Grant-making powers return to Tower Hamlets

Communities Secretary Sajid Javid confirmed the start of a ‘phased return’ of powers to Tower Hamlets council.

Communities Secretary Sajid Javid confirmed the start of a ‘phased return’ of powers to Tower Hamlets council – which means councillors can once again award grants to local not-for-profit organisations.

It is the first time locally-elected councillors will be able to make these decisions since December 2014, when government-appointed commissioners took over the day-to-day running of certain aspects of the local authority.

Mr Javid welcomed the significant improvements that have been made in the last 2 years and, following progress reports from the Mayor and commissioners and a public consultation, confirmed he would hand these powers back subject to ongoing commissioner oversight.

Mr Javid has also decided to end commissioner oversight of the council’s procurement processes and practices, and to reduce the commissioner team from 4 to 3. But he warned that he would halt the process if any further concerns were raised.

Communities Secretary Sajid Javid said:

"There is no place for rotten boroughs and I’m pleased that since commissioners were sent into Tower Hamlets council, significant changes have been made.

"Thanks to new checks in place, I’m satisfied that we can start a phased return of powers over grant-making and procurement to locally-elected councillors.

"This is a positive step – but one that is being overseen by commissioners and I will halt the process if there are any concerns."

Improvements helping to restore confidence

In 2014, an independent inspection of Tower Hamlets by PricewaterhouseCoopers warned of a breakdown in democratic accountability and a significant risk of misuse of public funds.

In response, the then-Secretary of State appointed a team of commissioners, led by former Chief Fire Officer Sir Ken Knight, to oversee the running of certain aspects of the local authority, and significant reforms to ensure these failings couldn’t happen again.

Subsequently, the then-Mayor of the Borough was found guilty of corrupt and illegal practices by an Election Court.

The latest report from Sir Ken and his team highlights continued progress at the council, with some areas demonstrating good practice, but warns that there is still “much more to do”.

In particular, all decisions relating to grants are now taken during specially-convened public meetings – a step which has increased transparency and has been well-received by local residents.

This latest decision by the Communities Secretary Sajid Javid means that from grant-making powers will now be returned through a phased approach, with commissioners also ending their oversight of the council’s procurement processes and practices.

However, the commissioners will continue to:

• exercise the council’s function in respect of the appointment and dismissal of the Electoral Registration Officer and Returning Officer for local elections
• oversee the council’s decisions relating to the recruitment and dismissal of persons designated to the position of Statutory Officer
• oversee the council’s decisions regarding property disposal or transfer to third parties
• oversee the council’s decisions in relation to publicity

Further information

The commissioners are currently scheduled to leave the council at the end of March 2017, but could stay longer if required.

Following this announcement, Alan Wood CBE has stepped down as commissioner. The 3 remaining commissioners at Tower Hamlets Council are: Sir Ken Knight (lead commissioner), Max Caller CBE and Chris Allison CBE.

See further information relating to the government’s intervention in Tower Hamlets.