Communities Secretary set to send commissioners into Tower Hamlets

The Communities Secretary plans to send three commissioners into Tower Hamlets Council after an inspection report found that the authority had failed to comply with the best value duty in a number of areas.

In an oral statement to the House of Commons Eric Pickles told MPs: ““There is a clear picture that there has been a fundamental breakdown of governance in this mayoral administration.

“If unchecked it will allow improper conduct to run rife, further undermining public confidence in the council, damaging community cohesion and ultimately put public services across the borough at risk.”

He added: “I am satisfied that the council is failing to comply with its best value duty.”

For a summary of the PwC report and Tower Hamlets' response to its publication, see our earlier story here.

The Communities Secretary said the commissioners, if appointed, would be in place until 31 March 2017.

The commissioners and the council will be expected to draw up an action plan on future compliance with the best value duty. The plan will then be submitted to the Secretary of State.

The commissioners will be expected to report on progress to the Department for Communities & Local Government on a six-monthly basis.

Eric Pickles proposed to direct the council as a matter of urgency – and as directed by the commissioners – to make permanent appointments to the position of its three key statutory officers.

The PwC report noted that all three posts of the Head of Paid Service, the Section 151 Officer and the Monitoring Officer are currently held by interim appointments.

The Communities Secretary proposed to direct that any dismissal, suspension or further appointment of a statutory officer would need to be with agreement of the commissioners.

The commissioners will assume responsibility from the council for grant-making, although they will be expected to have regard to the authority’s views on any individual grants.

The council will also have to obtain the commissioners’ prior written agreement to any commitment to dispose of or otherwise transfer to third parties, other than individual housing.

The Communities Secretary proposed too that he would direct the council to produce a fully-costed plan on how its publicity function can be properly exercised.

Tower Hamlets will have to agree that plan with the commissioners, report on its delivery and adopt any recommendations they make in relation to the plan and publicity more generally.

The commissioners will meanwhile be asked as a matter of urgency to exercise the council’s functions of appointing an electoral registration officer and a returning officer.

The final part of the intervention package is a proposed direction that the authority should prepare a plan for addressing the weaknesses identified by PwC in relation to contracting.

The Communities Secretary meanwhile demanded that Tower Hamlets give two written undertakings within 24 hours. These are that:

  • It will not without the Secretary of State’s prior approval enter into any agreement or modify any existing agreement for the making of grants pending any decision on any proposed intervention package.
  • The council will not appoint or designate any statutory officer without his prior approval pending any decision on any proposed intervention package

If no satisfactory undertakings are forthcoming, the Communities Secretary threatened to use ‘urgency powers’ that he has under statute.

Pickles will also ask the council to provide details on any property transactions it has in the pipeline.

Tower Hamlets will be required to pay the commissioners’ expenses and a ‘reasonable fee’ for the role, the Communities Secretary said.

The council is already picking up the cost of the PwC report, which came in at just under £1m. The Communities Secretary claimed it would have been cheaper if the council had been more cooperative.

Eric Pickles said the proposed intervention package as outlined would need to achieve three things:

  1. Put an end to all council activities that are not compliable with its best value duty;
  2. Remove so far as possible the risk of further failures to comply with the duty; and
  3. Rebuild the governance and financial management capacity and capability of the council.

Tower Hamlets has been given 14 days in which to make representations on the PwC report and the proposed intervention package.