LGA Corporate Peer Challenge: LB Hackney Council

Corporate Peer Challenge (CPC) is a highly valued improvement and assurance tool that is delivered by the sector for the sector. It involves a team of senior local government councillors and officers undertaking a comprehensive review of key finance, performance and governance information and then spending four days at LB Hackney to provide robust, strategic, and credible challenge and support.

CPC forms a key part of the improvement and assurance framework for local government. It is underpinned by the principles of Sector-led Improvement (SLI) put in place by councils and the Local Government Association (LGA) to support continuous improvement and assurance across the sector. These state that local authorities are responsible for their own performance, accountable locally not nationally, and have a collective responsibility for the performance of the sector. 

CPC assists councils in meeting part of their best value duty, with the UK Government expecting all local authorities to have a CPC at least every five years. 

Peers remain at the heart of the peer challenge process and provide a ‘practitioner perspective’ and ‘critical friend’ challenge. 

This report outlines the key findings of the peer team and the recommendations that the council are required to action. 

The LB of Hackney is an inclusive, exciting and ambitious council, committed to delivering for its residents. It is a council with a strong strategic plan in place, and a  clear commitment  to improve services and outcomes for people in Hackney.

The borough spans just seven square miles, with a population of approximately 259,200 people. Hackney has a healthy economy, good schools and parks, and a young and diverse population. It also includes areas of high deprivation and is grappling with the growing issue of in-work poverty, high demand for help with housing, and significant health inequalities for parts of the community. Hackney knows its communities well, understands the challenges  faced as well as the opportunities, and have reflected these as key unifying themes in the council’s strategic plan. Members and officers demonstrated their pride for the borough describing that it was ‘a real privilege to serve’ and that they are ‘so proud to live in Hackney.

Climate change, poverty and inequalities, and housing and homelessness are the mayor’s cross-cutting priorities for the next two years. The council also have an ambitious house-building programme underway with the peer team visiting the impressive housing developments at Woodberry Down and Tower Court. Alongside this, Hackney is also rightly proud of achieving improvements in Children’s Services, with an OFSTED inspection rating of ‘good’ in the summer of 2024. 

As expected for a busy inner London borough, the council’s remit and responsibilities are vast, with an equally large work programme which include a number of priority areas and projects. Staff reflected however, that there are ‘too many priorities’ and it was difficult  to know what the key priorities are. Now would be a good time for the council to assess whether it’s corporate priorities should be refocused or reduced, and that staff are engaged in this process and therefore informed about the key priorities for the next two years so they can deliver.

The council’s strategic plan sets out its delivery priorities alongside the mayor’s priorities from the 2022 manifesto commitments, which have provided a framework for the mayor and chief executive to work together over the last year. 

Increasing financial and demand pressures means the council will either have to fundamentally transform  the way it operates and delivers services  or continue on its current path of working to stay within budget whilst having to reduce or remove services.

An opportunity has presented itself within this to further extend the council’s ambitions and define what Hackney wants to be in the future. Defining the shape and purpose of a future Hackney Council and building this into its transformation programme and goals would create an aspirational model, instead of a financial necessity-driven reduction and smaller ‘Hackney Council’. There is now an opportunity to create a different council to better meet the needs of the residents in the future.

The introduction of the current transformation programme is welcomed and understood across the organisation as part of the work needed to review and address the increase seen in costs, especially in demand-led council services and the continuous modernisation of ways of working, including utilising new digital technology. Support for this and an understanding of drivers for change is strong in the council. It is important to maintain this momentum and seize the opportunity to build upon it  as the transformation plan takes shape. Now is the opportunity to accelerate the programme, increasing the pace, scope, and capacity of the work. When scheduling and prioritising transformation projects, the council should reprioritise and review the level of the resources to enable  work to happen at pace in the areas creating the most significant financial challenges for the council; these areas include social care support, the rising numbers of homeless approaches, and increasing numbers in temporary accommodation.

Hackney has a strong understanding of the communities it serves and the aspirations of residents for the borough and levels of acceptable services. There are many good examples of the council working collaboratively and creatively with partners to improve services and outcomes for Hackney residents. Partnerships with statutory partners are highly valued, with positive outcomes for residents and the community resulting from strong partnership arrangements, especially noted  during the peer challenge with the police and health partners. In order to nurture all partnerships Hackney must ensure that the flow of information to partners during co-production and consultation is clearly defined and agreed at the start of the process, and updates are provided.

