Best Value statutory guidance consultation

Please find on the following pages the response of the Local Government Association to the government’s consultation on draft statutory guidance for local authorities on the Best Value Duty.

We are grateful to have had the opportunity to comment on an earlier draft and to see that some of the comments made at that time have been incorporated in this revised draft.

Councils are integral to addressing core issues for their residents – such as growing the economy, improving our health and care services and building more houses.  It is only at local level – with local knowledge and leadership – that services are effectively delivered.

Councils and the LGA are committed to continuous improvement.  While councils hold this responsibility, we welcome anything which will provide support and add value to that work, and it is right that government is clear about its expectations of local government, as long as those expectations are realistic.  It is essential that a transparent, consistent, timely and proportionate approach is taken in the small number of cases where a council is at risk of not meeting its Best Value duty.

Councils are large, very complex systems which have different priorities, and it will never be possible to draw sound conclusions about their performance through a focus on quantitative metrics or taking a tick-box approach.  It is rare that a set of indicators will all point in the same direction, and interpretation, informed by understanding of the sector will always be required.  The guidance rightly states that there is no single version of ‘good’.

When and if a significant number of issues of concern arise in relation to a council, it will always be essential to enter into dialogue – with no preconceptions - with that council’s leadership (political and managerial) to understand the local context and risk, level of self-awareness and ownership of the challenge and current direction of travel before proceeding with any form of intervention.  This is something that the LGA, as part of our sector-led improvement programme, can facilitate.

The principle of prevention, proposed in this guidance, is an important one.  The guidance should make it clear that the aim is for all councils to be performing well and seeking to improve and that it is in everyone’s interest that support is provided to achieve this aim.  Government intervention should be a last resort: it is costly and should be avoided wherever possible. 

Sector-led improvement, again led by the LGA, is the most effective route to ensuring good performance for the vast majority, both by assisting councils to demonstrate their openness to external challenge and develop their self awareness, and by providing improvement support before issues escalate and become embedded.  The LGA’s work to develop the Model Councillor Code of Conduct in consultation with the sector is another example of the sector taking the lead.

It is also important that government, with the sector, takes a holistic view of the entire system, including consideration of wider factors, in councils.  In some cases, failures have happened despite extensive control systems and it is important that the effectiveness of this wider framework is kept under review.  We believe that our work to map the improvement and assurance framework for local government offers potential to build greater understanding of the many checks and balances in the system at present, and to consider how these can be clarified and enhanced.  We look forward to continuing to discuss this work with you.

There are a couple of elements of the draft guidance for which there is no opportunity to give comments in the survey: for the sake of clarity and completeness please find our comments on these below:

• Paragraph 4 of the introduction references improvement support for specific service areas such as social care, public health, planning and transport.  We are not aware of any such support in relation to transport.
• Section 2: Office for Local Government.  We support any work to increase the transparency of information about the performance and health of the local government sector.  At present, we believe that Oflog’s published metrics do not add value to what is already available in LG Inform (which in some cases includes data more current than that used by Oflog).

We look forward to meaningful engagement with Oflog and the opportunity, which has been promised, to co-produce further metrics and the work programme.  This will enable any concerns about proposed metrics to be ironed out before publication.  I have written separately to Lord Morse with some specific examples on this point as well as asking for further information about how Oflog’s proposal to have conversations with councils and use peers and experts sits alongside our sector led peer challenge programme and the oversight of the sector which we currently have.

Yours faithfully

Cllr Abi Brown

Chair, Improvement and Innovation Board, Local Government Association

Q1 What is your name?

This response is from the Local Government Association.

Q2 What is your organisation?

The Local Government Association.

Q3 Are you answering the consultation as

• An individual with personal interest
• An individual as a member of an organisation
• An Upper Tier local authority
• A Lower Tier local authority
• Other – please specify

Other.  This response is on behalf of the Local Government Association (LGA), which is the national voice of local government.  We are a politically led, cross party organisation, representing councils from England and Wales.  Our role is to support, promote and improve local government, and to raise national awareness of the work of councils.  Our ultimate ambition is to support councils to deliver local solutions to national problems.

Q4  From the list below, where are you or your organisation based?

• London
• South East
• North West
• East of England
• West Midlands
• South West
• Yorkshire and the Humber
• East Midlands
• North East
• National

National.

Q5  Do you agree that the principles in section 4 should apply to all best value authorities?

