Wirral Council has made progress but “significant challenges” still face the local authority according to a new report.
The external report was published in December 2022 by the Local Government Association but has been made public ahead of a top committee meeting on March 22. It is the latest update on progress made after Wirral Council was heavily criticised for its decision making and finance management in 2021.
That year, the local authority was forced to request £10m from the government to balance its budget and was later slated in two external reports. As a result, a professional panel made up of local government finance experts was set up as well as another panel called the Corporate Peer Challenge to scrutinise the council.
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The new report from the Corporate Peer Challenge praised “encouraging” improvements since the last report in June as well as “positive responses that the Council has made to recommendations.” It said this included key positions such as a Section 151 officer who oversees finances, a Monitoring Officer, and a Director of Regeneration being filled.
However the report also shines a light on issues still facing the organisation as it faces a £12m budget deficit in 2024 and prepares to make £35m in cuts over the next four years putting the council in a precarious position due to low levels of backup reserves.
It said this was the most urgent issue facing the council due to “the council’s financial position worsening in-year due to inflationary pressures” in 2022 as its projected deficit went from £14m to £49m though this later reduced to £38m. This was further reduced to £32m after the local authority received an extra £6m from the government.
The report predicted several tough years ahead for the council to balance the books and improve its financial position, adding: “Whilst the scale of this challenge is significant, it is important to note that this is the start of the process for creating a medium term financial recovery and will only provide headroom for the coming 15 months.
“The Council will need to maintain this approach and rigour to move towards a sustainable medium-term financial recovery for the organisation from April 2024 onwards, recognising their continued vulnerability in this context due to low levels of financial reserves.”
The report also said the council needed to think long term about its finances and with the improvements made, “it is important that they are used to build momentum for the organisation to continue to address bigger and more challenging historic issues which have existed, particularly on the delivery of financial savings, rather than being seen as the completed milestones.”
The report praised the council’s delivery of budget cuts and savings passed in 2022 as a positive sign saying they were “on track” as of December. It also said management of regeneration projects in Birkenhead and Seacombe had also improved with a new board set up to scrutinise the projects.
The report also said the way the council makes decisions had been improved too adding: “There has been a great deal of time given by all groups towards supporting the Council’s approach to budget setting for 2023-2024 and politicians deserve credit for their input and contributions. This must be maintained.”
The report however was completed before the local authority set its budget for 2023-24, which saw Conservative councillors vote against the proposed budget put forward by Labour, the Greens and the Liberal Democrats.
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