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LGA Corporate Peer Challenge: Luton Borough Council

Feedback report: 12 – 15 March 2024

1. Executive summary

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Luton Borough Council (LBC) has an ambitious vision ‘Luton 2040’ – a town where everyone can thrive, and no one has to live in poverty. LBC is trail blazing and the leader, the executive, chief executive, Corporate Leadership Team (CLT), cross-party councillors, and all council staff are fully committed to improve outcomes for the diverse community of Luton.

LBC and partners are determined to change the perception and reputation of Luton, rewrite the narrative, and put the town and surrounding area on a more positive footing. In August 2023 LBC launched ‘Step Forward Luton’ a new place and inward investment brand, fronted by community and business leaders with a dedicated council team supporting the implementation. Some 40 ambassadors representing all parts of the community, including key sectors and community leaders across education, sport, healthcare, the voluntary community sector (VCS) and arts, culture and heritage. 

The five Luton 2040 priorities feed into the vision and are focused on inclusive economic growth, a town with positive health outcomes for all, a child- friendly Luton, working towards Net Zero and building a strong and empowered community.

LBC and system partners have a strong understanding of the drivers of poverty in Luton with housing a keystone issue providing a critical dependency to all five core priorities of the Luton 2040 vision. Luton 2040 was first launched in October 2020 with the vision being created in collaboration with residents and partners and is underpinned by evidence gathered by the Inclusive Growth Commission in 2019 which clearly identified the scale of poverty in the town and the links between dependent challenges including education and health inequalities.

The council has strong self-awareness of the complex challenges facing the town and understands only a system approach, including integral working with communities and partners will enable improvement to outcomes and positively work towards the vision of Luton 2040. The council has strong partnerships across statutory, faith, VCS, education and business sectors for example Luton Town FC and Luton Rising, the council owned airport company. 

Despite the complex challenges facing Luton, the council, partners, and community are determined to transform the town to a place where everyone can thrive, and no one has to live in poverty. This vision was widely understood by the many partners, members of the community, councillors, and council staff the peer team engaged with over the four days facilitating the corporate peer challenge in Luton. 

Before the peer challenge commenced, peers were invited to attend the Luton 2040 conference on 9th February 2024. With over 210 attendees, it was evident to peers there is significant passion, energy, and enthusiasm across all partners to commit to the improvement of outcomes for Luton residents. Partners are encouraged to make a pledge that captures how they can directly support Luton 2040 with one or more of the five core priorities. 

As a trail blazer, the council, partners, and community are highly ambitious and driven to deliver impactful outcomes. On the evening of the first day of the corporate peer challenge process, peers participated in a guided walking tour of Bury Park, visiting the Luton Town FC stadium, the many places of faith and worship and heard personal accounts from faith leaders demonstrating the resilience and robustness of communities.

Peers were impressed by the highly committed councillors and staff, all of whom are passionate about Luton, are explicit about their civic pride and focused on tirelessly delivering positive outcomes for residents and communities. The council recognises that they have built a strong foundation for Luton 2040 and the vision is well communicated with strong partnerships. The work to address the many complex challenges now needs to enter its next phase of delivery. The timing of the corporate peer challenge provided the council with external sector-led challenge to help LBC shape the next phase of the Luton 2040 delivery.

There are many positive outcomes already delivered that contribute towards the Luton 2040 vision, for example 64 per cent of residents consider themselves happy, an increase from 53 per cent last year. There are 93 per cent of pupils attending good or outstanding schools with above national average attendance. The Centre for Research in Social Policy reported a 5.5 per cent reduction in the town’s child poverty figures in 2023 with 39 per cent of children in low-income households, compared to the previous figure of 45 per cent. There are many complex challenges for LBC and partners to work through together which are well evidenced with supporting data in the recently published Luton 2040 Progress Report.

Luton 2040 will require the council’s executive and the Corporate Leadership Team (CLT) to undertake an increasingly challenging and complex agenda. There are many moving parts, this will require more dedicated time and focus on strategic decision making and planning. Peers recommend a reset of the executive decision-making function to include regular informal meetings of just the Executive and informed by a forward plan, alongside regular meetings between the CLT and the executive to facilitate a more coordinated response to strategic challenges.

The council’s executive can be further supported with a targeted councillor development programme focused on fulfilling their responsibilities and leading on culture change and the Luton 2040 priorities. The development and further understanding of each of the complex policy areas will support the Executive with insight, skills and increased understanding to ensure improved governance, oversight and challenge to the strategic challenges and priority work areas of the council. 

As the Luton 2040 vision enters its next phase of delivery, peers recommend establishing a comprehensive data driven roadmap and delivery plan under the five priorities of Luton 2040. This should be underpinned by an outcomes framework that charts progress over one, three and five years. 

To ensure all 2040 partners deliver on their high-level commitments, peers recommend the council provides greater structure to support partners with translating their pledges into demonstrable actions over the next one, three and five years along with a framework for tracking, measuring, and reporting on progress. This is essential to ensure all effort is coordinated and to allow line of sight of all actions and dependencies across the five priorities. 

Housing and temporary accommodation is a significant issue for LBC and as a keystone issue, if not improved, will fundamentally impact the overall delivery of Luton 2040, and adversely impede the success of the priorities. All priorities are dependent on provision of housing. Luton has considerable pressures in terms of homelessness prevalence and the use of temporary accommodation. The context of housing is challenging with Luton seen as an attractive location by other councils in more expensive areas to relocate. In recent times, Luton has hosted around a fifth of the East of England’s supported asylum population. This placement by the Home Office has gone on to further exacerbate the housing pressures. The impact has made securing affordable temporary accommodation much more difficult and has driven up the local costs and is now a significant cost pressure. 

This situation is recognised by the council as providing one of the biggest risks with the costs of temporary accommodation projected to be overspent by circa £3.5m for 2023/24. In the last 18 months the number of people presenting as homeless has doubled to 450 per month. Given these significant factors, peers strongly recommend a corporately led new and ambitious strategic approach to the delivery of affordable housing and maximise this opportunity during the refresh of the local plan. 

