Eastleigh Borough Council – Progress Review

The council undertook an LGA Corporate Peer Challenge (CPC) during 17-19 October 2023 and promptly published the full report with an action plan. 

The Progress Review is an integral part of the CPC process.  Taking place approximately ten months after the CPC, it is designed to provide space for the council’s senior leadership to:

• receive feedback from peers on the early progress made by the council against the CPC recommendations and the council’s RAG rated CPC action plan;
• consider peer’s reflections on any new opportunities or challenges that may have arisen since the peer team were ‘on-site’ including any further support needs; and
• discuss any early impact or learning from the progress made to date. 

The LGA would like to thank Eastleigh Borough Council for their commitment to sector led improvement. This Progress Review was the next step in an ongoing, open and close relationship that the council has with LGA sector support.

The Progress Review at Eastleigh Borough Council took place (onsite) on 1 October 2024.

It focussed on each of the recommendations from the Corporate Peer Challenge, under the following theme headings: 

• Local priorities and outcomes
• Organisational and place leadership
• Governance and culture
• Financial planning and management
• Capacity for improvement
• One Horton Health housing development

For this Progress Review, the following members of the original CPC team were involved: 

• Cllr Gareth Roberts, Leader, London Borough of Richmond upon Thames
• Caroline Green, Chief Executive, Oxford City Council 
• Anne Brinkhoff, Peer Challenge Manager, LGA Associate.

The team was also joined by Andrew Hardingham, LGA Associate (Finance). 

Peers met with over 20 officers and members over the course of one day.

The peer team were delighted be on site at Eastleigh Borough Council and recognise good progress with implementing the recommendations in what has been a challenging year for the council. The council has engaged openly and positively with the significant external challenge over the last 12 months whilst continuing to deliver on important priorities. We experienced an air of greater confidence about the council’s flagship project, One Horton Heath and the staff we spoke with told us that the council feels more settled and with strong direction and leadership. The council leadership was not complacent about the challenges in delivering a project of this scale of ambition and recognised the importance of on-going scrutiny and transparency. The council should take assurance from external scrutiny, which reflected positively on the council’s delivery, and taking forward some of the suggestions and ideas to further strengthen governance and accountability. It will have provided you a sharp focus on planning, scrutiny and governance which will remain important in mastering future challenges. 

Out of the CPC’s 12 recommendations, the council’s RAG rated action plan reports that nine recommendations (75 per cent) are completed or being implemented (green) and three recommendations (25 per cent) have next steps scheduled. Two of these are awaiting outcomes of external governance reviews.

Recommendation 1 - Ensure a golden thread from corporate plan to directorate plans supported by aligned risk registers, KPIs and internal audit programme

Directorate Development Plans (DDPs) have been developed and went ‘live’ from April 2024. They outline all service objectives across the council, identify how they link to the corporate plan and align with the corporate performance Indicators as well as risks. They also highlight interdependencies between services and help managers to plan for these. DDPs inform service reviews and prioritisation by the corporate leadership board to ensure that council resources are focused in the right areas. This process started in August 2024, and we understand that an on-going process will now be developed. 

It will be important that the DDPs are embedded and actively used so that they don’t become documents that sit on a shelf. The outcome of DDPs could be reflected stronger in the MTFP to provide the narrative of service changes and explain how and why budgets are re-prioritised or moved. 

Recommendation 2 - Appoint independent challenge, particularly for Audit & Resources and One Horton Heath

In November 2023, council agreed to appoint two independent co-opted members onto the Audit and Resources committee. The council has revised its constitution in the light of this decision and has successfully recruited to the two posts which bring a fresh perspective and a new dynamic to the committee. Following the local elections, the membership of the committee has been revised and now includes a mix of new and experienced members who have received training on their roles and responsibilities and how to provide effective challenge. The committee now has more meetings face to face and reports have been changed to ask for ‘consideration and comment’ as opposed to ‘noting’ findings. This has resulted in better debate and more effective engagement, for example of the annual governance statement and the Audit Plan. The audit programme is evolving and now includes more substantial items. Recognising the need for more specialist audit skills, Internal Audit has seen investment of £55k pa to obtain specialist advice from South West audit partnership as and when required.

The council is in the process of reviewing the findings from the Centre for Public Scrutiny (CfPS) report which will provide ideas on developing the effectiveness of the audit and resources committee further. The peer team consider it to be good practice to separate the distinctive functions of audit (ensuring that governance, risk and financial management is effective) and scrutiny (reviewing policy, its formulation and implementation).

Recommendation 3 - To address the significant budget gap, actively plan for and explain that some areas of the council will require further investment whilst others may have less resource.

