Department for Communities and Local Government
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Sajid Javid: grant-making powers return to Tower Hamlets

Plans for a ‘phased return’ of powers to Tower Hamlets council announced.

Communities Secretary Sajid Javid recently (2 December 2016) announced plans for a ‘phased return’ of powers to Tower Hamlets council, so they can now make the final decision on grants awarded to not-for-profit organisations in the local community.

But Mr Javid warned that the government-appointed commissioners who found a ‘breakdown of democratic accountability’ in 2014, would continue to oversee these decisions to ensure taxpayer’s money was put to best use.

The commissioners’ latest report to the Communities Secretary shows that, over the past 2 years, improvements have been made. In response, Mr Javid is minded to return these powers to the directly elected mayor as well as plans to end the commissioners’ oversight of procurement – but said he would halt the process if further concerns were raised.

Communities Secretary Sajid Javid said:

In the past we had a situation in Tower Hamlets where the former mayor was handing out grants against the advice of its own officers, which an election court later found amounted to the corrupt practice of bribery. There was also no monitoring of what hard-earned taxpayers’ money was being spent on.

Since commissioners have been in place, root and branch reforms mean I am now minded to start a phased return of grant-making responsibility back to the mayor, so these key local decisions can return to those who have been directly elected by local residents.

This is a positive first step – but I won’t restore full powers until I can be sure residents’ money is in safe hands and will halt the process if commissioners raise any concerns.

Cleaning up a ‘rotten borough’ to restore residents’ confidence

In 2014, an independent inspection of Tower Hamlets council ordered by the government and conducted 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 4 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.

The commissioners’ latest report to the Communities Secretary highlights continued progress at the council, with some areas demonstrating good practice, but warns that there is still “much more to be done”.

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.

On that basis, the commissioners have made a clear recommendation that grant-making powers be returned through a phased approach, and that the commissioners’ oversight of the council’s procurement processes and practices now ends.

Further information

Under proposals published recently for consultation, Sir Ken Knight and his team would continue to:

  • exercise the council’s function in respect of the appointment and dismissal of the Electoral Registration Officer / 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 and publicity
  • oversee the council’s decisions in relation to publicity

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

Local people now have until 16 December to have their say, with a final decision expected before the end of the year.

The 4 commissioners at Tower Hamlets are: Sir Ken Knight (Lead Commissioner), Max Caller CBE, Chris Allison CBE and Alan Wood CBE.

Further information relating to the government’s intervention in Tower Hamlets is available on GOV.UK.

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