Wednesday 24 April 2024
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Nottingham

Nottingham City Council has made ‘unsatisfactory progress’ in work to improve finances

A Government-appointed improvement board says Nottingham City Council has made “unsatisfactory progress” in almost all areas of work to improve its struggling finances.

The latest report from the Improvement and Assurances Board (IAB), chaired by Sir Tony Redmond, was published on May 18, a matter of hours after Secretary of State Michael Gove (Con) had left Nottinghamshire following a visit to Mansfield.

Mr Gove oversees the Department for Levelling Up, Housing and Communities, which is currently monitoring the progress the Labour-run council makes towards financial and operational stability.

The council again avoided commissioner intervention in February this year, in favour of new powers of direction for Sir Tony, who gave the authority a list of 39 instructions it had to meet by certain dates.

The council declined to release details on how far through the 39 instructions it is.

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The latest report, which contains information dating back to February, says the council has made progress in some areas, including governance, but criticised the pace of improvement in areas such as finance.

It says: “It is encouraging to see there is greater clarity now in the way in which decisions are taken, and by whom, but evidence remains of instances of delay or variation in the outcome of the decision-making process.

“A deadline has now been set, by instruction, through which sound governance in decision-making must be effected.”

“Fair progress” has also been made in the development of a transformation plan, the board report states, including in the training of staff through a ‘Change Academy’ which aims to make workforce practices and culture better.

However, the report reveals “unsatisfactory progress” is being made in most areas of a plan to improve the management of its finances and accounting.

The finance improvement plan comes after the council was issued a legal notice after an investigation revealed money from the Housing Revenue Account (HRA), which must only be used on council housing and tenants, had been misspent.

The cost of this is now estimated to be £51m.

“The finance improvement plan is critical in terms of ensuring sound and secure financial management, budgeting and accounting arrangements,” the report says.

“There has been some limited advances in this area but the council now concedes that it has made unsatisfactory progress in virtually all of the key elements of the Finance Improvement Programme.

“This needs to change as the board looks to an early resolution of the problems relating to the experience and the calibre of staff for the finance function.”

Back in March the authority set a balanced budget and Medium-Term Financial Plan, which details its financial outlook for the next four years.

In the budget the council managed to find savings to bridge a £32m gap for 2023/24, with council tax increased by almost five per cent and a number of jobs cut.

This has been acknowledged by Lee Rowley MP, the parliamentary under-secretary of state for local government.

Mr Rowley sent a letter to Sir Tony in response to the board report, in which he says: “I am pleased to see that Nottingham City Council has made some good progress around improvement and recovery in recent months and was able to set a balanced budget for 2023/24.

“I am disappointed, however, that the board’s overall assessment is that ‘there has been a distinct lack of urgency in tackling the necessary change’ and that at present you are not satisfied with the progress being made.”

In response council leader, Cllr David Mellen (Lab), said: “We know that further improvements are required and the report clearly sets out the areas where we need to bring about change at a faster pace. However, we are committed to working with the board to ensure that happens.”

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