This should be underpinned by a robust delivery plan, utilising innovative solutions within a year. This is an area peers would like to see considerably advanced when they return circa January 2025 to conduct a progress review. This must therefore become a top corporate and partnership priority informed by best practice and through exploring how other councils are responding to similar challenges.

Despite financial challenges, LBC has managed to set a balanced budget year on year without the use of reserves. The council’s airport (Luton Rising) provides a positive financial and social contribution. With the rising complex demand pressures facing the council, including the above housing challenges and the impact of cost inflation, there is an urgent need to ensure the organisational culture is developed to foster a corporate ownership of financial management. 

This should also include investing to achieve an effective business partnering model to improve financial management and the sharing of responsibility across the council. The Director of Finance is held in high regard; however, the financial challenges require a coming together of service directors to develop a strategic and operation response to the budget pressures and take collective ownership of the council’s financial performance and challenges.

Setting a balanced budget has been predicated on planned cost reduction and benefit realisation through the implementation of a three-year transformation programme, supported by an external partner and the implementation of service deficit recovery plans. Peers recommend rapidly increasing the capacity to deliver the transformation and deficit recovery programmes to help assure financial sustainability over the medium-term. 

Peers were informed that some service areas are struggling to cope with business-as-usual operational demand, so expecting the same service area to be focused on related transformation projects, as well as specific work related to deficit recovery plans is unrealistic and provides additional risk for the projected financial savings, which are integral to the delivery of budget and financial performance. To prioritise and deliver more capacity across the council, continue to progress the implementation of the people strategy at pace, with an incisive focus on this, as well as developing capability, culture and equality, diversity, and inclusion. 

Peers recognise the importance of a thriving town centre. Throughout the meetings with councillors, staff, and partners there was a strong repetitive and worrying narrative that the town centre is not safe. Peers also expressed their own perception that the town centre did not feel safe, which was the opposite experience to the walking tour on Bury Park and around the Luton Town FC stadium which felt much safer and welcoming. 

The town centre must be the door to the town and to prepare the ground for the successful execution of the town centre master plan, peers recommend quickly refocussing the multi-agency town centre operational task force to actively address and alleviate the overt challenges evident in the town centre. There have been some positive successes already including the reduction of town centre crime (Operation Metal). 

As part of the Luton 2040 vision to build an inclusive economy that delivers investment to support the growth of businesses, jobs and incomes, the council’s emergent work to develop an economic development strategy should use research, analysis and engagement (at a local regional and sub-regional level), to establish a clear understanding of economic growth opportunities for the borough’s diverse population. When there is a clear understanding of the areas for economic development, ensure alignment with employment pathways, ensuring local partners are providing the best opportunities for learning and skills and engaging the population in employment opportunities.

There is so much to already celebrate in Luton; from Luton Town FC’s recent promotion to the Premier League (which local people are very proud of and celebrate), and the pending new proposed football stadium (Power Court), the successful modernisation of Luton airport, including the recent Direct Air-Rail Transit (DART) and plans to grow the local region and wider regions economic value through the increase of passenger numbers and expansion to the terminal buildings through a Development Consent Order (DCO). The council and its partners have so much to be proud of with many examples of positive delivery that have been captured in a recent Luton 2040 Progress Review report

2. Key recommendations

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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:

1. Executive decision-making

Reset of the executive decision-making function – to include regular informal meetings of the executive informed by a forward plan and regular meetings between CLT and executive, to facilitate a more coordinated response to strategic challenges.

2. Councillor development 

To enhance the current member development programme so the executive team can effectively fulfil their responsibilities and lead on culture change. 

3. Develop a Luton 2040 roadmap 

To establish a comprehensive data driven roadmap and delivery plan under the five pillars of Luton 2040. To be underpinned an outcomes framework that charts progress over one, three and five years. 

4. Development of Luton 2040 pledges

To ensure that all system partners deliver on their high-level commitments that greater structure is provided from the council to partners that translate their pledges into demonstrable actions over the next one, three and five years. 

5. Affordable housing delivery plan

The development of a corporately led new and ambitious strategic approach to the delivery of affordable housing. This should be underpinned by a robust delivery plan, utlising innovative solutions, within a year. This must become a corporate and partnership priority, informed by best practice. 

6. Financial management

To develop a culture that enables corporate ownership of financial management – to include investing to achieve an effective business partnering model to improve financial management and the sharing of responsibility across the council.

7. Transformation capacity

To rapidly increase the capacity to deliver the transformation and deficit recovery programmes, to help assure financial sustainability over the medium term.   

8. People strategy delivery

To prioritise strategic activity in order to address capacity issues across the council. Continue to progress the implementation of the people strategy at pace, with incisive focus on this, as well as capability, culture and EDI. 

9. Improve town centre safety 

To prepare the ground for the successful execution of the town centre master plan, refocus the multi-agency town centre operational task force to actively address and alleviate the overt challenges evident in the town centre.

10. Economic Growth Strategy 

As part of the emergent work to develop an economic development strategy the council should use research, analysis and engagement, (at a local regional and sub-regional level), to establish a clear understanding of economic growth opportunities for the borough’s diverse population. To then secure alignment with employment pathways.