Financially, the council has effective financial management systems in place and a senior leadership team that is aware of  the financial challenges the council is  facing. Demand pressures and forecast overspending have brought new focus to the council’s work and are a driver of the transformation programme. At current rates of demand and spending, reserves will be depleted in three years, and therefore, action needs to be taken now to reduce spending in year, challenge unit costs, challenge demand, and develop a right-sourcing approach to ensure  the council gains best value from its’ contracts and in-house services. Regular use and the normalisation of using reserves for in year overspends should be closely managed and monitored, with base budgets set to reflect anticipated spend as closely as possible. Any forecasting overspends identified through the budget assurance processes need to be responded to with in-year savings plans to seek to balance the budget. Opportunities remain for in year savings for 2024/25 and work to achieve these should be prioritised. 

The peer team found the council to be an inclusive organisation with strong ambitions around the EDI (equality, diversity and inclusion) agenda for the organisation and the borough. The anti-racism summit received positive feedback whilst also highlighting the need to ensure the follow-up for engagement events are clear and reach participants, especially detailing the ‘what next’ that is crucial to maintaining confidence in the agenda and delivering improvements . Hackney has strong staff networks, with the levels of awareness within all aspects of the organisation being good. The peer team heard Hackney described as ‘welcoming, accepting, diverse, a destination, and home’. External partners presented a more mixed view of relationships with the council; statutory partners in health and police reported strong relationships while other partners wanted to see more opportunities for co-production and valuing local expertise. The council have the opportunity to increase the reach and impact of the EDI work across the council by employing greater ownership of the agenda through all the senior leaders in the council. 

The relationships between the political and officer leadership are very good with a high level of collaboration. The respect and appreciation that the role of the mayor and chief executive play in providing ‘strong’ leadership was evident during the peer challenge. There is a high level of commitment and skills in the executive team and cabinet. It is important that there is collective responsibility and accountability across that group to meet the council’s key priorities and  savings targets. The level of the financial challenge requires a whole council approach to meeting the needs and implementing early intervention / prevention solutions to reduce some of the demands on the most challenged  services.

The level of member/officer communication is good with decision-making processes working in the main, but there is an opportunity to look at strengthening these further. Alongside this, the peer team heard that whilst the member development programme meets many of the needs of council members, further work on chairing skills and help with working with the most vulnerable would be welcome.

There are a number of observations and suggestions within the main section of the report. The following are the peer team’s key recommendations to the council:

Recommendation 1 – Explore how this peer challenge and your other external reviews can support and accelerate the mayor’s intent to reset priorities and deliver a sustainable budget in the short and medium term: Use this time and the reviews completed, to support and accelerate the mayor’s intent to reset priorities and deliver a sustainable budget in the short and medium term.

Recommendation 2 – Accelerate the whole council/system change transformation workstream, creating an explicit path to where the organisation wants to be for the future (new priorities, sustainable financial envelope, ways of working, etc.): Ensure that the one council integrated system is led and modelled by CLT behaviour and that enables pace, and capacity to be  aligned with the council’s transformation ambitions.

Recommendation 3 – Consider the design of regular structured meetings between the cabinet and Corporate Leadership team (CLT) that anchor the corporate delivery of priorities: Ensure the regular structured meetings between the cabinet and CLT are used to anchor the corporate delivery of priorities and achieve agreed outcomes.

Recommendation 4 – Clarify the approach to the use of reserves as an in-year solution to budget overspends and ensure there is an understanding of the limitations and risks of this:

Given the reserves position and financial pressures that the council is experiencing, revisit the approach to the use of reserves as an in-year solution to budget overspend and ensure there is an understanding of the limitations of this approach.

Recommendation 5 – Continue with the intention to introduce a new performance management framework: Consider reshaping the council’s performance management framework to provide a more comprehensive and shared overview of performance and outcomes against the council’s strategic priorities.

Recommendation 6 – Accelerate the current review of council assets and ensure the approach reflects the emerging financial position and new priorities: Ensure all assets are working for the council and the approach taken to future decisions and changes reflects the emerging financial position and new priorities.

Recommendation 7 – Consider how best to resolve the differing views on the adult social care budget and the need for collective endeavour: There is considerable financial pressure and challenge in the adult social care budget. Work cross council on how best to resolve/address this and embed the commitment for collective endeavour in seeking solutions.

Recommendation 8 – Consider how to communicate the plan for the resolution of the cyberattack on council systems and effective use of data. Plan to cover any unresolved or outstanding issues: The 2020 cyberattack on council systems, which affected the majority of council services and access to data, left significant issues with delivering services. Work has been done to resolve issues across service areas, but issues remain and a clear path and timeline for resolution are required to inform and support the workforce strengthening a forward-looking approach.

Recommendation 9 – Maximise opportunities to work across boroughs and capitalise on areas of economic prosperity e.g. – Shoreditch and other business districts, like the City of London, may be able to offer: Maximise opportunities for innovation and investment, working across boroughs capitalising on areas of economic prosperity to realise the political vision for Hackney.

