‘An extravagant waste of public money’: inside the meltdown at Wirral Council

By Charlotte Robson, The Liverpool Post

A riddle that’s bedevilled Wirral Council in recent months: how to show the government that you’re (once again) in need of extra funds – but you’re also cost-efficient, trustworthy with taxpayers’ money, exceptional at decision-making, and organisationally sound?

Their answer (at least this time): an extraordinary meeting that involved packing around 70 of the organisation’s most high-profile individuals into its former headquarters to solemnly debate the risks tied to a financial decision some present had already taken a whole month prior.

Perhaps not the most conventional solution, but that’s an adjective seldom applied to the peninsula’s local authority.

Barely five years since funds were made available, news broke that the council was once again applying for millions in exceptional financial support (EFS) to balance its books before an 5th April deadline, raising eyebrows on both sides of the Mersey.

Wallasey Town Hall. Photo: Creative Commons

Grant Thornton — the long-suffering external auditor — had once again identified urgent concerns with the organisation’s pecuniary stability. Shortfalls in the 2024-25 budget caused by overspends and chronically low reserves — by now, almost a Wirral speciality — suggested that the authority may not be able to meet its financial obligations by the fiscal year-end, nor set a legally viable strategy for 2025-26.

Now, though, the stakes were even higher. Auditors had exercised legal powers to issue the council with a statutory recommendation in January, meaning the secretary of state had also been notified, as is standard practice. They gave decision-makers one calendar month to publicly recognise the severity of what remains a precarious situation. Without improvement, the prospect of a dreaded section 114 notice — the closest UK councils can feasibly come to layman’s bankruptcy — still looms large.

Eight days after the recommendation was issued, all sixty-six elected councillors, led by Paul Stuart of Labour – an ambitious ally of Wallasey MP Angela Eagle from her failed bid to reunite and “heal” the Labour Party by ousting Jeremy Corbyn – were summoned to the unusual meeting at Wallasey’s town hall. (In 2022, Al Jazeera’s Labour Files investigation had unmasked right-leaning Stuart, soft-spoken but not at all media-shy, as the instigator behind the compilation of a dossier attacking fellow Wallasey members.)

The otherwise out-of-use, Grade II-listed town hall was reopened to the tune of £400,000 a year in 2024 after some councillors had felt intimidated by Liverpool Friends of Palestine’s March protest outside Birkenhead town hall. A Labour and Conservative-led majority had voted against a ceasefire in Gaza, and members of the public turned up to heckle them for it.

“Of course there was a public reaction,” Bromborough representative Jo Bird, the Green Party co-leader, told The Post. “And [Stuart] should take responsibility for his actions. He’s leading the council [in] an extravagant waste of public money.”

A Birkenhead native, Bird was originally elected under Labour Party banners in 2018, but he was expelled after speaking at a Labour Against the Witchhunt (LAW) campaign group meeting that same year and later signing one of its petitions in 2020. LAW was founded to contest what it called politically-driven allegations of antisemitism among Labour members, and it was proscribed by the party’s UK executive committee in July 2021.

Bird, whose own Jewish great-grandparents were forced to flee Eastern Europe for fear of persecution, was expelled retrospectively four months later. Unflinching and piercingly perceptive, she describes herself as an eco-socialist and is often spotted sporting at least something green.

Councillor Jo Bird addresses the chamber. Photo: livestream

Paul Satoor, the council chief executive, also joined the meeting. So too did Matthew Bennett, the finance director. Should balancing the books ultimately prove too difficult over the coming weeks, the responsibility for serving the section 114 notice would fall upon Bennett’s shoulders.

But did all this pomp and circumstance help either taxpayers or the central government feel assured that the council could really turn things around?

A culture of division

“If your leader doesn’t tell you anything, you’re in the dark,” one Conservative source said of meetings like these. “Unless I ask questions myself.” But getting a personal meeting with officers is nigh-impossible.

In 2020, Wirral transitioned to a committee system of governance, as opposed to a cabinet model. No single party has held more than half of its seats — and therefore a controlling majority — since 2019. Labour today leads with 29 seats, followed by the Conservatives with 17, Greens with 14 and the Liberal Democrats with six.

Despite the Greens forming around 20% of the council, only Labour, Conservative and, more recently, Liberal Democrat members chair these all-important committees. About her party’s conspicuous absence, councillor Bird says its leadership role has been carved out and replaced. Prior to Stuart becoming overall leader in May 2023 — and following a planned coup against Labour’s Janette Williamson, for whom he had served as deputy — the allocation of committee chairs between parties was usually fair and proportional, Bird’s co-leader Pat Cleary affirms. (It was reported at the time that Stuart had attracted Tory support for his own leadership bid by promising them paid committee chair positions in advance.)