3. Summary of the peer challenge approach

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The peer team

Peer challenges are delivered by experienced elected member and officer peers. The make-up of the peer team reflected the focus of the peer challenge and peers were selected on the basis of their relevant expertise. The peers were:

  • Councillor Lead Peer: Cllr Kaya Comer-Schwartz, Leader, London Borough of Islington
  • Lead Officer Peer: Ian Thomas CBE, Chief Executive, The City of London Corporation
  • Officer Peer: Alison Parkin, Director of Finance / S151 – Derby City Council 
  • Officer Peer: Rebecca Purnell, Assistant Chief Executive – West Northamptonshire
  • Officer Peer: Stephen Haynes, Strategic Director, Economy, Regeneration and New Homes at Hackney Council
  • Sector Partner Peer: Adam Doyle, Chief Executive Officer – NHS Sussex and National Director for System Development, NHS England
  • Sector Partner Peer Chris Childs, Long Road Sixth Form, Cambridge
  • LGA Peer Challenge Manager: James Mehmed 
  • Onyekachi Abajingin – LGA PSO

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? 
  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?
  5. Capacity for improvement - Is the organisation able to support delivery of local priorities? Does the council have the capacity to improve?

The peer challenge process

In addition to these questions, the council asked the peer team approach the CPC through a partnership / system lens, with peers examining the effectiveness of the Luton 2040  vison / strategy and to what extent the approach is delivering and making a difference to the community of Luton. Peers were also asked to provide feedback regarding how well everything corporately and across the Luton system is aligning to the place agenda?

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. The team then spent four days onsite at Luton Borough Council, during which they:

  • Gathered information and views from 63 meetings, in addition to further research and reading.
  • Spoke to circa 250 people including a range of council staff together with members and external stakeholders.

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. 

4. Feedback

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4.1 Local priorities and outcomes

The council is trail blazing with an ambitious place-based vision. Luton 2040 sets out a vision of a healthy, fair, and sustainable town where everyone can thrive, and no one has to live in poverty. Luton 2040 was co-produced with leaders, public and private sector organisations, the community, and partners across Luton. The vision captures the hopes and aspirations for a future Luton. This is a twenty-year programme with sixteen years remaining. 

Peers recognise the council has an excellent self-awareness of the challenges facing the town. The council knows that poverty and inequality directly impact outcomes for residents in education, health, and employment. These factors are at the core on delivering a town free of poverty. 

The council has created Luton 2040 built on a comprehensive evidence base. In 2018 the council set up the Inclusive Growth Commission who worked independently to determine the most significant barriers to inclusive growth in Luton through engagement with residents, partners and stakeholders. 

A further example of engagement with residents to identify local priorities is ‘The Denny Review’ which was commissioned to investigate health-related inequalities across Bedfordshire, Luton and Milton Keynes. The life expectancy of residents in deprived areas of Luton is around six years lower for women compared to more affluent areas and worse for men. Peers heard how the range of commissioned reports has provided the initial engagement with communities and partners and directly formed the identification of the Luton 2040 priorities. This strongly demonstrates the council’s approach to the place vision is evidence based, independent and informed by residents’ views, opinions, and as appropriate lived experiences. 

Given the health inequality challenges, peers were pleased to see how well Public Health is present throughout the council’s policies and practice, coupled with a high level of passion and commitment for transformation from the functions leadership team. Luton becoming a ‘Health Equity Town’ is further evidence the council is focused on reducing health inequalities aligning with Luton 2040. A one-year progress review will shortly be issued detailing delivery. 

Peers heard about the council’s emergent work regarding an economic development strategy and recommend taking a similar approach to other policy areas and utilise research, analysis, and engagement at a local regional and sub-regional level to establish a clear understanding of the economic growth opportunities for the town’s diverse population. Once the economic development strategy is agreed, Luton should ensure all partners and the council secure alignment with employment pathways. 

The council has a comprehensive understanding of local priorities which can be evidenced in the latest Luton 2040  progress report which sets out the case for the vision, provides further evidence on latest poverty statistics and measures with an assessment of what is going well and where future work and attention needs to be targeted. 

The council has a lot to celebrate at this early stage of the twenty-year vision. The above Luton 2040 report evidences a range of outcomes, for example child poverty in the town dropped from 45 per cent to 39.5 per cent (evidenced by The Centre for Research in Social Policy); 90 per cent of pupils in Luton attend a ‘good’ or ‘outstanding school’ above the national average of 88 per cent; 64 per cent of residents consider themselves happy compared to 53 per cent a year ago. 

Whilst progress has been made, the next phase will require visible and effective cross-cutting political leadership, supported by officers, with the capacity to deliver and work effectively across the organisation.

Peers were cognisant to the complexity and range of significant challenges the council is faced with. Homelessness, housing, and temporary accommodation is a keystone issue. Homelessness presentations have doubled in the last 18-months and the disproportionate number of asylum seekers placed in the town is further exacerbating the challenge and an unfunded driver for demand across the council, partners and health services. Peers applaud how the officers have more than risen to the challenge and have a multi-agency working group set up to ensure the right partners are around the table to ensure asylum seekers are fully supported (e.g. welfare, safeguarding, schools, healthcare). The council predict around 75 percent of asylum seekers (1125 people) will be future Luton residents. 

The council will be refreshing the local plan and peers recommend utilising this process to maximise the opportunities to influence the building of social and affordable housing. Peers recommend the development of a corporately led new and ambitious strategic approach to the delivery of affordable housing. This should be underpinned by a robust delivery plan, utilising innovative solutions, within a year. This must become a corporate priority and informed by best practice and learning from the experience of other councils. The LGA can help with sign-posting LBC to other local authorities and offers were made directly by peers to visit their councils to examine housing strategies and further discuss innovative approaches to achieving viability of social housing delivery. 

Creating a thriving town centre is at the heart of the council’s strategy for building a more inclusive economy. The council has a £1.7b transformation programme detailed within the town centre masterplan. The town centre was described to peers as feeling unsafe. Peers visited the town centre and could see the issues for themselves and also expressed feeling unsafe. Regeneration projects like ‘The Stage’ (mixed-use development of new homes, office space, performance venue) and ‘Power Court’ the new Luton Town Football Club stadium will help improve the town centre, although peers reflected that the town centre needed more urgent attention and recommended coordinated action to address the concerns needs to be prioritised. Peers do recognise the positive outcomes of ‘Operation Metal’ where the town centre has seen a 15 per cent reduction in crime for the first three months of this work including a reduction in knife crime. Staff leading the community safety partnership (CSP) have developed a “single version of the truth” on what is a complex landscape and have now created a specific town centre standalone plan in the overall CSP plan which peers see as a positive giving more focus to this critical issue.


