The chief executive of Liverpool City Council said measures have been put in place over the past 18 months to resolve a plethora of governance failings that sparked an ongoing police investigation and subsequent Whitehall action, and vowed to do a great deal more to improve investor confidence.
“This is not a council that’s in a corner licking its wounds, this is a council that’s leading its place,” Tony Reeves said in an interview with Place North West. “Liverpool is very much open to business – good business.
“And while the start of this story is not great, how it ends is very much up to us. Collectively, we can make sure it is positive and that we build on the opportunities we have here, and the council will absolutely do that.”
A damning report into Liverpool City Council’s operations by Whitehall advisor Max Caller, commissioned by ministers last year and published yesterday, identified a host of “deeply concerning” management failings and a “dysfunctional, rotten” internal culture, according to communities secretary Robert Jenrick.
As a result, Government-appointed commissioners (likely to be around three people, said Reeves) will be sent to support the council by overseeing certain functions over the next three years. At the same time, a Merseyside Police probe known as Operation Aloft is ongoing, investigating suspected corruption in the award of building contracts across the city.
A total of 11 individuals including former mayor of Liverpool Joe Anderson have been arrested on charges ranging from bribery, conspiracy to defraud, witness intimation and misconduct in public office, and later released as part of the probe. No charges have been brought and all individuals have denied wrongdoing.
In one of his first interviews since the publication of the report, Reeves told Place North West that he recognises “there is still a lot to do”. But he was at pains to stress that much of the wrongdoing highlighted by Caller took place before the police investigation began in mid-2019 and has since been addressed by the council.
“The report is shocking for a lot of people, and it highlights a lot of bad practice, but two things: the vast majority of that is historic, and it is a small number of people responsible for that ‘wrongdoing’ – I’m not saying ‘criminality’ here, that’s a matter for the police – but in terms of not following proper process and policies and doing the wrong thing.
“I can’t say to you hand on heart more won’t come out, we just don’t know, but what I do know is these are historic issues we are dealing with, and in terms of property management and culture, the council is on a rapid improvement journey. We are really determined about what happens next and how we’ll get it right.”
Reeves described his own role in helping to identify issues within the council shortly after he took the reins as chief executive in August 2018.
“I already had some insights gleaned from my time advising the council in my previous post [as an independent consultant], including concerns over transparency around property deals. In early autumn 2018, I was invited to speak in front of a property audience and I made it clear that while I thought there were some quality development and regeneration projects in Liverpool, and some world-class projects, there were also some where the quality wasn’t good enough for a city as fine as Liverpool,” he said.
“I made the point then that I wanted to see much more consistency and transparency in the way the council dealt with the property sector. Because of my background in regeneration I know a lot of people, so I was aware that there were perceptions it wasn’t a level playing field in Liverpool and that some people got preferential treatment.
“Whether that’s a reality or not, people’s behaviour is shaped by their perceptions so I knew we needed to do something about it.”
One of the first actions Reeves took to improve council processes was to move the property and asset management functions from the regeneration directorate to the finance and resources division, “to make sure we had a proper grip on property deals and were following the council’s ‘standing order’ protocol [which governs how public money is spent],” he explained.
However, later on, the council received two formal complaints – the details of which Reeves says he is not at liberty to discuss as they are the subject of the ongoing police inquiry – that prompted the council to conduct its own investigations. One of these was led by an external independent lawyer, and the other by the internal auditing team.
“They highlighted some really concerning issues and under local government law, if in the course of your investigation of issues, if there is potential criminality you are duty-bound to make a referral to the police. So we did, and that kickstarted [Operation Aloft].”
‘This is not a council that’s in a corner licking its wounds, this is a council that’s leading its place.’
The first the public heard about the probe was in December 2019, when the first two arrests were made, of former council head of regeneration Nick Kavanagh, and property developer Elliot Lawless, founder of Elliot Group. Both were released without charge.
Reeves said the council has implemented a host of other measures over the past 12 months to improve the council’s operations and continues to do so. Among these actions are toughening up due diligence processes; rewriting property contract standing orders; reviewing disposal policies; training up staff and councillors, and abolishing the council’s involvement with any property schemes that involve ‘fractional’ sales as of last year.
In addition, Reeves appointed a new assistant director of property management, Lee Kinder, from Blackburn with Darwen Council, last autumn and is in the middle of restructuring the council’s senior management team. The latter has taken a while, he says, due to staff disciplinary procedures set to continue in the coming months. This week, Kavanagh was formerly dismissed after having been suspended following his arrest in 2019.
“It’s because of the way we’ve addressed those issues that we’re having in effect, a ‘light-touch supervision’ by the Whitehall commissioners rather than full control imposed upon us,” Reeves told Place North West.
He added: “In officer terms, I’m the chief executive and the figurehead and I get that, but there are a lot of really, good, honest, hardworking people here in the council, who stood up and wanted to put the record straight. And the report recognises we’ve been doing that for a considerable period of time.
“What people saw this week was the public lifting of the lid, but we’ve been dealing with these things over the past two years and also driving forward at the same time.”
Reeves pointed to several large-scale property projects that have seen progress in the past year, even during the pandemic, including plans for the Littlewoods redevelopment, the opening of The Spine next month, the Knowledge Quarter, Central Business District at Liverpool Waters, the start of remediation works at Festival Gardens and the tender process that has just launched for seven sites in Kings Docks.
“And I can tell you now: the pace is not going to slow down,” Reeves added. “What we want to help us progress are strong partnerships with good private sector partners with proper funding, and to secure fantastic development that along with the other things happening in the city will continue to transform Liverpool in the way that the many good projects here have done in recent years.
“There’s a lot of positivity to build on. Our journey will be a long one, but we’re already on it, and the public, and the business community, should take confidence in that we’re on the right path.”