Michael Gove – 2022 Statement on the Liverpool City Council Commissioners

The statement made by Michael Gove, the Secretary of State for Levelling Up, Housing and Communities, in the House of Commons on 8 November 2022.

On 19 August 2022, my right hon. Friend the Member for Tunbridge Wells (Greg Clark), the then Secretary of State for Levelling Up, Housing and Communities, announced he was minded to expand the intervention into Liverpool City Council by appointing a commissioner to oversee the council’s financial management and to transfer functions associated with governance and financial decision making to the commissioners together with powers regarding recruitment to improve the running of the organisation. Today I am confirming that I will be implementing these proposals.

The intervention at Liverpool City Council started on 10 June 2021 following a best-value inspection trigged by the arrest of the former Mayor. The then Secretary of State appointed four commissioners with powers over regeneration, highways and property and their associated governance.

The commissioners submitted their second report on 10 June 2022, the anniversary of the intervention, leading to the “minded to” announcement in August. I am pleased that progress has been made and commend the hard work of the councillors and officers to achieve this. Commissioners also report that the arrival of Theresa Grant OBE as interim chief executive in September has bought renewed drive to the transformation work across the council.

The intervention is at a critical juncture as it approaches the halfway point and it is clear significant challenges remain. The commissioners’ second report identified systematic, whole-council weaknesses in areas that stretch beyond the existing intervention. It concluded the council is not meeting its statutory duty to provide best value and the council must take urgent, whole-council action to progress on their improvement journey.

My predecessor invited representations on the proposals on or before 2 September 2022. Having considered the representations received from the authority, councillor Richard Kemp and the evidence in the commissioners report, I have decided to implement the proposals. I have made one small modification to remove an errant timeframe attached to a direction.

I am appointing Stephen Hughes as finance commissioner, until June 2024 or such earlier or later time as I determine. Stephen is a seasoned finance officer who has recently worked as a finance and management consultant and previously worked as interim chief executive at Bristol.

More must be done to embed the desired cultural change across the organisation, to bridge the budget gap and set a balanced budget for 2023-24. My decision, to expand the intervention, reflects the stark situation in the council. The powers provided to commissioners are wide-ranging, but I feel are necessary to deliver the effective, efficient and convenient local government for communities across Liverpool.

The commissioners have agreed to provide their next report to me in February 2023 and I will update the House on further progress with the intervention at that time. I have published the directions and explanatory memorandum associated with this announcement on gov.uk and placed copies, together with the commissioners’ second report, in the Libraries of both Houses.

My predecessor also announced the Liverpool Strategic Futures Panel to craft a vision for Liverpool’s future beyond Government intervention, with a plan for driving growth in skills, jobs and opportunities. Liverpool has fantastic potential, and I am considering carefully how we can work together with partners to best support levelling up in the area. I will update separately on these plans in due course.