All hon. Members will recognise the importance of having well-functioning local councils which provide essential statutory services local residents rely upon. Local councils must be fit, legal and decent and this Government are aiming to fix the foundations of local government. Today I am updating the House on the statutory inspection of Spelthorne borough council and the steps I am proposing to ensure a focus on reform and recovery, alongside and within the wider context of having invited proposals for unitary local government in Surrey.
Best value inspection report
It is a matter of public record that Spelthorne borough council has significant debt leverage. Spelthorne’s debt stands at nearly £1.069 billion—as of January 2025—which is 62.2 times its total service expenditure and is the second highest level of debt for a district authority in England, after Woking.
A capital review by the Chartered Institute of Public Finance and Accountancy (CIPFA) highlighted concerns around governance and decision making. Following this, on 8 May 2024 the then Secretary of State, the right hon. Michael Gove, commissioned an inspection of the council and its compliance with its best value duty. He appointed Lesley Seary as lead inspector, alongside Mervyn Greer, who were later joined by Peter Robinson and Deborah McLaughlin. Inspectors were asked to report their findings by 31 July 2024. The deadline was subsequently extended to 31 January 2025. The inspectors completed their inspection and submitted their report to the Secretary of State for Housing, Communities and Local Government, my right hon. Friend the Member for Ashton-under-Lyne (Angela Rayner) and, as statute requires, provided a copy to the council. I am grateful to the inspection team for their thorough work, and to the council and all participants for their co-operation.
The report identifies some positive features at the council, such as strong resident engagement and positive local partnerships. The report also notes that the council has already taken positive steps to make improvements, including against recommendations made in the CIPFA review, such as the suspension of the planned housing developments and cessation of further borrowing for this initiative after determining it was no longer viable. However, the report documents serious concerns across a number of areas which I consider to be against its best value duty:
On Continuous Improvement: The report describes the council as having a “poor record” of adequately addressing recommendations from external reviews and the inspectors have no confidence in the council’s ability to make the changes “without significant external support”.
On Leadership: The report highlights that the council lacks consistent leadership, strategic direction, constructive challenge and a robust corporate plan. Optimism bias clouds officers’ awareness of risks, and to some degree the council has been “blindsided” by the financial situation.