Review highlights ongoing financial management issues at Northamptonshire

Northamptonshire County Council’s new section 151 officer should draw up plans to repatriate powers from government commissioners amid ongoing problems with financial management, according to an independent review.

In September, Barry Scarr became the fourth finance director at the council in four years, a period which saw the council issue two section 114 notices and have government commissioners imposed on it.

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March 25th, 2020, Manchester
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An independent review commissioned by the council last week said that the council is improving in a number of areas but problems still remain.

It said: “At all management levels there are different messages, attitudes and language evident when discussing financial management and budget pressures.

“There is a lack of collective ownership of the budget pressures, with some areas expressing resentment at having to ‘bail out’ areas of the council where budget and financial management is less developed, and others where there is a sense of inevitability of being unable to manage demand or costs.”

The report also said that some service managers “lack the financial acumen to manage budgets effectively, and are struggling to understand the information available to them”.

In some areas, service managers don’t see budget management as their responsibility, but think that the budget should be managed by finance, it continued.

“There is a tendency to see their ability to impact on the budget as limited, and a failure to connect decisions on expenditure with budget management,” the report added.

Later in the document, the independent reviewers said that “at all levels in the organisation there are people who still do not see it as their responsibility to find solutions to the problems, or who feel that overspends are inevitable and cannot be managed.”

Within the finance function itself, leadership below the section 151 is “weaker than desirable”, the report said.

The report said that the overall size of resources within the finance team “appears to be sufficient” but that reconfiguration is needed to drive improvements.

“There are high numbers of qualified finance staff and some of these should be spending more of their time on the more complex and strategic areas of work, where at present they often seem to be focused at an operational level and supporting work that should be undertaken by budget managers themselves, who could be supported by accounting technicians,” the report said.

It listed a number of recommended actions to be taken by Scarr in his new role, including:

• Setting out and communicating the current financial position, his role and the role of the finance team, along with expectations of budget managers;
• Improve training on financial management and control;
• Build effective relationships with new external auditors;
• Prepare a plan for the repatriation of work areas and improvements currently being driven by commissioners;
• Review skills, configuration and capacity in the finance function.

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