Recommendation 10 – Use the ongoing review of decision-making and the constitution to more effectively deliver the mayor’s priorities: Hackney should ensure that arrangements continue to serve the organisation well in delivering council priorities and ensure an appropriate level of resilience for the challenges ahead. The ongoing reviews of decision-making and the constitution should be used to ensure more effective delivery of the mayor’s priorities.

Recommendation 11 – Review member training and support to include chairing skills, support for dealing with casework involving vulnerable residents, and support for member wellbeing and mental health: Explore opportunities to expand member training and support, including chairing skills, support for dealing with casework involving vulnerable residents, and support for members’ wellbeing and mental health. 

The peer team

Scope and focus

The peer team considered the following five themes which form the core components of all Corporate Peer Challenges. These areas are critical to councils’ performance and improvement.

1. Local priorities and outcomes – Are the council’s priorities clear and informed by the local context? Is the council delivering effectively on its priorities? Is there an organisational-wide approach to continuous improvement, with frequent monitoring, reporting on and updating of performance and improvement plans?
2. Organisational and place leadership – Does the council provide effective local leadership? Are there good relationships with partner organisations and local communities?
3. Governance and culture – Are there clear and robust governance arrangements? Is there a culture of challenge and scrutiny?
4. Financial planning and management – Does the council have a grip on its current financial position? Does the council have a strategy and a plan to address its financial challenges? What is the relative financial resilience of the council like?
5. Capacity for improvement – Is the organisation able to bring about the improvements it needs, including delivering on locally identified priorities? Does the council have the capacity to improve?

As part of the five core elements outlined above, every Corporate Peer Challenge includes a strong focus on financial sustainability, performance, governance, and assurance. 

The council also asked the peer team to consider how resident-focused Hackney is as part of the peer challenge. 

The peer challenge process

Peer challenges are improvement-focused; it is important to stress that this was not an inspection. The process is not designed to provide an in-depth or technical assessment of plans and proposals. The peer team used their experience and knowledge of local government to reflect on the information presented to them by people they met, things they saw, and material that they read.

The peer team prepared by reviewing a range of documents and information in order to ensure they were familiar with the council and the challenges it is facing. This included a position statement prepared by the council in advance of the peer team’s time on site. This provided a clear steer to the peer team on the local context at LB Hackney Council and what the peer team should focus on. It also included a comprehensive LGA Finance briefing (prepared using public reports from the council’s website) and an LGA performance report outlining benchmarking data for the council across a range of metrics. The latter was produced using the LGA’s local area benchmarking tool called LG Inform. 

The peer team then spent four days onsite at LB Hackney, during which they:

• Gathered evidence, information, and views from more than 50 meetings, in addition to further research and reading.
• Spoke to more than 107 people including a range of council staff together with members and external stakeholders.
• Visited Woodberry Down, Tower Court, and Hackney Central.

This report provides a summary of the peer team’s findings. In presenting feedback, they have done so as fellow local government officers and members.

Local priorities and outcomes

Hackney is an inner London borough spanning just seven miles wide, with an estimated population of 260,000, making it one of the most densely populated areas in England. Demographically, the borough is diverse, home to a wide range of ethnic groups. It also has a younger population, with a median age of 32. The borough has experienced rapid change over the past 20 years, building on the legacy of the London Olympics in the summer of 2012. The council has worked hard to improve public services and shape places, neighbourhoods, and transport, evolving into a highly desirable place to live, work, and play.

Hackney is known for its vibrant business, cultural, and nightlife activity. In the past decade, the number of businesses in the borough has doubled from 10,450 to 22,560. The borough also has an improving employment rate, which is currently at over 80 per cent for the borough, higher than the London and national average. Despite the economic opportunities available in the borough, Hackney suffers from structural disadvantages and systemic inequalities leading to poor outcomes for some members of the community. Data shows that one in four residents and two in five children in Hackney live in poverty, and the borough remains one of the most deprived in England. The peer team found that the council are acutely aware of the difficulties many in the community experience and are committed to supporting the most vulnerable residents. The political and corporate leaders of the council appreciate their role in shaping the borough, improving outcomes for all residents, and championing their Climate Action Plan, commitment to anti-racism, commitment to ensuring diverse leadership in the organisation, and commitment to implementing a programme of transformation.

The priorities for Hackney Council are set out in the council’s strategic plan working  to ‘make Hackney a fairer, safer, greener and healthier borough for every child’. The plan was adopted in 2022 and organised around three themes, incorporating the mayor’s 2022 manifesto commitments. The peer team observed a clear commitment  within the council to deliver   the council’s priorities and improve services and outcomes for residents. The peer team heard in the feedback sessions from staff that with so many council priorities there is a lack of awareness about the key priorities. The peer team recommends that the council uses the opportunity of being two years into the strategic plan with  the new political senior leadership to refocus and reduce the number of priorities. 

