set out the specific transformation that was to be achieved, on a project-by-project basis. This goes against the terms of use of the money.

Despite his criticism of bosses, Mr Caller makes a point of separating the acts of managers and leaders from frontline staff.

He says: “NCC employs many good, hardworking, dedicated staff who are trying to deliver essential services to residents who need and value what is offered and available. The problems the council faces are not their fault.”