Performance Management

The council produces a quarterly corporate performance management report and tracks performance through a set of key performance indicators (KPI’s). The KPI’s are currently being reviewed to ensure there is alignment with the Luton 2040 outcomes. Each service area is identifying the top five KPI’s they intend to measure within their service. 

The quarter three performance report is structured around; resident wellbeing, child friendly, net zero and workforce welfare. The corporate performance report details both quarterly and annual service data, which allows performance to be monitored and discussed at CLMT, Overview and Scrutiny (OSB), and Executive prior to headlines being published to staff and citizens. 

There is a good use of performance narrative providing further detail regarding the reported performance. The quarter three report details RAG rated achievement of KPI targets and is showing 13 KPI’s that are red and missing targets, with 10 amber and the remaining 41 green and on-track. Peers were unable to cross reference the subsequent discussion with OSB as the report had only recently been issued.

The councils LG Inform headline performance report compares council performance to CIPFA nearest neighbours. In the context of Luton 2040, the data on total expenditure per head of population is £165.92 well below the mean of £260.98 and the second lowest from a group of 15 in the benchmark group. The council performs above the mean for non-domestic rates not collected as a percentage of non-domestic rates due at 3.96 per cent. The council spends above the mean (£835.5) for total revenue expenditure on education services per head of population at £904.61.

Luton is amongst the lowest in the benchmark group for total revenue expenditure on children’s services per head of the population, spending £958.12, compared to a mean of £1228.28.

The total revenue expenditure on Housing services (GFRA only) per head of population is significantly higher than the mean of £48.75 at £131.98, the highest per head value compared to the benchmark group. 

The council uses a resident’s survey to capture a range of data. The residents survey for March – April 2023 engaged 1000 residents across all 20 wards. The council use the outcomes to inform decision-making. For example, 34 per cent feel they are managing well financially compared to 20 per cent last year. Satisfaction with the town as a place to live has gone down to 59 per cent compared to 73 per cent last year. The most frequently cited dissatisfaction is ‘Luton is dirty’. Increased investment in street cleaning has recently been approved.

There has been a drastic decline in the percentage of residents who feel positive about the future of the town compared to last year (40 per cent down from 75 per cent). The biggest reason for lack of positivity is respondents feel there are too many people hanging around, drinking, taking drugs and the levels of homelessness. These indicators directly correlate with the feedback peers heard through the many discussions. Luton 2040 is actively seeking to address these issues. 

The council is actively working on refreshing the 2040 measures and there is still work to do. Peers heard an example in Public Health were there are high-level established public health measures, these inform a set of KPI’s and the KPI’s for part of individual personal objectives, ensuring there is a thread from overall measures to individual staff performance. This was deemed to be working well and providing focused effort on key outcomes. This approach has yet to be fully embedded across the council.

Peers discussed the future of performance and intelligence with performance team representatives. There is a drive to shift from performance monitoring to developing insight. The plan is to be more intelligence led and support more evidenced led prioritisation. 

The council shared with peers how a specific workstream has been set up to focus on data and evidence for housing, with a view to influence the application of intelligence-based decision-making to inform future strategies and improvement in this important service area. This was a positive example of prioritising resource and insight on a problematic area and taking an increased corporate focus. 

The council was subject to an Ofsted inspection of local authority children’s services in January 2020 and given an ‘Inadequate judgement’. The council responded positively, developing an improvement plan and being held to account on improvement by an independently chaired improvement board as well as a children’s services review group to provide regular challenge and oversight to service improvement. The July 2022 inspection resulted in overall effectiveness judgement being ‘Requires improvement to be good’. 

Leaders and staff have achieved tangible and significant progress since the last inspection in 2020, when the overall effectiveness of services was judged to be inadequate. In general, children and their families receive a much better service than they did, although the impact of improvement is not yet consistent for all children.

Improving the quality of support for children who need help, protection or care is a clear priority for councillors, senior leaders and partners. Leaders maintain close oversight, regularly engaging with children and staff in order to understand the quality of the service being provided and to assess the progress that is being made.

What needs to improve - the quality and impact of supervision and management oversight; the stability of the workforce; the quality and analysis of assessments of children; the quality of evidence-based assessments undertaken to support effective placement matching; the consistency of support and pathway plans for care leavers.

The June 2023 focused visit by Ofsted recognised there have been significant changes in the leadership of children’s services since the last ILACS inspection in July 2022, with further senior management changes planned. Inspectors found no detriment to services as a result of these changes, which appear to have been well managed. This has enabled the authority to continue to build on and sustain the progress made in responding effectively to the needs of children in Luton.

Peers discussed with staff the current education and learning reset which is underpinned by the Luton 2040 vision and from intelligence drawn from the council’s own data and analysis. This work has identified some key themes (academic and learning provision, mental health and wellbeing, special education needs and confidence, ambition and pathways to employment) and priorities which will be subject to further engagement with partners and schools. The council plans to co-create a detailed delivery plan with partners, schools, parents, and young people to drive outcomes forward over the next three years with measured success.

The education reset will require refocused teams and service areas to work differently and to coordinate activity in new ways to ensure there is adequate joint working to fully support children and schools in achieving the planned changes and improvement. This is a positive example of how the council is actively seeking to drive improvement with a strong link to the Luton 2040 vision. 

4.2 Organisational and place leadership

The council benefits from strong, courageous, and stable leadership. There is an effective working partnership between both the Leader and Chief Executive. The Chief Executive and Leader were both praised positively by staff, councillors, and partners for their full commitment to place and organisational leadership.

