National and Devolved Politics

07.08.17

Birmingham Improvement Panel to step back, but finances still ‘extremely challenging’

The independent panel working with Birmingham City Council has recommended that it will step back after it concluded that major improvements had been delivered in the authority.

DCLG placed the panel into the authority back in 2015 in a bid to improve the way it drives forward with “major reforms” in the area.

But a letter from the panel to Sajid Javid has now recommended that it should “suspend its current operation” with the council, leaving only the vice chair and the panel’s adviser in touch with the council in future.

The letter said that “significant changes” had been delivered to the council’s management arrangements, as a new interim CEO and interim chief finance officer joined the authority in April with considerable experience achieving fiscal improvement.  

Despite this, the letter still reinforces warnings that were voiced earlier in the year that the council’s financial position remained “extremely challenging”.

It was noted that the results for the financial year 2016-17 showed an overspend of £72m on directorate controllable spend, reduced to a net overspend for the council as a whole of £29m after taking account of corporate underspends and use of contingency provisions. In relation to the current financial year the council has to deliver savings of £71m, and this rises to savings of £171m in the period to 2020-21.

As at June 2017 the interim chief finance officer estimated that for 2017-18 £10m (14%) of the planned savings was undeliverable, with a further £4m (6%) at risk. However, the corporate leadership team is therefore undertaking further work to improve this position and to identify alternative savings measures.

John Crabtree, chair of the panel, said: “Our assessment overall is that the council’s broad direction of travel is positive and prospects for improvement are good. However, the council recognises that it still faces many significant risks and challenges, as well as opportunities.

“These include the delivery of challenging revenue budgets for 2017-18 and future years and the implementation of the council’s future operating model.”

“The council has agreed to produce a further progress report in December 2017, and there will be a more in-depth review and public report about the council’s overall position and progress within twelve months,” Crabtree concluded.

Leader of Birmingham City Cllr John Clancy thanked the panel for its hard work now that it has come to the end of its time in Birmingham.

“The latest report to the secretary of state is the most positive assessment of Birmingham City Council’s performance since the Independent Improvement Panel was established, underlining the council’s strong political and managerial leadership and concluding that our prospects for the future are good,” he commented.

“This is a significant step forward and an important vote of confidence as we continue our improvement journey.”

Top Image: Cristian Bortes

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