Gove appoints Finance Commissioner at Liverpool as government intervention expanded

Levelling Up Secretary Michael Gove has expanded the Government’s intervention at Liverpool City Council with the appointment of a Commissioner for Finance.

Stephen Hughes, an experience finance professional and former Chief Executive at Birmingham City Council, has been appointed to the role, which will oversee the council’s financial management.

New powers for the Commissioners over governance, financial decision-making and recruitment have also been announced, in updated directions issued under section 15(5) and (6) of the Local Government Act 1999.

The Department for Levelling Up, Housing and Communities (DLUHC) said the move came after a report on Liverpool’s progress revealed “serious shortcomings, particularly around financial management and senior leadership”.

The report also criticised the slow progress made in driving improvement measures and said that the council is failing to meet its “best value” duties.

Liverpool City Council Lead Commissioner, Mike Cunningham, said: “Our last report, written in June, identified significant areas of failure at Liverpool City Council. We welcome the Secretary of State’s decision to expand the intervention, and warmly welcome Stephen Hughes’ appointment as Finance Commissioner, who joins the team at a critical point in the intervention.

“We have been encouraged by the progress the council has made under the leadership of the interim Chief Executive and interim Director of Finance in recent months. However, the council faces substantial challenges in the next year, not least in agreeing a balanced budget, holding all out elections, and delivering a transformative improvement programme. We will continue to work closely with the Mayor and council leadership to address these challenges in the year ahead.”

In a letter dated 19 August, the then Secretary of State for Levelling Up, Housing and Communities, Greg Clark, had warned that he was minded to increase the degree of government supervision.

The minister informed the council that capacity and capability failings at senior management level meant that he planned to appoint a commissioner to oversee the financial, governance and recruitment functions of the council.

In 2021, the Government appointed four commissioners to oversee some of Liverpool’s functions after a report into the council’s highways, regeneration and property management functions found serious governance issues and “multiple apparent failures”.

The new Finance Commissioner will use his expertise to ensure that the council sets a balanced budget and uses its money wisely, DLUHC said. This includes strengthening financial resilience, management and accountability across the council.

Levelling Up Secretary Michael Gove said: “I am committed to helping Liverpool City Council come out of this intervention as a stronger organisation and that is why I am taking further steps to put the Council on a firmer footing.

“Liverpool is a city of fantastic potential and under the guidance of the new Finance Commissioner I am confident they will be able to rebuild trust with those they serve and deliver for the taxpayer.”

Further information on the Liverpool Strategic Futures Panel, a strategic advisory panel that was announced in August 2022 and which is intended “to develop a long-term plan to guide Liverpool City Council out of the current government intervention and help shape the future of the city”, will be unveiled in due course, DLUHC said.

Responding to the appointment of the Commissioner for Finance, Mayor Joanne Anderson said: “Stephen Hughes is an experienced local government leader. His appointment comes at a time of great challenge for us as we prepare to set out our 2023/2024 budget proposals. His experience will be helpful at this time.

“It is worth noting that the Lead Commissioner, Mike Cunningham, has recognised that we are continuing to improve as an organisation and that there is a huge amount of work ongoing to change systems, processes and our culture.

“The additional intervention is no reflection on the hard work of teams and individuals across the organisation who are delivering improvements and making a positive difference to the lives of residents.”

Lottie Winson