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Panel: Council’s financial plans still at ‘considerable risk’, as Rogers remains on ‘annual leave’

Panel: Council’s financial plans still at ‘considerable risk’, as Rogers remains on ‘annual leave’

🕔24.Feb 2017

The Birmingham Independent Improvement Panel (BIIP) today publishes a letter to the Secretary of State for Communities and Local Government, reporting on Birmingham city council’s financial plans.

It says the Council has shown “disappointingly slow progress” and did not “fully grip… transformation and financial stability agendas” and the level of managerial leadership needed has not been “consistently evident.”

The report comes just days after Chamberlain Files revealed chief executive Mark Rogers is leaving the council and days before budget plans are submitted to next Tuesday’s full Council.

The Panel comments in its letter that lessons from 2016/17 have been learned and that there is a “strong determination to provide the leadership needed to deliver the Council’s latest financial plans.”

However, the Panel also draws attention to the “considerable risks to delivery” of the financial plans.

John Crabtree OBE, the Panel’s chair, said there have been “improvements in many areas,” but there has also:

… been, overall, disappointingly slow progress in addressing many of the most important Kerslake recommendations relating to the Council’s culture, capacity and capability….

The Council has not effectively grasped the opportunities that could have helped it manage and mitigate its risks sooner.

Mr Crabtree, also recently installed as Lord-Lieutenant of the West Midlands, said:

We are pleased that new financial plans are now in place and these are more robust and credible. The plans and strategies however will not be easy to implement. Some implementation timetables are still extremely ambitious and the risks to achieving fully effective delivery are high.

Concluding the letter to Sajid Javid, John Crabtree says:

The corporate managerial leadership did not, during 2016/17 especially, fully grip and co-ordinate in a timely manner its transformation and financial stability agendas.

Given the Panel’s stark assessment, it might have been difficult for the political leadership of the council to have kept all members of its corporate leadership team in place.

The Improvement Panel’s letter draws on two reports from an independent financial review team which provided an assessment of whether the Council’s 2017/18 revenue budget plans were realistic and capable of delivery.

Drawing on the review team’s work, the Panel’s letter seeks to address two key questions:

• Are the Council’s proposals for 2017/18 and longer term financial plans credible and robust?
• How confident is the Panel about the Council’s ability to deliver its financial plans, taking account of the Council’s track record to date and relevant risks and opportunities?

The answers are – in short – yes (sort of) and not much.

Mr Crabtree’s letter provides a useful summary of the “mammoth” financial challenge facing Birmingham, as well as many other local authorities, but says the council had not “gripped the scale of change is necessary.”

It also reminded the Communities Secretary of the “unusual step” taken by the Council’s external auditors in issuing the Council with a statutory recommendation.

The Panel points out that it is estimated that the Council will have used up: “£104M of its reserves over the 2015/16 – 2018/19 period compared to a previously planned use of £41M.”

Summarising the two reports of the financial review team, the Panel states:

The finding was therefore that the Council’s latest financial plans are reasonably credible, robust and theoretically deliverable, although there were elements of the review team’s recommendations that were not fully implemented at the time it produced its final report.

John Clancy, leader of Birmingham city council, and his Cabinet are effectively given a vote of confidence – at least for now – from Mr Crabtree and the rest of his Panel.

In relation to the Council’s political leadership we concur with the independent financial review and the Council that the lessons of 2016/17 have been learned and that there is a strong determination from the Leader and Cabinet to provide the political support needed to deliver the Council’s latest financial plans.

The same cannot be said for its view of management.

However, the Panel considers that, despite some progress on some aspects of the Council’s improvement agenda, there remain additional risks that threaten the achievement of financial sustainability.

It suggests that the managerial leadership that will be required to see through the Future Operating Model has not been “consistently evident.”

It says there has been a “stop-start” approach and a “lack of follow through” in terms of relationships with partners, some of which may have been able to assist in finding new and more efficient ways of working.

Whilst not referring to individuals, the Panel says a number of:

… forthcoming changes to the corporate leadership team bring the risk of a ‘reset button’ being pressed once again which could lead to further delays in achieving effective managerial leadership team working.

It says the contingency savings plan is at a very early stage of development.

Finally, it points to the impact on “corporate capacity” from the transfer of services to a Children’s Trust from 2018.

The Panel proposes to report in “due course” about the Council’s progress in implementing the remaining recommendations set out in Lord Kerslake’s 2014 report.

Meanwhile, the council yesterday issued staff with an update on matters which have been appearing “in the media.” It indicated that Mark Rogers is on “annual leave during this period” which might appear strange to those who read the official confirmation that Mark Rogers had announced he was “moving on” from the role on Sunday afternoon.

The full statement read:

Much in the media over the last few days will have caused many of you concern; unfortunately, it is not possible to comment on this reporting at this present time.

In the meantime, however, I, as Leader of the Council, together with the Deputy Leader and the Corporate Leadership Team want to reassure all of you that the council continues with a strong and focused leadership team.

Whether you are a member, an employee, an interim, a partner or a citizen, the political and corporate leadership want to assure you that the council will continue to operate with a strong and focused leadership team to deliver the objectives and outcomes of the council.

Mark Rogers is currently on annual leave and during this period, Angela Probert, Strategic Director Change and Support Services is covering for him.

You will be aware that the other members of the CLT are:

Piali Dasgupta: Assistant Chief Executive
Waheed Nazir: Acting Strategic Director Economy
Jacqui Kennedy: Acting Strategic Director Place
Peter Hay: Strategic Director People
Steve Powell: now Acting Chief Financial Officer, whilst Jon Warlow is on leave.

The current immediate focus of CLT is to continue to deliver the Future Operating Model and deliver a balanced budget for 2017/18.  And both myself and the Deputy Leader have every assurance that the Corporate Leadership team will work together to do this  and continue with delivering our business as usual.

It is not possible to say anything more on the matters referred to in the press at the current time and any further updates will be provided as and when relevant information is available.

Cllr John Clancy and Angela Probert

It is noticeable that only two members of the corporate leadership team are in permanent roles and who plan to continue in post through the next financial year.

A further statement on the outgoing Chief Executive and the process to appoint a successor is anticipated.

Jo Miller, chief executive at Doncaster Metropolitan Borough Council, is seen as the front runner for the role. She is also the current President of SOLACE, the organisation for local authority bosses, where she succeeded… Mark Rogers.

She is understood to have been following developments in Birmingham with interest this week. Eyes in local government will be looking out for any comments she makes in the trade media, such as the Municipal Journal, in the coming days and weeks.

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