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WALSALL ON INTERVENTION SLOPE

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By LGC political correspondent Varya Shaw ...
By LGC political correspondent Varya Shaw

Walsall MBC has just months to prove it can turn around its finances or it could be referred for intervention.

An Audit Commission corporate governance inspection has attacked the council for operating a budget 'at the margins of legality'.

It has taken the unprecedented step of appointing a supervisory board to assist and monitor the council - one step away from referring it to the secretary of state for

intervention.

Walsall failed to monitor its expenditure and raided capital funds to reduce its deficit. The Commission said the overspend was around£10m at its worst.

Inspectors blamed a political culture of feuding and bullying. Audit Commission acting head of inspection Paul Kirby said: 'What we found we regret to say is systemic failure. The politicians are more interested in fighting and feuding.

'The culture of bullying and intimidation has had a long term impact on the ability of managers to say what has to be said.'

Audit Commission controller Sir Andrew Foster said: 'We're very keen to avoid Walsall slipping down the slippery slope to become as Hackney has become. We want to avoid referring Walsall.

'But if we don't see improvement there will be pressure on us to [do so].'

One Audit Commission source labelled the council a 'basket case' after initial presentations on the report (LGC, 28 September 2001). Sources also named it as a possible contender for government intervention (LGC, 2 November 2001).

The council must draw up a 'balanced and sustainable' budget by 31 March, a date the commission suggested would be make or break for the council.

But the commission has learned it must 'not simply walk away' as it did from Hackney, Mr Kirby added.

The supervisory board includes commission representatives, Warwickshire CC chief executive Ian Caulfield and former Gloucestershire CC county director Richard Cockroft. Walsall has also been working with the Improvement and Development Agency's performance support unit.

The council claims it has converted the deficit into a projected surplus of£2.5m.

Liberal Democrat group leader Ian Shires, whose party runs the council in coalition with the Conservatives, said: 'That's why we're smarting about some of the comments within the report.'

Leader Tom Ansell (Con) said action had been taken to improve relations between councillors and officers.

The council is setting up a strategic executive team to tackle performance management and a public relations unit. It is shortly to put in place a cabinet, with six area committees scrutinising services and helping develop policy.

Walsall chief executive Hardial Bhogal said: 'There will be dramatic improvement, but most of all sustainable improvement.'

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