A perfect storm could see Conservatives, who led Peterborough City Council for two decades either by being the largest group or at times with no overall control, removed from office for years to come. Key factors are at play, none of them boding well for former leader Wayne Fitzgerald, who remains, for now, leader of the 22 Conservatives on the city council.
He told the Local Democracy Reporting Service that he fully expects to remain in opposition after the May 2 local elections as he doesn’t expect to be able to form a majority of 31 seats which would give his party back control.
With Conservatives on the back foot nationally, Tory MP Paul Bristow odds-on to lose his seat, and a city council improvement board praising the calming influence of new leader Cllr Mohammed Farooq, Conservatives are in the doldrums.
But an even bigger threat could come with a crucial debate, and vote, promised to the improvement board once the May local elections are done and dusted.
The improvement panel wants the city council to change the electoral arrangements in Peterborough by moving to all out elections whereby all 61 councillors are elected every four years.
“The fact that the council has achieved a unanimous vote on the budget and provided continuity in direction of travel despite a change in administration to one led by 11 members does not change the panel’s advice,” says their report.
“Therefore, the panel asks that the council adheres to its commitment to reconsider this matter after the local elections in May. “
Cllr Farooq won praise from the independent improvement board for a “major achievement” in gaining unanimous support for the coming year’s budget.
“Not only did sufficient members of opposition groups support the approval of the budget and Council Tax for 2024/25 but the vote to support this was unanimous,” says a new report from the improvement board.
It was “a major achievement for the authority and one which bodes well for the future sound governance of the council; the conduct of members at the council meeting was markedly different from years gone by and is to be applauded”.
The Peterborough Independent Improvement and Assurance Panel, headed by Eleanor Kelly, the former chief executive of Southwark London Borough Council, was set up in December 2021 to keep the council on the straight and narrow by overseeing changes, giving the council regular feedback, and reporting to the Government on progress.
The panel reminds councillors that the overall governance of the city council has been a matter of concern to the Secretary of State since 2021.
“Since then, the council has implemented a series of recommendations to improve its governance,” says their report.
“In doing so the council has achieved greater stability and continuity in its direction of travel and in its decision making than would otherwise have been the case.
“Notwithstanding this, the whole council needs to retain focus on some important risks and issues which if not dealt with effectively will lead to a decline in the quality of governance which the public deserves and which is required by the government’s Best Value guidance.”
The improvement panel says that last November, when Peterborough First formed a new administration to lead the council, “there was considerable uncertainty about the prospects for the council’s direction of travel and its governance.
“This was based on the fact that the administration was formed by a group of 11 members in a council chamber of 60.
“To win any vote in council the administration had to be supported by at least 20 members from other political groups.
“Adding to the uncertainty was the fact that no formal agreements were made with any opposition groups (Labour, Liberal Democrat and Green) to support the administration”.
The panel says they were concerned that the situation could deteriorate and, in its report to council in December 2023, pointed out that the administration needed a high degree of officer support to operate with confidence and stability through to the local elections in May 2024.
But a few months later, and following acceptance of recommended actions, the panel looks increasingly confident the council is well on the path to recovery.
The panel says the new leader and Cabinet have found ways to work well with and win support from the opposition groups in relation to key decisions.
And new portfolio holders have worked hard to get on top of their briefs though many significant issues in the medium and long term need to be resolved.
Much of the panel’s report remains focused on the financial challenges faced by Peterborough City Council.
It reminds councillors that the city is far from being out of the woods which will mean “taking bold decisions to turn off the things that are no longer ‘core/can’t afford’ as we constantly challenge ourselves on how we spend every penny of the council’s money.
On adults and children’s services and housing for instance reviews are under way to “generate options and recommendations for doing things differently”.
On finances the report notes that during the current financial year, the council has steadily reduced the forecast overspend.
The forecast overspend as at December 2023 was £2.139 million on a net budget of £212.669 million.
The main drivers of this overspend were demand led services in looked after children homelessness and home to school transport.
“However, the council has reduced reserves significantly during the year with the net budget being funded by the use of over £10 million of reserves compared to the approved budget set in February 2023,” says the report.
“If the projected overspend cannot be brought down by restricting costs or raising income it will be a further call on reserves.
“The February budget report indicated that net reserves excluding the General Fund balance will be £26.275 million as at March 2024, an overall reduction of almost half in a year.
“Much of these costs were one off but the ongoing reliance on reserves on a continuing basis is not sustainable in the long run.”
The panel says both savings and growth proposals were included in the budget report.
“These include a number of high value proposals to reduce the future cost base of the council with a view to enabling the council to achieve a sustainable future city council in the medium to long term,” they conclude.
“To enable this to happen the council will need to ensure that these programmes are resourced correctly to ensure that the anticipated cost reductions are delivered without adversely affecting service delivery.
“Funding for programme delivery is largely from usable reserves which will further reduce by over £9.5 million in the 12 months to March 2025.
“The programme is, in the view of the panel, ambitious and not without risk particularly from factors that are outside the council’s direct control such as inflation.
“It will need to be closely monitored to ensure that corrective action is taken to ensure that in the event of non-delivery of proposals that other remedial action is taken to ensure that the budget remains in balance during the year.”
The panel also reminds councillors that the council has a high level of historic debt “and ideally this should be reduced in future years rather than increase.
“In the absence of capital receipts these costs will result in increased financing costs which will fall to the General Fund.
“The high level of debt makes the council heavily reliant on third party sources for capital funding or on disposing of underutilised, surplus, or redundant assets.
“The council has commenced a review of assets which will mean that some difficult decisions on asset retention will be necessary.
“But without that and the release of funding tied up in those assets the council will not be able to adequately fund the renewal or replacement of assets that are needed for service provision.”
The panel adds: “The effort and the progress over the last two years has been commendable, but the challenges are still immense.
“The collaborative approach – across political groups and between member and officers – has been at the heart of what has been achieved to date and will continue to be vital for the future if the city council is to achieve its ultimate aspiration of excellence for the people of Peterborough.”