The senior leadership at the council changed in 2023 with a new interim chief executive later becoming the permanent chief executive in May 2024 and a new mayor elected in November 2023 following a by-election. At the same time, there have been a number of changes in senior management positions. One year on, the council has stabilised with the mayor and chief executive leading the organisation together in their first year, receiving universal praise from those the peer team spoke to who saw them as  purposeful, considerate, rigorous, listening, and with a clear intent for change. 

Hackney has good schools, with 100 per cent of early years settings and 99 per cent of schools rated as ‘good’ or ‘outstanding’. The council’s green spaces perform strongly with 31 green flag parks and 5,000 trees planted in the last five years.

Hackney has an ambitious house building programme with over 3,000 homes planned to be built in the next three years and 1,900 built since 2018. The peer team visited three development/regeneration areas and saw the inciteful  work on consulting and co-designing with the community on new housing schemes. The team felt there was an opportunity for the council to look at how  community building and resources could be considered on a whole council basis, , with all council service, departments and partner agencies accessing these resources and the opportunity to work at the centre of these communities.

The peer team saw a real commitment within the council to deliver for residents with members and officers demonstrating a strong and sensitive understanding of its communities. 

Work is underway on a transformation programme, underpinned by the transformation strategy agreed in July 2024, with a focus on putting residents first, securing Hackney’s future and changing together. Projects in the transformation programme are seen as positive, and they are starting to create a sense of shared focus and challenges. However, the programme’s resourcing, scale and pace needs to be assessed to ensure   Hackney can  capitalise on opportunities which are available now and may not be available later. As part of conversations about the future for Hackney the peer team heard that ‘Hackney has great potential to do things differently, they need to stop thinking about service provision and think about creating the future for Hackney.’ 

Good practice examples were shared with the peer team , involving the community in helping to set the council’s future direction. The youth voice is an excellent example as well as the residents’ association work with housing. There was also very positive feedback about the culture team.

The peer team observed that while there are a number of projects and engagement  happening, often there was a lack of awareness of the next steps and future involvements of partners.  The peer team heard positive feedback about the council’s statutory partnerships with health and police. There was also positive feedback about the Anti-racism summit event. However, there was a lack of awareness about the next steps from participants in some projects.  Despite this, a  clear appetite to work with Hackney remains from partners, staff and members. It is clear a lot of work is happening within the council, but a perception exists that there is not always the resource and time to maintain or conclude communication on each initiative before moving onto the next. The peer team heard from some staff that there are too many priorities, and their focus is therefore spread too thinly. 

The peer team heard that it is important to staff that the legacy of the cyberattack is addressed in full. Rightly, there is a desire to move on from the consequences of the attack and an equal desire that it cannot be the answer anymore, as to why Hackney is unable to meet strong service level standards for residents. However resolutions or fixes have not reached every part of the council. It was observed that some services are still operating without adequate information management systems, thus hampering their ability to adequately manage services and customer need. The peer team recommends that work be done to communicate how the remaining cyberattack issues are to be resolved, including their priority, and a timeline for resolution so it can finally be put to bed. It is important that the CLT  ensure all staff understand that dealing with the residual effects of this legacy issue is a priority for the senior leadership. 

Performance

Hackney’s standard of performance across its core services compared to other London Boroughs (excluding the City of London) is mostly good with some areas performing at an average standard  and others requiring improvement. 

Summarising some of the indicators, Hackney’s council tax collection rates are below the mean for London in the 2023/24 period; performance in planning is around the London mean; and the borough has an above-average rate (the 5th highest in London) for qualifications and further education achievements per 100,000 population aged 19 to 64 in the 2022/23 period. Furthermore, some social care metrics are not available, but it is noted that the adult social care staff turnover rate is lower than the London median, which will help their work supporting the most vulnerable in Hackney. 

The council is rightly proud of the improvement in Children’s Services which was judged as ‘Good’ by Ofsted in July 2024, following a previous rating of ‘Requires Improvement’ in 2019 with inspectors finding support for children and families had ‘greatly improved’. This improvement is being used as an exemplar across the council of how to move services requiring improvement to a stronger position. 

At the time of the peer challenge, the council were due for an adult social care inspection by the Care and Quality Commission and were preparing robustly for this, including preparing for an Association of Directors of Adult Social Care (ADASS) peer review. The council are expecting an Area Special Educational Needs and Disability (SEND) and Alternative Provision Inspection to take place within the next financial year. The last inspection was under the 2017 regime and did not result in a written statement of action.

