Nottingham City Council is preparing to spend a further £1m on a consultancy firm to help it improve its finances, bringing the total to more than £2m in a year. The Labour-run authority had already approved spending around £1.1m on consulting and auditing firm PricewaterhouseCoopers (PwC) to deliver its financial improvement plan.
However, the council says PwC is again required “to support ongoing transformation programmes as part of the council’s overall improvement journey”. The required expertise, which the council says it does not have within its own workforce, will cost £1.1m, plus up to £55,000 allocated for any expenses.
The commission of the consultancy firm will directly support instructions set by the Improvement and Assurances Board (IAB), which was appointed by the Government to oversee change and make sure the authority is providing best value for city taxpayers following the collapse of Robin Hood Energy.
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Such instructions must be met by the deadlines set by the board, after it was given additional powers to direct in favour of commissioner intervention earlier this year.
Of the spend, a council spokesman said: “PwC will provide capacity and expertise to enable up-to-date reporting of complex staffing data for managers at all levels in the council; support the development of the core strategic teams to maintain the council’s focus on best value in all services in the long-term; and provide capacity and expertise to support ongoing transformation programmes as part of the council’s overall improvement journey.”
PwC is is considered one of the ‘Big Four’ accounting firms alongside KPMG, Deloitte and Ernst and Young (EY). The firm has also been working as the council’s ‘strategic delivery partner’, a role which ensures the delivery of savings included in the authority’s recently approved four-year financial plan (MFTP) and its Together for Nottingham improvement plan.
Its contract as the delivery partner was extended for six weeks towards the end of last year, costing a further £149,000.
Last week the council further published separate documents revealing it would be calling upon another of the Big Four firms, Ernst and Young Global Limited (EY), to help its finance team solve problems in its accounts and finances.
EY’s assistance over 12 weeks will come at a cost of £175,000, plus any expenses. The funding for both sets of work will come from a £2.4m funding allocation to support its response to the Improvement and Assurance Board instructions, the council says.
This allocation is a part of the Financial Resilience Reserve, which was approved by the Executive Board in March, along with the transformation reserve held for the funding of improvement activities met from revenue the council has set aside.
Improvements are also being funded using some of the cash generated from the selling of property assets the council no longer needs.
And a £20m sum has also been borrowed for these activities, with the council’s assets used as security against it. Speaking previously of the use of consultancy firms, council leader, Councillor David Mellen (Lab), said: “Where this work is specialised or we don’t have the necessary capacity within the council, we need to bring in external expertise.
“Often this work is for shorter periods only so it makes more economic sense to have people working on these specific projects with temporary contracts rather than as permanent staff so they can drive and direct the required changes which will leave us a better, more efficient council.”
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