The diverse group of hard-working councillors positively represent their wards. During an evening walking tour of Bury Park, peers observed several members of the public engaging with a ward councillor also on the tour, demonstrating connectivity with the ward’s constituents. 

Positive examples were shared with peers regarding the Chief Executive’s place-based leadership, which for example includes regular street walks with the Bedfordshire Chief Constable to engage with the community and to identify issues and jointly agreeing who has the accountability, legislative powers and resources to resolve. Peers were also informed of joint attendance to a place of worship to meet with members of the community during a challenging time of community cohesion and tension. Working together and exercising collective leadership in this example led to a positive outcome. 

Peers heard for example how the council has responded positively and at pace during crisis; using the council’s agency to effectively coordinate a partnership response and joint offer to communities following a tragic knife crime incident. 

Senior leaders have an unequivocal understanding of the complex challenges that Luton face from housing, employment, and health inequalities. The council’s leadership and partners understand the complex challenges can only be tackled through a system-wide partnership-based approach. Engagement with communities and partnership working is a core strength.

The council is trail blazing place leadership and along with its partners have together developed a town-wide vision for Luton 2040 – a healthy, fair and sustainable town where everyone can thrive, and no one has to live in poverty. The vision has been coproduced with residents and partners across Luton and is underpinned by their future aspirations of the town and its circa 225,000 residents.

The council has been hugely successful in using its agency to convene partners and is continuing to build momentum by growing the number of partners who are each making pledges and commitments to Luton 2040. Before the peer challenge commenced, peers were invited to a Luton 2040 conference (9th February 2024) titled ‘moving from vision to reality’ involving partners updating conference attendees on the role they play within the community, the commitment they have made and how through their individual leadership they are contributing to Luton 2040 outcomes. Peers were impressed to see around 210 conference attendees, from the community, faith leaders, VCS and larger anchor institutions from both public and private sectors. 

The council has successfully galvanised partners and partnerships will continue to evolve and grow going forward. The council describe Luton 2040 as a journey which will need to adapt and flex around the many social, economic, and political challenges. The council now recognises the importance of providing more leadership and structure to supporting the council and partners with a more detailed plan for how Luton 2040 can be collectively delivered. 

The council are self-aware that Luton 2040 needs to move into the next stage of delivery and peers have recommended the council establish a comprehensive data driven roadmap and delivery plan under the five priority areas of Luton 2040 and to be underpinned by an outcomes framework that clearly charts progress over one, three and five years. Peers were encouraged to understand the council has already undertaken steps towards preparing a roadmap as well as identifying key projects to be delivered by 2025 and 2028. 

Having been very successful in the first phase of delivery for Luton 2040 and nurtured a critical mass of partners, communities and system leaders, peers reinforced the councils view on needing to improve the accountability of partners across the system. Peers understand a performance framework is being developed to track progress against the priority areas along with changes to governance to ensure the programme is adaptable and agile in responding to external drivers of change. 

Peers have recommended that for all system partners to deliver on their high-level commitments, greater structure needs to be provided from the council to partners that help translate their pledges into demonstrable actions over the next one, three and five years and then measure and report on progress, ensuring feedback to the appropriate governance boards. Peers questioned whether pledges could be embedded in statutory delivery plans. Peers also highlighted the requirement to ensure dependencies are being managed across the different work areas to avoid duplication, unintended consequences, whilst ensuring outputs and delivery is joined up and working towards the Luton 2040 target outcomes.

The Executive have a key role to play to ensure Luton 2040 is given strong political leadership internally to the organisation and externally to communities, regionally and nationally. Local Leaders are keen to challenge the negative place narrative and utilise all the strengths the place has to offer from diverse resilient communities, the economic and social benefits of the airport, to Luton Town’s promotion to Premiership football, the prospective new football stadium and start of more town centre regeneration, the visit by His Majesty the King and being selected to host Radio 1’s Big Weekend. This is just a very short list of strengths from a long list of achievements. 

Peers recommend the council communicate these positive outcomes more widely. Take pride in shouting loudly about the great attributes Luton has to offer and is further progressing.  Consider developing the place narrative through engaging the support and voices of other system leaders and statutory partners to create a focus on Luton. 

4.3 Governance and culture

Peers’ engagement with councillors and LBC staff has further evidenced the strong civic pride for Luton. The council benefits from a very positive dynamic Leader and Chief Executive who are passionate about Luton and are driven to eradicate poverty and improve the lives of the community. The relationships between councillors and staff are positive, with respect for each other’s roles. There is cross-party support for Luton 2040. The impact of these factors are high levels of commitment and belief in the vision and strong connection with Luton 2040. 

The goal of a healthy, fair, and sustainable town where everyone can thrive and no one has to live in poverty was understood amongst most people peers met, although more work is now required to help the workforce and partners to determine the specific actions required over one, three and five years to ensure there are clear actions, tracked milestones and all system partners held to account for delivery.

The organisation has a caring culture. When peers asked staff to ‘describe the best thing working for Luton’, responses included – “caring, sense of team, commitment, dedication, solution focused, homely place and invested”. The results of the recent staff survey are generally positive and provide further evidence of the engaged nature of staff. Peers were impressed with the high level of dedication to Luton from both councillors and staff. People feel invested in the vision. Some staff members who have recently joined the council were specifically attracted to the Luton 2040 vision and the opportunity to support the priority areas. 

There is a rich skills base across councillors and staff. Given the complex and challenging nature of Luton 2040 the workforce and councillors are going to have to match this ambitious programme by acquiring new perspectives, learning from others, and developing together to ensure skills and capability continue to evolve and are more closely aligned to the challenges Luton 2040 presents, for example the strategic response to the housing issues faced by the council.

Although there is a huge degree of pride, drive, and ambition for Luton 2040, this could be construed as an over done strength, with the impact resulting in staff feeling there is a need for work to be prioritised and more effectively phased. Peers feel this would facilitate a more considered approach and support more cross-service area working on the more complex policy making and planning work areas. Silo working will likely limit and restrict the quality of outcome if continued and is already recognised by staff as a risk. 

