Liverpool: Ministers to increase city council intervention

Liverpool has seen a series of council failures over its finances

The government has said it will expand its role in running Liverpool City Council to cover financial decisions, governance and recruitment, after expensive errors by the authority.

The council's past failure to renew some contracts could lead to losses of millions of pounds, a report revealed.

In 2021, the government appointed four commissioners to oversee some functions after a local governance "breakdown".

It will now appoint a fifth to deal with finance.

It comes after a report suggested the council had not made enough progress and there were serious concerns about financial decision-making.

New chief executive

The city council has also announced that Theresa Grant will start work as its new interim chief executive in September, following the resignation of Tony Reeves.

She was previously chief executive of Northamptonshire County Council while it was subject to government intervention.

The government said Liverpool City Council was "failing in its best value duty".

Earlier this year, it was revealed that the council's errors in renewing their energy supply contract could cost the city an extra £10m.

An investigation then found the authority failed to act on 12 contracts across various services - which had expired or were close to doing so - and therefore best value had been "compromised".

Steve Rotheram will chair a new panel focused on the city's long-term future

In a letter, Communities Secretary Greg Clark said there was "evidence of failure" in the council's financial management and a "lack of urgency to implement change".

He added the team of commissioners would also be "given executive powers on recruitment" and "functions associated with governance and financial decision-making".

'Liverpool's revival'

Mr Clark said he was also establishing a "strategic futures" advisory panel to "plan for Liverpool's revival as a city", which will be chaired by regional mayor Steve Rotheram. It is believed to be the first time such a panel has been created to advise a council.

The panel will also include former Leeds City Council leader Baroness Judith Blake and Sir Howard Bernstein, the former chief executive of Manchester City Council.

Mr Rotheram denied claims the panel would run the council, saying it would "advise and offer support in setting strategic longer-term plans and priorities".

Liverpool city mayor Joanne Anderson says the council had been affected by "years of government cuts"

Joanne Anderson, mayor of the city of Liverpool, said in a social media thread that further intervention would will not solve the issues" at the council, as they were "being experienced right across local government".

"The UK is facing stark skills' shortages, and it is widely known that local councils are struggling to improve capacity in key areas, which is making us dependent on interim staff that cost more in the short term."

She added the council had "lost £465m in funding since this government came to power in 2010, so it is not surprising that there are areas where we can improve performance".

Analysis by Phil Cooper, BBC Radio Merseyside

Today's report reveals the council's failings are not just limited to a few departments - but include the overall way in which public money is managed.

It highlights "systematic and whole-council weaknesses", and argues "immediate further intervention is required to tackle this continued failure."

That intervention means a Whitehall-appointed official will effectively be making decisions over where public money in Liverpool is spent.

Mayor Joanne Anderson says she accepts the problems outlined in the report, but questions the solution.

She claims, by next March, the commissioners' intervention will have cost the council £6.7m and has questioned whether that money could be better spent on transforming services.

But lead commissioner Mike Cunningham says these powers are used "only in extraordinary circumstances".

Richard Kemp, the leader of Liverpool's Liberal Democrat group, said the appointment of commissioners meant unelected government officials were effectively taking control of the city's council.

'Democracy largely suspended'

He called for "a totally new lot of people" to oversee the authority, adding that "at the moment democracy is largely suspended in the city of Liverpool".

Mike Cunningham, who leads the team of commissioners, said the intervention's duration was not expected to continue beyond 2024.

"The commissioners believe that it will be possible for Liverpool City Council to make the required improvements within the next two years, as initially envisaged.

"By then, we are sure that the council will be in a stable place, where it can attract and nurture investment in the city, and it can deliver high-quality frontline services for the people of Liverpool."