1. Yes
2. No
3. Comments

We agree that it is helpful and necessary to have greater clarity and transparency about the standards expected by Government and the pathway to intervention by the Department. We believe that all best value authorities will benefit from this clarity, provided through this document as a whole.

Councils take their responsibilities seriously and have worked hard to maintain service delivery and ensure that their organisations are sustainable, resilient and continuously improve.  However it is important to recognise that government is issuing this guidance in the context of failure and intervention in a small number of cases and that councils have been relatively underfunded over a long period. It is not surprising that some have managed this better than others.  

Our views on the principles are set out in our answer to question 7.

Q6  This statutory guidance has been developed principally for local councils, including combined authorities. However, all best value authorities should be mindful of the principles set out in this document. Would further published guidance be welcome for other best value authorities to set out the application of best value duty given their specific responsibilities, structures and context? These include national park, fire, rescue, waste disposal, integrated and sub-national transport authorities, the London Fire Commissioner and Transport for London.

1. Yes [Please specify which type of authority and why]
2. No
3. Comments

The LGA’s core membership includes district, county, metropolitan and unitary authorities and this response is submitted on behalf of the LGA as national voice for local government.

While the LGA has an Associates scheme for organisations whose purpose is aligned with our own, including fire and rescue authorities and national park authorities, the LGA has not had an opportunity to discuss a response with these bodies given the short period for this consultation.

LGA member authorities are covered by this guidance. We have no view as to whether expanding its coverage to other best value authorities is desirable or requires separate guidance. 

Q7  Do you agree with the seven principles proposed in section 4?

1. Yes
2. No [Please provide reasoning or suggestions below]
3. Comments

Local accountability

We welcome the acknowledgement that accountability should be primarily to local residents and businesses and that, as far as possible, Government will look to local checks and balances in the system to mitigate risks of failure.

We also welcome the statement that statutory intervention will only be used when there are significant and extensive indications of failure and authorities are not delivering to the high standards which their local communities have a right to expect.  The vast majority of councils are well-run and significant and extensive failure is rare: it is right that a proportionate approach is taken.

Continuous improvement

We agree that continuous improvement is a key principle related to the Best Value duty.  Continuous improvement is at the heart of the sector led improvement approach that the LGA supports on behalf of the sector.  It is also an objective that is becoming harder for councils to deliver as resources reduce in real terms and government standards need to recognise this.  It is important that expectations of clear documentation of steps to remedy persistent mistakes/ poor performance are proportionate. 

Consistent with the principle of continuous improvement, it is also right to keep the effectiveness of all parts of the system under review.  The LGA is at present leading work to clearly set out what those local – and regional and national - checks and balances in the system are, and to consider whether there is any room for improvement in how any elements of that system work, or how they work together. 

Openness to challenge and support

We welcome this principle, which includes regular peer challenges and participation in improvement initiatives, and the importance of collective responsibility for the sector’s improvement.  In relation to our corporate peer challenges, we have already taken steps to increase the strength of the challenge provided and the focus on follow-up action and will continue to consider ways we can strengthen this much-valued source or improvement support.

We know from our extensive work to provide improvement support to the sector that councils which are open to external challenge are more likely to make progress in addressing the areas for improvement.  This is underpinned by a general expectation relating to transparency to the wider public.  The reference to transparency in Annual Governance Statements about plans for improvement is consistent with comments we have heard in our work on the improvement and assurance framework.

Expectations

It is right that Government is clear about its expectations of local government, as long as those expectations are both transparent and realistic. While councils are rightly expected to take steps to plan and manage their budgets effectively and manage demand as part of continuous improvement, Government should consider the impact of pressures on council finances and the cumulative impact of actions across Whitehall on councils’ capacity and capability: measurement of performance without consideration of cost or other resource implications is meaningless.

Prevention

The principle of prevention is an important one: sector-led improvement is a key and proven route to support councils to address challenges at an early stage, before they escalate. We note that when government does intervene, things have a tendency to get worse before they get better. There may be many reasons for this but they all point to that fact that intervention is something to be avoided. A robust system of challenge and support through sector led improvement has an important role to play in this.

By enabling and promoting the value of engaging with sector-led improvement to councils, Government can ensure that the number of times that it needs to engage with authorities showing signs of not complying with the Best Value duty are very few.  It would be helpful if paragraph 21 could be re-ordered to reflect the fact that, in the vast majority of cases, sector-led improvement will precede engagement by Government.