Hackney has one of the largest housing stocks in the country, with over 21,000 properties, which is the fifth largest stock in London. The council have recognised the need to improve its landlord function and address issues of repair, compliance, and safety in its housing stock. A housing improvement programme, established in 2023 is underway; however, in June 2024, the council self-referred to the Regulator of Social Housing and was allocated a Regulatory Judgement of C3, reflecting serious failings against consumer standards. 

The council are aware of the pressing need to improve the condition of its homes as well as the communication and relationship with its residents living in council stock and dealing with repair issues. The council’s housing stock, like many boroughs, requires significant investment and improvement to bring it up to modern standards of repair, amenities, and energy efficiency. Repairs are a key priority for council tenants, and there is dissatisfaction with the responsiveness and quality of repairs, with the council missing its performance target on response repair completion  rates. Furthermore, while the number of outstanding housing complaints is improving, a significant number of residents are still reporting issues and seeking remedy. Satisfaction with repairs is improving but still requires significant financial investment and management. This is a challenge seen by many providers of social housing and improvement takes time.

The council have a large Housing Division where housing management, repairs, and building safety improvement work sit amongst wider housing provision, homelessness support, and regeneration work for the whole borough. An action plan for service improvement in housing management and repairs is in place and requires close monitoring. Given the new regulatory framework and environment, plus the scale of the local challenge in housing at this time for Hackney, as well as many other councils, it is important that the mayor and chief executive are assured that adequate resources in terms of not only staffing but also leadership, focus, and supporting systems are in place. The service is housed in a large department also delivering regeneration and many other critical services and a consideration of whether the bandwidth of leadership for this area is sufficient may be helpful. 

The peer team understand that the cyberattack in 2020 was extremely debilitating for many parts of the council and for residents being able to report and get their issues resolved; this has been the case in housing. For staff, their ability to manage the stock including recording, tracking, and monitoring has been severely hampered by the lack of a housing management system and database, with staff managing activity via spreadsheets. Lacking a cohesive system is hampering the ability of the council and staff to improve at the rate they should be. A new system is planned to be introduced from the autumn of 2024, but the resilience of staff to manage despite this challenging situation is admirable. Better communication with staff on the system is needed.

Hackney has a performance management framework in place, organised by service areas. There is an opportunity to align the framework more closely with the council’s delivery priorities as set in the strategic plan 2022–2026 and the mayoral priorities for the next two years, as well as demonstrate corporate leadership of the delivery of these by shared reporting from CLT. Refreshing this framework to include reporting targets alongside data, a detailed commentary, and benchmarking data will be important to establish a stronger connection that shows how these activities and the Key Performance Indicators (KPIs) contribute to better outcomes for individuals, the community and the area. These changes will help to align the performance measures with the council's ambitions and demonstrate how the vision, priorities, and projects translate into meaningful results that enhance the quality of life for residents. Furthermore, it will be critical to ensure that the performance management framework provides a clear line of sight on progress to senior management, leading councillors through user-friendly dashboards, as well as providing the right level of information and in the right format to residents, partners, members, and staff at all levels. There is too lengthy a time lag between financial reporting and the presentation of this information to the cabinet and the council should work to reduce this where possible so as the information is meaningful to members and able to be acted upon by management. Hackney should also consider the flow and timing of performance report circulation and review and explore the opportunities and benefits of the performance reports going to overview and scrutiny and then the cabinet rather than the audit committee. Lastly the council should consider how officers could be more involved in presenting their own performance information to build personal accountability for delivery.

Hackney’s gender pay gap is positive, with women earning more on average than men. Reporting under the Gender Pay Gap Reporting Duty, Equality Act 2010, shows that women are paid 3.9 per cent more than men on average and earn 5.6 per cent more when using the median hourly rate to measure. The council has a clear commitment  to equality and diversity – the workforce described  Hackney as ‘an inclusive place to work – I feel welcome ’.

Organisational and place leadership

Organisational and place leadership were observed as being strong and vibrant at the council. The senior leadership team in Hackney is well  regarded. The peer team heard that the mayor is outstanding, listens and is rigorous; with a member of senior staff saying: ‘We are really proud of her.’ The chief executive received similar praise and is highly respected, described as someone with a ‘clear head’ and a leadership style that people ‘have faith in’. 

It was evident to the peer team that the mayor and chief executive work together collaboratively, demonstrating trust in their relationship to deliver both internally and externally. Relationships between members and officers are good, with each understanding the different roles they play in supporting and delivering for Hackney. 

The peer team heard that managers and staff are dedicated to Hackney. The council have a passionate and committed workforce who are proud of their work in the council. 

