A council-owned trading company providing financial services needs ‘urgent’ attention according to a review of activities.
A Peer Review conducted by a group of council officers and members from other parts of the country, highlighted the issue with Public Sector Partnership Services Ltd (PSPSL).
The company is owned by South Holland, Boston and East Lindsey councils and provides financial services, including collecting council tax and business rates each year.
But the review, published after a two-day visit in July, said there were ‘concerns’ around the governance and reliability of the service.
A £1m deficit in the 2022/23 revenue outturn was not forecast ‘due to issues with the reliability of financial data provided by PSPSL’ says the report which said the outcome was a ‘concern.’
“SHDC’s financial operational and reporting arrangements are a cause for concern,” it adds.
The Peer Team consistently heard that the performance of financial services arrangements are impacting on the council’s ability to ensure sound financial and risk management drive transformation.
“This included concerns around: governance, the reliability of financial data provided by PSPSL, implementation of finance systems, provision of support and timely information and local government skills and expertise within PSPSL,” the report, due to go before South Holland District Council’s Cabinet on Tuesday, says.
“Urgently address the financial planning and management performance for financial service arrangements and ensure PSPSL acts as an enabler of wider transformation,” says the action plan.
It also says the company has ‘recruited more experienced resources to assist and have more recruitment underway with a focus on ensuring local government experience is added to the team.’ The council was praised for its Future Leaders Programme by staff and the flexible approach for hybrid working was also highlighted.
“It is apparent SHDC have committed, loyal and motivated staff who are recognised internally and by external partners as an asset,” cabinet members will hear.
But: “There is uncertainty within the workforce stemming from the gradual pace – and lack of clarity around – future service reviews across the South East Lincolnshire Council Partnership and inconsistencies around employment terms and conditions,” the Peer Team noted.
Coun Nick Worth, leader of South Holland District Council said: “We invited representatives from the Local Government Association in July to conduct a South Holland Peer Challenge which was a great opportunity for members and officers to look at what we are doing well as well as learning from areas of improvement.
“A set of recommendations were highlighted following the challenge and the council has now published a brief action plan.
“We will of course, keep residents updated.”
While the creation of the partnership has been ‘transformative’ it is also important to develop and communicate a single view of the transformation, says the report.
A total of nine recommendations were made including a robust plan to deliver savings within the medium term.
Many of the actions are ongoing apart from a suggested review of the waste strategy which has no timescale alongside the key action.