The leadership teams are in early stages of embedding following several recent appointments. Peers strongly recommend senior leaders participate in a joint leadership development programme that explores the required components of leadership and organisational culture to underpin successful delivery of Luton 2040. For example, peers identified a need for the Executive and CLT to meet regularly, to tackle complex issues and decision-making together. 

Silo working was mentioned throughout the peer challenge. With an increased focus on system working, there must be more consideration given to how at the most senior levels, corporate working and cross-service area responses to challenges are embedded and part of the culture. Luton 2040 will require resources and expertise from across service areas to collaborate and work out solutions to complex problems, for example a corporate, cross-service area response to budget savings and transformation. A suggestion was made to peers that the CLT could consider all moving to one shared work space. This would strongly signal joint leadership and role modelling to the workforce, and support more informal cross-organisation corporate discussion. Staff would like to see more visibility of senior leaders; some were unable to name their service area director. 

Working together, utilising partnership relationships and developing joint strategic place-based responses are likely to have more impact on challenging issues like the placement of asylum seekers and legal challenges on selective licencing ensuring there is the strongest voice possible on national issues impacting Luton. 

The council has the opposition councillors chair all scrutiny committees. All Executive functions are subject to scrutiny with the Overview and Scrutiny (OSC) as the overarching committee responsible for four sub-committees – Overview and Scrutiny Board, Finance Review Group, Health and Social Care Review Group and Children Service Review Group. Given the increasingly complex challenges being addressed through Luton 2040, it will be essential to ensure all scrutiny committee members are supported in their continued learning and development of each policy area to ensure the challenge and oversight remains robust and effective. The council should consider if the allocation of a senior officer would further support each chair and ensure the scrutiny forward plan is representative of the council’s risks, further driving the linkage between the council’s risk culture and level of scrutiny.

The council should ensure the governance and oversight arrangements continue to evolve with the Luton 2040 programme and associated risks. This for example could be an area the Executive visit frequently to ensure they are satisfied there is appropriate challenge and scrutiny as the council progresses its policy making and delivery against the five priorities of Luton 2040. 

The council also ensures corporate risks and issues are regularly discussed through a statutory officers meeting held bi-weekly. 

Internal audit was seen as effective, with a direct line of sight to the chief executive and inclusion at CLT. Around 40 reports have been supported in the last 12-months and feedback suggested this is a robust service provision to the council. More recently two new independent people are now part of the audit committee providing further challenge and oversight.

4.4 Financial planning and management

Luton Borough Council Financial Context

The council has been facing and continues to be challenged by severe pressures in its finances. Like many councils LBC is adversely impacted by cost increases, disproportionate and increasing demand for housing and higher volumes of complex demand in both adult social care and children’s services.

Data from the Institute for Fiscal Studies shows that LBC has the second lowest public spending compared to need in the country, with £278 less spending per person than needed. 

The council is raising council tax to the maximum 4.99 per cent for 2024/25 and will continue to provide support for those who are not able to afford council tax. Luton’s B and D council tax is the lowest in Bedfordshire and with a disproportionate number of properties in this category compared to other councils, are able to claim less council tax than most adding to the financial pressure. 

Over the last 12 years the council has taken £170m out of the budget, requiring savings and resource reductions over this period. Workforce headcount numbers in 2010 were 4200 compared to 2700 in 2024. These workforce deductions are during a time population in Luton has increased by 11 per cent to 225,000.

The strain on resources was evident through the many discussions held with peers and staff. The ambitious agenda of Luton 2040, operational demand, deficit recovery plans and the transformation programme will all be competing for resource which will need careful planning and management to ensure anticipated outcomes are delivered, including the agreed benefits realisation programme which will be pivotal to achieving in-year financial targets as part of the overall medium-term budget plan.

The council benefits from Luton Rising, a council owned airport company which directly benefits Luton’s communities. Since 1998, Luton Rising has paid a dividend of £257m to the council, providing income for council services and over a 25-year period has generated £180m of funding to the VCS and community organisations across Luton. This level of funding equates to £0.53 per passenger, which is 26 times more that any UK airport, clearly demonstrating the social impact and direct benefit to communities. Over the period 2012 - 2020 Luton airport was the fastest growing UK airport with 18m passengers a year in 2019. Luton Rising is currently seeking to grow the airport to a maximum capacity of 32m passengers and is pending the outcome of a submitted Development Consent Order

During the pandemic and with air travel significantly impacted, so was the dividend paid to the council, resulting in an emergency budget meeting being called to reset the budget and to cut spending. The council expect to see a dividend paid to the council in 2026/27.

Despite this challenging period, Luton Rising, with the support of the council has continued to maintain a budget for its Community Funding Programme of circa £7.4m, with circa half funding ‘Active Luton’ and ‘The Culture Trust Luton’ whilst also providing funding to circa 50 local charities and VCS organisations. The community investment programme has ensured the many projects that directly improve the lives of local people are maintained, contributing to the vision of Luton 2040. Peers were unable to see any evidence of how the VCS funding has directly impacted the Luton 2040 outcomes, this could be an area to strengthen.

As such a prominent asset and significant source of income, inevitably the airport featured in many conversations held between peers over the four-days of the corporate peer challenge. Given the pandemic’s adverse impact on the airport and associated income to the council, peers were informed that when the dividend starts to be paid again, this will not be used to fund the revenue budget, avoiding any future risks. Income from the airport will be used to fund the council’s capital programme which can more easily be controlled in periods of financial uncertainty. This decision demonstrates the learning the council has undertaken through this difficult period and an approach to mitigate future risk exposure and achieve financial sustainability.

Financial Observations

Despite funding challenges, the council has managed to set a balanced budget year on year without the use of reserves. The council has a high level of usable reserves compared to other unitary councils. 

