Dan Peters Mark Whitehead 27 April 2022

Nottingham expected to bring housing back under direct control after probes

Nottingham expected to bring housing back under direct control after probes image
Image: Peter Tarleton / Geograph.org.uk

Nottingham City Council is expected to bring its housing back under direct control after two independent probes found ‘underlying issues around governance and finance’.

The council was previously forced to issue a section 114 notice acknowledging it had acted unlawfully following a Government review that found £16m from its Housing Revenue Account (HRA) had been wrongly used in its general fund for all services.

This week a report by the Chartered Institute of Public Finance and Accountancy found an additional £24m from the HRA ‘could potentially have been incorrectly used since 2014-15’.

A separate report by external investigator Richard Penn made recommendations including bringing housing services currently provided by Nottingham City Homes as an arm’s-length management organisation back under the control of the council to ensure HRA money was properly ringfenced in future.

The report also recommended strengthening the council’s housing authority role with improved financial knowledge, more detailed involvement of senior officers and scrutiny by auditors.

It said payments totalling £15.9m from 2014-15 to 2020-21 were made in an ‘environment where there were many proposals to reduce expenditure or increase income in order to maintain services and avoid cutting jobs’.

The report suggested anyone who had looked at the council’s 2014-15 budget report – including senior council officers and the external auditor at the time KPMG would have been aware of the payments.

Council chief executive Mel Barrett, who joined the council in 2020, said: ‘These reports identify underlying issues around governance and finance, which the council is addressing as part of our ongoing improvement work.

‘While the reports bring to light the serious failings in past practice Nottingham people may be reassured in knowing that the new leadership of the council has, at every stage, taken steps to identify, understand and own these issues.’

Council leader David Mellen added: ‘The findings of these investigations show that the finance and governance arrangements around the ringfencing of the HRA fell seriously short of acceptable standards, although we are disappointed that this wasn’t flagged up at the time by the council’s external auditors.

‘It’s important to make clear that the funding in question has been used for purposes that benefit local people but that are not an appropriate use of what is effectively tenants’ money.’

SIGN UP
For your free daily news bulletin
Highways jobs

Director of Public Health

Royal Borough of Greenwich
Up to £131,210
The Public Health department is at the heart of the council’s business. Greenwich, London (Greater)
Recuriter: Royal Borough of Greenwich

Head of Regeneration and Growth

Plymouth City Council
£68,387 - £74,411 (MFS and relocation available, pay award pending)
This is a unique opportunity to lead our award-winning development team and directly deliver hundreds of millions of pounds of projects. Plymouth, Devon
Recuriter: Plymouth City Council

Director of Adult Social Care

Wiltshire Council
£119,390 - £127,137
Join us as the Director of Adult Social Care and make a real difference to people’s lives. Wiltshire
Recuriter: Wiltshire Council

Assistant Director Planning, Performance & Engagement

East Sussex County Council
up to £97,700
With strong local communities, unspoilt countryside and vibrant coastal towns, East Sussex offers an exceptional quality of life to many. East Sussex
Recuriter: East Sussex County Council

Director of Finance & Commerce

Lancashire County Council
Up to £114,339
You will play a critical role in driving the organisation through complex change and innovation. Lancashire
Recuriter: Lancashire County Council
Linkedin Banner