Nottingham City Council has made substantial progress in stabilising its finances and strengthening governance following direct government intervention, but further work is required before all improvement and assurance arrangements can be fully withdrawn, according to the commissioners’ fourth and final report to ministers.
The report, sent to the Secretary of State on 5 December 2025, assesses progress made since commissioners were appointed in February 2024, following the council’s financial crisis and the issuing of a section 114 notice in late 2023. It concludes that the authority is now on a markedly stronger footing than when the intervention began, but warns that many reforms are still fragile and not yet fully embedded.
Commissioners were appointed after earlier improvement attempts through an Improvement and Assurance Board failed to prevent the council’s financial position from deteriorating. At the point of intervention, the council faced a projected £172 million deficit over four years and had not had audited accounts signed off since 2018/19.
The commissioners report that a change in political leadership in May 2024, alongside a new senior management team, helped reset relationships between councillors and officers and led to the adoption of a four-year Council Plan based on accepting a smaller, more focused authority. Long-standing weaknesses in decision-making, accountability and officer–member relations were identified as major contributors to previous failures, with commissioners noting that rebuilding trust and collegiate working remains a work in progress.
Financially, the report describes the turnaround as significant. Revised assumptions in the Medium-Term Financial Strategy, additional government funding announced in late 2024 and the identification of further savings have reduced the scale of the budget gap. The council now expects to set a balanced budget for 2026/27 without the need for Exceptional Financial Support, subject to final government settlement figures. The commissioners also report a much lower than expected call on support in 2024/25 and an improving in-year position for 2025/26.
However, they caution that some of the apparent improvement relies on temporary measures, including holding vacant posts, and that savings delivered in this way will not be permanent unless structures are formally changed. Delivering long-term workforce and service redesign savings remains one of the most significant challenges facing the authority.
The report highlights progress in financial controls, including redesigned finance processes, improved budget monitoring and mandatory training for budget holders. It also notes that while the budget-setting process for 2026/27 was better managed and more transparent than in previous years, maintaining discipline as financial pressure eases will be essential.
In governance and compliance, commissioners confirm that the backlog of unaudited accounts has been addressed through a national disclaimer process, although this leaves the council without fully audited opening balances. The 2024/25 accounts are still being audited and will also be disclaimed, with a separate best value review expected in early 2026. The council has also developed an Asset Management Strategy for the first time and strengthened oversight of council-owned companies, including closing those no longer providing appropriate services.
Progress on reshaping the council’s operating model and workforce has been slower than originally planned. While senior leadership recruitment is now complete and there have been advances in children’s services, housing and IT infrastructure, commissioners report delays in fully implementing new structures and corporate “centres of expertise”. Adult social care and children’s services, in particular, remain areas requiring accelerated improvement, with commissioners noting that savings plans and transformation programmes have not yet demonstrated consistent delivery.
Risk management, internal audit and performance reporting have improved significantly from what commissioners describe as a very weak starting point, but the quality of reports and use of performance data remains inconsistent. Cultural change, including moving away from blame and embedding continuous improvement, is also described as ongoing rather than complete.
Looking ahead, the commissioners recommend that their formal role should end on 22 February 2026, returning decision-making powers fully to the council. They propose that the Secretary of State appoints a smaller number of experts to provide lighter-touch support and oversight for up to 12 months, reporting regularly to ministers, to help ensure reforms are embedded and sustained.
• Nottingham City Council: Government commissioners to leave after progress made
The recommendations have been submitted to the Secretary of State, Steven Reed, who will decide whether to accept the proposed end date for the intervention and the future form of external oversight. If agreed, this would mark the end of nearly five years of formal improvement arrangements at Nottingham City Council, beginning with earlier assurance boards and culminating in the current commissioner-led intervention.
