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So, who is looking at Governance?

on Tuesday, 17 October 2023.

So much attention is on the finances - balancing the budget, Section 114 Notices, diminishing reserves, more for less - it is constant and a real problem for Local Government.

I have been a Corporate Head and Strategic Director of Resources with responsibility for finance (yes I am a lawyer!) and long been an advocate that this is not just an issue for the S151 Officer and their teams - we all need to own this one.  I have also worked with some of the best finance leads - Joseph Holmes, Liz Keys, Kevin Jaquest, Dorcas Bunton to name a few and behind them their brilliant teams - I cannot name check them all.  I have seen fit for purpose reviews, efficiency and savings reviews, commissioning, transformation - whatever their name there won't be many in Local Government that hasn't experienced one first hand. 

For me, stepping back and looking at the whole - have we got the balance right - who is really talking about the governance? You know - the bits that hold everything up and get in the way of delivery (I won't credit this quote but could several times over……..) 

Governance doesn’t get the good and positive attention it should nor the attention it deserves.  Good governance encourages robust decision making, effective and early scrutiny of decisions and better planning both for the immediate future and longer term. Good governance drives an authority’s ability to achieve its objectives, balance its books and secure the trust of residents, visitors and businesses.  

Max Caller CBE in a Best Value Inspection back in 2018 said “In Local Government there is no substitute for doing boring really well. Only when you have a solid foundation can you innovate”.  I love this and would ponder in 2023 is governance really that boring anymore? There has been a huge increase in council-owned companies and other SPV's established to deliver services to local authorities including leisure, waste, housing and energy - these options were explored as an alternative means of delivery to both improve the user experience but also relieve some financial pressure. Local Government has been driven to innovate.  But time and time again those solid foundations were not there and governance issues have resulted in high-profile failures and attracted adverse comments across the board. 

The Monitoring Officer must work closely with the Chief Executive and the Section 151 Officer ('the Golden Triangle'). This is essential to good governance. This is an issue that has been raised with us, and which also arises in matters we are asked to look at.  Lawyers in Local Government (LLG) has long argued that the increasing lower status of heads of legal in many local authorities affects their ability to bring influence to bear on material decisions; places considerable strain and conflict on Monitoring Officers and leaves them susceptible to targeted campaigns. We agree.

And back to Max Caller who has also recently explained that in his view, in councils where the monitoring officer does not have sufficient status,  the three statutory officers also often fail to meet to discuss statutory officer issues, creating an environment in which statutory officers do not have full oversight of member decisions.  In the recent Local Government Lawyer interview with Max Caller, he said "Yet even if you are a star monitoring officer, your position in the council structure can limit your effectiveness..."  In his independent governance review on Northumberland, Caller called for the local authority’s monitoring officer to be more prominent in the council structure, describing the position as a ‘third-tier role’ at the council.

Don’t forget the members. As CIPFA pointed out in the Lessons Learned report on previous section 114 Notices:

"If members are not informed enough to make decisions and challenge effectively, then they are more likely to take easy routes. They need to be engaged and financially literate to understand all aspects of the plans or issues that come before them. If there is no challenge, then they may not recognise how serious the situation is."

Governance reviews don't just look at the MO and their position in the authority, reviews we have undertaken can add value by looking at decisions made and the decision making process, scrutiny functions, the role of audit and governance committees, policy development, management and oversight of programmes and projects, risk policy and risk registers, communication, the role of internal audit, the role of and support to members, political and officer behaviours and staff development and retention.

So I ask again - who is looking at governance?  Answer - Everyone should be. We certainly are.

For more information, please contact Lisa Kirkman in our Public Sector team on 07468 698 977, or complete the form below.

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