Meeting the cost of failure

Government’s position on not introducing a ‘financial motive to fail’ is understood. However, the government tends to overstate this issue: in discussions with councils, no Chief Executive or Leader has ever expressed to us the view that financially it might be better for them to fail and no-one has ever set out to fail deliberately. However, there must be recognition of the impact of the loss of funding in the last decade, inflationary and demand pressures on council budgets.  Our position on these is set out in ‘A new approach to funding and resources’ in Make It Local, published in July 2023. It is conceivable that, in future, indicators of failure may arise in financially challenged councils where there is consistent compliance with good governance practice.

Default commissioner powers and de-escalation

We strongly endorse the principle of ensuring a clear exit strategy is in place at the earliest opportunity.

This section focuses on commissioner powers: however, Best Value legislation and this guidance relate to all forms of intervention including actions short of the introduction of commissioners.  The need for a clear exit strategy should therefore apply for all forms of intervention from the outset.

Q8  Do you agree with the seven best value themes? (Diagram 1, Section 5)?

1. Yes
2. No [Please provide reasoning or suggestions below]
3. Comments

We agree that all of the seven themes identified are relevant to an authority that meets and delivers best value.  We also agree that strong governance, culture and leadership underpin the other themes.  Effective use of resources is also a consistent feature of authorities which deliver best value.  Every corporate peer challenge which we deliver considers the following key themes: 

• Local priorities and outcomes
• Organisational and place leadership
• Governance and culture
• Financial planning and management
• Capacity for improvement

We believe that these are the key building blocks for a good council.

There is however a wide variance in the range of issues which are relevant to the best value duty under each proposed heading in this draft guidance. 

The many descriptions of ‘indicators of potential failure’, some of which are very specific, could more accurately be termed poor practices.  Some of these - such as failures of risk management or budgeting - might be sufficient on their own to lead to failure, but others in our view would never lead to failure unless associated with other poor practices.  Because the guidance does not make this clear, this limits the usefulness of the document to councils.  It would be more accurate to state that a significant accumulation of poor practices is an indication of potential failure.  However, counting the number of indicators alone cannot lead to a judgement of failure.  Greater reassurance is required throughout section 5 that a proportionate and consistent approach will be taken (see also our response to Q18, below).

Our comments on each theme appear in response to the questions below.

Q9  Do you agree with the suggested key characteristics of a well-run authority and key indicators of failure in relation to continuous improvement? (Table 1, Section 5)?

1. Yes
2. No [Please provide reasoning or suggestions below]
3. Comments

We welcome the clear statement that a well-functioning authority arranges a corporate or finance peer challenge at least once every five years, acts promptly on any recommendations given and publishes the report of that review and progress updates.  We also welcome the wording about collective responsibility and supporting other authorities to improve.

While all authorities should have measures to ensure they are continuously improving and innovating (within the context of appropriate risk management), it will not always be appropriate or necessary for authorities to have a transformation function or programme or separate improvement plans. 

The Annual Governance Statement may be a tool to inform improvement but is not in itself an improvement document.

Q10  Do you agree with the suggested key characteristics of a well-run authority and key indicators of failure in relation to leadership? (Table 2, Section 5)?

1. Yes
2. No [Please provide reasoning or suggestions below]
3. Comments

We welcome the focus on the role of both political and managerial leadership in the achievement of best value.

‘Members and officers, particularly those with statutory responsibility, including the Section 151 and Monitoring Officers, uphold their duties and speak truth to power’: the Head of Paid Service should also be referenced here.  Speaking truth to power is achieved through effective provision of advice to members, enabled by constructive working relationships between members and officers. 

While understanding of public sector standards, the Nolan Principles and appropriate behaviour are important, evidence of a lack of compliance with those standards and principles would also be a potential indicator of failure (this item also reads across to the Governance theme).

‘Officers with statutory responsibilities… report directly to the Chief Executive’: by our calculation there are currently over 15 officers with statutory responsibilities and clearly it would not be appropriate for all of these to report directly to the Chief Executive.  It is for the Head of Paid Service, and not for Government, to decide how the council’s workforce will be structured: it is more appropriate for this guidance to focus on the required outcome, that statutory officers are engaged and have the opportunity to give advice on decisions (not just Key Decisions in the formal sense). 

