Government commissioners empowered to run Birmingham City Council until 2028

A letter from the government to Birmingham City Council’s chief executive outlines “serious” finance and governance concerns – and reveals commissioners could be in place for five years.

It states that government commissioners will take over the running of the council for as long as five years if required and outlines in detail the “severe” situation.

The letter states: “Given the scale of the issues, the Secretary of State proposes that directions to the authority should be in place for five years, noting that the authority’s situation is severe, and the improvement and recovery journey is likely to take a number of years.

“If the Secretary of State considers at any time that it would be appropriate to change directions or withdraw them, then he will do so. His concern will be to ensure that the directions operate for as long, but only as long, and only in the form, as he considers it should operate.”

Levelling Up Secretary Michael Gove confirmed the action on Tuesday (September 19) in a statement to parliament. He said: “I do not take these decisions lightly but it is imperative in order to protect the interests of the residents and taxpayers of Birmingham, and to provide ongoing assurance to the whole local government sector.”

He will also launch an inquiry into how Birmingham City Council got into this position and how it can improve. The letter, from Max Soule, deputy director, local government stewardship to chief executive Deborah Cadman OBE, cites the handling of the equal pay claims and the failed implementation of the Oracle IT system as evidence for Mr Gove’s decision.

It also points to “broader weaknesses” in the council’s environment and detailed criticism in areas of governance, financial governance, leadership, and capability to improve. These include a very high turnover of senior staff, a culture of “sweeping issues under the carpet or blaming others” and interventions into waste services and special educational needs.

Mr Soule also points to recent, serious concerns raised by social care and social housing regulators. He writes: “The authority has been beset by systemic failings over several years including poor culture, weak governance, a challenging relationship with trade unions and ineffective service delivery. These failings have been exacerbated by instability and churn at senior officer level.”

He also referred to the 2015-19 intervention following the Kerslake report on the Trojan Horse affair which “found failings in governance, transparency, and financial management”. He continued: “On culture and leadership, the Authority has experienced extremely high levels of churn of senior staff in recent years.

“In the eight years prior to 2022, and following the 2014 Kerslake report, there had been nine chief executives and nine directors of children services. The Kerslake review also highlighted a culture of sweeping problems under the carpet or blaming them on others, rather than tackling them head-on.

“On services, the authority has historic issues with its waste services as shown in the non-statutory intervention and recent cases considered by the Local Government and Social Care Ombudsman; a Department for Education Special Educational Needs and Disabilities intervention is in place; and the Local Government Social Care Ombudsman and Regulator of Social Housing have recently raised significant concerns with the Council about service delivery.

“The ongoing equal pay dispute is also causing continued friction with trade unions and there are risks of industrial action and impacts to service delivery. On capacity or capability to improve, the Kerslake review found that successive administrations had failed the city.

“It warned that the authority lacked a clear vision, had failed to tackle deep-rooted problems such as low skills and was not doing enough to provide consistently good quality services. These problems have endured as highlighted by the equal pay liability issue and failed implementation of the Oracle financial ledger system.

Birmingham City Council now has the opportunity to make representations to Mr Gove but given the “exceptional level” of concerns and risk, he has set a shorter period than is standard for these to be submitted. The full letter to Deborah Cadman is published here: Department for Levelling Up, Housing & Communities website