The Government has issued a formal notice regarding its concerns about the governance and financial sustainability of the Conservative-run Hillingdon Council.
This comes after the Government ordered a review of the council’s finances and governance as a condition for financial support awarded to the borough, helping it avoid bankruptcy. The full review is yet to be published, however its findings have led the Government to issue a Best Value Notice.
The notice, described as “damning” by Labour, highlights several concerns relating to the organisational culture of the council, its financial management, and its governance weaknesses. Despite this, the Government says it “acknowledges the steps that Hillingdon is already taking to address issues”, however ministers “remain concerned”.
What is a Best Value Notice?
The Best Value Authority is a legal classification that demands that councils and public bodies constantly strive for improvements while balancing economy, efficiency, and effectiveness. In practice, this regulation relates to how these bodies achieve a balanced budget, deliver services such as adult social care and children’s services, and ensure value for money in all spending activities.
The notice raises “significant concerns” about the council’s financial resilience and forecasted reliance on government bailouts, “serious concerns” about financial management and governance and concerns about organisational culture.
It also notes concerns relating to the “weaknesses in the quality, reliability and use of financial information to support decision-making” and the “evidence of systemic governance weaknesses”. The Government noted that “there is a lack of challenge, clarity of strategic direction and organisational grip”.
Each notice is unique to the circumstances of the public body it has been issued to. The notice remains in effect for 12 months unless it is withdrawn or escalated.
In this case, the Ministry for Housing, Communities and Local Government says that “given the seriousness of the issues identified, and the pace to deliver the level of change required” the council must take “urgent steps” to improve its financial sustainability.
The west London council must ensure effective governance and scrutiny processes are in place that enable decisions and improvements to be made at pace, and for performance to be accurately monitored. It must also continue to engage constructively with external challenge and sector support whilst engaging with the government department on at least a quarterly basis to discuss progress against the actions above.
‘I’m stunned by the persistent failures’
Danny Beales, the Labour MP for Uxbridge and South Ruislip, described the report as a “damning” indictment of “institutional failure”. He said: “As the Member of Parliament for Uxbridge and South Ruislip, I have been left stunned by the persistent failures of Hillingdon Council to deliver for residents.
“The fact that people in Hillingdon work hard, pay their council tax, and are met with poor services and an administration that has been proven to be financially unsound is a disgrace. The Best Value Notice is an important intervention by this Labour Government to deliver meaningful change.
“This must serve as a much-needed wake-up call to Hillingdon Council that their approach of business as usual, and rearranging deckchairs whilst the Titanic sinks, is failing residents and will not be allowed to continue. As Hillingdon Council attempts to silence residents by limiting opportunities for scrutiny through changes to petition rules, this Best Value Notice leaves the failing administration with nowhere left to hide.”
Council ‘pleased’ Government has recognised ‘progress’
A Hillingdon Council spokesperson said: “This Best Value Notice reflects the financial challenges the council has been working through during recent months. We are pleased the Government has recognised not only the progress we’ve already made, but also the cumulative impact funding pressures over a number of years have had on the council’s finances.
“It also recognises both the progress we have already made, and the department is confident that continuous improvement can be sustained without statutory intervention.”
They added: “The notice does not take powers away from the council or affect the day-to-day services residents rely on. Instead, it supports the improvements already underway through our Finance Modernisation Plan and Governance Review Improvement Plan.
“We have never shied away from the difficult decisions needed to restore the council’s finances, and we won’t start now. We will continue to work constructively with Government, strengthen governance and ensure Hillingdon is on a stable and sustainable footing for the future.”
‘Best Value Notice should concern every resident’
Councillor Stuart Mathers, Leader of Hillingdon Labour, told the Local Democracy Reporting Service (LDRS): “This is a damning assessment of a Conservative administration that has been in power for nearly two decades. Concerns first raised by Labour have now been reinforced by external auditors, internal auditors, CIPFA and the Government itself, all pointing to significant weaknesses in governance, financial sustainability, organisational culture and financial management. That should concern every resident.
“Hillingdon residents deserve a council that understands its finances, manages its assets effectively, makes decisions based on reliable information, and delivers value for every pound of public money. The time for excuses has passed; the time for urgent action and meaningful reform is now.
“The question now is whether the administration has a credible plan to put the council’s finances on a sustainable footing without asking residents to pay the price. Having already increased council tax and many fees and charges, residents will rightly want to know where the savings will come from, or whether they are once again expected to foot the bill for years of poor financial management and weak governance.
“Labour will scrutinise the council’s response carefully. We will support measures that genuinely improve the council for residents, but we will also hold the administration to account for how it allowed these failings to develop.”