Poor ownership and accountability by the s151, leading to poor quality financial management’ would be better framed as ‘poor quality financial management’ since there are many potential reasons for poor financial management, not all of which would relate to the ownership and accountability of the s151 officer.

While we agree with the sentiment of the indicator ‘Risk management ownership and discussion is limited to the Audit Committee rather than across the whole organisation’, the way it is framed is unhelpful.  It would be better to say ‘Risk management is not effective, owned corporately and/or embedded throughout the organisation.  Audit Committee does not have effective oversight of risk management.’

While it would be appropriate for councils experiencing significant challenges to consider whether annual campaigning is hindering improvement and to take action accordingly, many councils with multiple elections during the four-year cycle are well-run.  It is therefore not appropriate to include all-out elections as a characteristic of a well-functioning authority.

A lack of political stability is not an indicator of failure, it can be a valid outcome of the democratic process in a place where the politics are finely balanced. 

Q11  Do you agree with the suggested key characteristics of a well-run authority and key indicators of failure in relation to governance? (Table 3, Section 5)?

1. Yes
2. No [Please provide reasoning or suggestions below]
3. Comments

While this is referenced in an earlier section, it would be appropriate to include here reference to the robust review of governance arrangements, and not simply to overview of the systems of control, audit and governance as a characteristic of a well-functioning authority. It is important to distinguish however between the detailed oversight provided by Audit Committee and the wider ownership role of Full Council.

You will want to ensure that the link to Local Authority Company Review Guidance is to the most recent version of the guidance.

For the indicator ‘Credible allegations of corruption or maladministration’, the existence of such allegations, even if they are credible, is not necessarily an indication of failure.  A lack of appropriate action in response to such allegations would be a cause for concern.

Sometimes it is appropriate not to fully implement a decision or to revisit a decision in light of changed circumstances, as long as this happens transparently.  Key decisions not being fully implemented may be an indicator of factors other than political indecision.  The use of ‘not fully implemented’ and ‘frequently reversed’ leaves significant room for interpretation and is therefore of questionable use as a standard.

The statutory guidance for scrutiny states that each authority should identify the role and focus of scrutiny within the organisation.  With the exception of budget scrutiny, it is not mandatory to undertake pre-decision scrutiny and so it is not appropriate to identify a lack of this as a potential indicator of failure.  Use of co-production and co-design and effective engagement may reduce the need for pre-decision scrutiny.

While a ‘too-wide’ brief for Audit Committee would be a risk factor, so, equally, would a brief that is too narrow, since this would indicate that the Committee does not understand and/or is not performing its role.  Non-compliance with CIPFA’s guidance on audit committees would be a better indicator of potential failure.

We agree that a lack of corporate risk registers and ownership of risk by senior leaders is a key indicator of potential failure.  A lack of risk management at service level, and of consideration of risk in decision making would also be a significant concern.

Is there a typo on the indicator ‘No independent oversight or members of relevant committees in accordance with good practice’? It is not clear whether this is referring to the formal appointment of Independent Persons and/or to use of co-optees on scrutiny committees (which is only mandatory in specific circumstances).  Independent Persons / co-optees do not provide oversight, but they can contribute to scrutiny/ challenge and good governance.

While transparency is a key element of good governance, and a lack of openness is a clear indicator of potential failure, there is not an unlimited ‘right to know’ for councillors.  Different groups of councillors will have varying rights of access to information for different purposes (for example scrutiny councillors have enhanced powers in addition to councillors’ right to information to enable them to perform their duties).  There is a risk that this indicator, as currently drafted, gives a misleading impression of councillors’ ‘right to know’.

Q12  Do you agree with the suggested key characteristics of a well-run authority and key indicators of failure in relation to culture? (Table 4, Section 5)?

1. Yes
2. No [Please provide reasoning or suggestions below]
3. Comments

We agree that organisational culture is a key contributor to organisational success or failure.  However, for this theme even more than the others, it is important to recognise that a tick-box exercise can neither assess success nor failure.

As stated in the response to Q11 above, the ‘councillors’ right to know’ is not unlimited, and this guidance should not give a misleading impression of the nature of councillors’ rights to access information.

‘A widespread failure to follow due process, the constitution and codes of conduct’  would be a failure of governance.  An environment in which this is allowed to happen demonstrates an indication of potential failure in the council’s culture.

