What comes next for Liverpool as government set to announce plans

Liverpool is bracing itself for an incoming storm.

The city and its troubled council is waiting to hear the findings of what is likely to be a damning report into its activities and to find out whether the government will step in and take over.

If the government does send commissioners in to run the Cunard Building administration, it will be an unprecedented move.

So what action could the government announce? What will it mean for the people of the city and how did we get here?

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Here's a quick explainer to get you up to date.

How we got here

In December 2019, police officers marched into Liverpool Council's Cunard Building headquarters and arrested one of the authority's most senior officials.

Nick Kavanagh was until very recently, the council's £145,000 per year Director of Regeneration.

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He was arrested on suspicion of conspiracy to defraud and misconduct in a public office.

At the same time, city developer Elliot Lawless was arrested and questioned on suspicion of conspiracy to defraud, bribery and corruption.

Both men have protested their innocence and neither have been charged.

Yesterday it was confirmed Mr Kavanagh had been dismissed by the council, something he intends to appeal at a tribunal.

The arrests were part of Merseyside Police's Operation Aloft – an investigation into building and development contracts in Liverpool.

Almost a year after those arrests, the operation would become even bigger news as police arrested the most high profile figure yet.

On December 4 2020, Liverpool's Elected Mayor Joe Anderson was due to chair a meeting of his cabinet when there was an early knock on the door.

Dozens of police officers arrived at his home and arrested the 63-year-old on suspicion of conspiracy to commit bribery and witness intimidation, taking him to a city police station for questioning.

Police made four other arrests as part of the same investigation that day.

Mr Anderson has since described the police case against him as 'bizarre' and has vowed to clear his name.

He was suspended by the Labour Party and stepped away from his position, with Deputy Wendy Simon taking over as Acting Mayor.

An inspector calls

The hugely high profile arrest of Joe Anderson, one of several linked to the council clearly sent shockwaves around the country and made its way to the desk of the government's Communities Secretary.

On December 17, Robert Jenrick ordered an emergency inspection of Liverpool Council, to be carried out by Max Caller.

He said the investigation would look into the authority’s planning, highways, regeneration and property management functions and the strength of associated audit and governance arrangements.

He asked Mr Caller to head to Liverpool and report back with his findings by the end of March.

We now understand that the inspection report is likely to be published tomorrow, with Mr Jenrick expected to announce his intentions for action in Parliament beforehand.

What is in the report?

In short, we don't know. The report has not been published yet.

But we are expecting it to be pretty damning about Liverpool Council, especially relating to the troubled departments mentioned above.

The ECHO understands that Mr Caller has looked at dozens of property deals in the city involving the council, as well as things like grant funding and the relationships between officers and elected members.

He will make a number of recommendations to the Secretary of State, based on his findings.

So what will the government do?

This is the question on everyone's minds.

Robert Jenrick has a number of options in his gift when it comes to what happens next for Liverpool Council.

There are three main courses of action he could recommend.

One is that no action at all is required following the inspection.

The second is of a non-statutory intervention, where new training and mentoring would be organised and an improvement panel would perhaps be installed to scrutinise the council and help it improve going forward.

The third route, and very much the nuclear option, would be for Mr Jenrick to order government commissioners to take over the full day-to-day operations of Liverpool City Council.

Joe Anderson

This is a very rare move and one that has never been done on this scale. While smaller councils like Tower Hamlets and Northamptonshire have received this level of direct government intervention, a city like Liverpool is a whole new scale.

While it is inevitable that some form of government intervention will happen, there are many who believe that full scale intervention should be avoided, largely because the current Chief Executive Tony Reeves, is seen as the right person to improve the situation, something he has been working on since he arrived at the Cunard in 2018.

Others believe Mr Jenrick will now have an opportunity to really hurt Labour and one of its most loyal cities just before crucial local elections and reports in the Daily Telegraph over the weekend suggest the Communities Secretary is poised to take this action.

What would commissioners mean for Liverpool?

If Mr Jenrick decides that full scale intervention is needed then he will personally appoint a commissioner or commissioners to take over the day-to-day running of Liverpool City Council.

This would have a huge impact on how the city is run.

When the government took over Rotherham Council in 2015 because of its failures over child sexual exploitation, the commissioners took over all the executive decisions of the cabinet.

The government also also made an order under the Local Government Act to compel the council to hold all out elections the following year – something we understand could also be now done in Liverpool.

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Of course Liverpool has elections just around the corner, with a new mayor set to replace Joe Anderson.

Liverpool University Politics Professor Jonathan Tonge told the BBC the arrival of commissioners could render whoever is elected to that position 'powerless.'

Stephen Yip, who is running as an independent candidate has written to Mr Jenrick, urging him not to appoint commissioners and arguing that it would deepen the political crisis in the city.

A lot of questions remain about what the government report says and what the Secretary of State will decide, but whatever does happen, it will be a dark day for Liverpool and its council.