Slough Council accepts findings in damning reports

Yesterday, the government published two papers drawn up by the Chartered Institute of Public Finances and Accountability (CIPFA) and the Department for Levelling Up, Housing and Communities (DLUHC).

These were triggered after the council had to make a £15m capitalisation directive from government to obtain permission to sell off some of their assets to fill the identified blackhole at that time.

But more damning evidence has been uncovered forecasting financial pressures of £174m by 2025 and the council ‘incorrectly’ paying back its minimum revenue provision, which is money set aside to pay back debt.

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This triggered the council to increase its capitalisation directive of up to £600m to ease off pressures.

A “series of failings” were found in the council’s financial affairs and corporate governance, democratic services and scrutiny, and service reform – and that it has failed to comply with its ‘best value duty’.

In the DLUHC governance report, led by Salford’s former chief executive Jim Taylor, he found “sustained and systematic failure across some functional processes, governance, and certain services”.

Meanwhile, the CIPFA review into the council’s finances found it will need “ongoing financial oversight” from the government in order for its future budgets to be balanced.

The government has appointed independent commissioners to make sure the council is taking action to address these serious issues for three years and has demanded the council to draw up an improvement plan within three months on how it intends to close their financial gaps.

James Swindlehurst

In a statement, council leader James Swindlehurst, said: “We completely accept both reports’ findings, the recommendations and the comments – and are satisfied the work we have been doing since April this year has been very rigorous and comprehensive and has started to instigate positive action in a number of areas to ensure we address as many of the issues identified as are able to.

“In light of the work that has gone since we received our auditors report and the 114 notice was issued, we are fortunate to be in an improved position now than we were before April and our awareness of the issues and our plans and actions are starting to make a difference already, however we completely accept that we still have a lot to do.”

He added: “There are still many difficult decisions ahead of us. We are financially in a very challenging place, and we will be asking government for a level of capitalisation direction which has never before been made by a local authority.”

Kemi Badenoch

Levelling up minister Kemi Badenoch said the reports “paint a deeply concerning picture of mismanagement” of a breakdown in scrutiny and accountability, and of a dysfunctional culture.

She criticised the council’s “inadequate” internal controls and processes, “weak” contract management, the staffing structure not delivering Slough’s challenges, and its “struggling” revenue and benefits service which is “poorly” serving residents.

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Ms Badenoch added the council did not understand their commercial investments and their impact on its finances, and senior members are only now grasping the “seriousness and urgency” of the situation.

She said: “The review shows unequivocally that Slough Borough Council has failed to comply with its best value duty of continuous improvement, as required by the Local Government Act 1999. The financial challenge is acute, and the review has concluded that the council cannot become financially self-sustaining without considerable Government support.”