As stated at Q11 above, for the indicator ‘Credible allegations of corruption or maladministration’, the existence of such allegations, even if they are credible, is not necessarily an indication of failure.  A lack of appropriate action in response to such allegations would be a significant cause for concern.

It is not easy to understand what issue the proposed indicator ‘The organisation is paralysed by a large number of procedural issues’ is designed to address. 

Q13  Do you agree with the suggested key characteristics of a well-run authority and key indicators of failure in relation to efficient use of resources (Table 5, Section 5)?

1. Yes
2. No [Please provide reasoning or suggestions below]
3. Comments

The characteristic ‘…regular financial reports to Cabinet and training for all members on finance’ combines two different things.  Reporting is already covered in an earlier characteristic and reference to the member dimension could be made there.  While training for all members on finance is important, it must be proportionate and appropriate to members’ various roles.

The indicator ‘Inadequate reserves, savings not achieved and poor benefits realisation’ combined three very significant issues into one.  It could be read as suggesting a degree of connection between the level of reserves and the achievement of savings/ benefits which does not exist.

Indicators of failure relating to risk management are focused on commercial/ company activity.  There are many risks which councils have to manage effectively (for example, cost of living increases, reduction in Government grant funding, regulatory changes), and not doing so will be a potential indicator of failure.  It will be necessary for any consideration of intervention, when looking at a range of indicators, to include an understanding of each council’s overall risk awareness and management.

Non-compliance with accounting requirements in general is a potential indicator of failure, it is not appropriate to single out MRP in particular.

Very few councils will, in the past 12 years, have been able to invest in back-office services to the extent which they would have wished, and this will inevitably have impacted capacity and succession planning.

Q14  Do you agree with the suggested key characteristics of a well-run authority and key indicators of failure in relation to service delivery (Table 6, Section 5)?

The description states ‘Authorities should provide services at a comparable level to other authorities of a similar size and location when benchmarked’.  While all authorities should benchmark their provision with comparable authorities, it is for councils’ political leadership to make judgements about the levels at which services are provided (absent specific standards).  Different councils will have different priorities which means that suggesting all councils of a similar size and location should provide services at a comparable level is simply not appropriate when councils are primarily accountable locally.

A high level of complaints to the Local Government and Social Care Ombudsman is not in itself a potential indicator of failure: a high level of findings of fault and the council not implementing the Ombudsman’s recommendations would however be such an indicator.

Q15  Do you agree with the suggested key characteristics of a well-run authority and key indicators of failure in relation to partnerships and community engagement (Table 7, Section 5)?

Every council sets its own strategic priorities, including plans for building prosperity, promoting social cohesion and pride of place.  Councils should consider a wide range of factors, including available resources, appropriate phasing of activity with other bodies and coordination with other activities, informed by strategic risk management when setting these priorities.  It would only be possible to assess missed opportunities over a relatively long period of time.  There is a risk that the indicator relating to failing to seize opportunities could be misused as a route to challenge the identification of valid political choices.

The proposed indicator ‘…does not seek and consider feedback from citizens and service users on performance when developing improvement plans’ is excessively granular: a focus on a lack of meaningful engagement more generally would be appropriate.

While it is right to identify a perfunctory approach to consultation (and engagement) as an indicator of potential failure, it appears perverse to suggest that a council could fail to comply with its Best Value Duty by complying with statutory minimums. 

Q16  The seven themes have a description, characteristics of a well-run authority and indications of potential failure (Tables 1-7, Section 5).  Which, if any, of the proposed characteristics and indicators of failure are priorities and the strongest indicators of best value?

a. Comments

We believe strongly that not all of the characteristics and indicators proposed are of equal weight.  Some of the indicators are extremely granular, others cover multiple issues in one indicator.

We believe that the strongest indicators of compliance with the best value duty are:

• Openness to external challenge
• Clear leadership demonstrated through a realistic and robust corporate plan
• A robust medium-term financial strategy, with consistent delivery of budget plans
• Compliance with legislative, regulatory and constitutional requirements
• Effective risk management with ownership and understanding across senior political and managerial leadership
• Effective use of performance management information leading to strong self-awareness
• Robust plans to address service failure, where applicable

As stated at Q13 above, understanding a council’s overall risk position will also inform judgements about other indicators. 