The council has identified its budget gap for 2025/26 and could be more specific about the precise number to manage expectations and ensure there is a clear focus. The council recognised that there is further work to do to deal with the budget gap in future years of the MTFP. There is a process of service prioritisation (being informed through DDPs) by CLB, and regular sessions between CLB and the Leader and Deputy Leader have started in June 2024. We heard about some proposals for service savings which are being consulted upon. The council benefits from strong reserves (specifically held in relation to their assets; the maintenance and financing) and the recent reductions in interest rates will impact positively on the council’s borrowing costs.  The council will need to proactively manage potential future commercial voids to ensure the budget is not adversely impacted.

Budget monitoring is established to ensure that savings targets are being achieved. 

Crystallising the savings plans by clearly and explicitly presenting savings targets and current savings proposals will help to ensure a culture of financial awareness and astuteness that will serve the council well in the years to come. 

Recommendation 4 - Deliver the People Strategy so that your workforce is skilled, motivated and can see clear career pathways.

The council’s three-year People Strategy was launched in April 2023 and includes measures and actions around the themes of Recruit, Reward and Retain. It is supported by a three-year action plan and the council is making steady progress in implementing the plan. It has confirmed a new pay progression scheme has been confirmed which provides a fair and transparent way for staff to reach the top of their bands. Service directors carried out a benchmarking exercise in early 2024 to identify posts where pay was significantly below the market, and actions were taken to assess posts and address any discrepancies. This was an important concern for staff during our on-site visit in October 2023. We heard about a comprehensive training and learning offer and good use of apprenticeships to develop existing staff. The council has run a staff survey in early summer. It achieved a response rate of 51 per cent which has provided rich data, insights and segmentation about staff engagement. The leadership team’s view was that the response rate reflects that approximately 50 per cent of the workforce are frontline non-desk based staff and therefore unlikely to fill in an on line survey.  Efforts were made to capture their views through hard copies of the survey.  Presumably the council will have the data to check the response rates from different services and be able to verify this. The council could consider how best to formally capture the views of those staff to supplement the survey and inform actions. Going forward it ought to consider how to engage with frontline staff to boost staff survey returns. 

CLB members are actively engaged in running open dialogue with staff on the key themes, including leadership visibility, pay & benefits and career progression. This shows a real commitment to using the findings to make changes and improvements in employment practice and culture. This was recognised by the senior managers we spoke with who feel they have a lot to contribute and would like to be involved. The council is developing a detailed action plan and it will be important for this to be clear and a basis for reporting back (‘you said – we did’) so you demonstrate accountability and communicate this to the organisation as a whole. 

Whilst action plans are an important part of delivering change – it will also be  important to recognise (and communicate) that all staff have a stake and can make a contribution to making the council an even better place to work. There are many actions that teams or individuals will and are able to progress that foster relationships, learning, communication and these can happen outside of formal action plans - and can help signal a shift in culture.

Recommendation 5 - Develop a mechanism for evidence-based understanding of residents’ needs to inform choices about service re-design and reallocation of staff resources.

The wealth of data in the council’s possession relating to service use and service delivery has been positively complemented by the findings of the recent residents’ survey which means the council now has a clearer understanding of not just how residents interact with the council, but also about how they feel about the council. Staff have identified that residents engage more in the digital sphere in matters relating to finance, but still prefer to engage through traditional methods in matters such as waste management. 

While continuing with the drive to promote closer digital interaction with residents across all directorates, it should be kept in mind that some residents, from across the demographic spectrum, will still prefer to interact via traditional channels and this needs to be recognised in any digital transformation plan.

Recommendation 6 – Modernise systems and processes to reduce the amount of processed work and improve resilience and efficiency.

Data and insights from the Customer Service Survey have been used to agree that the focus for improvements to processes and efficiencies will be in the Neighbourhoods and Greenspaces Directorate with a large number of transactional contacts. A programme of workshops has been planned with the first being held in September 2024. The methodology includes process mapping, followed by a critical review of value/failure steps in order to make practical changes. Workshops are supported from within the directorate, drawing on IT, Comms and other back-office functions as necessary. 

This will be an on-going process of change and the council needs to assure itself that is has the right capacity and capability to work through a programme of service changes. 

Recommendation 7 - review and update the IT strategy to ensure it supports the organisation to modernise and change.

The council has developed an IT vision to guide its IT strategy and delivery plan. The vision complements the council’s Data & Performance; and Customer Access vision and seeks to:

• Provide reliable and fit for purpose technology to provide quality services to customers, staff and councillors;
• Enable a modern, customer focused council that adapts and operates in an evolving digital workspace; and
• Promote an adaptable environment maximising technology and opportunities to best deliver the corporate plan.

