The Newham Overview and Scrutiny Committee met to discuss the annual scrutiny work programme, the July finance review, and the non-statutory best value notice. The committee agreed to establish a working party to review the in-year performance of Newham council's budget. They also agreed to Paul Leslie continuing as a co-operative member for the Overview and Scrutiny Committee, and Councillor Anthony McAlmont being named as chair of the Relationship Between Black Boys and the Borough Scrutiny Commission.

Annual Scrutiny Work Programme

The committee approved the annual scrutiny work programme for the Overview and Scrutiny Committee and the scrutiny commissions for the municipal year 2025/2026. As part of the approval, Councillor Lester Hudson, Chair of Overview and Scrutiny, proposed the establishment of a working party to review the in-year performance of Newham council's budget, which was seconded by Councillor Masters. The membership of the in-year budget party will be the four scrutiny chairs and a couple of other people, to be agreed under delegated authority.

July Finance Review

The committee reviewed the latest financial review, which included a look back at the last year, the current position for this year, and a strategic look at the longer term position. Conrad Hall, corporate director of resources, introduced the report, noting a substantial overspend of £41 million in the previous year, and a forecast overspend of £5 million for the current year.

Housing Revenue Account (HRA) Capital Programme

Councillor Terence Paul raised concerns about a substantial underspend in the housing revenue account capital programme, and asked for reassurance that the affordable housing programme would catch up, and whether there was a risk of overspends due to contractors increasing costs. Paul Kitts, the corporate director for inclusive economy, housing and culture, responded that the underspend was due to slippage on several schemes, and that a full paper would be presented in September updating members on the whole program. Councillor Paul also asked if the council had the right construction contracts and procurement in place. Paul Kitts responded that newer schemes tend to be fixed price contracts where the contractor would absorb cost increases.

Adults and Public Health Capital Budget

Councillor Masters questioned the large reduction in capital spend in the outturn for adults and public health. Simon Reid, Director of Commissioning Adults and Health, responded that several schemes were in progress, but had not yet delivered. Andrew Ward, Director of Finance, added that the largest scheme was related to the Health Venture Scales for Care Space Newham, which was in a moderate and progressive state.

Children in Care Placement Costs

Councillor Lakmini Shah, Chair of Education, Children and Young People Services scrutiny commission, raised concerns about high placement costs for children in care, and asked what long-term strategy the council had to secure more affordable and stable accommodation for care leavers. Laura Eden, Corporate Director for Children and Young People Services, responded that the council had been successful in gaining capital to open its own children's home for children with complex needs, and that a four-bedded unit was due to open for care leavers with high needs. Councillor Stratton asked when the high-cost placements would be reviewed, and what the policy was if young people refused the offered placements. Laura Eden responded that the 25 high-cost placements were reviewed every fortnight, and that it was not legal to make a care leaver homeless.

Adult Social Care

Councillor Masters asked what contingencies adults had in budget for any unexpected changes recommended by the Care Quality Commission (CQC). Fireman, director, responded that they had done a lot of work to assess where they were as a directorate, and that they thought that most areas should have been captured. Andrew Ward added that there was not a large contingency pot within the adults budget.

Councillor Masters asked about ideas for stimulating placements at a local level. Mr Raish responded that they were doing a huge amount to look at their shared accommodation market across North East London and work collaboratively on things.

Home to School Transport Costs

Councillor Shah asked about rising home to school transport costs, and what measures had been taken to reduce this overspend. Laura Eden responded that they had a pilot program where they had bought bicycles for families, so that they can cycle with their child to school.

Schools in Deficit

Councillor Shah asked what specific support or intervention the council was offering to schools at risk of falling into deficit. Laura Eden responded that they provided financial and education advice, meeting with the governing body and senior leadership team to come up with a plan to ensure that they can have a balanced budget.

Councillor Paul asked why the consultation was only being done on one school to close and one school to merge, and not across all schools in the borough. Laura Eden responded that they had met with all schools, and that some schools had opted to reduce their pupil admission numbers.

Disposal Receipts

Councillor Paul asked how much of the estimated £17.6 million in disposal receipts had actually come in. Andrew Ward responded that the actual figure was just over £21 million.

Exceptional Financial Support

Councillor Bliss Phone raised concerns about the tone of the report, and said that it would be safest to work on the basis that exceptional financial support was not granted again. Andrew Ward responded that the intent was just to be realistic about the position. Councillor Paul asked when they were going to be clear about what was going to be cut, and when they were going to have that general discussion with residents. Andrew Ward responded that there was no list, and that they wanted to engage councillors in terms of deciding what the priorities should be for the next year.

Councillor Paul asked about the assumptions that were made, and about the assumptions of the standards. Paul Kitts responded that they were doing some work which was examining the relative merits of using their allocation of acquisitions fund more outside the borough than within the borough.

Non-Statutory Best Value Notice

The committee considered a report concerning the Non-Statutory Best Value Notice issued by the Ministry of Housing, Communities and Local Government to Newham Council on 8 May 2025. Paul Martin, Interim Chief Executive, introduced the report, saying that the notice meant that there was a fork in the road for the council, and that what was at stake was really important for the future of the council and its democratic control. Robert Whiteman, chair of the improvement board, added that the notice was a mixture of concerns about governance and the medium-term financial strategy. He also said that the governance issues at Newham were not about political difference, but about behaviour.

Councillor Mercer asked whether the recent change in the top officer position would benefit them towards the best value notice. Robert Whiteman responded that he believed that Paul Martin was better equipped than virtually anybody to help them in their next chapter.

Councillor Masters asked how the presence of the transformation improvement board had affected the desire of people to fill some of the senior management posts. Robert Whiteman responded that he thought having the panel helped, because they built individual relationships with chief officers and talked through succession planning and issues with them.

Councillor Paul asked where the visibility was of what was discussed at the improvement board, and how they ensured that everyone didn't just pat themselves on the back. Robert Whiteman responded that he would write to the chief executive and the mayor with a summary of what was coming out of their improvement board meetings.

Councillor Shah asked who would be monitoring the culture and relationships. Robert Whiteman responded that in well-run councils, everyone has a role in expecting good behavior from their peers.

Councillor Masters said that the mayoral system was quite heavily criticised within the peer review, but that there didn't seem to have been any comment on that role within the best value notice. Robert Whiteman responded that there were some places where the mayoral model was viewed as having worked very well, and that he hoped that they could help them work that through.

Councillor Paul asked to whom the board reported. Robert Whiteman responded that he imagined that it would be looked at by the new chief executive.

Councillor Paul said that he was not quite clear on what success looked like, and that he was concerned that it all fit together. Robert Whiteman responded that he didn't like the language of patting themselves on the back, and that he would advise all members to get into the habit of making a brilliantly incisive point without the more evocative phrases at the end.

Councillor Paul asked what the chief executive's plan was to ensure that they had an element of stability at the upper levels. Paul Martin responded that a crucial part of his job was to provide motivating and supportive leadership to the senior staff.

Scrutiny Chairs' Updates

Councillor Garfield said that they had met in June to agree on the work plan for the commission, and that members were enthusiastic and eager to start the work. Councillor Masters said that they had also set their provisional work program, and that they would be heavily influenced by the outcomes of the CQC report.

Appointments

The committee agreed that Paul Leslie continue as a cooperative member for the OSC, the Relationship Between Black Boys and the Borough Scrutiny Commission, and one other scrutiny commission. They also noted that Councillor Anthony McAlmont was erroneously not named as chair of the Relationship Between Black Boys and the Borough Scrutiny Commission, and proposed correcting this now.