Q17  Many of these indicators are measured by metric but there is scope to identify more to more accurately assess Best Value.  What do you think are the top most appropriate quantitative metrics for monitoring Best Value, against the indicators in section 5?

a. Comments

The assessment of whether or not a council is complying with its Best Value duty requires consideration of a wide range of complex and inter-related factors.  While councils will routinely consider key performance indicators as part of their own assurance work, these will only give part of the picture and must be interpreted through understanding of wider local context, along with consideration of other key factors such as the robustness of the Medium Term Financial Strategy, the extent of transparency and openness to challenge.

Q18  The guidance sets out a number of characteristics and indicators across the seven themes in section 5.  If certain characteristics or indicators were to be identified as key, and more important than others in achieving Best Value, what would the risks be to this approach?  The department is mindful of proportionality and the need to ensure the full context and circumstances of each case is taken into account, and is clear that no single characteristic or indicator automatically results in actions relating to the use of Best Value powers.  How could any risks be further mitigated?

a.  Comments

We welcome this reference to proportionality, which we believe is crucial.  There is a risk that this guidance, as currently drafted, could be read as suggesting that issues relating to any one of the indicators listed would lead to intervention. Section 3 of the guidance refers to the analysis of a complex set of data and circumstances, and section 4 states that intervention will only be used when there are significant and extensive indications of failure: this narrative needs to be carried into section 5 of the guidance. 

The practice of triangulation is vital: all evidence should be triangulated to ensure that consistent conclusions can be drawn.

There is also a danger that the publication of characteristics and indicators will drive councils away from effective risk management into a ‘tick the box’ compliance strategy.

The characteristics of well-functioning authorities, and indicators of potential failure fall into (at least) the following categories:

• Hard data which is reviewed in public by members and/or publicly reported – e.g. a high number of standards complaints against members which are upheld
• Hard data which is detailed management/ operational information used internally within councils – e.g. take-up of the officer training offer
• Subjective judgements about published documents – e.g. the adequacy of the Annual Governance Statement
• Subjective judgements about less tangible issues – e.g. a culture of bullying and distrust

Councils should consider all of these factors with appropriate regularity and make their own decisions about what action to take to address issues of concern.

Q19  Are you happy with the level of clarity and detail in the description of statutory and non-statutory Best Value Notices? (section 6)

1. Yes
2. No [Please provide reasoning or suggestion below]
3. Comments

Paragraph 29 references ‘the local government accountability system’.  We do not believe that this system (as opposed to the system for accountability of the Department to Parliament) is currently documented and are currently working to do so.

Paragraph 35 references to action the department will take when it becomes aware of indicators of potential failure being met.  It should be made clear here, as elsewhere, that engagement by the department will take place only on a proportionate basis.  There are already a significant number of checks and balances in place: to ensure that councils’ limited resources are deployed to best effect, councils should only be required to engage with the department to discuss their organisational challenges when there is significant and extensive risk of failure.  Councils may of course seek such engagement for themselves at any time.

Councils will also want to be assured that government will apply the menu of intervention options consistently.

Q20  Besides those mentioned in section 5, are there other ways in which the government could engage earlier with individual local authorities to prevent any challenges experienced from escalating?

1. Yes  [Please provide suggestions below]
2. No
3. Comments

The extent to which the government engages with individual local authorities (unless at the authority’s invitation) should be limited, to ensure that limited resources are deployed to best effect.  However, if the government has identified a growing number of indicators of potential failure in a local authority and that this authority is not engaging with sector-led support, the department should write to the authority to reiterate the expectation of such engagement.

Where the government does identify the need for engagement with a local authority, it is important that this happens in a timely manner.

Q21  Based on lessons learned from interventions to date, the guidance proposes that where authorities are unable to correct failure in specific services, such as social care or education, for two years, this is potentially symptomatic of wider governance and leadership failure and the department should consider the authority’s compliance with the Best Value duty.  Do you agree that two years is a reasonable timeframe to consider whether an authority’s service performance may impact its ability to deliver Best Value? (Section 6, para 32)

1. Yes
2. No [Please provide reasoning or suggestion below]
3. Comments

Where service, governance or leadership failures exist, it may take longer than two years to address them.  Addressing service failure in children’s or adult services will often have significant financial implications.  However, it is reasonable, in two years, to take a view on whether the local authority has capacity, including the use of sector support, to deliver its plans for improvement.

We recommend the use of a corporate, governance or service peer review to assist the government to understand whether that capacity is in place.