The peer team heard a number of examples of positive partnership working with one small business representative saying they ‘can’t fault Hackney Council’. Whilst statutory partners were positive about the relationship with the Council, this was not so much the case with the Voluntary, Community and Faith Sector (VCFSE) who felt the Council could strengthen their relationship with the sector. Frustration was shared by residents and partners that some initiatives are not co-designed or clearly communicated end-to-end, which can result in lower trust and understanding amongst partners about how the council truly feels about the value of their engagement, their perspective and the time of those involved. Although it is more difficult and time-consuming when projects are multifaceted and long, it is important to provide good quality feedback and create opportunities for further partnership involvement, demonstrating that partners time and views are valued, and the council is an open and transparent organisation. 

The increase in the number of new businesses in Hackney is impressive and brings a wealth of opportunities and benefits to the borough. As part of the council’s place leadership role, Hackney should look to maximise opportunities for innovation and investment into the borough,  capitalising on all areas of economic prosperity to realise the political vision for Hackney. 

The success of the transformation work at Hackney is key to achieving the desired priorities and outcomes for the area but also essential for the future financial health and stability of the council.  As part of the transformation work, it would benefit the council to review what it thinks “good” looks like and what works well  in other councils. In addition to building this into the refreshed performance management framework, looking at how transformation has been managed elsewhere will help the council further define the scale  and pace at which they need  Hackney’s transformation to proceed. The LGA have recently launched resources that Hackney can access both for councillors and officers on transformation frameworks, good practice, and case studies.

Hackney has a vision to operate a ‘one council’ approach, working together as one organisation for the community and residents. This requires setting clear expectations and service standards with all staff, residents and partners, working in a joined-up way, and anchoring that across the organisation. The council’s transformation programme must  be used as a way to help achieve this as well as explicit modelling of this by the CLT. An example of needing to work better together heard by the peer team was where staff were struggling to contact colleagues in other departments to get a response for a resident on a multifaceted issue. Staff expressed their frustration and concerns about telephone calls to other departments not being picked up and a frequent need to escalate queries as responses were not provided. Resetting expectations that work is more joined-up and developing digital solutions to track interdepartmental queries could also be achieved as part of the transformation process.

The recruitment of some key senior posts is still required, Hackney should ensure sufficient support and priority is given to filling posts in the corporate leadership team on a permanent basis, as they are pivotal to the council’s transformation journey.

Governance and culture

There is a good working relationship and trust between members and officers. The peer team heard a strong sense of loyalty to the council and Hackney the place, from both members and officers. 

Both the mayor and chief executive are trusted and well respected by members and officers. The peer team were told they provide a coherent, cohesive and effective leadership for the organisation. 

The peer team found a strong culture of openness and transparency in the governance systems at the council. The scrutiny system works well and is respected in the council and by statutory partners. There is a healthy acceptance of what governance issues need to be addressed. The relationship and cooperation between the chief executive, chief finance officer, and monitoring officer is a strength of the council. There is an observable dedication to residents with equality, diversity, and inclusion at the heart of governance. 

The peer team found that officers have a good understanding of governance  . Now is the opportunity to use the ongoing reviews of decision-making and the constitution to  ensure that decision-making is timely. 

It would be useful to consider the design of the regular structured meetings between cabinet and CLT to  ensure these are used to anchor corporate delivery of priorities, and accountability for them and support the transformation programme.

Scrutiny at the council works well, with a good forward plan of activities in place. The peer team heard that occasionally decision-making lacks pace and some officers and members were not always sure of the delegation provisions. The council should take some time to review the scheme of delegation and recommunicate this to staff and members, especially in light of the tough financial decisions ahead for the council. The council are aware of the concerns at the pace of decision-making and have committed to undertaking a decision-making review, to include looking at comparator authorities  and piloting revised processes in early 2025.

 On observing a full council meeting, the peer team reflected that the current agenda, running order and pace could be limiting the mayor’s ability to address key priorities. Reviewing the order of the agenda and accelerating certain items could allow more focus on issues that align more closely with the mayor’s goals and vision.  

Members fed back during the meetings that they have  good support and a training offer available to them, with the peer team recommending this be extended to include chairing skills, support for dealing with casework involving vulnerable residents, and support for members’ wellbeing and mental health, given the pressures and increase in complex casework.

Staff  were proud and excited about their work at the council and with residents. The peer team heard that staff relationships within the council and between departments are mostly good although there is an appetite for more cross -council collaboration and being able to get responses to queries from colleagues. A common request from staff was for the council to move quicker with digital improvements, including enabling where appropriate, customer self-serve via the Hackney website for service requests.