“And that’s important,” Cleary, the representative for Birkenhead and Tranmere, tells The Post. He comes across as thoughtful and considered, with a soft Irish accent. “[Without it, there is] a kind of cultural division, a culture of decisions being taken in a non-transparent way.” From his perspective, solid, day-to-day financial decision-making has given way to politics-playing under Wirral’s current leader. The Greens have never much appreciated Stuart’s style of running things. Cleary calls Stuart’s approach “very partisan” and non-collegiate. The Greens have felt pushed out, which has not been good for residents: “We see that as a key reason why the council has again slipped into financial difficulties, to put it mildly.”

The Post spoke to Cleary the day after details of a no-confidence letter in Stuart’s leadership was leaked to the press — by members of Stuart’s own party. Labour’s leader has since announced his decision to stand down in May; he will continue to represent the Seacombe ward as councillor.

Cleary painted a striking picture of an almost coalition-like alliance between Labour’s Stuart and the Tories’ Jeff Green. The two would turn up together at committees they would not otherwise be expected to attend to watch and make sure, side by side, that “their members do the right thing, as they see it”. Cleary says it is more often Jeff Green, as leader of the Conservatives, who backs Stuart in the press — for instance, recently calling Stuart’s decision not to seek reelection as “tribal nonsense” and praising his work “across party lines”.

Councillor Jeff Green takes up his Mayoral chains of office at Wallasey Town Hall in 2022. Photo: Wirral Council

An anonymous Conservative insider offered another angle. They described Stuart as nice, quite quiet…and somebody Green “probably thinks he can manipulate”. The source recalled how their leader does not enjoy competition and tends to play favourites, “take over" and “waffle on a lot” at meetings. “He likes it to be the Jeff Green show; we all say that.”

Both councillors Stuart and Green ignored repeated requests for comment. As did members of the Labour party. Nobody from the Conservatives would go on the record.

Every little helps

Talking to councillors in the weeks since January’s meeting, some of whom asked to remain anonymous, The Post learned of unearthed corporate credit or purchasing card (ie, p-card) transactions from recent years. These included a personalised car number plate, thousands of pounds’ worth of Asda shopping, hundreds spent on takeaway pizzas, and thousands more in vouchers bought in value retailer B&M – all single transactions with council p-cards, on which there should be no personal spend. Nine or so items from Vue cinema totalled just under £200.

Querying the latter with finance, a Conservative source was reassured that the money would be paid back. But how? And to which account, exactly? Using what reference number?

The department did not respond. It had been quite a process to obtain this transaction-level data at all. Colleagues in finance made it quite clear that they considered the councillor’s request an added pressure they didn’t need.

“It is symptomatic of the fact that you haven’t got a handle on your finances,” the elected member said. The p-card transactions serve as examples of “all the add-ons that we presumably spend when we don’t need to…nobody can tell me the actual or the minimum amount that we have to pay out on statutory services.” Services like, for instance, social care for children and adults.

Councillor Bird has faced similar difficulties with her requests for key financial information. By the time of our interview, she had been waiting on a breakdown of precisely which council services are statutory, and therefore mandated by law, versus which are discretionary, and therefore more flexible for a few months. In these times of intense financial pressure and increased scrutiny, you would be forgiven for imagining an all-hands-on-deck attitude behind the scenes to locate and maximise every inch of extra breathing room possible — not continued constrictions on useful data.

Asked what she truly thinks about Wirral’s finance team, Bird rather tactfully replied: “There is a very strict protocol about members and officers’ working relationships and elected members, councillors, are not allowed to criticise officers of the council in public. So I can’t really say much more than what I’ve said.” She describes the prevailing culture inside the local authority as one of deny and delay.

Addressing the January meeting, Bird highlighted an especially conspicuous sign of wastage: the new, 150,000-square-foot office blocks built by the council’s own Wirral Growth Company in the town’s Alice Ker Square, alongside regeneration partner Morgan Sindall-owned developer Muse Placements Limited. Wirral Growth Company is steered by councillors and sub-committee members Jeff Green and Jean Robinson, alongside the council’s assistant director of finance and investment, Daniel Kirwan.

According to Bird, the buildings, one of which remains vacant, while the other still has a whole floor of empty office space, represent a daily drain of £10,700 from the local authority’s pockets. They belong to London-based Canada Life Asset Management, which agreed to forward-fund the £75 million development after Wirral agreed to 35-year repayment terms. Asked by The Post why these buildings weren’t designed to facilitate public council meetings, in light of Wallasey town hall’s reopening following last year’s protests, Bird responded: “It’s a very good question and [members of what was then] the Labour cabinet can answer that. They’re the ones who approved the business plan. It’s entirely possible to move meetings into [one of the buildings], just as it was possible to move meetings into the Floral Pavilion theatre in New Brighton during lockdown.”