Where other government agencies are engaged in intervention in a local authority, it is essential that there is close coordination between those bodies to ensure consistency and clarity.

Q22  Is the description of a Best Value inspection sufficiently clear? (Section 7 and Annex A)

1. Yes
2. No [Please provide reasoning or suggestion below]
3. Comments

The deployment of a Best Value inspection by the department will lead to significant resource implications for the relevant local authority.  While it is understood that it is not possible to provide an exhaustive list of scenarios where an inspection may be appropriate, the current description (‘exhibiting some characteristics which may indicate best value failure’) does not sufficiently set out the level of seriousness/ extensiveness of issues which would lead to the commissioning of an inspection.

Q23  Is the description of independent reports sufficiently clear?

1. Yes
2. No [Please provide reasoning or suggestion below]
3. Comments

The deployment of an independent report by the department will lead to significant resource implications for the relevant local authority.  While it is understood that it is not possible to provide an exhaustive list of scenarios where an inspection may be appropriate, the current description (‘exhibiting some characteristics which may indicate best value failure’) does not sufficiently set out the level of seriousness/ extensiveness of issues which would lead to the commissioning of a report.

Q24  Are the models of intervention described in this guidance clear in terms of description, purpose and scenario when they would be applied? (Section 8)

1. Yes
2. No [please provide reasoning or suggestion below]
3. Comments

Improvement boards

The current text appears to conflate non-intervention activity (the local authority establishes its own improvement board), non-statutory intervention (the department makes proposals for the board’s membership and terms of reference) and statutory intervention (the department makes its own appointments). It would be clearer if these separate scenarios were clearly delineated, given that this description appears under the heading of non-statutory measures.

The description proposes non-statutory intervention by the department where ‘an authority demonstrates failures or risk of future failure which is not systemic and there is confidence that the authority has the willingness, capability and capacity to sustain continuous improvement, but external expertise and challenge would result in more efficient recovery’.  Greater clarity is required to ensure that any proposals from government will be proportionate and deliver valuable expertise and/or challenge.

Sector-led intervention

We welcome recognition of the role of the sector (including the Local Government Association and our role in brokering sector led improvement) in supporting local authorities experiencing failure or risk of future failure. 

Additional non-statutory interventions

In addition to Section 8, Section 6 para 40 refers to interventions relevant to capital risk assurance.  It is not appropriate to treat capital risk as separate or capable of being ring-fenced: it should be part of a mature and robust approach to corporate risk management, in light of all other relevant factors.

It is not clear how letters from the minister setting out ministerial expectations (e.g. the recent letter to South Cambridgeshire council) fit in the framework set out in this guidance.

Directions for a commissioner-led intervention

The guidance should make clear that the department will ensure that commissioners have all necessary skills and experience for their role, including provision of training clarifying roles and powers and expected standards, and evaluation of the effectiveness of their work.

Q25  Do you agree with the position that interventions should end as soon as an authority can demonstrate that it can independently sustain its journey of continuous improvement without support? (Section 9, para 50)

a. Comments

We agree with this position and we welcome the statement that local authorities are not expected to be perfect before an intervention ends.  It is right that the aim of all interventions should be to reach the point where the authority can demonstrate that it now has the capacity and capability to sustain its own journey of continuous improvement with continuing sector support and is able to address emerging issues as they arise (often as a result of the council’s new leadership team identifying them). Challenging situations will arise in any organisation at any time, and this should not mean that intervention is extended: the guidance should recognise this. 

The LGA’s corporate peer challenge provides a valuable means for independent assessment of the authority’s ability to independently sustain its journey of continuous improvement.

Q26  Are there any areas missing from the statutory guidance that you think would be helpful to include?

1. Yes [Please provide rationale and suggestions below]
2. No
3. Comments

In the interests of clarity and concision, we do not believe it would be helpful to add further areas to this guidance beyond the clarifications proposed in our comments above.

However, while recognising that it is essential for government to have a clear and transparent rationale for intervention, it is also important that government, with the sector, takes a holistic view of the entire system, including consideration of the wider factors which have contributed to failures – and increased the risk of failures – in councils. In some cases, failures have happened despite extensive control systems and it is important that the effectiveness of this wider framework is kept under regular review.  That does not necessarily mean the addition of new controls, rather ensuring that existing controls are fit for purpose.

We intend that the work we are undertaking at present to review the current improvement and assurance framework will assist us to consider, with the sector, how that framework can be improved.