The council’s approach and use of apprenticeships is impressive, with staff expressing an appetite to do more in this area, supporting residents and local people to benefit from the growth in borough. Strong relationships with businesses will be the key to this area of work continuing to grow. 

Financial planning and management

The peer team observed that awareness of the financial challenges among cabinet members is strong, with the mayor, cabinet, and CLT being transparent with staff on the financial difficulties the council is experiencing and the position the council will be in, if greater financial control and organisational and operational change are not achieved.

Hackney recognises the need for collective financial leadership across the whole council to address its challenging  budget position. More disciplined  corporate   ownership of the challenge, alongside delivery of the ambitious saving targets and transformation projects is key to managing the challenging financial position the council face. At the time of the peer challenge, the council were predicting a significant overspend for 2024/25 of £21 million but have introduced some further controls to address this including the recent introduction of the budget recovery board which was seen as a positive addition.  Hackney is facing a challenging financial position in the coming years with a £52 million budget gap for the medium term (2025/26-27/28), requiring the council to look at additional proposals for significant budget reductions up to 40 per cent in some service areas. 

Meetings with staff and trade unions as part of the peer challenge demonstrated a good awareness across the council of the financial position and the need to make savings and work at pace on the transformation programme. The peer team found the council’s financial monitoring information clear about the challenges that the council faces now and in the near future, and the tight timescales involved to resolve the situation without exhausting the reserves.

The council is forecasting for the medium term and not just the short term, but it is essential that work is completed now to clarify and review the approach to the use of reserves as an in-year solution to the budget, as has been the case   in recent years.  

It is also recommended that further work be completed on the resolution of the adult social care budget . Hackney, like many councils across the country, must keep the adult social care base budget  under review and ensure the challenge is seen as a collective endeavour.

Hackney is facing significant financial pressure regarding temporary accommodation,  as are many councils, especially in London. Temporary accommodation overspend is a significant budget pressure for the council requiring a collective and strategic response. The peer team observed a good understanding and strategic grasp of the issue, with Hackney working to ensure robust homelessness prevention activity is in place to keep people at home where possible, alongside the council investing further money in the procurement of temporary accommodation to reduce the use of expensive bed and breakfast and nightly paid accommodation. The peer team heard that asset reviews include consideration of new development and change of use to meet the need for more affordable temporary accommodation. Hackney are demonstrating  that they are actively working with other London boroughs to identify cross borough housing supply solutions to meet homelessness demand.

Although financial awareness is strong in the council, the peer team reflected that the council might want to consider in-year urgent action on the increasing overspending forecast and look at introducing new internal financial controls e.g. on recruitment.

The peer team suggest that there are possible in-year savings in agency staffing that can still be achieved for 24/25 with a strong approach and monitoring. The peer team overall recommend that more attention be given to making in-year savings and ensuring the monitoring of savings is robust and  discussed regularly at CLT.

Hackney has an ambitious long-term capital programme making a real difference, especially across housing. Officers leading the delivery of housing were cognisant of the financial challenges and determined to maximise delivery although there was feedback that priorities could be revisited so that they were realistic reflections of the current position.

The financial position of the council requires that Hackney ensures closer alignment between the new priorities and emerging priorities as the council reviews the affordability of the new shape and direction of their capital programme and other financial strategies. 

Now is the time to consider the scale of investment in the council’s transformation programme. Work has started to review how the operating model should shift given the financial challenge, improvement ambition, and continuous modernisation of systems. All work in this area should have a clear business case and include information on the return-on-investment analysis. Change at the scale sought by the council is likely to require additional capacity to deliver savings and change at pace. There are opportunities through capitalisation financing of transformation that should be explored. The peer team recommend additional advice be sought in this area. 

A significant portion of the council’s budget is allocated to demand-led services, such as children's and adult social care. The peer team observed that there was a perception from part of the organisation that the council cannot take money out of demand-led services, especially adult social care, and that all possible cost reduction methods have been explored. These services will have statutory elements that mean a minimum level of service is required; however, there are often parts of the service that can be reviewed and considered in the round when looking at the budget and the revenue available to the council. Equally challenging the cost base, and appropriateness of placement and package provision on a regular basis will ensure that all money spent on the statutory service is at the most cost effective level. Maintaining and developing the relationship with NHS partners to agree on funding models for services in Hackney will be important given the constrained NHS budget position. There is work underway to review hospital discharge arrangements and ensure fair apportionment of costs between the council and the NHS.  This will be critical in enabling the council to keep tight control of spend in these areas.  Reaching out to other London local authorities who are managing to reduce cost and work within budget in adult social care may be helpful in providing further ideas on balancing the budget and constraining demand and cost. 