In 2022/23 the council overspent by £10.7m. To respond to the overspend, the council agreed to a deficit recovery programme (DRP) process to recover £10.7m over years 2023/24 and 2024/25. Through conversations between peers and senior leaders, the council is unlikely to achieve the 2023/24 target of £4.1m, providing more challenge and financial recovery to be achieved in subsequent years and through the transformation programme.

The 2023/24 budget quarter three report details a forecasted overspend of £12m which peers heard will be met by planned provisioned contingency, and future transformation savings. This puts more emphasis on fast-tracking the transformation discovery phase to ensure there are business cases developed that contain detail on the anticipated savings that can be robustly reviewed by the financial director and transformation board. At present given the transformation programme is in an early ‘discovery’ phase, the view from the finance director is there is not enough detail available yet to provide financial assurance the selected first phase of transformation projects will deliver the required level of financial savings. 

To set and deliver a balanced budget, peers were informed that the council intends to use a range of measures; for example, renegotiating contracts to reduce the impact of inflation, service areas will be supported to develop the detail on how DRP’s will be delivered for 2024/25 and working up the necessary detail, business cases and benefits realisation for transformation projects for delivery starting in 2024/25. Pace is required in resourcing the transformation programmes to ensure the delivery of savings is in line with anticipated delivery timescales. Failure to deliver savings in time will lead to overspending and the requirement for further deficit recovery which is not sustainable and provide potential risk to general fund reserves. 

The council has agreed an investment of £0.9m for 2024/25 to fund transformation activity and a total of circa £4m for a three-year transformation programme to achieve a target of £15m - £16m of savings. The council has engaged external specialist support at a cost of circa £3m to manage the programme.

In the quarter two budget monitoring report, adult social care was showing a budget underspend of circa £0.4m. In the most recent quarter three budget monitoring report the same service area is forecasting an overspend of circa £1.8m. Peers explored the basis for the quarter-to-quarter change to learn this may be indicative of a structural budget issue. This also highlights the need for more accountability for budget planning at service director level to better understand service requirements for any budget growth fully in the context of operational delivery and wider transformation. 

Peers were keen to hear how a new financial resilience meeting chaired by the chief executive has been designed to engage the CLT with increased accountability for overall budget performance, DRP delivery and leadership for allocated transformation projects currently being scoped. This approach will contribute towards an improved corporate focus on financial performance. This is a welcomed recent development by peers.

The 2024/25 budget requires savings of £5.3m from the DRP and the use of a one-off collection fund surplus of £4.6m is being used to balance the budget. To ensure the DRP and transformation plans are robust, these will be subject to a value for money and financial resilience audit which will be conducted by external audit in April this year; this process will offer assurance independently of the council. This is a good use of external challenge and contributes to the council’s internal controls and assurance. 

There is a high level of respect across the council at both political and officer leadership level for the finance director for their skills and experience and the finance team who are in the process of learning and on a journey with their business partner model. There is a strong working relationship between the finance portfolio holder and the finance director with a well-developed understanding of the financial risks and performance of the council. There is recognition the financial performance of the council needs to increase beyond the portfolio holder more widely with the executive. 

Peers strongly recommend the finance director (s.151) has a seat at CLT to strengthen the importance and influence of financial strategy and performance at the most senior level and work towards more corporate ownership. 

Following a Department for Levelling Up, Housing and Communities finance review by CIPFA in December 2021, the report identified the need for more business partnering support and noted the finance function is stretched. Peers recommend the finance function further develops the skills of the team with the aim of developing more capability and to actively work towards devolving more financial management and sharing of the financial responsibility across the council. 

The council commissioned a review facilitated by the LGA before the corporate peer challenge and shared this openly with peers. The review examined how Luton compared against a mature, well organised accountable and empowered council. The outcomes of this work have been further triangulated by peers confirming that there is a need to move away from an over-reliance of the finance team and finance director to develop more corporate and service level ownership of the budget. 

A skilled, knowledgeable, and technically competent finance team is essential, but good financial management cannot be achieved by the finance function alone. The finance team should focus on supporting and advising service directors and operational managers on financial issues, whilst the operational managers remain accountable for the financial performance of their own service area. Ownership of the budget needs to be corporately and collectively owned with accountability clearly defined. 

Peers strongly recommend the development of an organisational culture where individual and collective responsibilities for the stewardship and use of resources and financial accountability to external stakeholders are taken seriously and financial skills are valued and developed. The development of the organisation’s strategic and corporate plan requirements needs to be informed by a detailed understanding and appreciation of the financial implications by senior service managers and the finance business partners. 

This position is recognised by the finance director who has advised that a cross council budget holders’ workshop is being commissioned from CIPFA to address this. Peers recommend the workshop is followed up with a series of training programmes whereby managers can develop their financial management skills. 

Peers highlighted during their final day presentation that the finance director needs further support and current arrangements provide a risk as a single point of failure, given the finance director has a demanding and wide-ranging portfolio (e.g., two-days per week focused on Luton Rising, review and delivery of transformation plans, review and monitoring of DRP’s). 

The impact would be strengthened resilience, succession and providing increased capacity for strategic finance work, and building the skills and capability of the team and organisation. Working together with CLT on these issues will support building an organisational culture where accountability for financial ownership can be devolved in a controlled way from the finance function to service directors and operational management. 

4.5 Capacity for improvement

The council has developed a ‘People Strategy’ covering delivery from 2023 – 2026 and sets out how the approach to recruitment, development and how the workforce will be supported to deliver the key priorities and Luton 2040 ambitions.

Peers heard there is a clear drive to ensure the workforce reflects the council’s diverse community to better understand needs which is positive. The council as a Luton 2040 anchor organisation needs to lead the way on fulfilling equality duties and promoting equity, recruiting, and developing diverse talent locally and demonstrating best practice on fairness, diversity, and inclusion to all Luton 2040 partners and the community.

