Was Somerset's financial emergency self-inflicted?
A Somerset Confidential® investigation looks into reports of chaos in Somerset Council's systems before Somerset Council suddenly declared a financial emergency. Was the crisis self inflicted?
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Was Somerset's financial emergency self-inflicted?
Less than a year ago, on the 8 November, Somerset Council declared a financial emergency. They acknowledged that urgent actions needed to be taken to address the position including the setting up of the Financial Focus Group and the introduction of further financial controls to limit spending.
As we have reported previously, some of those urgent controls included things that most businesses would take for granted as normal. Like having a purchase order system in place for all purchases, with management sign off of the purchase against a specific budget (you can read more about this here and paging down to “Out of control”).
The crisis management seemed all the more drastic as the declaration of a financial emergency seemed to have come out of nowhere. There was no hint of a problem in the first 6 months of the new council. There was no hint of any problem in the year before either.
However new information released in conjunction with the August Audit Committee meeting of Somerset Council calls into question the timeframe leading up to that declaration.
Why did it come out of the blue? Should it have been predictable?
In signing off in his final report as s151 officer before his role is, implausibly, made redundant, Jason Vaughan explains that a financial crisis has been avoided. The numbers for 2023/24 will come in under budget, the council finances are much more robust with £52m in reserves and plans in place to bridge the gaps between likely spend and likely income over the next 3 years.
There can be no doubt that in response to the financial emergency they declared, the council have taken many actions to reduce costs. These actions have in part, contributed to the improved outlook for the council.
how bad was the financial position when the financial emergency was declared
But we now have to question how bad the financial position really was when the financial emergency was declared in November last year?