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An LGC exclusive by Varya Shaw, political correspondent ...
An LGC exclusive by Varya Shaw, political correspondent

The government is drawing up a hit list of councils it believes have problems severe enough to merit intervention.

LGC understands around six councils are being considered for intervention either by the DTLR, the Department of Health or the Department for Education and Skills.

Possible candidates for such intervention include Walsall MBC, which one official labelled a 'basket case' after an Audit Commission corporate governance inspection. Hillingdon LBC has also had such an inspection, and was issued with a s114 notice last year.

Derby City Council, Malvern Hills DC and Waltham Forest LBC have been named by sources as councils with severe problems, and it is thought some councils in the north and west of London are of concern to the government.

However, prominent figures in local government say there is unlikely to be more DTLR interventions ion the basis of chronic failure, as the Hackney LBC case is unique.

Bill Murphy, head of peer review at the Improvement & Development Agency, said: 'We don't think [more Hackney-style intervention] is true. It doesn't make any sense. There isn't a model for it.'

Referring to the work on categorising councils for the local government white paper he said: 'There's some work going on around assessing people, but it would be very surprising to do something before that was completed.'

Intervention in social services or education was much more likely, he said.

Local Government Association vice-chair Lord Hanningfield (Con) agreed: 'I would be very surprised if the government intervenes to the extent it has in Hackney. For those of us who live these things day-to-day, there's no other council has problems across the whole range like Hackney.'

In this case, councils whose education or social services departments have recently been criticised by inspectorates could be in the frame.

A Derby City Council spokeswoman said Derby's Ofsted report had shown more strengths than weaknesses, but a subsequent management consultancy report did not recommend outsourcing.

Hillingdon LBC has had a corporate governance inspection, a new type of inspection designed to assess cross-cutting performance issues.

Hillingdon deputy leader David Yarrow (Con) said the corporate governance inspection was 'routine'. He added: 'The s114 should never have been issued. We're talking about£600,000. Haringey and Lambeth LBCs are£14m adrift and the government is only thinking of issuing one.

'The government intervenes too much as it is from a financial point of view. If the government came into Hillingdon with the same funding there would be the same problems.'

Malvern Hills DC chief executive Chris Bocock said: 'I've heard of no government intervention. We have no failing services, we have cracking services.'

Waltham Forest deputy leader Terry Wheeler (Lab) said: 'We do not accept the label 'failing borough', but that does not mean we are complacent. We are constantly striving to provide better services and best value to residents.'

A spokesman for the DTLR said: 'We have not had representations from the Audit Commission or any other inspectorate. We have not been informed of these councils. It's all speculation at this stage.'

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