Troubled Liverpool City Council is making progress, its commissioners have ruled, but there are still risks.

In their third report to the secretary of state, commissioners claimed they were cautiously optimistic about the council’s improvement journey – and they do not expect to extend the intervention.

It comes after the last report called for further powers to rescue the failing council, which in turn lead to the appointment of a Stephen Hughes as finance commissioner.

Since then, the council has come up with a plan to meet the budget gap, agreed its organisational structure, established a transformation programme and recruited Cheshire West and Chester chief executive Andrew Lewis as the new chief.

But, the commissioners warned there is significant risk on the horizon with a change of governance and political leaders as the council switches to a leader and cabinet model and all out elections with new boundaries.

The new leadership team, the transformation process and the culture change all require ‘close management’ the commissioners claimed.

Lead commissioner, Mike Cunningham, said: ‘Although challenges and risks to continued improvement remain, we are cautiously optimistic that the current positive trajectory will continue.’

Interim chief executive, Theresa Grant, said there had been ‘a significant shift’ in the commitment to delivering change during her tenure.

‘I am particularly proud of the way the whole organisation, including frontline staff and elected members, rose to the challenge of delivering a realistic balanced budget in a very short period of time to put us on a stable financial footing,’ she added.

Responding to the report, local government minister Lee Rowley said: ‘The decision to end the intervention in Liverpool City Council will only be made when the organisation has demonstrated that its improvement is sustainable.

‘You have been clear that this is possible to be achieved in the next 18 months, but that it is not yet a given and will require determined leadership and focus.’

This article was first published by The MJ (£).