The new lobby at the Alice Ker Square building. Photo: Rightmove

In the budget FAQ posting on the council’s website — under the heading “What is being done to ensure this won’t happen again?” — you will find a so-called “major transformation of the council’s digital capability to modernise business processes.”. Not a single councillor The Post spoke to recognised whatever this plan is. Those questioned include three P&R committee members: councillors Bird and Gilchrist, both of whom also serve on the finance sub-committee, as we have seen, plus councillor Cleary. No official public announcement about this contracted-out work has been made to date, but “there will be a report on digital in due course”, the council’s press office told us.

This four-year contract for cloud-based services — ostensibly, funded through preassigned reserves, capital and receipts from sales of council-owned assets — was awarded last summer. Who won the tender? Little old Microsoft, to the tune of up to £5 million. Ideas for related, medium-term budgetary savings that could be generated within four years’ time — note the multi-million-pound contract’s expected duration — include automated data entry to replace paper forms and other manual processes, a reduction in the number of telephone calls to council employees, and the roll-out of AI-based “efficiency” tools across the borough, as well as internally to improve forecasting. All a little vague, and hardly revolutionary.

By the time a report in support of Microsoft’s appointment was published in June, neither the exact cost nor scope had been ironed out. Matt Bennett ultimately signed off on the contract, with prior approval from P&R.

“At this stage, it is not possible to fully understand how much the cost of digital transformation will be,” wrote assistant director of digital, data and technology Peter Moulton, not too reassuringly. Any purchases of new IT systems needed to support Microsoft’s delivery “will be funded from savings achieved through efficiencies”, Moulton added.

A show of support

Let’s back up for a moment. In the last P&R meeting of 2024, it was widely known that finance director Matt Bennett was almost ready to submit the council’s EFS application to MHCLG by December 13. Discussions had been underway since November.

Stuart wanted an update. Bennett told P&R colleagues that a provisional amount of up to £20 million would now be formally requested.

All management committee meetings and gatherings of the full council are open to the press and public, both in person and by live broadcast via Wirral’s website. But sub-committees and working groups meet privately, including the finance sub-committee, comprised of Labour deputy leader Jean Robinson and all party chiefs — with the exception of Greens co-leader Pat Cleary. (Who first won his seat in what Labour then called a one-off protest vote in 2014, due to committee weighting.)

Conservative leader Jeff Green, who served as Lord Mayor between 2022 and 2023, and himself led the council in both 2010-11 and 2012, first voiced his endorsement. Green, who appears to possess almost thespian levels of self-assurance, said that something like a “cross-examination” of senior managers across the under-pressure children and adult’s social care directorates had satisfied him that reasons for the budget gap were as Bennett had described. Leader of the Liberal Democrats Phil Gilchrist — nowadays, the authority’s longest-serving elected member — similarly spoke up to say that EFS would help the council “keep things going as best we can in very difficult times”. Councillor Bird shared his sentiment, but cautioned that funding-related conditions, if approved, could be “endless” and burdensome down the line.

Councillor Paul Stuart addresses the chamber. Photo: livestream

Councillor Stuart addressed his own comments directly to observers, including the media, gesturing affectedly towards the back of the room. Strikingly, the majority leader apportioned blame for the budget shortfall squarely in the hands of private providers of residential care for looked-after children:

I welcome the government’s position on the profiteering of care homes that is clearly going on and I hope that they move quickly to try to resolve that, because it is a massive, massive issue. I don’t think it’s an issue many residents get and I’m not expecting there to be hundreds of our residents watching, but I am aware that the press is here and for those who are watching this at home, an example is that a child in care can and has cost us up to £18,000 a week for a placement. These are the kind of costs that cannot be foreseen and have left us here in Wirral and right across the country need[ing] this exceptional financial support.

Wirral Council’s homepage posted a budget and P&R committee update with a statement from Stuart, its chair, on 16th January, forecasting in-year overspends in children and adult’s social care to the tune of just under £10 million and £8.9 million, respectively. (A £2.9 million gap was likewise highlighted in the finance budget, as was a £2.3 million shortfall for neighbourhood services including car parking charges — which councillors only voted to reintroduce back in December. The total deficit for 2024-25 so far is projected around £21.6 million.)

Father-of-four Stuart has been a foster carer since 2017, the year after he was elected. He didn’t mention in his speech that weekly fees for a single child’s residential placement had spiralled well beyond £18,000 in the previous financial year. Chris Carubia — deputy leader of the Liberal Democrats, as well as children, young people and education committee vice-chair — told the BBC-funded Local Democracy Reporting Service in October 2023 that Wirral was then spending an eye-watering £42,000 a week to cover the costs of but one child’s private residential care.

