Thurrock Council is a unitary authority in the south of Essex and it was, once, heralded as a beacon for the Conservative Party with regard to managing Local Authority Finances. In 2016, it embarked on a series of risky investments that led to bankruptcy. This resulted in the council incurring a £1.3bn debt. The Chief Executive, Lyn Carpenter, and Director of Finance, Sean Clark, both resigned and Essex County Council were ordered to investigate. They found that Thurrock were ‘unconsciously incompetent’. This led to a 9.99% council tax increase and cuts in services. Eventually, in May 2024, the Conservative administration that had been in place during the investments, acting with total lack of transparency, lost control.
And if that was not bad enough…
In addition to describing the council as ‘unconsciously incompetent’, the Best Value Investment report noted that the internal audit team within Thurrock was under-resourced, with staff levels dropping from nine to just five in ten years. Coincidentally, whilst Thurrock was undermining its own ability to audit itself and undertake high risk investments, it was also publicising the success of its fraud team. It was set up specifically to investigate financial crimes involving public funds, though apparently without applying that expertise within Thurrock.
Back in 2016, the fraud team was called the Counter Fraud and Investigation Department (CFID) and while it remained part of Thurrock council, it has since been revealed that it operated as a commercial enterprise, able to take on work outside the council. The CFID became the National Investigation Service (NATIS) in 2018.
In 2022, around the same time as the news of the solar farms investments broke, NATIS was awarded a multi-million pound government contract to help identify COVID-19 fraud. The director of service in Thurrock with control over CFID/NATIS and responsibility for Internal Audits between 2016 and 2022, was the Director of Finance, Sean Clark.
The actions of CFID/NATIS remain the subject of an ongoing investigation by the East Anglia Bylines’ Spotlight investigative team. That investigation has already highlighted that between 2017 and 2024, CFID and NATIS used a police.uk domain name for its website and emails. As a result of those enquiries, and the intervention of the College of Policing, NATIS no longer uses the website.
How we got here
Concerns over the investments were first raised in 2019 when the Bureau of Investigative Journalists made a Freedom of Information Act request to Thurrock. The council had reported that it had borrowed £1bn from other local authorities but had not said which authorities or in which organisations it had invested the money.
Thurrock initially refused to disclose any information, and only did so after losing a three-year legal battle. This then led to the discovery that the council had invested in a number of solar farms between 2016 and 2020 without the correct level of oversight. All the investments were approved by the aforementioned Director of Finance, Sean Clark.
Bankrupt
Not long after the story broke, and after the resulting resignations of Sean Clark and CEO Lyn Carpenter, Essex County Council were appointed to conduct a Best Value Assessment of Thurrock, and the council declared itself, in effect, bankrupt, in December 2022.
Recovery
Since January 2023, Thurrock has set about trying to balance its budget as well as recover some of the money it had invested. In addition to a rise in council tax, Thurrock also cut £18.2m of services for 2024.
In January 2024, it was able to sell its solar farm portfolio for £700m. Additionally, the Financial Reporting Council indicated it was conducting an investigation into what had happened in Thurrock.
Thurrock today
While Thurrock has been under new Labour management since May, it is still battling the issues of the past. Council leader John Kent says the £1.5billion “toxic Tory debt legacy” will burden the council until 2030.
Thurrock council recently had to approach the government for additional financial support to address a £206.7m gap in its 2023/24 budget. The council had originally set spending plans that would have required it to borrow £180m but this has since had to be increased by a further £26.5m to cover the shortfall. It has been reported that the Secretary of State was “minded to approve” the additional funding but has also noted that the costs must not exceed £234.5m for the financial year.
At a recent cabinet meeting, Kent wanted to be clear about the government funding. “That isn’t money that the government has given us,” he stressed. “That’s money that we have effectively borrowed and we have to pay back.”
Thurrock has already increased its council tax rate by 7.46% for 2024, following the 9.99% rise the previous year.
Calls for inquiry
Given the revelations regarding the scale of the investments, the lack of transparency, and the impact on the residents of Thurrock themselves, there were calls for a public inquiry.
Those calls were rejected by the Conservative government in March of this year. The recent general election has brought about the possibility that this stance may change.
Where is the justice?
A new administration is in place, a new government sits in Westminster, and with each passing week, new information emerges on the cost felt by the residents of Thurrock. As time moves on, the question remains: ‘Where is the justice?’ given the obvious financial pressure on the council, and for the residents of Thurrock that something went seriously wrong and they have had to pay the price.