It further sets out a set of principles, aims and objectives and an ‘elements framework’ or a practice ‘gateway process’ for any future business cases requiring investment. An IT Implementation Group is being implemented to develop, implement and manage the IT strategy. Overall accountability rests with the Service Director for Finance, Improvement and Housing.

Recommendation 8 - Consider the need for a strategic planning committee for borough and regional wide matters.

The introduction of a joint area committee to consider any planning issues that are of Borough-wide significance, was approved at council meeting on the 27 November 2023. membership of the committee has been agreed and it met for the first time in July 2024. 

Recommendation 9 - Put in place a robust governance framework for your companies and Joint Ventures in accordance with latest governance guidance.

Following the Best Value Notice of December 2023, the council commissioned two additional governance reviews, focusing on whether the:

• council has effective and efficient internal decision-making and scrutiny processes in place, particularly with regard to financial and treasury decisions (Centre for Public Scrutiny working with Local Partnerships)
• delivery of ‘business as usual’ services is being affected by the council’s focus on housing development, particularly the One Horton Health project.

Both reports have now been received and were presented to council for comment in August and September 2024 respectively. 

The council will now want to consider the recommendations and put together a robust governance framework for its companies and Joint Ventures. It will be important that this is clearly documented and presented in a way that it is easily understood, and clearly sets out the role of officers and members in relation to its governance. There are positive messages in the reviews which should be communicated both to assure staff and partners and also to emphasise the importance of on-going attention to governance and scrutiny.

Recommendation 10 - For the One Horton Heath development, establish a senior officer board, chaired by the Corporate Director, with independent advice, making recommendations to the joint officer / member board. Both boards need clear terms of reference to separate out operational decision making from policy and strategic direction. 

The implementation of this recommendation links to R9 above and also reflects changes in the senior management team, with one of the corporate directors having left the council.

The council has established a development strategy board, which includes the CEO (who chairs the board), the Deputy CEO, a Corporate Director, the Leader and Deputy Leader. This board has started meeting and is focusing on policy and strategic direction and provides one half of the governance arrangements required to balance the strategic from the operational delivery. 

It is early days as the board has only met once, but has made a good start and this signals a clear intent of separating strategy from delivery. The next steps will be to develop the detail (including terms of reference) of how this governance will work in practice. 

Recommendation 11 - For each phase of the One Horton Heath development, understand the split of tenure and funding streams to ensure that each phase is financially viable.

As to be expected, much work has happened on the One Horton Health development over the last 12 months. This included updates on the mix of properties on the development site and the appointment of the lead contractor to deliver the first 381 homes on the site. New financial modelling is in place, supported by a new role in finance with specialist skills. A new Head of Housing provides additional skills and capacity which help to shape decisions on One Horton Heath. We heard from the Head of Housing that she feels able to influence and make recommendations. Building its council-owned housing stock and working towards establishing a housing revenue account, brings the advantage of being able to design services to meet the requirements of the Social Housing Regulator on housing standards and tenant’s engagement. This will require upfront investment from the council in staff and resources as it will be sometime before the HRA rents cover these costs.  The council is taking a long-term view and planning to develop and train staff to take on these functions. 

The peer team noted a marked increase in confidence, reporting and positioning of the council’s flagship programme. Our short visit has given us a sense that this flagship project is quickly becoming a ‘mainstream’. The frequency and depth of reporting (at all levels) has deliberately broadened the sense ownership and engagement across the senior team which is helping to break down the ‘trepidation’ of the enormity of the project into achievable deliverables. The council was clear that this did not mean they were complacent about the challenges in delivering the project.

Recommendation 12 - Be confident in the vision and capabilities of Eastleigh Borough Council and recognise the strength of your ambition and resilience of financial position to deliver that ambition, whilst clearly understanding the risks and emerging challenges to the organisation and the imperative drive to deliver further savings and efficiencies.

On returning to Eastleigh the peer team has a strong sense of a confident council.  The open and constructive engagement with external scrutiny in what will have been an extremely challenging 12 months highlights maturity, confidence and pride. The Solace report in particular highlights your track record of good service delivery, a strong performance management framework and strengthened capacity to manage risks and new areas of delivery, providing overall good assurance in your ability to meet your Best Value Duty.  

The LGA would like to thank Eastleigh Borough Council for undertaking an LGA CPC Progress Review. 

We appreciate that senior managerial and political leadership will want to reflect on these findings and suggestions in order to determine how the organisation wishes to take things forward.

Under the umbrella of LGA sector-led improvement, there is an on-going offer of support to councils. The LGA is well placed to provide additional support, advice and guidance on a number of the areas identified for development and improvement and we would be happy to discuss this. 

Will Brooks (Principal Adviser) is the main point of contact between the authority and the Local Government Association (LGA) and their e-mail address is [email protected]