Issues at the centre of Dudley Council’s ‘triple-whammy’ of failure

The documents, from the Local Government Association (LGA) and the Chartered Institute of Public Finance and Accountancy (CIPFA), highlight a number of areas where they think the council could be doing better.

Both reports were prepared in July and the council’s Conservative leaders say they are already out of date as changes have been made.

Labour claims the reports, along with a report from external auditors published recently, are a ‘triple-whammy of failure’.

The LGA said leadership was the biggest barrier to change as issues related to finance, governance and culture had, in many cases, become more serious since their previous report.

CIPFA was also critical, they were concerned that the ‘golden triangle’ of the chief executive, chief finance officer and monitoring officer, who is responsible for governance and standards, was not working effectively.

During the cabinet meeting the council’s leader, Councillor Patrick Harley, pointed out the chief executive and finance officer had now been replaced.

Councillor Harley added: “The experienced team we have now, which has replaced the much-criticised golden triangle, will help members make decisions and have opportunities and options put in front of us.”

Dudley is currently facing unprecedented financial pressures and the possibility of going into effective bankruptcy by admitting it does not have enough cash to pay its bills and declaring a notice under section 114 of the Local Government Finance Act 1988.

If, as Birmingham council has done, a section 114 notice is issued no new expenditure is allowed and existing spending will be strictly controlled.

The LGA does not believe a s114 notice is inevitable for Dudley but added: “This requires the council to act quickly and on the advice provided to it from other sources, such as CIPFA and particularly the Improvement and Assurance Board (IAB) which has had the ability to add real value to the council but until now its support has been largely ignored by DMBC”.

Councillor Harley told the cabinet: “I believe that the experience that was on hand on that improvement board was insufficient for the task that we face, I think that board has run out of steam.”

To avoid a s114 notice the council needs to raise more cash or make savings to plug a financial black hole of more than £30m over the next three years while at the same time topping up reserves which the LGA says are at a ‘critically’ low level.

The LGA said: “This is significant given that in previous years the savings programme has been much lower and delivery weak.

“It needs to urgently pick up the pace this year and implement plans.”

Councillor Harley told cabinet members: “A comprehensive improvement plan is being developed and will come back before this forum in January.

“In Dudley, we are committed to delivering on all the recommendations set out in the reports.”