Given the current financial challenges, it is good to see that the council have started work to review its assets. The peer team recommend that this work be accelerated to ensure the approach reflects the emerging financial position and new priorities of Hackney.

The scope of the  procurement review can be broadened to include focus on existing contract spending for in-year and medium-term savings when making procurement decisions 

The internal audit process is comprehensive with good quality reports and evidence of corrective action taken through the process. Senior management support of audit was evident. The accounts for the council have been audited and published with only 2023/24 outstanding.  

The council should also look at ways to utilise financial benchmarking data in their regular performance management reporting and when looking at opportunities to review and manage overall council spend and reduce unit costs.    

Capacity for improvement

The peer team reflected that the council’s workforce is a strong, passionate, and committed asset to Hackney, which the senior leaders in the council appreciate and value.

The council have a challenging time ahead with pressure in demand-led services and reducing reserves. It is positive to see that the mayor, cabinet and CLT are aware of the challenges ahead, including the scale and breadth of transformation work proposed. The peer team saw evidence that this has been shared and understood across the organisation. There is a lot of talent across the council, and it is clear that staff are prepared to fully embrace change. The peer team heard during the peer challenge that the workforce believes Hackney to be ‘forward thinking, forward-looking and ready to take up the challenges in the round’. The council will need to ensure communications around the transformation explains to the staff and partners  how the council is  changing and what the  future Hackney council and vision for the borough looks like. There is an opportunity following this peer challenge  to clarify the approach to transformation, defining clearly whether is it a programme that delivers  transformation in  the council or if it is also about the borough . There is an ambition for change and a determination  to deliver  from the mayor, cabinet, chief executive and senior officers, and there is a growing recognition that the level of change required will involve making tough decisions.

The relationship with statutory partners is strong and trusted. Comments such as 'outstanding' and 'best I've ever experienced' were made when talking about the council. However, it is important that statutory partners are kept in the loop throughout consultations and co-production work.

There is an appetite for more integrated working and a strategic approach to budget planning. Hackney’s member and officer leadership modelling a prevention and ‘whole council’ approach will enable  this change to succeed.

The peer team recommend the acceleration of the whole council/system change transformation workstream as a priority, creating a clear path to where the organisation wants to be in the future (new priorities, sustainable financial envelope, ways of working, for instance.). This should include looking at ways to create greater capacity and pace, increasing the investment in  the transformation programme and using opportunities available in the capitalisation of the financing of the transformation, as has been employed by other councils. We suggest Hackney seek advice on how to best utilise this. 

The appetite for whole system change is apparent and it is important that ‘one council’ working needs to be anchored across the organisation and led by CLT.

The council have undertaken a number of initiatives and changes to their operating model, necessitating the insourcing of council activities previously outsourced. These decisions should be supported by a new “right-sourcing” approach, which could help innovation and cost reduction. 

The peer team heard Hackney described as a ‘vibrant and exciting hotspot’ but observed that opportunities to work across other boroughs and capitalise on areas of economic prosperity have not been fully explored. Shoreditch and other business districts e.g. City of London, should be showcased and more done with the business sector to bring their experience and wealth to improving and managing the area. 

All council strategies should be aligned with a refreshed transformation strategy and the development of an IT strategy and a separate digital strategy should be accelerated.

Whilst appreciating the desire to move forward from the narrative around the cyberattack on council systems, this is still a live issue for many staff in the organisation and it is important that the council communicate the plan for the resolution of the remaining impact of the cyberattack on council systems and effective use of data. It will be helpful to create a plan to cover any unresolved or outstanding issues with resolution timelines. 

It is recommended that Hackney consider how to clarify and build an understanding of the differences in approach to digital and AI (artificial intelligence) in the council work on modernising and digitalisation of appropriate council systems, and ensure corporate leadership and management of the programme , with an organisational development and skills strategy  to support this.

Regarding external communications, the council need to consider if its  current messaging is assisting in helping to convey the challenges that the council are currently facing to the public and the intent to reset.

It is recognised that senior political and managerial leadership will want to consider, discuss and reflect on these findings. The LGA will continue to provide on-going support to the council. Following the publication of the CPC report Hackney will produce and publish an action plan within six months of the time on site. As part of the CPC, the council are also required to have a progress review and publish the findings from this. The LGA will also publish the progress review report on their website. 

The progress review will provide space for a council’s senior leadership to report to peers on the progress made against each of the CPC’s recommendations, discuss early impact or learning, and receive feedback on the implementation of the CPC action plan. The progress review will usually be delivered on-site over one day. 

The date for the progress review at LB Hackney will be September 2025.

In the meantime, Kate Herbert, Principal Adviser for London, is the main contact between your authority and the Local Government Association. As outlined above, Kate is available to discuss any further support the council requires. [email protected].