To evidence the current positive impacts of recruitment practices, peers were informed that around half of new recruits are from Luton and the surrounding areas, and how outreach within the community, as well as attending job fairs and selling the opportunities has provided a broader and diverse pool of applicants more representative of the local community. Around 70 per cent of all LBC staff are from Luton and the surrounding areas. It is therefore no surprise that the staff behaviour and attitudes mirror the resilience and values of the community because they are themselves the community. There is huge civic pride for Luton. Councillors and staff are fully invested in Luton 2040 and are dedicated and committed to delivering the vision and outcomes.

Peers met with a range of staff groups, it was evident the organisation is stretched, and capacity is an issue. Staff are working long hours and in their own words describe the scenario as not sustainable. The capacity issue is manifested in different ways from staff sharing they feel stressed, overworked, whilst others are seeking some reflective time to inform a more considered strategic response, opposed to a quicker, more reactive less considered response which may not lead to the best outcome.

Staff are suggesting in some cases more capacity is required and an urgent need for prioritisation. Consideration to phasing some work and not trying to do too much at once and feeling like staff can complete some work before moving onto the next project was also suggested. Sometimes operating at pace is necessary and encouraged, although peers heard from staff that fast paced, often reactive working can be a driver for silo working. Silo working will adversely impact Luton 2040 given priorities will cut across the organisation and require joined up working e.g., housing. Some councillors recognise the pressure and demands on staff and are concerned for the welfare and sustainability of the workforce.

Establishing a comprehensive data driven roadmap and delivery plan under the five priority areas of Luton 2040 would provide service areas and the workforce with more structure. Ensuring the roadmap is underpinned with an outcomes framework that charts progress over one, three, and five years will support planning and prioritisation of capacity and resource allocation.

The council is implementing a PMO (Project Management Office) to provide structure and a framework for projects. Peers were informed how this will be driven by the council, whilst learning and acquiring knowledge from the council’s external transformation partner (Human Engine). There is a strong desire to ensure the skills and capabilities built through the PMO remain in the council providing ongoing capability beyond the initial three-year transformation programme. The PMO will need to work seamlessly with the transformation board to determine the capacity and resourcing requirements of projects. Peers strongly recommend rapidly increasing the capacity to deliver the DRP and transformation programme to help assure financial sustainability over the medium term. It was positive to hear the council’s learning and development team are providing project management training internally, supporting staff with skills development they can apply in the context of their Luton 2040 work.

Capacity is also impacted through the council experiencing difficulty in recruiting to several jobs, for example social workers, housing officers, finance roles which is similar to national trends experienced by many councils. Peers were informed of a recent investment in the council’s recruitment team with the implementation of a talent acquisition and marketing role which was described as already paying dividends through actively promoting diversity in all work practices and ensuring how the council represents itself externally is fair and inclusive. This was seen as notable good practice.

Recruitment processes have been improved through the implementation of ‘Talent Link’ a workflow system which went live in January 2024. So far, the feedback is reported to be positive with 50 managers trained. Given the capacity issues and how stretched staff are feeling, improvement in streamlining recruitment processes including support for onboarding new staff is a positive outcome. Peers heard how the council is experimenting with inclusive recruitment and involving a new equality, diversity, and inclusion officer at advert stage. Blind recruitment is also being considered to reduce any potential bias during the recruitment process. This evidences the council’s willingness to try new approaches and positively impact more inclusive processes.

Pay was referenced as a big challenge for recruitment and retention, with overuse and reliance on market supplements. Peers were pleased to hear a paper is in early draft highlighting the need for a strategic approach to pay and grades, potentially providing an improved impact on resourcing and agency costs.

The council needs to prioritise strategic activity to address the council’s capacity issues across the council. Peers recommend progressing the implementation of the ‘People Strategy’ at pace, ensuring incisive focus on this as well as delivery on capability, culture and equality, diversity, and inclusion. The requirement for this recommendation was further evidenced by peers being informed that around 33 per cent of the workforce will be near retirement age in five years’ time, highlighting the need for effective workforce planning, recruitment, retention, and a programme of development to mitigate against this future loss of skills and experience. Peers understand workforce plans are being developed in both adults and children’s services. Both workforce plans should be driven with pace given both service areas are statutory and critical to the achievement of Luton 2040.

Peers recommend that the ‘People Strategy Board’ closely monitors these risks and ensure plans are developed to mitigate these workforce risks. The risks should be fully monitored and regularly discussed to ensure progress is being made. Peers would expect to see evidence of progress when they return in January 2025.

Peers reflected back to the council there is an urgent need to deliver your strategic framework as there are too many strategies. Remedial action is necessary to prioritise strategic policies that make a difference. Rationalising the number of strategies should support greater efficiency and free up capacity through the requirement for potentially less governance boards, duplicated reporting and updating of strategies.

Peers discussed the importance of a corporate approach to housing and temporary accommodation as one of the council’s key financial risks and its keystone role in underpinning the Luton 2040 vision. Peers were informed of a full review of housing which started in January 2024 and is being conducted by Human Engine. This will look from homelessness to temporary accommodation, however, will not include tenant management. The council recognise there is not enough early prevention work and resources need to be better targeted, potentially resulting in some changes to roles and accountability. When the peer team return in January 2025 to facilitate a corporate peer challenge progress review, they were told they can expect to see less households in bed and breakfast, hotels, and emergency accommodation, see less demand and see shorter stays in temporary accommodation.

5. Next steps

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It is recognised that senior political and managerial leadership will want to consider, discuss and reflect on these findings.

Both the peer team and LGA are keen to build on the relationships formed through the peer challenge. The CPC process includes a progress review within twelve months of the CPC, which provides space for the council’s senior leadership to update peers on its progress against the recommendations from this report.

In the meantime, Rachel Litherland, Principal Adviser for the East of England Region, is the main contact between your authority and the Local Government Association. Rachel is available to discuss any further support the council requires.[email protected], 07795 076834.