Green seconded the Labour leader’s motion to endorse Bennett’s EFS application. Indeed, the recording shows all P&R members raising their hand in favour. There were no questions.

MHCLG’s decision is expected before March’s end. As of last February, the ministry has agreed more than £1.5 billion in support across 19 councils, from cash-strapped Birmingham to penurious Woking, this financial year alone.

Evidently, any risk or possibility of requesting exceptional financial support from central government should surely have been old news by January. Not least to council leaders.

So why on Earth did the local authority need to kick off the year with such a public airing of escalated external improvement recommendations — the real-world relevance of which feels like a line in the sand it had already crossed?

In the risk business

Grant Thornton was late to file audit findings. Lack of delivery in December meant that month’s meeting of the audit and risk management committee was cancelled.

Calling the full-council meeting to Wallasey’s storied chambers on 14th January, with time running out to fulfil auditors’ statutory recommendations, still meant bypassing audit and risk. In so doing, members couldn’t assess or respond to these same recommendations with authority.

Helen Cameron, Conservative councillor and the committee’s chair since May, noted this to lead auditor Sarah Ironmonger when members did finally reassemble. Cameron pointedly expressed how she had felt uncomfortable signing off on the authority’s 2023-24 accounts in October. Key deadlines had been missed in September and November.

L-R Naomi Povey and Sarah Ironmonger of Grant Thornton, as the latter tells January's audit and risk management committee that their 2023-24 audit fee would need to be renegotiated. Photo: livestream

“Although officers had sight of your report,” Cameron said, nodding her head in Matt Bennett’s direction, “it was published in its entirety to hit the timeline for full council for your statutory recommendation.”

6th January was therefore the first time those responsible for monitoring the authority’s financial statements on taxpayers’ behalf had seen the final report — no earlier than residents, the press, and the wider public. Notably, though, not a single councillor took up the opportunity to question either Ironmonger or the council’s directorate about any specific detail contained within the document’s seventy-plus pages.

The fiscal writing on the wall

It perhaps comes as no surprise that despite regular meetings with senior officers, councillor Cleary had no idea the council was experiencing such significant financial issues prior to September’s mid-year freeze on unnecessary spending, hastily implemented once its overspend iceberg finally came into view. “That came as a shock to me,” Cleary says, noting he hadn’t been prepped with any particularly concerning forecast data beforehand and “councillors do rely on senior officers to give them a straight report of what’s going on”

You could reasonably ask, Clearly poses: are councillors, and committee chairs especially, even asking the right sort of questions of Wirral’s unelected leadership?

Are the press? The council has already pushed February’s budget meeting back to March, indicating the central government may not have been so quick to jump at the council’s ‘exceptional’ and well-publicised, not to mention time-sensitive, demands. This month’s policy and resources committee will similarly meet a week later than expected.

If true, does this mean the local authority’s advanced-stage case for another 20-year EFS loan is not quite as strong as its senior leaders, elected and otherwise, would have onlookers believe?

By the fag-end of Tory rule, the chief executive of the Local Government Information Unit spoke of an “existential threat to local government”, and just over a year ago, nearly one in five town halls were in the position Wirral’s now finds itself. This included “blue wall” shires such as Essex, Hampshire, Kent and Surrey, but less affluent areas have borne the brunt of central government cuts in the age of austerity. According to the Special Interest Group of Municipal Authorities (SIGOMA), the 10% poorest councils — including Liverpool and Knowsley — received a 28.3% on average cut between 2010 and 2023, a funding reduction nearly three times larger than the 10% wealthiest.

Wirral is in neither of these extremes. Nevertheless, SIGOMA figures show its funding was cut by a quarter while the Conservatives were in government. A look at Hansard in 2022 shows that Wirral West’s then-MP, Margaret Greenwood, alongside her Birkenhead colleague Mick Whitley, raised the issue of an even larger reduction in the peninsula’s local authority funding: from £266 million in 2010 to just £40 million by 2020.

In the context of that 85% reduction, a £21.6 million deficit and a section 114 notice looks more understandable. It’s no surprise that in May 2023, Wirral Council joined Liverpool and Knowsley in signing SIGOMA’s manifesto "for a sustainable and fairer future", with Stuart enthusiastically on board. While Wirral’s profligacy and mismanagement should not be underplayed, the fiscal writing has been on Wallasey’s grand neoclassical town hall’s walls for some time. And it’s a situation that will take more than competency and further cuts to remedy.

Source    16/02/2025