Debt-troubled Staveley council heralds ‘new era’ after critical report into its finances

The extent of the town council’s debt led to Chesterfield Borough Council agreeing to a £400,000 loan in February, 2023, to prevent bankruptcy and the two authorities – together with the Local Government Association and National Association of Local Councils – appointed an investigative Improvement Board to establish the causes of the insolvency, monitor the town council’s progress and advise upon its future.

Following a town council meeting, at Staveley Town Hall, on Tuesday, November 28, councillors accepted the board’s report findings into the town council’s previous financial management including its operations, finances and governance arrangements from between at least 2011 and 2022.

Despite severe criticism of the council’s previous financial management, it recognised councillors want to make the town council effective for residents, and it acknowledged lots of potential and opportunities, and praised the current, experienced town clerk but it urged there should be more effective partnership between councillors and other authorities.

Staveley Town Council Chairperson Elaine Tidd said: “Today (November 28) marks a new era for Staveley Town Council as we firmly draw a line under the past and open a new chapter to better represent and serve the local community.

“The town council fully accepts the report and findings of the Improvement Board and is committed to implementing its recommendations.

“On behalf of the town council, I want to thank the Improvement Board and Chesterfield Borough Council for their invaluable help, guidance, and support over the last twelve months.”

The board stressed the cause of Staveley Town Council’s financial position was due to events between 2011 and 2022 which were not due to issues faced by one particular political group’s administration.

However, the board added that the situation was of the council’s own making over many years and administrations but it has urged that everyone now needs to come together to take the council forward.

It explained the financial problems had arisen since the Labour administration from 2011/12 until 2018/19, and since the Community Independents’ administration from 2019/20 who had no support from the Liberal Democrats.

The 2011/12 to 2019/20 administration oversaw problems including HR issues, cost overspend, lost income, and lost grant opportunities which led to a structurally financially imbalanced council by the time of the 2019/20 election and subsequent insufficient action led to the authority’s financial failure, according to the board.

Staveley Town Council’s financial matters reached a crisis point in late 2022 when the incoming clerk reported the council’s bank balance was insufficient to discharge its obligations and even though the impact of Covid-19 was the tipping point, the circumstances had been in place for many years.

By November 2014, auditors identified various spending records not being kept up to date, confused record keeping, payments not supported by invoices, no risk management arrangements and incorrect payroll function.

The council was forced to make budget reductions by 2019 with the closure of a High Street office, reducing maintenance costs for Speedwell and Staveley Hall, reducing caretaker staff, and making cuts across other budget areas.

By 2021 the report stated the council had been operating with little or no reserves since 2012 which had been influenced by cost pressures from matters including the cost of refurbishing Staveley Hall and The Stables and the use of reserves to support the council’s revenue account, legal fees and employment issues.

Investigators found members did little or nothing to preserve or build up council reserves despite advice and warnings from auditors over 12 years.

There were also problems due to the ever-changing number of town clerks and there was further instability after one clerk had a two-year ill health absence.

The report stated that councillors had struggled to work well together and there had been antagonism and complaints. In addition, there was also a fraud loss suffered by the council in 2015/16 as the council’s internal controls had been disabled, according to the report.

But the board has made a series of constructive recommendations for the council including: Regaining public trust and confidence; Having a more consensual and transparent approach to governance; Using a member-officer behaviour protocol; Showing a commitment to peer reviewed accreditation; Demonstrating good governance, policies and procedures; Demonstrating an ability to deliver value for money services; Introducing a training programme for members who need to work together; Seeking to build stronger relationships with Chesterfield Borough Council, Derbyshire County Council, and Derbyshire Association of Local Councils.

The council aims to demonstrate good governance, better engagement with the community, improved management and development of staff and councillors, and it has acknowledged the range of recommendations in the report which also include: Councillors focusing on delivering the 2024-27 Corporate Delivery Plan; Demonstrating good governance through accreditation under the Local Council Award Scheme; Signing up to the national Civility and Respect Pledge; More effective and regular reporting of financial statements and audit reports to committees and the town council; Reviewing the town council’s asset base; And preparing an action plan to implement the recommendations of the report.

Staveley Town Council stated it has considered the key areas addressed in the report which are the cumulative financial impact of previous events such as Covid-19, the council’s budget, staffing, financial reporting, governance arrangements and member conduct and training.

The council’s budget is now deemed to be ‘balanced’ with a clear understanding of the long term commitments that it has to manage, according to the report.

A new financial system has been introduced by the new clerk who has shown a good grasp of the council’s organisation, according to the report, and the authority has since reduced expenditure as it works to pay off its debt.

The board stressed that a good, experienced clerk is now in place and the council is working towards Peer Reviewed Accreditation to demonstrate good governance, policies and procedures and the board was impressed by the initiatives members wanted to do for their communities without draining any further council funds.

Cllr Tidd added: “We are now determined to put our past difficulties behind us and re-establish the organisational credibility and confidence in the town council. Lighting the way to the brighter future is the town council’s motto and that is what we will be focusing on delivering over the months and years ahead.”

Staveley Town Council’s Labour Group Leader, Cllr Barry Dyke, said he supported the report’s recommendations and conclusions.

And Chesterfield Borough Council Leader, Cllr Tricia Gilby, has welcomed the report, which she said provides an independent view of the reasons behind the town council’s insolvency and a sound roadmap and lifeline for the town council to grasp and follow for a more positive future.

Chesterfield MP Toby Perkins has also described the report as an excellent piece of work and he described its recommendations as sensible and that he hopes the council will work together in the interest of the people of Staveley.

The investigation costs are to be covered by the town council, the LGA and Chesterfield Borough Council.