Liverpool City Council was issued with a strong warning from the government in response to costly failures over a city energy contract.
The troubled council was already the subject of a government intervention before a litany of errors in securing a new electricity contract led to a disaster that could cost the city as much as £16m. Four commissioners were installed at the council last June in response to the damning revelations from the Max Caller inspection report.
Those commissioners were due to provide their update on the council's improvement work in April, but asked for a delay, citing new issues that had been uncovered. It seems likely that the energy contract failures were a big factor in that delay.
READ MORE: Deputy Mayor removed from finance role after council energy bill 'disaster'
Those failures include council officers not informing the mayor or cabinet that Scottish Power had stopped supplying commercial customers. As a result, no contingency plans were made and the council was automatically placed onto a far more expensive deal. The net result could be a £16m hit to the council, city schools and the fire service.
The mess has already led to deputy mayor Jane Corbett having her finance portfolio taken away, with Mayor Anderson now picking up the brief. She will also hire a new political adviser to specifically help with budget matters. The council has also appointed independent auditors to investigate the mistakes, with a report due back at the end of the month.
The energy contract debacle is a real disaster for a council that was given an historically bad inspection report and landed with commissioners last year. Currently those commissioners are overseeing a specific number of departments, but Communities Secretary Michael Gove could expand the intervention if he believes it is needed. All eyes will now be on that delayed commissioner update, which is expected to arrive on June 10 - a year on from their arrival at the Cunard Building.
Responding to the latest news, a Department for Levelling Up, Housing and Communities spokesperson said: “This situation is unacceptable. We sent in commissioners last year to turnaround this struggling council so that it delivers for the public, and we remain in close contact with them about their progress.”
