A REVIEW has recommended Warrington Borough Council ‘establish clarity’ over its overall risk threshold in relation to ‘borrowing and finance more generally’.

The LGA ‘corporate peer challenge’ – which the council was subject to in March – has made a number of recommendations.

In the feedback report, it says Warrington is an ‘economically successful’ area but also faces ‘significant socio-economic inequalities’.

“Elected members and officers emphasise the council’s commitment to addressing these and protecting the vulnerable in Warrington’s communities,” it said.

“The council has been integral to the delivery of a wide range of initiatives across the town and wider borough aimed at enhancing the quality of life and has sought also to maintain and enhance the public service offer.

“Within all of this, it has demonstrated an impressive track record of securing external investment and bidding successfully for funds.

“Essentially, this is a council that is driven to improve the lives of its residents. There is good work going on in Warrington and there are good stories to tell.”

As reported last week, the ‘best value’ inspection into the council is continuing – despite the change of Government.

As reported in May, the then-Conservative Government ordered a ‘best value’ inspection into the Labour-run council amid the council’s debt totalling around £1.85 billion.

A lead inspector was appointed to assess the council’s ‘compliance with its best value duty’.

The lead inspector – who is able to request the appointment of assistant inspectors – had been asked to report findings by August 30, or ‘such later date as may be agreed’.

The council’s level of borrowing has been highlighted in the feedback report, which states that it is ‘amongst the most significant in local government nationally’.

“The reliance on investment returns means the council has a very different risk profile to many other local authorities,” it said.

“It is vital for there to be clarity over the council’s overall risk threshold in relation to borrowing and finance more generally. This threshold needs to be politically determined and fully understood by elected members, informed by statutory officer advice and the national context.

“The complexity and specialist nature of elements of the commercial and investment portfolio made it difficult to identify how the overall risk profile in Warrington is understood and who owns it.

“How the council manages, across the medium term, the financial risk that it already holds in terms of its investments will be crucial to the authority’s financial sustainability.”

Furthermore, ‘significant concerns’ have been raised in the feedback report.

It said: “The council’s position statement highlights that ‘scrutiny, accountability and transparency are paramount’.

“However, as a peer team, we have significant concerns about the way in which these are being undermined by a culture that has been allowed to develop in the organisation.

“The cause of our concern is two-fold – the breadth of people, internally and externally and across both officers and elected members, who emphasised governance matters during their conversations with us and what the council highlighted as a significant rise in the number of Freedom of Information requests it has been receiving in recent months and years.

“The council maximising the amount of information entering the public domain and providing for increased scrutiny by the public and elected members would contribute to it being perceived more positively in relation to openness and transparency.

“Currently, a climate exists internally and externally in which the actions of the council increasingly risk being called into question or being viewed sceptically. Greater clarity being established in the respective roles and responsibilities across the senior managerial leadership and the cabinet would also be beneficial.

“A concerted effort is required by the council to ensure it has the most effective governance arrangements possible and is viewed in the most positive light feasible. Our perception as a peer team is of an organisation that is retrenching in the face of a desire for greater scrutiny from a range of sources. We would encourage the council to ensure the exact opposite is the case.”

The peer team have made a number of key recommendations to the council.

These include recommendations to develop the new corporate strategy in a way that it ‘reflects the political ambitions of the administration, outlines a clear set of priorities, focuses on outcomes and becomes a plan for the borough’, to establish the ‘necessary insight and mechanisms’ to support enhanced understanding of, and engagement with, local communities, to invite sector-led support ‘in response to our fundamental concerns about approaches to scrutiny, accountability and transparency’ – including establishing a voluntary and independently chaired ‘assurance and development group’.

Other recommendations include recommendations to secure the ‘necessary support’ for elected members to ‘develop the capacity and skills to provide the required clear political leadership and checks and balances’, to ‘start in earnest’ the work necessary to address the medium-term financial position including establishing a cross-organisational plan for savings, to deliver on the recommendations from the CIPFA report, ‘especially any relating to enhanced governance, oversight and value for money to protect the interests of the citizens of Warrington and enhance trust and confidence’, and to ‘establish clarity over the council’s overall risk threshold in relation to borrowing and finance more generally – with this needing to be politically determined’.